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Registered number: 01459158












ZEON LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

 

ZEON LIMITED

CONTENTS



Page
Company information
 
1
Strategic report
 
2 - 3
Directors' report
 
4 - 6
Independent auditor's report
 
7 - 10
Profit and loss account
 
11
Balance sheet
 
12
Statement of changes in equity
 
13
Notes to the financial statements
 
14 - 32


 

ZEON LIMITED
 
COMPANY INFORMATION


Directors
T K S Cheung  
R D Dorfman 
S Gilham  
T G Lawrance 
M P Lai (appointed 8 December 2023)
C S P Thong (appointed 8 December 2023)




Company secretary
Dr M Bloch



Registered number
01459158



Registered office
Unit 1 Apsley Way
Phoenix Park

London

England

NW2 7LN




Independent auditor
Blick Rothenberg Audit LLP
Chartered Accountants & Statutory Auditor

16 Great Queen Street

Covent Garden

London

WC2B 5AH




Page 1

 

ZEON LIMITED
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024

Performance
 
A strong performance for this year has been delivered through the continued adoption of a defined strategy that is focused on achieving sustainable year on year turnover growth (+10%) and delivering improved levels of profit (+73%) through a committed drive to maximise existing resources. The direct-to-consumer sales channels and the focus on channel penetration within markets with the biggest volume opportunities has been key to this year’s success.  In the short term, our objective within these global key markets has been to maintain levels of inventory and increase access to our products to satisfy previously existing, under-supplied demand (in particular for the Vivienne Westwood brand, through Vivienne Westwood owned retail).
 

Key performance indicators

The directors monitor the performance of the trading operations on a regular basis. The main KPIs are listed below:
 

2024
2023
% Change

(£000)
(£000)





Turnover
14,441
13,162
10%
Profit before tax
1,955
1,129
73%
Sales service income from Zeon HK
1,825
196
831%
Cash at bank
2,119
1,109
91%
Net assets
6,340
3,935
61%


Business review
 
Continuing to build on the wider company mindset of having a customer focused business based on repeat transactional customer relationships driven by great product offerings and cohesive, consistent brand storytelling strategies that overall lead to an elevated customer experience has underpinned the past years' success.  As we look to build on the global markets where demand for our products has been under-serviced, we have started to adopt a more local engagement with our partners, including assortment planning and supply chain management that enables a deeper penetration and better serviceability. The focus placed on our direct to consumer e-commerce business continues through various platforms and channels, with an expectation of ensuring the investments made at a local level through distribution partners will retain customers and bring them into our brand ecosystem touchpoints for future potential engagement and transactional conversion.
Principal risks and uncertainties
The directors have overall responsibility to assess risk and the systems of internal control. 
This includes a review of financial, operational and compliance controls and risk management procedures. There is an ongoing process for identifying, evaluating and managing significant risks faced by the Company:
Price risk
The Company enters into negotiations with major customers and suppliers 6-8 months in advance regarding product selection and prices. This process facilitates planning and enables the Company to negotiate prices with third party suppliers to manage price risk.
Credit risk
The effectiveness and efficiency in cash flow planning and review enables the Company to stringently manage trade receivables and hence ensure that the terms allowed are adhered to. An excellent relationship is also maintained with the Company's bankers. 
 
Page 2

 

ZEON LIMITED

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

Liquidity and cash flow risk
Working capital is managed effectively as internal control procedures are in place to plan and review working capital requirements on a regular basis. 
Fund flows
There is an arrangement for funding from the Parent Company (Herald Group Limited) if required.
Foreign exchange risk
The Company operates in the global market, both buying and selling products on a global basis. The Company seeks to generate revenues in stronger currencies in order to meet its commitments. 
Zeon Limited does not consider there to be any further material levels of risk to its operating business.
Order Book
At 31st March 2024, the Company had confirmed orders in the amount of £0.925m for UK operations (2023: £1.006m) and orders amounting to US $1.287m for Zeon Far East Group business (2023 : $0.07m).
Health, safety and the environment
We work hard to make sure that Health and Safety policies are well communicated, understood, respected and implemented to protect the health, safety and welfare of all our stakeholders, customers, suppliers, and the public at large. The Company ensures that all products shipped out to customers conform to EU safety guidelines and that the disposal of waste complies with WEE (Waste Electronic and Electrical equipment EU directive 2002/96EC). The volume of waste to landfill is minimized and all paper waste is recycled. 
The Company also complies with both the Nickel Directive (94/27/EC) where the amount of Nickel substance in our products may not exceed 0.28US/cm2/week and the Restriction of Hazardous Substances EU Directive (2011/65/EU).
Outlook
The continued customer expectations of convenience, choice and value price will inevitably maintain the dominance of online shopping compared to traditional high streets and shopping malls for our product categories. We are continuing to invest across all our digital platforms and associated customer digital touchpoints through deeper relationship management strategies and by ensuring our licensed brand partners weave those strategies into their businesses to ensure we’re well placed to take advantage of overall brand strength and demand at brand level.


This report was approved by the board on 12 August 2024 and signed on its behalf.



S Gilham
Director

Page 3

 

ZEON LIMITED

DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024

The directors present their report and the financial statements for the year ended 31 March 2024.

Directors' responsibilities statement

The directors are responsible for preparing the strategic report, the 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and 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 for the company's financial statements and then apply them consistently;

make judgments and accounting estimates that are reasonable and prudent;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the 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 to enable them to ensure that the financial statements comply with the Companies Act 2006They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Principal activity

The principal activity of Zeon Limited is the distribution of watches, clocks, consumer electronics and gifts.

Page 4

 

ZEON LIMITED

DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

Financial review

The Company's results for the year are shown in the profit and loss account on page 11.
The business environment remains unpredictable across the world due to ongoing geo political challenges. Conflict in Ukraine and the potential for further global conflicts are all prevalent and remain a significant risk factor. Through continued scenario planning and investment in our relationships with all our international trading partners and customers, we feel confident that the demand and our ability to take advantage of that demand remains solid. The loyalty and performance of our employees and partners, both internally and externally continue to be an intrinsic part of our core strength and company foundations.
Going concern
The directors have prepared prudent, sensitised forecasts including cash flow forecasts  for a period of at least 12 months from the date of approval of these financial statements. The directors note the positive performance of the Company in the year to 31 March 2024 which facilitated a significant repayment the of full amount outstanding to the Company’s ultimate parent undertaking Herald Holdings Limited. During the year the company generated profits of £2.405m (2023: £1.129m) and as at the balance sheet date is in a net asset position of £6.340m (2023: £3.935m). 
Consequently, the directors are confident that the Company will have sufficient funds to continue to meet its liabilities as they fall due for at least 12 months from the date of approval of the financial statements and therefore have prepared the financial statements on a going concern basis. 
Proposed dividend
The directors do not recommend the payment of a dividend on the ordinary shares (2023: £Nil). 

Directors

The directors who served during the year were:

T K S Cheung 
R D Dorfman 
S Gilham 
T G Lawrance 
M P Lai (appointed 8 December 2023)
C S P Thong (appointed 8 December 2023)
K H Shum (resigned 8 December 2023)
Y S M Thong (resigned 8 December 2023)

Political contributions

The Company made no political donations or incurred any political expenditure during the year.

Future developments

An indication of likely future developments in the business and particulars of significant events which have occurred since the end of the financial year have been included above or in the Strategic Report on pages 1 to 3.

Page 5

 

ZEON LIMITED

DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

Employee involvement

Retention of staff, especially amongst all key employees has remained high and has helped achieve business objectives across many areas including cost control and effective re deployment of resource and assets. 
It is the Company's policy that there should be no discrimination against any person. Training, career development and promotion are made available to all employees. Employees' advancement is based purely on the effectiveness of their performance. 
In accordance with the Company's equal opportunity policy, disabled persons are given the same consideration as others when they apply for jobs. Depending on their skills and abilities, they enjoy the same career prospects as other employees.

Qualifying third party indemnity provisions

None

Disclosure of information to auditor

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

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the company's auditor is aware of that information.

Auditor

The previous auditor, Grant Thornton UK LLP, did not seek reappointment in accordance with section 485 of the Companies Act 2006 and therefore tendered their resignation. Blick Rothenberg LLP were appointed auditors on 20th March 2024.

This report was approved by the board on 12 August 2024 and signed on its behalf.
 





S Gilham
Director

Page 6

 

ZEON LIMITED

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ZEON LIMITED
 FOR THE YEAR ENDED 31 MARCH 2024

Opinion


We have audited the financial statements of Zeon Limited (the 'company') for the year ended 31 March 2024, which comprise the profit and loss account, the balance sheet, the statement of changes in equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the company's affairs as at 31 March 2024 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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 United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


Conclusions relating to going concern


In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.


Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the 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 reportOur opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.


We have nothing to report in this regard.


Page 7

 

ZEON LIMITED

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ZEON LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

Opinion on other matters prescribed by the Companies Act 2006
 

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


the information given in the 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 set out on page 4, 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.


Page 8

 

ZEON LIMITED

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ZEON LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

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:

the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the company's sector;
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation, employment, and health and safety legislation; 
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

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

making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and 
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

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

performed analytical procedures to identify any unusual or unexpected relationships;
tested a sample of journal entries to identify unusual transactions;
assessed whether judgements and assumptions made in determining the accounting estimates set out in note 3 were indicative of potential bias; and
investigated the rationale behind significant or unusual transactions.

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

agreeing financial statement disclosures to underlying supporting documentation; 
reading the minutes of meetings of those charged with governance; and
enquiring of management as to actual and potential litigation and claims.



 
Page 9

 

ZEON LIMITED

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ZEON LIMITED (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

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 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 2006Our 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.





Krishan Sivathondan BSc (Hons) FCA (senior statutory auditor)
  
for and on behalf of
Blick Rothenberg Audit LLP
 
Chartered Accountants
Statutory Auditor
  
16 Great Queen Street
Covent Garden
London
WC2B 5AH

 
Date: 
12 August 2024
Page 10

 

ZEON LIMITED
 
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2024

2024
2023
Note
£000
£000

  

Sales
 4 
14,441
13,162

Cost of sales
  
(10,298)
(8,786)

Gross profit
  
4,143
4,376

Distribution costs
  
(208)
(111)

Administrative expenses
  
(3,837)
(3,362)

Other income
 5 
1,850
226

Operating profit
 6 
1,948
1,129

Interest receivable and similar income
 10 
7
-

Profit before taxation
  
1,955
1,129

Deferred taxation
 11 
450
-

Profit for the financial year
  
2,405
1,129

There are no items of other comprehensive income for either the year or the prior year other than the profit for the year. Accordingly, no statement of other comprehensive income has been presented.

Page 11


 
REGISTERED NUMBER:01459158
ZEON LIMITED

BALANCE SHEET
AS AT 31 MARCH 2024

2024
2023
Note
£000
£000

Fixed assets
  

Intangible assets
 12 
-
1

Tangible assets
 13 
320
335

Investment property
 15 
475
475

  
795
811

Current assets
  

Stocks
 16 
3,050
3,088

Debtors
 17 
1,967
2,257

Cash at bank and in hand
  
2,119
1,109

  
7,136
6,454

Creditors: amounts falling due within one year
 18 
(1,591)
(3,330)

Net current assets
  
 
 
5,545
 
 
3,124

Total assets less current liabilities
  
6,340
3,935

  

Net assets
  
6,340
3,935


Capital and reserves
  

Called up share capital 
 20 
7,149
7,149

Share premium account
 21 
1,214
1,214

Revaluation reserve
 21 
147
147

Profit and loss account
 21 
(2,170)
(4,575)

Total equity
  
6,340
3,935


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 12 August 2024.




S Gilham
Director

The notes on pages 14 to 32 form part of these financial statements.

Page 12

 

ZEON LIMITED

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024


Called up share capital
Share premium account
Revaluation reserve
Profit and loss account
Total equity

£000
£000
£000
£000
£000


At 1 April 2022
7,149
1,214
147
(5,704)
2,806


Comprehensive income for the year

Profit for the year
-
-
-
1,129
1,129



At 1 April 2023
7,149
1,214
147
(4,575)
3,935


Comprehensive income for the year

Profit for the year
-
-
-
2,405
2,405


At 31 March 2024
7,149
1,214
147
(2,170)
6,340


The notes on pages 14 to 32 form part of these financial statements.

Page 13

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

1.


General information

Zeon Limited is a private company limited by shares incorporated in England and Wales. The address of its registered office is 16 Great Queen Street, Covent Garden, London, WC2B 5AH.
The company is exempt by virtue of s405 of the Companies Act 2006 from the requirement to prepare group financial statements on the basis that all subsidiaries of the company as a parent are not material for the purposes of giving a true and fair view. These financial statements present information about the company as an individual undertaking and not about its group.
The financial statements are presented in Sterling (£), which is the functional currency of the company.
Monetary amounts in these financial statements are rounded to the nearest thousand pounds, £000.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

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

The company's financial statements are presented in Sterling and all values are rounded to the nearest thousand (£000) except where otherwise stated.

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

The following principal accounting policies have been applied:

  
2.2

Financial Reporting Standard 102 - reduced disclosure exemptions

The company's ultimate parent undertaking, Herald Holdings Limited includes the company in its consolidated financial statements. The consolidated financial statements of Herald Holdings Limited are available to the public and may be obtained from http://www.heraldgroup .com.hk/financial_reports .htm. In these financial statements, the company is considered to be a qualifying entity (for the purposes of this FRS) and has applied the exemptions available under FRS 102 in respect of the following disclosures:

Reconciliation of the number of shares outstanding from the beginning to end of the period;
Cash Flow Statement and related notes; and
Key Management Personnel compensation.

As the consolidated financial statements of Herald Holdings Limited include the equivalent disclosures, the company has also taken the exemptions under FRS 102 available in respect of the following disclosures:

The disclosures required by FRS 102.11 Basic Financial Instruments and FRS 102.12 Other Financial Instruments Issues in respect of financial instruments.

The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in these financial statements. 

There have been no judgments made by the directors in the application of these accounting policies that have a significant effect on the financial statements and estimates with a significant risk of material adjustment in the next year.

Page 14

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

 
2.3

Going concern

The directors have prepared prudent, sensitised forecasts including cash flow forecasts for a period of at least 12 months from the date of approval of these financial statements. The directors note the positive performance of the Company in the year to 31 March 2024 which facilitated a full repayment of the amounts outstanding to the Company's ultimate parent undertaking Herald Holdings Limited. During the year the company generated profits of £2.405m (2023: £1.129m) and as at the balance sheet date is in a net asset position of £6.340m (2023: £3.935m).  
Consequently, the directors are confident that the Company will have sufficient funds to continue to meet its liabilities as they fall due for at least 12 months from the date of approval of the financial statements and therefore have prepared the financial statements on a going concern basis.

 
2.4

Revenue

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

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
the company has transferred the significant risks and rewards of ownership to the buyer;
the company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the company will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the company will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

  
2.5

Other operating income

Sales and marketing service income from group undertakings

The company receives commission for sales and marketing from Zeon Far East Ltd accounted for on a monthly basis and is recognised as other income.

Page 15

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

 
2.6

Foreign currency translation

Functional and presentation currency

The company's functional and presentational currency is Sterling (£).

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the profit and loss account within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'administrative expenses'.

 
2.7

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Investments in unlisted company shares, whose market value can be reliably determined, are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in the profit and loss account for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment.

 
2.8

Cash

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. 

 
2.9

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Page 16

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)


2.9
Tangible fixed assets (continued)

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Long-term leasehold property
-
      50 years
Motor vehicles
-
      4 years
Fixtures and fittings
-
      4 - 7 years

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

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

 
2.10

Intangible assets

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

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

 
2.11

Investment property

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

 
2.12

Stocks

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

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

Page 17

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

  
2.13

Financial instruments

The company has elected to apply Sections 11 and 12 of FRS 102 in respect of financial instruments.
Financial assets and financial liabilities are recognised when the company becomes party to the contractual provisions of the instrument.
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.
The company’s policies for its major classes of financial assets and financial liabilities are set out
below.
Financial assets
Basic financial assets, including trade and other debtors, cash and bank balances, intercompany working capital balances, and intercompany financing are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate.
Such assets are subsequently carried at amortised cost using the effective interest method, less any impairment.
Such financial assets are subsequently measured at fair value through profit or loss, where they are publicly traded, or fair value can be measured reliably, for example by using a valuation technique.
Where fair value cannot be measured reliably, the financial asset is measured at cost less
impairment.
Financial liabilities
Basic financial liabilities, including trade and other creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, 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 for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method. 
Impairment of financial assets
Financial assets measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the profit and loss account.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between the asset's carrying amount and the best estimate of the amount the company would receive for the asset if it were to be sold at the reporting date.
For financial assets measured at amortised cost, the impairment loss is measured as the difference between the asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If the financial asset has a variable interest rate, the discount
Page 18

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

rate for measuring any impairment loss is the current effective interest rate determined under the contract.
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 and financial liabilities
Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.
Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.
Offsetting of financial assets and financial liabilities
Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

 
2.14

Pensions

Defined contribution pension plan

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

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

Page 19

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

 
2.15

Taxation

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

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

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

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


3.


Judgements in applying accounting policies and key sources of estimation uncertainty

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reports for assets and liabilities as at the Balance Sheet date and the amounts reported for revenues and expenses during the year. However, the nature of estimation means that actual outcomes could differ from those estimates. The items in the financial statements where these judgements and estimates have been made include: 
Stock provision (estimate): 
The Company performs regular review of the carrying amounts of inventories with reference to aged inventories analysis and management judgement. Based on this review, write down of inventories will be made when the estimated net realisable values of inventories decline below their carrying amounts. However, actual consumption may be different from estimation and profit or loss could be affected by differences in this estimation. 
Recognition of deferred tax asset:
There is judgement involved in the recognition of a deferred tax asset in respect of unutilised losses brought forward. Management have made an assessment based on forecasted future profits and the enacted rate of UK tax to estimate the tax losses that can be utilised going forward.

Page 20


4.


Turnover

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


2024
2023
£000
£000

Sales
14,441
13,162


Analysis of turnover by country of destination:

2024
2023
£000
£000

United Kingdom
9,071
8,720

Rest of Europe
4,243
3,738

Rest of the world
1,127
704

14,441
13,162



5.


Other operating income

2024
2023
£000
£000

Sales and marketing service income
1,825
196

Other income
25
30

1,850
226


The sales and marketing service income relates to income received from Zeon Far East Limited, a related party.


6.


Operating profit

The operating profit is stated after charging:

2024
2023
£000
£000

Depreciation
39
31

Amortisation
1
2

Other operating lease rentals
238
220

Exchange differences
(82)
(20)

Page 21

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

7.


Auditor's remuneration

During the year, the company obtained the following services from the company's auditor:


2024
2023
£000
£000

Fees payable to the company's auditor for the audit of the company's financial statements
36
46

Fees payable to the company's auditor in respect of:

Taxation compliance services
3
13


8.


Employees

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


2024
2023
£000
£000

Wages and salaries
1,657
1,579

Social security costs
185
174

Cost of defined contribution scheme
124
99

1,966
1,852


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


        2024
        2023
            No.
            No.







Packing and quality control
14
14



Selling and distribution
12
13



Office and management
5
5

31
32

Page 22

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

9.


Directors' remuneration

2024
2023
£000
£000

Directors' emoluments
441
367

Company contributions to defined contribution pension schemes
26
26

467
393


During the year retirement benefits were accruing to no directors (2023 - NIL) in respect of defined contribution pension schemes.

The aggregate remuneration and amounts receivable under long term incentive schemes of the highest paid director was £252,651 (2023: £180,998), and company pension contributions of £7,500 (2023: £7,500) were made to a money purchase scheme on his behalf. 
During the year retirement benefits were accruing to 2 directors (2023: 2) in respect of defined contribution pension schemes.
The directors TKS Cheung, RD Dorfman, YSM Thong, KH Shum, Chi Shun Peter Thong and Man Pun Lai were remunerated by fellow subsidiaries of Herald Group Limited for their services to the group as a whole. The directors do not believe it is practical to apportion their remuneration between the services to the Company and their services as directors of the parent and fellow subsidiaries. The cost of remuneration is not recharged to the Company and the services provided are not considered material to the Company.


10.


Interest receivable

2024
2023
£000
£000


Other interest receivable
7
-


11.


Taxation


2024
2023
£000
£000



Current tax on profits for the year
-
-


Total current tax
-
-

Deferred tax


Recognition of deferred tax in relation to unrelieved tax losses
(450)
-

Total deferred tax
(450)
-


Deferred taxation
(450)
-
Page 23

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
 
11.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is lower than (2023 - lower than) the standard rate of corporation tax in the UK of 25% (2023 - 19%). The differences are explained below:

2024
2023
£000
£000


Profit on ordinary activities before tax
1,955
1,129


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of % (2023 -    19%)
489
215

Effects of:


Fixed asset differences
-
(1)

Non-deductible expenses
-
1

Chargeable gains / (losses)
-
2

Utilisation of brought forward tax losses
(489)
(285)

Deferred tax not recognised
-
68

Recognition of deferred tax in relation to unrelieved tax losses
(450)
-

Total tax charge for the year
(450)
-


Factors that may affect future tax charges

The company has tax losses of approximately £2.6m (2023: £4.6m) available to carry forward against future trading profits. 
There is a potential deferred tax asset of £0.7m (2023: £1.1m) which has only been partially recognised in the financial statements due to the uncertainty concerning the timescale of its recoverability.
No deferred tax asset had been recognised in respect of tax losses at 31 March 2023 (2022: £Nil) as the probability of these being utilised was considered uncertain. 

Page 24

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

12.


Intangible assets




Brand names

£000



Cost


At 1 April 2023
281



At 31 March 2024

281



Amortisation


At 1 April 2023
280


Charge for the year on owned assets
1



At 31 March 2024

281



Net book value



At 31 March 2024
-



At 31 March 2023
1



Page 25

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

13.


Tangible fixed assets





Long-term leasehold property
Motor vehicles
Fixtures and fittings
Total

£000
£000
£000
£000



Cost 


At 1 April 2023
307
39
2,256
2,602


Additions
-
-
24
24


Disposals
-
(39)
(481)
(520)



At 31 March 2024

307
-
1,799
2,106



Depreciation


At 1 April 2023
117
39
2,111
2,267


Charge for the year
6
-
33
39


Disposals
-
(39)
(481)
(520)



At 31 March 2024

123
-
1,663
1,786



Net book value



At 31 March 2024
184
-
136
320



At 31 March 2023
190
-
145
335

Page 26

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

14.


Fixed asset investments





Investments
in
subsidiary companies

£000



Cost


At 1 April 2023
2,502


Additions
-



At 31 March 2024

2,502



Impairment


At 1 April 2023
2,502



At 31 March 2024

2,502



Net book value



At 31 March 2024
-



At 31 March 2023
-


Subsidiary undertakings


The following were subsidiary undertakings of the company:

Name

Registered office

Class of shares

Holding

Ingersoll Limited
Units 1 & 2 Phoenix Park,
Apsley Way,
London, England,
NW2 7LN
Ordinary
100%
Steven Strauss & Co Limited
(Company dissolved on
16 May 2023)
Units 1 & 2 Phoenix Park,
Apsley Way,
London, England,
NW2 7LN
Ordinary
100%

Page 27

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
Subsidiary undertakings (continued)

The aggregate of the share capital and reserves as at 31 March 2024 and the profit or loss for the year ended on that date for the subsidiary undertakings was as follows:

Name
Profit/(Loss)
£000

Ingersoll Limited
-

Steven Strauss & Co Limited
(Company dissolved on
16 May 2023)
-


15.


Investment property


Freehold
investment
property

£000



Valuation


At 1 April 2023
475



At 31 March 2024
475

Investment property fair value is based on a valuation performed as at 31 March 2023, by external, independent valuation firm, LCH (Asia Pacific) Surveyors Limited, who have among their staff members, appropriate recognised professional qualifications and recent experience in the location and class of property being valued. The Directors have updated this valuation for the year ended 31 March 2024.
The valuations, which are supported by market evidence, are prepared by considering the aggregate of the net annual rents receivable from the properties and where relevant, associated costs. A yield which reflects the specific risks inherent in the net cash flows is then applied to the net annual rentals to arrive at the property valuation. 
Any gain or loss arising from a change in fair value is recognised in profit or loss. Rental income from investment property is accounted for as described in the Other Income accounting policy.







16.


Stocks

2024
2023
£000
£000

Gross stock value
3,217
3,094

Provision
(716)
(660)

Goods in transit
549
654

3,050
3,088


Page 28

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

17.


Debtors

2024
2023
£000
£000

Due after more than one year

Amounts owed by group undertakings
-
1,095

Due within one year

Trade debtors
1,168
887

Amounts owed by group undertakings
-
5

Other debtors
256
174

Prepayments and accrued income
93
96

Deferred taxation
450
-

1,967
2,257



18.


Creditors: amounts falling due within one year

2024
2023
£000
£000

Trade creditors
216
203

Amounts owed to group undertakings
179
2,194

Other taxation and social security
-
54

Other creditors
50
7

Accruals and deferred income
1,146
872

1,591
3,330


Page 29

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

19.


Deferred taxation




2024


£000






Charged to profit or loss
450



At end of year
450

The deferred tax asset is made up as follows:

2024
2023
£000
£000


Tax losses carried forward
450
-

Deferred tax asset
450
-


20.


Share capital

2024
2023
£000
£000
Allotted, called up and fully paid



6,983,750 (2023 - 6,983,750) Ordinary Shares shares of £1.00 each
6,984
6,984
165,417 (2023 - 165,417 ) Preference shares shares of £1.00 each
165
165

7,149

7,149





Shares classified in shareholders' funds
7,149
7,149

The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the Company.

Page 30

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

21.


Reserves

Revaluation reserve

Where tangible fixed assets are revalued or reclassified as investment property, the cumulative increase in the fair value of the property at the date of the reclassification in excess of any previous impairment losses is included in the revaluation reserve

Dividends

After the Balance Sheet date, total dividends of £Nil equivalent to 0p per qualifying ordinary share (2023: £Nil, 0p) were proposed by the directors.

Profit and loss account

The profit and loss account includes all current and prior period retained profits and losses.


22.


Capital commitments

The Company contractual commitments in respect of minimum guaranteed royalties for licenses are £1,697,652 (2023: £2,081,882).


23.


Commitments under operating leases

At 31 March 2024 the company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2024
2023
£000
£000


Not later than 1 year
221
220

Later than 1 year and not later than 5 years
613
661

Later than 5 years
301
451

1,135
1,332

During the year £237,917 was recognised as an expense in the profit and loss account in respect of operating leases (2023: £220,426).


24.


Related party transactions

As the Company is a wholly owned subsidiary of Herald Holdings Limited, the Company has taken advantage of the exemption contained in FRS 102.1.12(d) and has therefore not disclosed transactions or balances with entities which form part of the group. There were no other related party transactions.

Page 31

 

ZEON LIMITED

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

25.


Controlling party

The Company is a subsidiary undertaking of Herald Group Limited which is incorporated in the British Virgin Islands. The ultimate controlling party is Herald Holdings Limited, incorporated in Bermuda. The address of the parent undertaking's registered office is Clarendon House, 2 Church Street, Hamilton HM11, Bermuda. 
The largest group in which the results of the Company are consolidated is that headed by Herald Holdings Limited, incorporated in Bermuda. No other group financial statements include the results of the Company. The consolidated accounts of this company are available to the public and may be obtained from Clarendon House, 2 Church Street, Hamilton HM11, Bermuda. 

 
Page 32