Registered number:
For the year ended
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H.F.L. Building Solutions Limited
Company Information
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H.F.L. Building Solutions Limited
Contents
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H.F.L. Building Solutions Limited
Strategic Report
For the year ended 31 December 2023
The directors present their strategic report for the year ended 31 December 2023.
HFL Building Solutions Limited is one of the UK's foremost building services companies. We have an enviable reputation for the reliable delivery of cost and energy efficient building management, operational and technical solutions for businesses of all shapes and sizes - from retail parks to leisure complexes, educational establishments and commercial properties.
We offer a nationwide service of mobile maintenance, integrated facilities and building environmental services from two main hubs located in Central and Northern England.
The general economic environment in 2023 was good which resulted in growth in turnover. 2023 was a year for strategic investment in the Company, in both infrastructure and systems. This has helped create a stronger platform to support our continued growth.
The general economic environment continued to be highly competitive in 2023. The business delivered a strong performance in the year, with our reactive and project works in line with forecasts. New contract wins exceeded the lost/terminated contracts, and this trend continues in to 2024. The Directors remain optimistic of the Company's prospects in 2024. The Company is continuing to work with our business partners to seek efficiency in all areas, and support and train our employees to provide the level of service that will raise our profile within the industry and help us retain and grow client portfolios.
The Company is exposed to lead times of manufacturing of parts so the global pressure on the supply chain does have an impact, as does the inflationary pressures of the global economy. The energy markets will increase our overheads and we will take appropriate measures to secure the best deals for the Company.
Competitive pressure will always exist as client portfolios come up for re-tender. We will continue to develop working relationships with consultants and the correct director decision makers of existing and prospective clients. By focusing on the service element of our offering, we can illustrate value for money and achieve a high retention rate on our contracts and assist existing clients in providing opportunities for growth. The greatest challenge is coming from the pressure on wages, as an apparent shortage of skilled engineers had forced up the market rate significantly in 2022, but this has now stabilised. The Company has invested both in apprenticeships for the future and in training of existing staff to create a strong enterprise culture for retaining its skilled staff. Our continued investment in people, technology and training leaves the business well placed to differentiate itself within the competitive environment of building maintenance. Health and Safety continues to be a key focus of risk management for the Company. The Company will continue to invest internally in our systems to ensure our framework of policies and procedures achieve the objective of minimising avoidable risk in the business. The Company is continually developing and upgrading our IT infrastructure, software and cyber threat and assessment capabilities. The increased risk of cyber-attack during the pandemic could impact the business operations and lead to loss of confidential information, damaging the Company's reputation. We will continue to enhance our data protection and security procedures to mitigate these risks.
Page 1
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H.F.L. Building Solutions Limited
Strategic Report (continued)
For the year ended 31 December 2023
Sales in the year showed an increase compared to 2022, at £15.8m (2022: £15.1m) and are continuing to grow in line with our strategies.
Gross margin was 22.0% (2022: 24.9%) and is line with expectations. Operating profit has increased to £242k (2022: £122k), in line with expectations. The directors are confident that this will be maintained moving forward. The Company paid dividends in the year of £176k (2022: £214k). The balance sheet remains strong with net assets of £1.85m (2022: £1.83m). Given the economic hardships suffered by many suppliers within our sector during the pandemic the Directors believe that it is increasingly important that our clients, suppliers, and employees are able to rely on the continued financial strength of HFL Building Solutions.
This report was approved by the board and signed on its behalf.
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H.F.L. Building Solutions Limited
Directors' Report
For the year ended 31 December 2023
The directors present their report and the financial statements for the year ended 31 December 2023.
The directors are responsible for preparing the strategic report, the directors' report and the financial statements in accordance with applicable law and regulations.
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 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.
The profit for the year, after taxation, amounted to £198,074 (2022 -£138,868).
Dividends of £176,252 (2022: £214,000) were paid during the year. The directors do not recommend a final dividend.
The directors who served during the year were:
An indication of likely future developments in the Company's business can be found throughout the Strategic Report.
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H.F.L. Building Solutions Limited
Directors' Report (continued)
For the year ended 31 December 2023
On 16 February 2024, control of the Company was transferred to Saxton Group Holdings Limited, a company registered in England and Wales, registered number 15372940.
Hurst Accountants Limited were appointed as auditors during the period.
They will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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H.F.L. Building Solutions Limited
Independent Auditors' Report to the Members of H.F.L. Building Solutions Limited
We have audited the financial statements of H.F.L. Building Solutions Limited (the 'Company') for the year ended 31 December 2023, which comprise the statement of income and retained earnings, the balance sheet, the statement of cash flows and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the 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.
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the Annual Report other than the financial statements and our auditors' 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.
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H.F.L. Building Solutions Limited
Independent Auditors' Report to the Members of H.F.L. Building Solutions Limited (continued)
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.
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.
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H.F.L. Building Solutions Limited
Independent Auditors' Report to the Members of H.F.L. Building Solutions Limited (continued)
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these 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:
Identifying and assessing potential risks related to irregularities
In identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:
∙The nature of the industry and sector in which the company operates; the control environment and business performance including key drivers for directors' remuneration, bonus levels and performance targets.
∙The outcome of enquiries of management, including whether management was aware of any instances of non-compliance with laws and regulations, and whether management had knowledge of any actual, suspected, or alleged fraud.
∙Supporting documentation relating to the Company's policies and procedures for:
- Identifying, evaluating, and complying with laws and regulations
- Detecting and responding to the risks of fraud
∙The internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations.
∙The outcome of discussions amongst the engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.
∙The legal and regulatory framework in which the Company operates, particularly those laws and regulations which have a direct effect on the financial statements, such as the Companies Act 2006, pensions and tax legislation, or which had a fundamental effect on the operations of the Company, including General Data Protection requirements, and Anti-bribery and Corruption.
Audit response to risks identified
Our procedures to respond to the risks identified included the following:
∙Reviewing the financial statements disclosures and testing to supporting documentation to assess compliance with the provisions of those relevant laws and regulations which have a direct effect on the financial statements.
∙Discussions with management, including consideration of known or suspected instances of non-compliance with laws and regulations and fraud.
∙Evaluation of management’s controls designed to prevent and detect irregularities.
∙Enquiring of management about any actual and potential litigation and claims.
∙Performing analytical procedures to identify any unusual or unexpected relationships which may indicate risks of material misstatement due to fraud.
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H.F.L. Building Solutions Limited
Independent Auditors' Report to the Members of H.F.L. Building Solutions Limited (continued)
We have also considered the risk of fraud through management override of controls by:
∙Testing the appropriateness of journal entries and other adjustments. We have used data analytics software to identify accounting transactions which may pose a heightened risk of material misstatement, whether due to fraud or error.
∙Challenging assumptions made by management in their significant accounting estimates, and assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and
∙Evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
There are inherent limitations in the audit procedures described above, and the further removed non-compliance with laws and regulations are from the events and transactions reflected in the financial statements, the less likely we would become aware of them. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through 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 auditors' report.
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an auditors' 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.
for and on behalf of
Chartered Accountants and Statutory Auditors
3 Stockport Exchange
Railway Road
Stockport
Cheshire
SK1 3GG
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H.F.L. Building Solutions Limited
Statement of Income and Retained Earnings
For the year ended 31 December 2023
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H.F.L. Building Solutions Limited
Registered number: 05595234
Balance Sheet
As at
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 13 to 26 form part of these financial statements.
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H.F.L. Building Solutions Limited
Statement of Cash Flows
For the year ended 31 December 2023
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H.F.L. Building Solutions Limited
Analysis of Net Debt
For the year ended 31 December 2023
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H.F.L. Building Solutions Limited
Notes to the Financial Statements
For the year ended 31 December 2023
H.F.L. Building Solutions Limited is a private company limited by members capital incorporated in England and Wales, registered number 05595234. The address of the registered office and principal place of business is Freeman House, Orbital 24, Oldham Street, Manchester, M34 3SU.
The nature of the Company's operation and principal activity is that of building services.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
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H.F.L. Building Solutions Limited
Notes to the Financial Statements
For the year ended 31 December 2023
2.Accounting policies (continued)
Grants of a revenue nature are recognised in the statement of income and retained earnings in the same period as the related expenditure.
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H.F.L. Building Solutions Limited
Notes to the Financial Statements
For the year ended 31 December 2023
2.Accounting policies (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:
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.
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H.F.L. Building Solutions Limited
Notes to the Financial Statements
For the year ended 31 December 2023
2.Accounting policies (continued)
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
Basic financial assets
Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.
Impairment of financial assets
Financial assets are assessed for indicators of impairment at each reporting date.
Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.
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H.F.L. Building Solutions Limited
Notes to the Financial Statements
For the year ended 31 December 2023
2.Accounting policies (continued)
If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.
Financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
Derecognition of financial assets
Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.
Derecognition of financial liabilities
Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.
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H.F.L. Building Solutions Limited
Notes to the Financial Statements
For the year ended 31 December 2023
The estimates and underlying assumptions are reviewed on an ongoing basis. Revision to accounting estimates are recognised in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and future periods, if the revision affects both current and future periods.
The whole of the turnover is attributable to the Company's principal activity.
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H.F.L. Building Solutions Limited
Notes to the Financial Statements
For the year ended 31 December 2023
Page 19
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H.F.L. Building Solutions Limited
Notes to the Financial Statements
For the year ended 31 December 2023
Page 20
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H.F.L. Building Solutions Limited
Notes to the Financial Statements
For the year ended 31 December 2023
12.Taxation (continued)
There were no factors that may affect future tax charges.
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H.F.L. Building Solutions Limited
Notes to the Financial Statements
For the year ended 31 December 2023
Page 22
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H.F.L. Building Solutions Limited
Notes to the Financial Statements
For the year ended 31 December 2023
Page 23
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H.F.L. Building Solutions Limited
Notes to the Financial Statements
For the year ended 31 December 2023
Page 24
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H.F.L. Building Solutions Limited
Notes to the Financial Statements
For the year ended 31 December 2023
21.Deferred taxation (continued)
Profit and loss account
The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from
those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £283,357 (2022: £297,201). Contributions totalling £48,174 (2022: £26,199) were payable to the fund at the balance sheet date.
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H.F.L. Building Solutions Limited
Notes to the Financial Statements
For the year ended 31 December 2023
There is no overall controlling party of the Company during the period.
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