Company registration number 03141268 (England and Wales)
SATAIR UK LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
SATAIR UK LIMITED
COMPANY INFORMATION
Directors
M Vaquerizo Sanchez
J S Rose
(Appointed 1 July 2023)
R Stoddart
(Appointed 1 September 2023)
Company number
03141268
Registered office
Unit 3 Space Waye
North Feltham Trading Estate
Feltham
Middlesex
TW14 0TH
Auditor
Glazers
843 Finchley Road
London
NW11 8NA
Business address
Unit 3 Space Waye
North Feltham Trading Estate
Feltham
Middlesex
TW14 0TH
SATAIR UK LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Income statement
8
Statement of comprehensive income
9
Statement of financial position
10
Statement of changes in equity
11
Statement of cash flows
12
Notes to the financial statements
13 - 25
SATAIR UK LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Principal activities
Satair UK Limited is in the business of distribution & maintenance of aircraft main and emergency batteries for commercial airlines, helicopter, military and corporate market sectors of the aerospace aftermarket industry.
Our parent company, Satair A/S is a global distributor of aircraft spares and services primarily for the aftermarket and has headquarters in Copenhagen, Denmark. Satair A/S is in turn part of Airbus SE; a company listed in France, Germany and Spain and registered in the Netherlands.
The company operates in the following principal areas of activity:
The maintenance of batteries (including maintenance, overhaul, repair, services) also known as Battery workshop
The distribution of new batteries
The provision of FHS (Flight Hour Services) derives from an inter-company business, focused on the distribution of parts and support the delivery of the contracts held between Airbus and commercial airlines.
Business review
During 2023, Satair UK has also introduced the distribution of Pall Filters (Q4 2023) which contributed to balancing the workload after the re-scope of the FHS contract. In, 2023 VAS (sister company acquired by Satair A/S in June 2022) signed an Operating lease with Satair UK and will continue to operate as a separate business. It is planned for 2024 that VAS Limited employees will be transferred.
The profit after taxation for the financial year was £1,207,083 (2022: £190,848). Representing a significant increase from the previous year due to the overall good performance of the group.
Principal risks and uncertainties
Satair UK is continually engaged in efforts to identify measures and where possible mitigate risk exposure. Outlined below is a list of these risks. This is not an exhaustive list nor are the risks listed in any priority.
Competition and prices
Satair UK's Director identified a risk due to inflation, a significant increase in operating expenses, including wages. As a consequence Satair UK reviews pricing policy on an annual basis and market to monitor evolution and financial impact. The Company is able to recover its cost from customers and other entities within the group.
Foreign currency exposure
The majority of our stock is bought in either USD or EUR and so the majority of our sales is then converted to GBP at prevailing rates at the time of delivery. The company does not use financial instruments to hedge its exposure and relies on the natural hedged protection of its contracts and supply chain.
Credit, liquidity and cash flow risk
The directors consider this risk limited as Satair UK also uses the cash and overdraft borrowing provided by Satair A/S / Airbus SAS. In 2024 it is planned to increase cash liability from the group to 15M€ as the new distribution line grows.
SATAIR UK LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Key performance indicators
The on time delivery for the distribution business is being constant at 99% despite the increase of activity due to the new distribution business line. The FHS distribution continues to be recognised as a benchmark warehouse within the group.
The performance of the repair workshop has been steady in terms of growth and at 95% performance.
Future Development
The Board continuously reviews which relationships support the generation and preservation of value in the Company. The Directors consider that during 2022 the recovery of the sector has consolidated and does not foresee significant changes in upcoming years. The forecast for the distribution and maintenance of batteries business lines is to continue with that trend.
Business relationship with Suppliers
Satair UK has distributorships or sales agreements with the major battery manufactures around the world and as such, we are highly dependent upon our suppliers. The risk is reduced by not having exclusive rights and by having a number of differing distributorships with main OEM’s. Overtime, Satair UK has also developed its credentials being one of the largest Battery workshops in Europe to increase services under those sales agreements and position itself as key partner.
Business relationship with Customers
Satair UK provide services to in excess of 170 customers and augment sales via intercompany sales to out of territory-based users.
Technology
Much of the technology used is tried & tested and new technology introduction is a long and complicated process requiring type approval & extensive testing. There is no doubt that new technology will at some time be proven and Satair UK is closely monitoring developments on OEM’s such as solid electrolyte batteries and what is happening in other sectors such as automotive and solar.
Most importantly to mention, the need to develop the new generation of technicians to maintain skills and competences needed to sustain the business operations. Satair UK relies on in-house development and apprenticeship programmes.
M Vaquerizo Sanchez
Director
12 August 2024
SATAIR UK LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
The directors present their report and financial statements for the year ended 31 December 2023.
Results and dividends
The results for the year are set out on page 8.
The company’s business activities, together with the facts likely to affect its future development and position are set out in the strategic report.
The Directors conclude that the requirement of the UK business operations continues.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
H Reijnen
(Resigned 31 July 2023)
A Bonnaud
(Resigned 30 June 2023)
M Vaquerizo Sanchez
J S Rose
(Appointed 1 July 2023)
R Stoddart
(Appointed 1 September 2023)
Auditor
The auditor, Glazers, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
On behalf of the board
M Vaquerizo Sanchez
Director
12 August 2024
SATAIR UK LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
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.
SATAIR UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SATAIR UK LIMITED
- 5 -
Opinion
We have audited the financial statements of Satair UK Limited (the 'company') for the year ended 31 December 2023 which comprise the income statement, the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
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.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
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.
SATAIR UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SATAIR UK LIMITED (CONTINUED)
- 6 -
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 remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
We gained an understanding of the legal and regulatory framework applicable to the company and the sector in which it operates, and considered the risk of acts by the company that were contrary to applicable laws and regulations, including fraud. We designed audit procedures to respond to the risk, recognising that 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.
We focussed on law and regulations which could give rise to material misstatements in the financial statements, including, but not limited to, the Companies Act 2006 and UK tax legislation. Our tests included agreeing the financial statements disclosures to underlying supporting documentation and enquiries with management. 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. We did not identify any key audit matters relating to irregularities, including fraud. As in all our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
SATAIR UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SATAIR UK LIMITED (CONTINUED)
- 7 -
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.
Paraskumar Shah FCA
Senior Statutory Auditor
For and on behalf of Glazers
15 August 2024
Chartered Accountants
Statutory Auditor
843 Finchley Road
London
NW11 8NA
SATAIR UK LIMITED
INCOME STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
2023
2022
Notes
£
£
Revenue
3
19,562,678
14,033,295
Cost of sales
(18,981,265)
(13,372,487)
Gross profit
581,413
660,808
Distribution costs
(20,580)
(113,664)
Administrative expenses
(2,371,597)
(493,633)
Other operating income
3,415,639
150,456
Operating profit
4
1,604,875
203,967
Investment income
8
5,771
62,551
Finance costs
9
(70,795)
(6,338)
Profit before taxation
1,539,851
260,180
Tax on profit
10
(332,768)
(69,332)
Profit for the financial year
1,207,083
190,848
The income statement has been prepared on the basis that all operations are continuing operations.
SATAIR UK LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
£
£
Profit for the year
1,207,083
190,848
Other comprehensive income
-
-
Total comprehensive income for the year
1,207,083
190,848
SATAIR UK LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
Notes
£
£
£
£
Non-current assets
Property, plant and equipment
11
715,842
877,882
Current assets
Inventories
13
15,118,817
3,399,922
Trade and other receivables
14
5,423,744
5,712,953
20,542,561
9,112,875
Current liabilities
15
(12,789,641)
(2,712,611)
Net current assets
7,752,920
6,400,264
Total assets less current liabilities
8,468,762
7,278,146
Provisions for liabilities
Deferred tax liability
17
43,831
60,298
(43,831)
(60,298)
Net assets
8,424,931
7,217,848
Equity
Called up share capital
19
125,000
125,000
Retained earnings
8,299,931
7,092,848
Total equity
8,424,931
7,217,848
The financial statements were approved by the board of directors and authorised for issue on 12 August 2024 and are signed on its behalf by:
M Vaquerizo Sanchez
Director
Company registration number 03141268 (England and Wales)
SATAIR UK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Retained earnings
Total
£
£
£
Balance at 1 January 2022
125,000
6,902,000
7,027,000
Year ended 31 December 2022:
Profit and total comprehensive income
-
190,848
190,848
Balance at 31 December 2022
125,000
7,092,848
7,217,848
Year ended 31 December 2023:
Profit and total comprehensive income
-
1,207,083
1,207,083
Balance at 31 December 2023
125,000
8,299,931
8,424,931
SATAIR UK LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
23
163,033
(3,162,466)
Interest paid
(70,795)
(6,338)
Income taxes paid
(108,421)
(251,912)
Net cash outflow from operating activities
(16,183)
(3,420,716)
Investing activities
Purchase of property, plant and equipment
(23,687)
Interest received
5,771
62,551
Net cash generated from investing activities
5,771
38,864
Net decrease in cash and cash equivalents
(10,412)
(3,381,852)
Cash and cash equivalents at beginning of year
(4,186)
3,377,666
Cash and cash equivalents at end of year
(14,598)
(4,186)
Relating to:
Bank overdrafts included in creditors payable within one year
(14,598)
(4,186)
SATAIR UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
1
Accounting policies
Company information
Satair UK Limited is a private company limited by shares incorporated in England and Wales. The registered office is Unit 3 Space Waye, North Feltham Trading Estate, Feltham, Middlesex, TW14 0TH.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention The principal accounting policies adopted are set out below.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Revenue
Revenue is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on despatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Revenue from the provision of services, which relates to the re-charge and servicing of aviation batteries, is recognised once the service has been completed and despatched for return to the customer.
1.4
Property, plant and equipment
Property, plant and equipment are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Land and buildings Leasehold
Over the term of the lease
Plant and machinery
Over 10 years
Fixtures, fittings & equipment
Over 7 years
Computer equipment
Over 3 years
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
SATAIR UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
1.5
Impairment of non-current assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
Inventories
Inventories are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost 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.
Inventories held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of inventories over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.7
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
SATAIR UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Basic financial assets
Basic financial assets, which include trade and other receivables and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Trade receivables, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as 'loans and receivables'. Loans and receivables are measured at amortised cost using the effective interest method, less any impairment.
Interest is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial. The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating the interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the debt instrument to the net carrying amount on initial recognition.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
SATAIR UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
Basic financial liabilities
Basic financial liabilities, including trade and other payables, 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. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Derivatives
Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.
A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.
1.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
SATAIR UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred taxation is provided in full in respect of taxation deferred by timing differences between the treatment of certain items for taxation and accounting purposes. The deferred tax balance has not been discounted.
Deferred tax assets are recognised only to the extent that the directors consider that it is more likely than not that there will be suitable taxable profits from which the future reversal of the underlying timing differencies can be deducted.
1.12
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or non-current assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
1.15
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
SATAIR UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
3
Revenue
An analysis of the company's revenue is as follows:
2023
2022
£
£
Revenue analysed by class of business
Sales of goods and services
19,562,678
14,033,295
2023
2022
£
£
Revenue analysed by geographical market
Europe and UK
13,755,634
10,889,880
Asia
4,330,796
2,116,783
USA
1,466,678
1,010,557
Other
9,570
16,075
19,562,678
14,033,295
2023
2022
£
£
Other revenue
Interest income
5,771
62,551
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
138,094
(531,289)
Depreciation of owned property, plant and equipment
162,040
162,084
Operating lease charges
327,917
327,774
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
18,000
17,000
SATAIR UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Directors
1
1
Sales and operations staff
27
30
Administrative staff
2
2
Total
30
33
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
1,410,607
1,440,936
Social security costs
148,860
151,799
Pension costs
122,584
108,823
1,682,051
1,701,558
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
158,788
109,808
Company pension contributions to defined contribution schemes
11,660
11,000
170,448
120,808
8
Investment income
2023
2022
£
£
Interest income
Other interest income
5,771
62,551
9
Finance costs
2023
2022
£
£
Other finance costs:
Other interest
70,795
6,338
SATAIR UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
(Continued)
- 20 -
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
385,886
59,144
Adjustments in respect of prior periods
(36,651)
Total current tax
349,235
59,144
Deferred tax
Origination and reversal of timing differences
(16,467)
10,188
Total tax charge
332,768
69,332
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Profit before taxation
1,539,851
260,180
Expected tax charge based on the standard rate of corporation tax in the UK of 23.50% (2022: 19.00%)
361,865
49,434
Tax effect of expenses that are not deductible in determining taxable profit
39,500
12,644
Adjustments in respect of prior years
(36,651)
Permanent capital allowances in excess of depreciation
(15,479)
(2,934)
Deferred tax adjustments
(16,467)
10,188
Taxation charge for the year
332,768
69,332
SATAIR UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
11
Property, plant and equipment
Land and buildings Leasehold
Plant and machinery
Fixtures, fittings & equipment
Computer equipment
Total
£
£
£
£
£
Cost
At 1 January 2023 and 31 December 2023
281,890
1,259,430
112,127
121,790
1,775,237
Depreciation and impairment
At 1 January 2023
84,569
618,915
72,081
121,790
897,355
Depreciation charged in the year
18,793
127,229
16,018
162,040
At 31 December 2023
103,362
746,144
88,099
121,790
1,059,395
Carrying amount
At 31 December 2023
178,528
513,286
24,028
715,842
At 31 December 2022
197,321
640,515
40,046
877,882
12
Financial instruments
2023
2022
£
£
Carrying amount of financial assets
Debt instruments measured at amortised cost
4,299,478
4,608,296
Carrying amount of financial liabilities
Measured at amortised cost
12,560,548
2,604,561
13
Inventories
2023
2022
£
£
Finished goods and goods for resale
15,118,817
3,399,922
14
Trade and other receivables
2023
2022
Amounts falling due within one year:
£
£
Trade receivables
733,394
840,888
Corporation tax recoverable
89,499
Amounts owed by group undertakings
3,133,745
3,767,408
Other receivables
945,975
Prepayments and accrued income
610,630
1,015,158
5,423,744
5,712,953
Trade receivables disclosed above are measured at amortised cost.
SATAIR UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
15
Current liabilities
2023
2022
Notes
£
£
Bank loans and overdrafts
16
14,598
4,186
Trade payables
3,143,217
2,111,601
Amounts owed to group undertakings
9,024,274
Corporation tax
151,315
Other taxation and social security
77,778
108,050
Accruals and deferred income
378,459
488,774
12,789,641
2,712,611
SATAIR UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
16
Borrowings
2023
2022
£
£
Bank overdrafts
14,598
4,186
Payable within one year
14,598
4,186
17
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2023
2022
Balances:
£
£
ACAs
43,831
60,298
2023
Movements in the year:
£
Liability at 1 January 2023
60,298
Credit to profit or loss
(16,467)
Liability at 31 December 2023
43,831
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so.
18
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
122,584
108,823
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
SATAIR UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
19
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
125,000
125,000
125,000
125,000
20
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
277,046
278,338
Between two and five years
1,108,184
1,108,184
In over five years
1,062,010
1,339,056
2,447,240
2,725,578
21
Related party transactions
Transactions with related parties
The company has taken advantage of the exemption available in FRS 102 "Related party disclosures" whereby it has not disclosed transactions with the ultimate parent company or any wholly owned subsidiary undertaking of the group.
22
Ultimate controlling party
The immediate parent company is Satair A/S, a company incorporated in Denmark.
The ultimate parent company is Airbus SE., a company listed and registered in the Netherlands. The consolidated financial statements of Airbus SE. are publically available at www.airbus.com.
SATAIR UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 25 -
23
Cash generated from/(absorbed by) operations
2023
2022
£
£
Profit for the year after tax
1,207,083
190,848
Adjustments for:
Taxation charged
332,768
69,332
Finance costs
70,795
6,338
Investment income
(5,771)
(62,551)
Depreciation and impairment of property, plant and equipment
162,040
162,084
Movements in working capital:
(Increase)/decrease in inventories
(11,718,895)
129,980
Decrease/(increase) in trade and other receivables
199,710
(4,266,463)
Increase in trade and other payables
9,915,303
607,966
Cash generated from/(absorbed by) operations
163,033
(3,162,466)
24
Analysis of changes in net debt
1 January 2023
Cash flows
31 December 2023
£
£
£
Bank overdrafts
(4,186)
(10,412)
(14,598)
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