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Registration number: 05361794

Purdicom Limited

Annual Report and Financial Statements

for the Year Ended 31 December 2023

 

Purdicom Limited

Contents

Company Information

1

Strategic Report

2 to 4

Directors' Report

5

Statement of Directors' Responsibilities

6

Independent Auditor's Report

7 to 9

Profit and Loss Account

10

Balance Sheet

11

Statement of Changes in Equity

12

Statement of Cash Flows

13

Notes to the Financial Statements

14 to 24

 

Purdicom Limited

Company Information

Directors

H C G Garrod

A D R Black

M J Smith

H McNulty

Company secretary

M J Smith

Registered office

Mitchell House
Unit 4, Woolley Barns
Wantage
Oxfordshire
OX12 8TA

Auditors

UHY Ross Brooke
Chartered Accountants and Registered Auditors
2 Old Bath Road
Newbury
Berkshire
RG14 1QL

 

Purdicom Limited

Strategic Report for the Year Ended 31 December 2023

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

Principal activity

The principal activity of the company is that of the wholesale distribution of electronic parts and equipment.

Objectives and strategies to achieve

Our mission statement: “Purdicom’s mission is to offer state-of-the-art, best of breed, and versatile wireless, cloud and security solutions that harmoniously align with the objectives of our customers. Unusual processes and unique business needs are all accommodated in an “ease of doing business” environment facilitated by our own highly trained experienced communications technology experts. Whilst all the time delivering value to our shareholders and colleagues alike.” We continue to look for acquisitions, as well as growing organically.

This statement set out our objective to reach a £47 million turnover by 2023. Whilst the global turmoil of the post Covid years has meant we fell short this year, we strive to achieve £50 million in the coming years.

Business model

We have four sales teams specialising in indoor wireless, outdoor wireless, security, and cloud markets. These have performed well, and we continue to win some significant projects and customers. These teams continue to sell to Telecommunications Operators, ISP’s, Value Added Resellers, Integrators and Managed Service Providers (MSP’s). Our indoor wireless team addressing the indoor market continues to gain many new customers and have won back many customers as we demonstrate our value-added services.

Our professional services have grown strongly, and we have a lot of service offerings from surveys to installation and commissioning work, and system design. Our export sales have increased by 18.7% in 2023, with EU sales seeing an increase of 32.3%. 2024 will see a targeted sales growth into the EU with warehousing facilities due to be in place towards the end of the year.

Our online portal has enhanced our customer experience providing customers with the option to build, review and place orders through our webstore. We continue to develop the knowledge and skills of our expert sales team and the webstore compliments this by providing a convenient and easy to use portal for those who prefer to order online.

Trends

Around the world, cities are evaluating how to leverage smart technology to enhance citizens lifestyle, increase economic growth and make the city more efficient. The possibilities are limitless with advanced technology in smart lighting, traffic and parking systems, public safety and much more.

A great starting point for cities is to deploy public Wi-Fi. Public Wi-Fi is a great way to create a more vibrant community and connect citizens, businesses, and visitors. But the benefits of Wi-Fi do not stop there. Once the Wi-Fi network infrastructure is in place, it can be used to enable other smart city applications such as public safety / IP Video, traffic and parking controls, air quality and many others. We also took on a well-known large US security vendor which has significantly strengthened our security portfolio.

We have seen a significant rise in the number of Managed Service Providers encouraged by the UK Governments grants. These “pots” of money have enabled MSPs to attract many new customers and to rapidly grow their business and network coverage. In addition, wireless has become the norm and must in homes,offices, hotels, city centres and out and about on the move. The trend to provide blanket coverage everywhere with Wi-Fi is continuing and people are demanding more and more as Wi-Fi has significant bandwidth coverage and reliability advantages over cellular offerings. Mobile Operators are also starting to offer Wi-Fi calling which is providing connectivity for both voice and data to a cellular user utilising any Wi-Fi network that can be connected to for both incoming and outgoing calls.

 

Purdicom Limited

Strategic Report for the Year Ended 31 December 2023

Principal risks and uncertainties


Inflation, Interest Rates & Recession

The prominent levels of inflation seen since 2021 continued through 2023 and whilst inflation has now fallen, interest rates remain high. Whilst the IT sector continues to grow there is a risk that a recession will stifle investment through 2024. Purdicom continues to look at new products and new markets to continue to expand and spread any potential risk across its portfolio.

Political Risk

With a change in the UK government in July 2024 and elections across the EU there is likely to be a shift in governmental policy both domestically and internationally. Governmental investment and tax policy will likely change the landscape through 2024 and 2025.

Conflict

Ongoing conflicts in Ukraine as well as the Israel-Gaza conflict continue to cause uncertainties around supply and pricing of goods from certain key partners.

Exchange Rate Risk

An ever-present risk is Purdicom’s exposure to international exchange rate movements, Purdicom utilises hedging strategies to mitigate these risks.

Credit Risk

The risk of a customer default is one that Purdicom is aware of, a tightening of the credit insurance market along with a back log of customer orders has proved challenging at times. Purdicom maintains strong relationships with its customers & utilises credit insurance and credit agencies to set appropriate credit limits.

Development and performance

The first half of 2023 has seen robust growth as the industry pulled out of the 2022 components shortage, shelves were replenished and customer orders were fulfilled. This continued the trend from late 2022 however the market slowed as 2023 came to its conclusion. This slowdown has continued into 2024 with growth expected to return towards the end of the year.

With two contrasting halves to the year, 2023 saw turnover increase marginally to £43.9m, gross profit has seen an increase to £8.6m through shrewd purchasing, favourable currency trades and a reduction in shipping costs.

2023 has seen an increase in overheads because of our strategy to invest in our people. Head count increases in the sales and engineering teams are aligned with our strategies of growth and diversification. There has also been investment in our internal systems and web portal offering to help streamline future growth.

The investment has resulted in strengthened teams and systems but this has an impacted on net profit, which whilst remaining above our budget level, the £2.3m after tax that we achieved is down 15% on 2022.

The company’s balance sheet remains strong at £12.9m, with net current assets increasing by £1.64m to £12.7m. This has been driven by a reduction in heightened stock levels seen as the industry component shortage abated, customer orders were fulfilled and suppliers paid down. The reduction in stock level is expected to continue into 2024 with a resulting liquidity increase forecast.

 

Purdicom Limited

Strategic Report for the Year Ended 31 December 2023

Approved and authorised by the Board on 1 August 2024 and signed on its behalf by:
 

.........................................
H C G Garrod
Director

 

Purdicom 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.

Directors of the company

The directors who held office during the year were as follows:

H C G Garrod

A D R Black

M J Smith - Company secretary and director

H McNulty

Disclosure of information to the auditors

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditors are unaware.

Approved and authorised by the Board on 1 August 2024 and signed on its behalf by:
 

.........................................
H C G Garrod
Director

 

Purdicom Limited

Statement of Directors' Responsibilities

The directors acknowledge their responsibilities for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

select suitable accounting policies and apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

 

Purdicom Limited

Independent Auditor's Report to the Members of Purdicom Limited

Opinion

We have audited the financial statements of Purdicom Limited (the 'company') for the year ended 31 December 2023, which comprise the Profit and Loss Account, Balance Sheet, Statement of Changes in Equity, Statement of Cash Flows, and Notes to the Financial Statements, 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).

In our opinion the financial statements:

give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its profit for the year then ended;

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; 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 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 director's 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 original financial statements were 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 directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinion on other matter 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 Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

 

Purdicom Limited

Independent Auditor's Report to the Members of Purdicom Limited

the Strategic Report and 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 our 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 and the Directors' Report.

We have nothing to report in respect of the following matters where 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 Statement of Directors' Responsibilities [set out on page 6], 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 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.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Detecting irregularities, including fraud

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. As such, we have considered:

 

Purdicom Limited

Independent Auditor's Report to the Members of Purdicom Limited

• the nature of the industry and sector, control environment and business performance including the company's remuneration policy, bonus levels, and performance targets;
• the company's own assessment, including assessments made by key management, of the risks that irregularities may occur either as a result of fraud or error;
• any matters we identified having reviewed the company's policies and procedures relating to:

- identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;
- detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; and
- the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;

• the matters discussed amongst the audit engagement team.

As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the areas in which management is required to exercise significant judgement, such as the disclosure of adjusting items. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.

We also obtained an understanding of the legal and regulatory framework that the company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context were the Companies Act, tax legislation and regulations concerning importing and exporting to and from the UK.

There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. 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.

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

......................................
Dean Blunden BFP FCA (Senior Statutory Auditor)
For and on behalf of UHY Ross Brooke, Statutory Auditor

2 Old Bath Road
Newbury
Berkshire
RG14 1QL

12 August 2024

 

Purdicom Limited

Profit and Loss Account for the Year Ended 31 December 2023

Note

2023
£

2022
£

Turnover

3

43,952,076

43,866,953

Cost of sales

 

(35,317,828)

(35,874,251)

Gross profit

 

8,634,248

7,992,702

Administrative expenses

 

(5,671,967)

(4,689,403)

Operating profit

4

2,962,281

3,303,299

Other interest receivable and similar income

1,571

2,418

Interest payable and similar expenses

(1)

73

   

1,570

2,491

Profit before tax

 

2,963,851

3,305,790

Tax on profit

8

(709,533)

(622,572)

Profit for the financial year

 

2,254,318

2,683,218

The above results were derived from continuing operations.

The company has no recognised gains or losses for the year other than the results above.

 

Purdicom Limited

(Registration number: 05361794)
Balance Sheet as at 31 December 2023

Note

2023
£

2022
£

Fixed assets

 

Intangible assets

9

-

-

Tangible assets

10

280,657

236,148

 

280,657

236,148

Current assets

 

Stocks

11

13,698,389

15,691,736

Debtors

12

8,119,494

9,233,911

Cash at bank and in hand

 

472,299

1,905,907

 

22,290,182

26,831,554

Creditors: Amounts falling due within one year

14

(9,556,612)

(15,742,884)

Net current assets

 

12,733,570

11,088,670

Total assets less current liabilities

 

13,014,227

11,324,818

Provisions for liabilities

15

(100,068)

(113,289)

Net assets

 

12,914,159

11,211,529

Capital and reserves

 

Called up share capital

83

83

Share premium reserve

490

490

Capital redemption reserve

19

19

Retained earnings

12,913,567

11,210,937

Shareholders' funds

 

12,914,159

11,211,529

Approved and authorised by the Board on 1 August 2024 and signed on its behalf by:
 

.........................................
H C G Garrod
Director

 

Purdicom Limited

Statement of Changes in Equity for the Year Ended 31 December 2023

Share capital
£

Share premium
£

Capital redemption reserve
£

Retained earnings
£

Total
£

At 1 January 2022

83

490

19

9,074,147

9,074,739

Profit for the year

-

-

-

2,683,218

2,683,218

Dividends

-

-

-

(546,428)

(546,428)

At 31 December 2022

83

490

19

11,210,937

11,211,529

Share capital
£

Share premium
£

Capital redemption reserve
£

Retained earnings
£

Total
£

At 1 January 2023

83

490

19

11,210,937

11,211,529

Profit for the year

-

-

-

2,254,318

2,254,318

Dividends

-

-

-

(551,688)

(551,688)

At 31 December 2023

83

490

19

12,913,567

12,914,159

 

Purdicom Limited

Statement of Cash Flows for the Year Ended 31 December 2023

Note

2023
£

(As restated)

2022
£

Cash flows from operating activities

Profit for the year

 

2,254,318

2,683,218

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

4

176,625

142,057

Profit on disposal of tangible assets

(9,723)

-

Finance income

(1,571)

(2,418)

Income tax expense

8

709,533

622,572

 

3,129,182

3,445,429

Working capital adjustments

 

Decrease/(increase) in stocks

11

1,993,347

(8,154,686)

Decrease/(increase) in trade debtors

12

1,114,417

(4,153,177)

(Decrease)/increase in trade creditors

14

(5,876,302)

7,776,272

Cash generated from operations

 

360,644

(1,086,162)

Income taxes paid

8

(1,013,872)

(678,660)

Net cash flow from operating activities

 

(653,228)

(1,764,822)

Cash flows from investing activities

 

Interest received

1,571

2,418

Acquisitions of tangible assets

(238,923)

(110,498)

Proceeds from sale of tangible assets

 

27,512

-

Net cash flows from investing activities

 

(209,840)

(108,080)

Cash flows from financing activities

 

Payments to finance lease creditors

 

(18,852)

(7,992)

Dividends paid

(551,688)

(546,428)

Net cash flows from financing activities

 

(570,540)

(554,420)

Net decrease in cash and cash equivalents

 

(1,433,608)

(2,427,322)

Cash and cash equivalents at 1 January

 

1,905,907

4,333,229

Cash and cash equivalents at 31 December

 

472,299

1,905,907

 

Purdicom Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

1

General information

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office is:
Mitchell House
Unit 4, Woolley Barns
Wantage
Oxfordshire
OX12 8TA
United Kingdom

These financial statements were authorised for issue by the Board on 1 August 2024.

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.

Basis of preparation

These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.

Going concern

The financial statements have been prepared on a going concern basis.

Revenue recognition

Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the company’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts.

Foreign currency transactions and balances

Transactions in foreign currencies are initially recorded at an exchange rate which is updated periodically (but not daily) throughout the year. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rate on the date when the fair value is re-measured.

Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.

Tax

The tax expense for the period comprises current tax payable and deferred tax.

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

 

Purdicom Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the financial statements.

Unrelieved tax losses and other deferred tax assets are recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference.

Tangible assets

Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class

Depreciation method and rate

Leasehold improvements

Over the life of the lease

Plant and machinery

33% straight line

Furniture, fittings and equipment

33% straight line

Motor vehicles

25% - 33% straight line

Amortisation

Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:

Asset class

Amortisation method and rate

Intangible assets other than goodwill

Over 36 months

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Trade debtors

Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.

The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. At each reporting date, stocks are assessed for impairment. If stocks are 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.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers.

 

Purdicom Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Borrowings

Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the Profit and Loss Account over the period of the relevant borrowing.

Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.

Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

Provisions

Provisions are recognised when the company has an obligation at the reporting date as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee.

Assets held under finance leases are recognised at the lower of their fair value at inception of the lease and the present value of the minimum lease payments. These assets are depreciated on a straight-line basis over the shorter of the useful life of the asset and the lease term. The corresponding liability to the lessor is included in the balance sheet as a finance lease obligation.

Lease payments are apportioned between finance costs in the profit and loss account and reduction of the lease obligation so as to achieve a constant periodic rate of interest on the remaining balance of the liability.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Dividends

Dividend distribution to the company’s shareholders is recognised as a liability in the financial statements in the reporting period in which the dividends are declared.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

 

Purdicom Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

3

Revenue

The analysis of the company's Turnover for the year from continuing operations is as follows:

2023
£

2022
£

Sale of goods

43,952,076

43,866,953

4

Operating profit

Arrived at after charging/(crediting)

2023
£

2022
£

Depreciation expense

176,625

142,057

Research and development cost

(2,000)

10,493

Profit on disposal of property, plant and equipment

(9,723)

-

5

Staff costs

The aggregate payroll costs (including directors' remuneration) were as follows:

2023
£

2022
£

Wages and salaries

3,426,006

2,837,663

Social security costs

425,414

356,762

Other short-term employee benefits

33,278

25,776

Pension costs, defined contribution scheme

121,657

99,984

Other employee expense

89,487

73,080

4,095,842

3,393,265

The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:

2023
No.

2022
No.

Management

3

2

Admin

15

14

Technical support

9

8

Sales

36

32

63

56

 

Purdicom Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

6

Directors' remuneration

The directors' remuneration for the year was as follows:

2023
£

2022
£

Remuneration

438,315

317,822

Contributions paid to money purchase schemes

29,846

23,541

468,161

341,363

In respect of the highest paid director:

2023
£

2022
£

Remuneration

225,218

202,355

Company contributions to money purchase pension schemes

19,200

19,200

7

Auditors' remuneration

2023
£

2022
£

Audit of the financial statements

15,250

14,600


 

 

Purdicom Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

8

Taxation

Tax charged/(credited) in the profit and loss account

2023
£

2022
£

Current taxation

UK corporation tax

722,754

645,941

Deferred taxation

Arising from origination and reversal of timing differences

(13,221)

(23,369)

Tax expense in the income statement

709,533

622,572

The tax on profit before tax for the year is lower than the standard rate of corporation tax in the UK (2022 - higher than the standard rate of corporation tax in the UK) of 23.5% (2022 - 19%).

The differences are reconciled below:

2023
£

2022
£

Profit before tax

2,963,851

3,305,790

Corporation tax at standard rate

696,505

628,100

Tax increase from effect of capital allowances and depreciation

13,515

4,320

Effect of expense not deductible in determining taxable profit (tax loss)

26,482

13,521

Tax decrease from other tax effects

(26,969)

(23,369)

Total tax charge

709,533

622,572

 

Purdicom Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Deferred tax

Deferred tax assets and liabilities

2023

Asset
£

Liability
£

Accelerated tax depreciation

-

20,068

-

20,068

2022

Asset
£

Liability
£

Accelerated tax depreciation

-

33,289

-

33,289

9

Intangible assets

Other intangible assets
 £

Total
£

Cost or valuation

At 1 January 2023

180,000

180,000

At 31 December 2023

180,000

180,000

Amortisation

At 1 January 2023

180,000

180,000

At 31 December 2023

180,000

180,000

Carrying amount

At 31 December 2023

-

-

The aggregate amount of research and development expenditure recognised as an expense during the period is £(2,000) (2022 - £10,493).
 

 

Purdicom Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

10

Tangible assets

Long leasehold land and buildings
£

Fixtures and fittings
£

Plant and machinery
£

Motor vehicles
 £

Total
£

Cost or valuation

At 1 January 2023

28,449

95,688

298,836

114,873

537,846

Additions

-

53,762

50,262

134,899

238,923

Disposals

-

-

-

(41,495)

(41,495)

At 31 December 2023

28,449

149,450

349,098

208,277

735,274

Depreciation

At 1 January 2023

14,842

49,823

186,314

50,719

301,698

Charge for the year

7,069

37,490

78,817

53,249

176,625

Eliminated on disposal

-

-

-

(23,706)

(23,706)

At 31 December 2023

21,911

87,313

265,131

80,262

454,617

Carrying amount

At 31 December 2023

6,538

62,137

83,967

128,015

280,657

At 31 December 2022

13,607

45,865

112,522

64,154

236,148

Included within the net book value of land and buildings above is £6,538 (2022 - £13,607) in respect of long leasehold land and buildings.
 

 

Purdicom Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

11

Stocks

2023
£

2022
£

Other inventories

13,698,389

15,691,736

12

Debtors

Current

2023
£

2022
£

Trade debtors

5,722,672

8,598,881

Other debtors

2,236,735

500,421

Prepayments

160,087

134,609

 

8,119,494

9,233,911

13

Cash and cash equivalents

2023
£

2022
£

Cash on hand

103

132

Cash at bank

472,196

1,284,118

Short-term deposits

-

621,657

472,299

1,905,907

14

Creditors

Note

2023
£

2022
£

Due within one year

 

Loans and borrowings

18

-

18,852

Trade creditors

 

7,372,161

11,608,105

Social security and other taxes

 

797,576

1,349,759

Other payables

 

21,194

30,094

Accruals

 

1,169,507

2,248,782

Income tax liability

8

196,174

487,292

 

9,556,612

15,742,884

 

Purdicom Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

15

Provisions for liabilities

Deferred tax
£

Other provisions
£

Total
£

At 1 January 2023

33,289

80,000

113,289

Increase (decrease) in existing provisions

(13,221)

-

(13,221)

At 31 December 2023

20,068

80,000

100,068

16

Pension and other schemes

Defined contribution pension scheme

The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £121,657 (2022 - £99,984).

17

Share capital

Allotted, called up and fully paid shares

2023

2022

No.

£

No.

£

Oridnary shares of £0.01 each

8,300

83

8,300

83

       

18

Loans and borrowings

Current loans and borrowings

2023
£

2022
£

Hire purchase contracts

-

18,852

The company has a debt discounting facility which is secured against trade debtors. The facility available to the company at the reporting date was £5,000,000 (2022: £5,000,000) of which 85% can be borrowed against of which £nil (2022: £nil) was in use. The debt is repaid on successful recovery of qualifying sales invoices. The interest charges incurred can be seen on the income statement under interest payable. Hire purchase liabilities are secured against the assets to which they relate.
 

 

Purdicom Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

19

Obligations under leases and hire purchase contracts

Finance leases

The total of future minimum lease payments is as follows:

2023
£

2022
£

Not later than one year

-

18,852

Operating leases

The total of future minimum lease payments is as follows:

2023
£

2022
£

Not later than one year

187,500

187,500

Later than one year and not later than five years

329,167

516,667

516,667

704,167

20

Related party transactions

Other transactions with directors

At the reporting date the director H C G Garrod was owed £147 (2022: £614) from reimbursed expenses.

Dividends totalling £352,270 (2022: £348,924) were paid in the year in respect of shares held by the company's directors.

The ultimate controlling party is H C G Garrod by virtue of a majority share holding and his position as managing director.