Company registration number 05633906 (England and Wales)
DL M & E BUILDING SERVICES LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
DL M & E BUILDING SERVICES LTD
COMPANY INFORMATION
Directors
Mr B T G Milner
Mr P J W Maher
Mr G P McCormack
Mr M B Watts
Mr S Young
Company number
05633906
Registered office
King House
Stotts Park, James Street
Westhoughton
Bolton
Auditor
Barlow Andrews LLP
Carlyle House
78 Chorley New Road
Bolton
DL M & E BUILDING SERVICES LTD
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4
Directors' responsibilities statement
5
Independent auditor's report
6 - 8
Profit and loss account
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 21
DL M & E BUILDING SERVICES LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -

The directors present the strategic report for the year ended 31 December 2023.

 

The business continued to build upon its foundations and continued to provide a quality service to its customers through the mutually beneficial and ethical relationship with its suppliers.

 

The business still offers its Mechanical and Electrical Design and Commercial resources. This resource offers it the greater opportunity to engage further with its clients to provide additional support on larger project schemes. This underpins its strong links to the large blue-chip clients that it works for, which, along with reciprocal relationships will give the business the platform to build sustainable future growth upon.

Fair review of the business

The directors consider turnover and profit before tax to be key performance indicators.

 

2023         2022

£             £

 

Turnover                 16,836,534         21,567,771

Profit before taxation          2,579,849         4,267,404

 

2023 saw turnover decrease by 21.9% when compared with 2022. Gross profit margin remained fairly consistent, being 23.49% in 2023 and 26.62% in 2022. Inflationary pressures held the company back from making any changes to the gross margin.

 

The company's existing frameworks and tender projects continue to perform well, ensuring a steady workflow throughout the year. The year has also ended with a strong forward order book.

 

Average staff numbers decreased through the year, moving from 79 in 2022 to 76 in 2023.

 

Cash balances remained strong throughout the year, despite a slight decrease from 2022.     

 

At the year end, shareholders' funds amounted to £12.8 million. The directors believe the company's position to be financially robust particularly given that current assets exceed current liabilities to the extent of £12.8 million.

 

Our strategy seeks to reinforce our position as a leader in the supply of Mechanical and Electrical services, whilst acting in a responsible and ethical manner. We aim to grow our cash flow and deliver competitive returns to fund future growth.

 

The company specialises in the provision of Mechanical and Electrical engineering services for construction projects in both private and public sectors.

 

Much of the company's activities are organised into the following divisions:

 

DL M & E BUILDING SERVICES LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
As the whole manner of our Mechanical and Electrical projects become more complex and demanding, we believe our technical expertise along with excellent customer service will be a deciding factor in the growth of our business. Our key strengths include our knowledge and application of product and technology, the financial and project management skills that allow us to deliver solutions and the management of integrated value chains.

The group's credentials include registered membership of or accreditation by, the following associations and industry bodies;

• NICEIC (National Inspection Council for Electrical Installation)
• Constructionline UK Gold
• CHAS (Construction Health and Safety Awareness Scheme)
• ISO 9001 : 2015 Quality Management System
• REFCOM F - Gas Registered
• Mitsubishi Business Solutions Partner
• Daiken D1 Partner
Principal risks and uncertainties

There are several potential risks and uncertainties which could have a material impact on the business performance and could cause actual results to differ materially from expected and historical results.

 

The principal risks inherent in the business model, include the following:

 

Operational risk

The activities of the business subject it to risks relating to its ability to implement and maintain effective systems and process control. The company has implemented strict process control to monitor commercial and operational risks.

 

Competitor risk

The business faces competition in the core markets in which it operates. There is a danger that its profitability may be impaired. To manage this risk, the business maintains close relationships with its customers, introducers, and other significant participants.

 

Supplier risk

The business sources products from around the globe. There is the possibility that logistical problems in certain areas of the world may impact on its ability to supply. To mitigate this risk, the company has invested in strong relationships with its suppliers and has a comprehensive portfolio of products that mean it is able to supply from a variety of sources and minimise any disruption to supply.

 

Credit risk

The business operates larger contracts only with Blue Chip clients to mitigate any potential credit risks. The business also ensures that all its potential customers must go through a full test procedure before credit facilities are granted.

Key performance indicators

Key features of our business performance during the year include the following:

 

 

Financial KPIs have been discussed in the fair review of the business.

DL M & E BUILDING SERVICES LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -

On behalf of the board

Mr B T G Milner
Director
24 May 2024
DL M & E BUILDING SERVICES LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -

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

Principal activities

The principal activity of the company continued to be that of mechanical and electrical installations.

Results and dividends

The results for the year are set out on page 9.

Ordinary dividends were paid amounting to £727,004. 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 B T G Milner
Mr P J W Maher
Mr G P McCormack
Mr M B Watts
Mr S Young
Future developments

We continuously seek to improve our operating performance with the emphasis on quality, performance, and operating costs. For 2024, we have set out three key priorities: improving our financial performance, develop existing and potential routes to market and to continue to focus on successful project delivery for our customers.

Auditor

The auditor, Barlow Andrews LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Matters of strategic importance

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has been done so in respect of financial instruments.

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.

On behalf of the board
Mr B T G Milner
Director
24 May 2024
DL M & E BUILDING SERVICES LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 5 -

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:

 

 

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.

DL M & E BUILDING SERVICES LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF DL M & E BUILDING SERVICES LTD
- 6 -
Opinion

We have audited the financial statements of DL M & E Building Services Ltd (the 'company') for the year ended 31 December 2023 which comprise the profit and loss account, the balance sheet, 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:

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 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:

DL M & E BUILDING SERVICES LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF DL M & E BUILDING SERVICES LTD (CONTINUED)
- 7 -
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:

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.

DL M & E BUILDING SERVICES LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF DL M & E BUILDING SERVICES LTD (CONTINUED)
- 8 -

We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur by:

 

 

To address the risk of fraud through management bias and override of controls, we:

 

 

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

 

 

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry 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 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.

Use of our 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.

Alison Cornes
Senior Statutory Auditor
For and on behalf of Barlow Andrews LLP
24 May 2024
Chartered Accountants
Statutory Auditor
Carlyle House
78 Chorley New Road
Bolton
DL M & E BUILDING SERVICES LTD
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
Notes
£
£
Turnover
3
16,836,534
21,567,771
Cost of sales
(12,882,265)
(15,826,281)
Gross profit
3,954,269
5,741,490
Administrative expenses
(1,395,312)
(1,479,434)
Other operating income
21,359
5,348
Operating profit
4
2,580,316
4,267,404
Interest receivable and similar income
7
3,741
-
0
Interest payable and similar expenses
8
(4,208)
-
0
Profit before taxation
2,579,849
4,267,404
Tax on profit
9
(610,462)
(751,436)
Profit for the financial year
1,969,387
3,515,968

The profit and loss account has been prepared on the basis that all operations are continuing operations.

 

There is no other comprehensive income for the year. The total comprehensive income is the profit for the financial year shown above.

DL M & E BUILDING SERVICES LTD
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
26,197
34,492
Current assets
Debtors
12
13,672,515
12,004,624
Cash at bank and in hand
1,093,438
1,489,841
14,765,953
13,494,465
Creditors: amounts falling due within one year
13
(1,941,333)
(1,920,086)
Net current assets
12,824,620
11,574,379
Total assets less current liabilities
12,850,817
11,608,871
Provisions for liabilities
Deferred tax liability
14
(643)
(1,080)
(643)
(1,080)
Net assets
12,850,174
11,607,791
Capital and reserves
Called up share capital
16
182
182
Profit and loss reserves
12,849,992
11,607,609
Total equity
12,850,174
11,607,791

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 24 May 2024 and are signed on its behalf by:
Mr B T G Milner
Director
Company registration number 05633906 (England and Wales)
DL M & E BUILDING SERVICES LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 January 2022
182
8,531,524
8,531,706
Year ended 31 December 2022:
Profit and total comprehensive income
-
3,515,968
3,515,968
Dividends
10
-
(439,883)
(439,883)
Balance at 31 December 2022
182
11,607,609
11,607,791
Year ended 31 December 2023:
Profit and total comprehensive income
-
1,969,387
1,969,387
Dividends
10
-
(727,004)
(727,004)
Balance at 31 December 2023
182
12,849,992
12,850,174
DL M & E BUILDING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
1
Accounting policies
Company information

DL M & E Building Services Ltd is a private company limited by shares incorporated in England and Wales. The registered office is King House, Stotts Park, James Street, Westhoughton, Bolton.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

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:

 

 

The financial statements of the company are consolidated in the financial statements of BTGM Group Limited. These consolidated financial statements are available from its registered office, King House, Stotts Park, James Street, Westhoughton, Bolton.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Turnover 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.

In respect of long-term contracts and contracts for on-going services, turnover represents the value of work done in the year, including estimates of amounts not invoiced. Turnover in respect of long-term contracts and contracts for on-going services is recognised by reference to the stage of completion.

DL M & E BUILDING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
1.4
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

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

Plant and equipment
20% straight line
Fixtures and fittings
20% straight line
Computers
33.3% straight line
Motor vehicles
25% reducing balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

1.5
Construction contracts

Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the reporting end date. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.

 

When it is probable that total contract costs will exceed total contract turnover, the expected loss is recognised as an expense immediately.

 

Where the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised to the extent of contract costs incurred where it is probable that they will be recoverable. Contract costs are recognised as expenses in the period in which they are incurred. When costs incurred in securing a contract are recognised as an expense in the period in which they are incurred, they are not included in contract costs if the contract is obtained in a subsequent period.

1.6
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks.

1.7
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 balance sheet when the company becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs. Financial assets classified as receivable within one year are not amortised.

DL M & E BUILDING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

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

Basic financial liabilities

Basic financial liabilities, including creditors, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.8
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

1.9
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

DL M & E BUILDING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

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

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.10
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of debtors.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

1.11
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.12
Share-based payments

Equity-settled share-based payments are measured at the cost of the shares. The cost of shares issued under an Enterprise Management Incentive scheme are recognised within administration expenses in the Profit and Loss account. A corresponding entry is made to equity.

 

1.13
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 leased asset are consumed.

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.

DL M & E BUILDING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
2
Judgements and key sources of estimation uncertainty
(Continued)
- 16 -
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.

Stage of contract completion

Profit is recognised in the profit and loss account in proportion to the stage of completion of a contract, taking into account the work done and expected margin. Professional judgement is applied in assessing the stage of completion of a contract and the anticipated outcome.

3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Long term contract revenue
16,836,534
21,567,771
2023
2022
£
£
Other revenue
Interest income
3,741
-

All turnover arose in the UK and is fully attributable to the principal activity of the company.

 

 

4
Operating profit
2023
2022
Operating profit for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
15,800
15,000
Depreciation of owned tangible fixed assets
8,295
13,144
Share-based payments
-
105,088
Operating lease charges
153,627
109,405
5
Employees

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

2023
2022
Number
Number
Management
25
22
Productive
51
57
Total
76
79
DL M & E BUILDING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
5
Employees
(Continued)
- 17 -

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
3,916,866
3,745,938
Social security costs
421,688
438,168
Pension costs
91,771
116,855
4,430,325
4,300,961
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
131,137
98,600
Company pension contributions to defined contribution schemes
2,246
41,497
133,383
140,097

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 5 (2022 - 5).

7
Interest receivable and similar income
2023
2022
£
£
Interest income
Other interest income
3,741
-
0
8
Interest payable and similar expenses
2023
2022
£
£
Other interest payable
4,208
-
0
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
610,899
807,513
Adjustments in respect of prior periods
-
0
(56,077)
Total current tax
610,899
751,436
DL M & E BUILDING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
9
Taxation
2023
2022
£
£
(Continued)
- 18 -
Deferred tax
Origination and reversal of timing differences
(437)
-
0
Total tax charge
610,462
751,436

Change in tax rates

The corporation tax rate increased from 19% to 25% from 1 April 2023. This was substantively enacted by the UK government on the 14 October 2022.

 

As two corporation tax rates were used in the financial year, a hybrid tax rate has been apportioned in determining DL M&E Building Services Ltd's corporation tax charge for the year ended 31 December 2023.

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Profit before taxation
2,579,849
4,267,404
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
606,780
810,807
Tax effect of expenses that are not deductible in determining taxable profit
6,264
(1,227)
Adjustments in respect of prior years
-
0
(56,077)
Group relief
(2,145)
(1,163)
Capital allowances in excess of depreciation
-
0
(904)
Deferred tax movement
(437)
-
0
Taxation charge for the year
610,462
751,436
10
Dividends
2023
2022
£
£
Final paid
727,004
439,883
DL M & E BUILDING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
11
Tangible fixed assets
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2023 and 31 December 2023
30,890
33,513
64,246
34,000
162,649
Depreciation and impairment
At 1 January 2023
30,888
20,814
64,047
12,408
128,157
Depreciation charged in the year
1
2,704
192
5,398
8,295
At 31 December 2023
30,889
23,518
64,239
17,806
136,452
Carrying amount
At 31 December 2023
1
9,995
7
16,194
26,197
At 31 December 2022
2
12,699
199
21,592
34,492
12
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
757,700
220,533
Gross amounts owed by contract customers
2,346,337
1,620,405
Amounts owed by group undertakings
10,259,082
9,868,601
Other debtors
167,670
164,372
Prepayments and accrued income
141,726
130,713
13,672,515
12,004,624
13
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
1,350,368
1,147,094
Corporation tax
254,174
438,412
Other taxation and social security
128,576
116,292
Other creditors
17,482
24,267
Accruals and deferred income
190,733
194,021
1,941,333
1,920,086
DL M & E BUILDING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
14
Deferred taxation

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

Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
643
1,080
2023
Movements in the year:
£
Liability at 1 January 2023
1,080
Credit to profit or loss
(437)
Liability at 31 December 2023
643

The deferred tax liability set out above is expected to reverse within 12 months and relates to accelerated capital allowances that are expected to mature within the same period.

15
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
75,487
116,855

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.

At the year end the company owed £17,674 (2022 - £23,772) in regard to pension contributions.

16
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary Shares of £1 each
182
182
182
182

The ordinary shares rank pari passu in all respects as regards voting, dividends and distributions, including on a winding up and are not redeemable.

17
Financial commitments, guarantees and contingent liabilities

On 26 February 2021, the company, its parent company, DL M & E Holdings Limited and its ultimate parent company, BTGM Group Limited entered into a joint guarantee and debenture, containing a fixed and floating charge over all property and undertaking of the companies. The amount outstanding was £405k (2022 - £1.25 million).

DL M & E BUILDING SERVICES LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
18
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
19,228
15,931
Between two and five years
41,870
1,299
61,098
17,230
19
Related party transactions
Transactions with related parties

Total wages of £72,199 (2022: £23,419) were paid to family members of the directors and key personnel of the company.

20
Ultimate controlling party

The company's immediate parent is DL M & E Holdings Limited, a company registered in England and Wales. The registered office of the parent is King House, Stotts Park, James Street, Westhoughton.

 

The ultimate parent undertaking is BTGM Group Limited, a company under the ultimate control of Mr B Milner, director.

 

BTGM Group Limited prepares group financial statements and copies can be obtained from Companies House, Crown Way, Maindy, Cardiff.

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