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COMPANY REGISTRATION NUMBER: 04953775
Metallisation Limited
Financial Statements
31 December 2023
Metallisation Limited
Financial Statements
Year ended 31 December 2023
Contents
Pages
Officers and professional advisers
1
Strategic report
2
Directors' report
3 to 4
Independent auditor's report to the members
5 to 8
Statement of income and retained earnings
9
Statement of financial position
10
Statement of cash flows
11
Notes to the financial statements
12 to 22
Metallisation Limited
Officers and Professional Advisers
The board of directors
B White
M McClanahan
Registered office
Peartree Lane
Dudley
West Midlands
DY2 0XH
Auditor
Muras Baker Jones Limited
Chartered accountants & statutory auditor
Regent House
Bath Avenue
Wolverhampton
West Midlands
WV1 4EG
Bankers
Yorkshire Bank
Temple Point
1 Temple Row
Birmingham
B2 5YB
Metallisation Limited
Strategic Report
Year ended 31 December 2023
Principal activity
The principal activity of the company continued to be the manufacture of thermal spray equipment and the distribution of thermal spray consumables.
Review of business, development and performance
During 2023 the company continued with the mission of providing excellence in its products, support and innovation to extend the benefits of thermal spray technology to its customers. The company has continued to invest in the business to facilitate growth and improve operational efficiency. The year has seen an anticipated reduction in turnover compared with 2022 as the previous year had included significant "turnkey" projects, further projects of a similar nature will come on stream in 2024. Performance in other sectors of the business was mixed, equipment sales being impacted by customers delaying orders, whereas spares sales improved by over 11% year on year. Whilst overall turnover was down 15% against the previous year to £14m, margins improved enabling the company to achieve a profit before tax for the financial year of £2.1m compared to £2.4m the previous year. Exports, to over 50 different countries comprise a significant proportion of turnover. In December 2023 the company became part of the Kymera International Group and the directors consider that this new relationship will create significant opportunities for growth going forward. The company has a strong balance sheet and is well placed to continue to grow its market position during 2024 and beyond. All of this would not be possible without the continued support and dedication of a loyal and skilled workforce and the directors would like to place on record their appreciation of this.
Principal risks and uncertainties
The principal risks and uncertainties faced by the company relate to the recoverability of trade debtors. To this effect the company performs credit checks for all significant customers and carries insurance policies to minimise bad debt risk. The company has some exposure to risk in the respect of certain sales and purchases being in foreign currencies. The risk is managed by forward contracts for currency where it is considered applicable. Other trading risks are managed by strategic policy of diversifying into new overseas markets and new products.
This report was approved by the board of directors on 16 July 2024 and signed on behalf of the board by:
B White
Director
Metallisation Limited
Directors' Report
Year ended 31 December 2023
The directors present their report and the financial statements of the company for the year ended 31 December 2023 .
Principal activities
The principal activity of the company has continued to be the manufacture of thermal spray equipment and the distribution of thermal spray consumables.
Directors
The directors who served the company during the year were as follows:
B White
(Appointed 13 December 2023)
M McClanahan
(Appointed 13 December 2023)
T P Lester
(Resigned 13 December 2023)
R V C Hill
(Resigned 13 December 2023)
S A Barker
(Resigned 13 December 2023)
P J Silcox
(Resigned 13 December 2023)
S Milton
(Resigned 13 December 2023)
J Newton
(Resigned 13 December 2023)
Dividends
Particulars of recommended dividends are detailed in note 13 to the financial statements.
Financial instruments
The company holds financial instruments to finance its operation and as a tool to manage currency exposure risks arising from its operations.
In addition, various financial instruments such as trade debtors and trade creditors arise directly from the company's operations.
Operations and working capital requirements are funded principally out of short term banking facilities and retained profits.
Disclosure of information in the strategic report
The directors have prepared a separate strategic report in accordance with the requirements of section 414 Companies Act 2006.
Directors' responsibilities statement
The directors are responsible for preparing the strategic report, directors' 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 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 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 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. Auditor
Each of the persons who is a director at the date of approval of this report confirms that:
- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.
This report was approved by the board of directors on 16 July 2024 and signed on behalf of the board by:
B White
Director
Metallisation Limited
Independent Auditor's Report to the Members of Metallisation Limited
Year ended 31 December 2023
Opinion
We have audited the financial statements of Metallisation Limited (the 'company') for the year ended 31 December 2023 which comprise the statement of income and retained earnings, statement of financial position, statement of cash flows and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion the financial statements: - give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its profit for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; - 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 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.
Other information
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. 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. In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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 the 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.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion: - adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or - the financial statements are not in agreement with the accounting records and returns; or - certain disclosures of directors' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. 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 planning and designing our audit tests we identify and assess the risks of material misstatement within the financial statements, whether due to fraud or error. Our assessment of these risks includes consideration of the nature of the industry and sector, the control environment and the business performance along with the results of our enquiries of management about their own identification and assessment of risks and irregularities. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. We also obtained an understanding of the legal and regulatory frameworks that the company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act, UK tax legislation and other laws and regulations identified as risk areas identified from our discussions with management. We communicated relevant identified laws and regulations and potential fraud risks to all engagement team members including internal specialists, and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit. After consideration of the above risks we then carried out audit procedures including the following: - specific tests in relation to material amounts and disclosures in the financial statements considered to be of high risk; - performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud; - reading minutes of management meetings; - reviewing correspondence with H M Revenue & Customs; - enquiring of management and reviewing any correspondence with legal advisors concerning actual and potential litigation and claims; - reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements; - in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business. There are inherent limitations in our audit procedures described above. The more removed that the laws and regulations are from financial transactions the less likely it is that we would be aware on non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to inquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any. Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion. 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 auditor’s report. Use of our report
This report is made solely to the company's members, as a body, in accordance with chapter 3 of part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.
Oliver Ross BSc(Hons) FCA
(Senior Statutory Auditor)
For and on behalf of
Muras Baker Jones Limited
Chartered accountants & statutory auditor
Regent House
Bath Avenue
Wolverhampton
West Midlands
WV1 4EG
16 July 2024
Metallisation Limited
Statement of Income and Retained Earnings
Year ended 31 December 2023
2023
2022
Note
£
£
Turnover
4
14,001,653
16,468,381
Cost of sales
9,578,553
11,968,318
-------------
-------------
Gross profit
4,423,100
4,500,063
Distribution costs
172,860
178,268
Administrative expenses
2,206,897
1,987,491
Other operating income
5
61,747
82,242
------------
------------
Operating profit
6
2,105,090
2,416,546
Other interest receivable and similar income
10
5,562
Interest payable and similar expenses
11
13,587
26,445
------------
------------
Profit before taxation
2,097,065
2,390,101
Tax on profit
12
390,639
355,678
------------
------------
Profit for the financial year and total comprehensive income
1,706,426
2,034,423
------------
------------
Dividends paid and payable
13
( 1,700,000)
Retained earnings at the start of the year
7,795,635
7,461,212
------------
------------
Retained earnings at the end of the year
9,502,061
7,795,635
------------
------------
All the activities of the company are from continuing operations.
Metallisation Limited
Statement of Financial Position
31 December 2023
2023
2022
Note
£
£
£
Fixed assets
Tangible assets
14
279,419
245,507
Investments
15
1
1
---------
---------
279,420
245,508
Current assets
Stocks
16
2,258,830
1,916,828
Debtors
17
9,091,942
7,928,269
Cash at bank and in hand
941,628
1,197,488
-------------
-------------
12,292,400
11,042,585
Creditors: amounts falling due within one year
19
2,817,231
3,253,930
-------------
-------------
Net current assets
9,475,169
7,788,655
------------
------------
Total assets less current liabilities
9,754,589
8,034,163
Provisions
Taxation including deferred tax
20
56,400
42,400
------------
------------
Net assets
9,698,189
7,991,763
------------
------------
Capital and reserves
Called up share capital
24
196,128
196,128
Profit and loss account
25
9,502,061
7,795,635
------------
------------
Shareholders funds
9,698,189
7,991,763
------------
------------
These financial statements have been prepared in accordance with the provisions applicable to companies subject to the medium companies regime.
These financial statements were approved by the board of directors and authorised for issue on 16 July 2024 , and are signed on behalf of the board by:
B White
Director
Company registration number: 04953775
Metallisation Limited
Statement of Cash Flows
Year ended 31 December 2023
2023
2022
Note
£
£
Cash flows from operating activities
Profit for the financial year
1,706,426
2,034,423
Adjustments for:
Depreciation of tangible assets
99,037
102,146
Government grant income
( 6,092)
( 22,998)
Other interest receivable and similar income
( 5,562)
Interest payable and similar expenses
13,587
26,445
Gains on disposal of tangible assets
( 7,946)
Tax on profit
390,639
355,678
Accrued (income)/expenses
( 40,289)
180,790
Changes in:
Stocks
( 342,002)
512,737
Trade and other debtors
( 1,163,673)
( 441,273)
Trade and other creditors
( 240,014)
91,838
------------
------------
Cash generated from operations
404,111
2,839,786
Interest paid
( 13,587)
( 26,445)
Interest received
5,562
Tax paid
( 379,428)
( 558,489)
---------
------------
Net cash from operating activities
16,658
2,254,852
---------
------------
Cash flows from investing activities
Purchase of tangible assets
( 133,140)
( 134,634)
Proceeds from sale of tangible assets
8,137
1
---------
------------
Net cash used in investing activities
( 125,003)
( 134,633)
---------
------------
Cash flows from financing activities
Proceeds from loans from group undertakings
102,874
42,110
Government grant income
6,092
22,998
Dividends paid
( 1,700,000)
---------
------------
Net cash from/(used in) financing activities
108,966
( 1,634,892)
---------
------------
Net increase in cash and cash equivalents
621
485,327
Cash and cash equivalents at beginning of year
941,007
455,680
---------
---------
Cash and cash equivalents at end of year
18
941,628
941,007
---------
---------
Metallisation Limited
Notes to the Financial Statements
Year ended 31 December 2023
1. General information
The company is a private company limited by shares, registered in England and Wales. The address of the registered office is Peartree Lane, Dudley, West Midlands, DY2 0XH.
2. Statement of compliance
These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.
3. Accounting policies
(a) Basis of preparation
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.
The financial statements are prepared in sterling, which is the functional currency of the entity.
(b) Judgements and key sources of estimation uncertainty
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
(c) Revenue recognition
Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax. Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably.
(d) Corporation tax
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date. Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference .
(e) Foreign currencies
Foreign currency transactions are initially recorded in the functional currency, by applying the spot exchange rate as at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate ruling at the reporting date, with any gains or losses being taken to the profit and loss account.
(f) Operating leases
Rentals applicable to operating leases where substantially all of the benefits and risks of ownership remain with the lessor are charged against profits on a straight line basis over the period of the lease.
(g) Tangible assets
Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in equity, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation, is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in equity in respect of that asset. Where a revaluation decrease exceeds the accumulated revaluation gains accumulated in equity in respect of that asset, the excess shall be recognised in profit or loss.
(h) Depreciation
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:
Leasehold Property
-
Straight line over the life of the lease
Plant & Machinery
-
Over 3 to 10 years
Fixtures & Fittings
-
Over 3 to 10 years
(i) Investments
Fixed asset investments are initially recorded at cost, and subsequently stated at cost less any accumulated impairment losses.
Listed investments are measured at fair value with changes in fair value being recognised in profit or loss.
(j) Impairment of fixed assets
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets. For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the company are assigned to those units .
(k) Stocks
Stocks are measured at the lower of cost and estimated selling price after making due allowance for obsolete and slow moving items. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition. Work in progress is valued on the basis of direct costs plus attributable overheads based on normal level of activity. Provision is made for any foreseeable losses where appropriate. No element of profit is included in the valuation of work in progress.
(l) Government grants
Government grants are recognised at the fair value of the asset received or receivable. Grants are not recognised until there is reasonable assurance that the company will comply with the conditions attaching to them and the grants will be received. Government grants are recognised using the accrual model and the performance model. Under the accrual model, government grants relating to revenue are recognised on a systematic basis over the periods in which the company recognises the related costs for which the grant is intended to compensate. Grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the entity with no future related costs are recognised in income in the period in which it becomes receivable. Grants relating to assets are recognised in income on a systematic basis over the expected useful life of the asset. Where part of a grant relating to an asset is deferred, it is recognised as deferred income and not deducted from the carrying amount of the asset. Under the performance model, where the grant does not impose specified future performance-related conditions on the recipient, it is recognised in income when the grant proceeds are received or receivable. Where the grant does impose specified future performance-related conditions on the recipient, it is recognised in income only when the performance-related conditions have been met. Where grants received are prior to satisfying the revenue recognition criteria, they are recognised as a liability.
(m) Provisions
Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event, it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense. Provisions are initially measured at the best estimate of the amount required to settle the obligation at the reporting date and subsequently reviewed at each reporting date and adjusted to reflect the current best estimate of the amount that would be required to settle the obligation. Any adjustments to the amounts previously recognised are recognised in profit or loss unless the provision was originally recognised as part of the cost of an asset. When a provision is measured at the present value of the amount expected to be required to settle the obligation, the unwinding of the discount is recognised as a finance cost in profit or loss in the period it arises.
(n) Financial instruments
The company holds financial instruments to finance its operation and as a tool to manage currency exposure risks arising from its operations. In addition, various financial instruments such as trade debtors and trade creditors arise directly from the group's operations. The company performs credit checks for all significant customers and carries insurance policies to minimise bad debt risk. Operations and working capital requirements are funded principally out of short term banking facilities and retained profits .
(o) Defined contribution plans
Contributions made by the company in respect of director's and employee's personal pension schemes are charged to the profit and loss account in the period they are paid.
4. Turnover
Turnover arises from:
2023
2022
£
£
Sale of goods
14,001,653
16,468,381
-------------
-------------
The total turnover of the company for the year has been derived from its principal activity wholly undertaken in the UK.
The analysis of turnover by geographical market required by SI 2009/410 Schedule 1 Paragraph 68(5) has not been provided as, in the opinion of the directors, such disclosure would be seriously prejudicial to the interests of the company.
5. Other operating income
2023
2022
£
£
Government grant income
6,092
22,998
Discounts received
16,241
33,469
Other operating income
39,414
25,775
--------
--------
61,747
82,242
--------
--------
6. Operating profit
Operating profit or loss is stated after charging/crediting:
2023
2022
£
£
Depreciation of tangible assets
99,037
102,146
Gains on disposal of tangible assets
( 7,946)
Impairment of trade debtors
(23,042)
5,147
Foreign exchange differences
9,513
14,295
--------
---------
7. Auditor's remuneration
2023
2022
£
£
Fees payable for the audit of the financial statements
15,000
15,000
--------
--------
8. Staff costs
The average number of persons employed by the company during the year, including the directors, amounted to:
2023
2022
No.
No.
Production staff
21
20
Administrative staff
27
26
----
----
48
46
----
----
The aggregate payroll costs incurred during the year, relating to the above, were:
2023
2022
£
£
Wages and salaries
1,988,511
1,823,875
Social security costs
222,036
219,298
Other pension costs
275,579
37,221
------------
------------
2,486,126
2,080,394
------------
------------
9. Directors' remuneration
The directors' aggregate remuneration in respect of qualifying services was:
2023
2022
£
£
Remuneration
128,640
85,207
Company contributions to defined contribution pension plans
234,200
---------
--------
362,840
85,207
---------
--------
10. Other interest receivable and similar income
2023
2022
£
£
Interest on cash and cash equivalents
3,185
Other interest receivable and similar income
2,377
-------
----
5,562
-------
----
11. Interest payable and similar expenses
2023
2022
£
£
Interest on banks loans and overdrafts
13,587
26,445
--------
--------
12. Tax on profit
Major components of tax expense
2023
2022
£
£
Current tax:
UK current tax expense
481,000
442,800
Adjustments in respect of prior periods
( 104,361)
( 112,522)
---------
---------
Total current tax
376,639
330,278
---------
---------
Deferred tax:
Origination and reversal of timing differences
14,000
15,204
Impact of change in tax rate
10,196
--------
--------
Total deferred tax
14,000
25,400
---------
---------
Tax on profit
390,639
355,678
---------
---------
With effect from 1 April 2023, UK corporation tax rates increased from 19% to 25% and as a result of this the current year's tax charge is increased by £92,328.
Reconciliation of tax expense
The tax assessed on the profit on ordinary activities for the year is lower than (2022: lower than) the standard rate of corporation tax in the UK of 23.50 % (2022: 19 %).
2023
2022
£
£
Profit on ordinary activities before taxation
2,097,065
2,390,101
------------
------------
Profit on ordinary activities by rate of tax
492,810
454,118
Adjustment to tax charge in respect of prior periods
3,195
(5,669)
Effect of expenses not deductible for tax purposes
1,757
5,917
Effect of capital allowances and depreciation
( 937)
( 7,675)
Effect of different UK tax rates on some earnings
1,389
10,196
Rounding on tax charge
( 18)
( 56)
R & D claims in respect of prior periods
( 107,557)
( 106,853)
Short term timing differences
5,700
------------
------------
Tax on profit
390,639
355,678
------------
------------
13. Dividends
2023
2022
£
£
Dividends paid during the year (excluding those for which a liability existed at the end of the prior year )
1,700,000
----
------------
14. Tangible assets
Short leasehold property
Plant and machinery
Fixtures and fittings
Total
£
£
£
£
Cost
At 1 January 2023
80,991
1,571,062
578,613
2,230,666
Additions
31,860
101,280
133,140
Disposals
( 14,930)
( 14,930)
--------
------------
---------
------------
At 31 December 2023
80,991
1,587,992
679,893
2,348,876
--------
------------
---------
------------
Depreciation
At 1 January 2023
78,664
1,431,579
474,916
1,985,159
Charge for the year
45,283
53,754
99,037
Disposals
( 14,739)
( 14,739)
--------
------------
---------
------------
At 31 December 2023
78,664
1,462,123
528,670
2,069,457
--------
------------
---------
------------
Carrying amount
At 31 December 2023
2,327
125,869
151,223
279,419
--------
------------
---------
------------
At 31 December 2022
2,327
139,483
103,697
245,507
--------
------------
---------
------------
15. Investments
Shares in group undertakings
£
Cost
At 1 January 2023 and 31 December 2023
1
----
Impairment
At 1 January 2023 and 31 December 2023
----
Carrying amount
At 31 December 2023
1
----
At 31 December 2022
1
----
Subsidiaries, associates and other investments
Class of share
Percentage of shares held
Subsidiary undertakings
Metallisation Projects Limited
Ordinary
100
The company has not prepared consolidated accounts on the basis that they are exempt under Section 401 Companies Act 2006, due to the company and its subsidiary being included in the consolidated financial statements of PEP Alchemy LP, the ultimate parent undertaking.
16. Stocks
2023
2022
£
£
Work in progress
408,330
49,085
Finished goods and goods for resale
1,850,500
1,867,743
------------
------------
2,258,830
1,916,828
------------
------------
17. Debtors
2023
2022
£
£
Trade debtors
1,713,363
2,663,383
Amounts owed by group undertakings
7,224,372
5,094,872
Prepayments and accrued income
145,900
146,638
Other debtors
8,307
23,376
------------
------------
9,091,942
7,928,269
------------
------------
18. Cash and cash equivalents
Cash and cash equivalents comprise the following:
2023
2022
£
£
Cash at bank and in hand
941,628
1,197,488
Bank overdrafts
( 256,481)
---------
------------
941,628
941,007
---------
------------
19. Creditors: amounts falling due within one year
2023
2022
£
£
Bank loans and overdrafts
256,481
Payments received on account
703,573
104,042
Trade creditors
1,135,166
1,933,074
Amounts owed to group undertakings
144,985
42,111
Accruals and deferred income
378,870
419,159
Corporation tax
246,000
248,789
Social security and other taxes
187,832
243,189
Other creditors
20,805
7,085
------------
------------
2,817,231
3,253,930
------------
------------
The company has a bank overdraft facility under which advances can be received in respect of unsettled sales invoices. The amount outstanding is secured by a debenture dated 14 November 2019 incorporating a fixed and floating charge over the assets of the company. The company's banking facilities as a whole are also secured by the same unlimited debenture dated 14 November 2019 incorporating a fixed and floating charge over the assets of the company.
20. Provisions
Deferred tax (note 21)
£
At 1 January 2023
42,400
Additions
14,000
--------
At 31 December 2023
56,400
--------
21. Deferred tax
The deferred tax included in the statement of financial position is as follows:
2023
2022
£
£
Included in provisions (note 20)
56,400
42,400
--------
--------
The deferred tax account consists of the tax effect of timing differences in respect of:
2023
2022
£
£
Accelerated capital allowances
58,600
44,600
Provisions
( 2,200)
( 2,200)
--------
--------
56,400
42,400
--------
--------
22. Employee benefits
Defined contribution plans
The amount recognised in profit or loss as an expense in relation to defined contribution plans was £ 275,579 (2022: £ 37,221 ).
23. Government grants
The amounts recognised in the financial statements for government grants are as follows:
2023
2022
£
£
Recognised in other operating income:
Government grants recognised directly in income
20,906
Government grants released to profit or loss
6,092
2,092
-------
--------
6,092
22,998
-------
--------
24. Called up share capital
Authorised share capital
2023
2022
No.
£
No.
£
Ordinary shares of £ 1 each
196,128
196,128
Ordinary Class A shares of £ 1 each
49,031
49,031
Ordinary Class B shares of £ 1 each
49,031
49,031
Ordinary Class C shares of £ 1 each
98,066
98,066
---------
---------
---------
---------
196,128
196,128
196,128
196,128
---------
---------
---------
---------
Issued, called up and fully paid
2023
2022
No.
£
No.
£
Ordinary shares of £ 1 each
196,128
196,128
Ordinary Class A shares of £ 1 each
49,031
49,031
Ordinary Class B shares of £ 1 each
49,031
49,031
Ordinary Class C shares of £ 1 each
98,066
98,066
---------
---------
---------
---------
196,128
196,128
196,128
196,128
---------
---------
---------
---------
With effect from 13 December 2023 the shares were re-designated as Ordinary Shares of £1 each.
25. Reserves
Profit and loss account - This reserve records retained earnings and accumulated losses.
26. Analysis of changes in net debt
At 1 Jan 2023
Cash flows
At 31 Dec 2023
£
£
£
Cash at bank and in hand
1,197,488
(255,860)
941,628
Bank overdrafts
(256,481)
256,481
Debt due within one year
(42,111)
(102,874)
(144,985)
------------
---------
---------
898,896
( 102,253)
796,643
------------
---------
---------
Metallisation Limited
Notes to the Financial Statements (continued)
Year ended 31 December 2023
27. Operating leases
The total future minimum lease payments under non-cancellable operating leases are as follows:
2023
2022
£
£
Not later than 1 year
185,063
170,053
Later than 1 year and not later than 5 years
513,326
503,907
Later than 5 years
105,000
210,000
---------
---------
803,389
883,960
---------
---------
28. Related party transactions
The company occupies premises owned by Pathfinder Private Pension Scheme, a scheme in which former directors T P Lester , R V C Hill and S A Barker are members and trustees. Rent Payable by the company to the scheme for the year ended 31 December 2023 amounted to £105,000 (2022 - £105,000). The company has taken advantage of the exemption allowed by Financial Reporting Standard 102 Paragraph 33.1A "Related Party Disclosures", not to disclose any transactions with the entities that are included in the consolidated financial statements of the ultimate parent undertaking.
29. Controlling party
The company is a wholly owned subsidiary of Metallisation Holdings Limited, a company registered in England and Wales. With effect from 13 December 2023 the ultimate parent undertaking is PEP Alchemy LP, a limited partnership registered in the province of Alberta, Canada.