Company registration number 03877685 (England and Wales)
GRANBY MARKETING SERVICES LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
GRANBY MARKETING SERVICES LIMITED
COMPANY INFORMATION
Directors
J Kimber
C Noblett
A Gregson
Company number
03877685
Registered office
Granby House
Stanley Street
Blackburn
Lancashire
BB1 3BW
Auditor
Azets Audit Services
Fleet House
New Road
Lancaster
United Kingdom
LA1 1EZ
GRANBY MARKETING SERVICES LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 24
GRANBY MARKETING SERVICES LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Review of the business
Principal risks and uncertainties
Granby has provided complete end to end brand fulfilment for some of the best-loved household brands and public sector organisations for over 70 years. Granby operates to connect brands with their customers through our 3PL, contract packing and promotional marketing services.
In September 2023 Granby celebrated one year as an employee-owned business and in line with this anniversary, we amended our purpose, vision, and mission statements to reflect the new journey that we are now on:
Our vision is to be the leading choice for businesses seeking innovative, comprehensive and transformative fulfilment solutions. Whilst being committed to creating a lasting legacy for our people, industry and communities.
Internal training and succession planning are a huge focus to our strategic plans to enable our future leaders of Granby to be identified and supported.
The first successful part of the succession planning, at the end of the 2023 financial year, saw Jo Kimber step down from Managing Director and move to be CEO, supporting the Leadership team strategically.
Granby continue to hold strong relationships with our clients and our supply chains and have been re-awarded all of our professional accreditations and audits undertaken in 2023.
Granby strongly believe in our internal Governance structure, reporting to the Employee trust board on a quarterly basis.
We are committed to making positive changes to develop more ethical and sustainable ways of providing the services we offer focusing on 3 key areas; more sustainable packaging, upcycling more of clients’ waste products and reducing our gross carbon footprint during despatches.
Granby have a genuine commitment to Social Value, continuing to develop our social value policies and understanding the positive impact that these have.
The outlook for 2024 is extremely exciting, focused and aligned on where we want our new business revenues to come from, continuing to look ahead to the future of Granby, further embedding our employee-owned culture, encouraging all employees to be collaborative and working together to be solution focused to achieve our strategic goals, whilst exceeding the requirements and expectations of our clients.
Embracing change by being agile and curious in finding new ways of working, using our IT roadmap to be resilient in moving forward with innovative solutions and processes.
All whilst being respectful and supportive to our colleague's health and wellbeing, our clients and our community.
The directors, and the employee trust board believe the company is in a sound position at the year end.
Key performance indicators
The directors monitor the company's performance through regular monthly reporting.
Key financial performance indicators includes: -
Turnover - £7.193m (2022 - £6.418m)
Gross profit % - 43.2% (2022 - 47.4%)
Pre-tax profit margin % - 7.9% (2022 - 12.1%)
Current ratio - 3.8 (2022 - 5.5)
Net asset level - £3.991m (2022 - £4.480m)
GRANBY MARKETING SERVICES LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
J Kimber
Director
4 July 2024
GRANBY MARKETING SERVICES LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company continued to be the provision of brand support services, offering a complete range of integrated multi-channel contact, database management, outsourced co-packing and handling and fulfilment solutions across a broad set of industry sectors, powering the mechanics behind promotional marketing in connecting the brand with the customer.
Results and dividends
The results for the year are set out on page 8.
Ordinary dividends were paid amounting to £922,500. The directors do not recommend payment of a further dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
J Kimber
C Noblett
A Gregson
Auditor
The auditor, Azets Audit Services, 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
J Kimber
Director
4 July 2024
GRANBY MARKETING SERVICES 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;
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.
GRANBY MARKETING SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF GRANBY MARKETING SERVICES LIMITED
- 5 -
Opinion
We have audited the financial statements of Granby Marketing Services Limited (the 'company') for the year ended 31 December 2023 which comprise the statement of comprehensive income, the balance sheet, 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.
GRANBY MARKETING SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GRANBY MARKETING SERVICES LIMITED
- 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.
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.
GRANBY MARKETING SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GRANBY MARKETING SERVICES LIMITED
- 7 -
Extent to which the audit was considered capable of 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 and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.
We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework. Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.
In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:
Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud;
Reviewing minutes of meetings of those charged with governance;
Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the company through enquiry and inspection;
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
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.
Susanna Cassey
Senior Statutory Auditor
For and on behalf of Azets Audit Services
15 July 2024
Chartered Accountants
Statutory Auditor
Fleet House
New Road
Lancaster
United Kingdom
LA1 1EZ
GRANBY MARKETING SERVICES LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
2023
2022
Notes
£
£
Turnover
3
7,193,151
6,417,759
Cost of sales
(4,082,587)
(3,373,301)
Gross profit
3,110,564
3,044,458
Administrative expenses
(2,542,418)
(2,266,414)
Operating profit
4
568,146
778,044
Interest receivable and similar income
7
1,814
Interest payable and similar expenses
8
(196)
Profit before taxation
569,960
777,848
Tax on profit
9
(136,260)
(98,889)
Profit for the financial year
433,700
678,959
The profit and loss account has been prepared on the basis that all operations are continuing operations.
GRANBY MARKETING SERVICES LIMITED
BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
11
11,256
33,180
Tangible assets
12
113,449
107,586
124,705
140,766
Current assets
Stocks
13
39,614
37,477
Debtors
14
4,977,362
4,570,729
Cash at bank and in hand
258,996
698,898
5,275,972
5,307,104
Creditors: amounts falling due within one year
15
(1,386,030)
(939,655)
Net current assets
3,889,942
4,367,449
Total assets less current liabilities
4,014,647
4,508,215
Provisions for liabilities
Deferred tax liability
16
23,417
28,185
(23,417)
(28,185)
Net assets
3,991,230
4,480,030
Capital and reserves
Called up share capital
18
75
75
Share premium account
19
39,900
39,900
Capital redemption reserve
20
25
25
Profit and loss reserves
3,951,230
4,440,030
Total equity
3,991,230
4,480,030
The financial statements were approved by the board of directors and authorised for issue on 4 July 2024 and are signed on its behalf by:
J Kimber
Director
Company Registration No. 03877685
GRANBY MARKETING SERVICES LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
Share capital
Share premium account
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
Balance at 1 January 2022
75
39,900
25
5,982,586
6,022,586
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
-
678,959
678,959
Dividends
10
-
-
-
(2,221,515)
(2,221,515)
Balance at 31 December 2022
75
39,900
25
4,440,030
4,480,030
Year ended 31 December 2023:
Profit and total comprehensive income for the year
-
-
-
433,700
433,700
Dividends
10
-
-
-
(922,500)
(922,500)
Balance at 31 December 2023
75
39,900
25
3,951,230
3,991,230
GRANBY MARKETING SERVICES LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
25
597,638
1,428,965
Interest paid
(196)
Income taxes paid
(73,916)
(316,578)
Net cash inflow from operating activities
523,722
1,112,191
Investing activities
Purchase of tangible fixed assets
(42,938)
(51,969)
Interest received
1,814
Net cash used in investing activities
(41,124)
(51,969)
Financing activities
Dividends paid
(922,500)
(2,221,515)
Net cash used in financing activities
(922,500)
(2,221,515)
Net decrease in cash and cash equivalents
(439,902)
(1,161,293)
Cash and cash equivalents at beginning of year
698,898
1,860,191
Cash and cash equivalents at end of year
258,996
698,898
GRANBY MARKETING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
1
Accounting policies
Company information
Granby Marketing Services Limited is a private company limited by shares incorporated in England and Wales. The registered office is Granby House, Stanley Street, Blackburn, Lancashire, BB1 3BW.
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
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
1.4
Research and development expenditure
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
1.5
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Amortisation 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:
Software
4 years straight line
GRANBY MARKETING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
1.6
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Leasehold land and buildings
4 - 7 years straight line
Fixtures and fittings
7 years straight line
Computers
2 years straight line
Motor vehicles
2 years straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.7
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible 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.
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.
1.8
Stocks
Stocks 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 stocks to their present location and condition.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks 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.
1.9
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.
GRANBY MARKETING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
1.10
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs 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.
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.
GRANBY MARKETING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. 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 creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.11
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.
1.12
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
GRANBY MARKETING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
1.13
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 fixed 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.
1.14
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.15
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.
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.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Leases
In categorising leases as finance leases or operating leases, management make judgements as to whether significant risks and rewards of ownership have transferred to the company as lessee.
Intangible and Tangible Assets
The useful life of assets, depreciation rate of tangible fixed assets and amortisation rate of intangible assets are reviewed annually and amended when necessary.
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Provision of services
7,193,151
6,417,759
GRANBY MARKETING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
3
Turnover and other revenue
(Continued)
- 17 -
2023
2022
£
£
Other revenue
Interest income
1,814
-
All turnover arose within the UK.
4
Operating profit
2023
2022
Operating profit for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
14,835
14,400
Depreciation of owned tangible fixed assets
37,075
36,472
Amortisation of intangible assets
21,924
25,570
Operating lease charges
330,199
225,601
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Production
136
107
Administration
26
31
Total
162
138
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
3,612,612
3,016,908
Social security costs
165,994
178,304
Pension costs
143,631
64,861
3,922,237
3,260,073
GRANBY MARKETING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
188,156
305,681
Company pension contributions to defined contribution schemes
101,951
28,725
290,107
334,406
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2022 - 4).
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
n/a
143,456
Company pension contributions to defined contribution schemes
n/a
7,108
As total directors' remuneration in respect of qualifying services was less than £200,000 in the current year, no disclosure is provided for that year.
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Other interest income
1,814
8
Interest payable and similar expenses
2023
2022
£
£
Other finance costs:
Other interest
196
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
141,035
102,923
Adjustments in respect of prior periods
(7)
Total current tax
141,028
102,923
GRANBY MARKETING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
9
Taxation
2023
2022
£
£
(Continued)
- 19 -
Deferred tax
Origination and reversal of timing differences
(4,768)
(4,034)
Total tax charge
136,260
98,889
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
569,960
777,848
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
134,055
147,791
Tax effect of expenses that are not deductible in determining taxable profit
2,227
1,279
Effect of change in corporation tax rate
(282)
(968)
Group relief
(3)
Depreciation on assets not qualifying for tax allowances
521
539
Research and development tax credit
(14,612)
Under/(over) provided in prior years
(7)
Effect of superdeduction
(254)
(655)
Grant of EMI options
(34,482)
Taxation charge for the year
136,260
98,889
10
Dividends
2023
2022
£
£
Final paid
922,500
2,221,515
GRANBY MARKETING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
11
Intangible fixed assets
Software
£
Cost
At 1 January 2023 and 31 December 2023
330,180
Amortisation and impairment
At 1 January 2023
297,000
Amortisation charged for the year
21,924
At 31 December 2023
318,924
Carrying amount
At 31 December 2023
11,256
At 31 December 2022
33,180
12
Tangible fixed assets
Leasehold land and buildings
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2023
160,612
269,611
453,041
14,995
898,259
Additions
25,898
17,040
42,938
Disposals
(13,000)
(13,000)
At 31 December 2023
160,612
282,509
470,081
14,995
928,197
Depreciation and impairment
At 1 January 2023
106,199
219,982
449,497
14,995
790,673
Depreciation charged in the year
15,173
12,278
9,624
37,075
Eliminated in respect of disposals
(13,000)
(13,000)
At 31 December 2023
121,372
219,260
459,121
14,995
814,748
Carrying amount
At 31 December 2023
39,240
63,249
10,960
113,449
At 31 December 2022
54,413
49,629
3,544
107,586
13
Stocks
2023
2022
£
£
Finished goods and goods for resale
39,614
37,477
GRANBY MARKETING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
14
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
1,244,538
856,274
Corporation tax recoverable
20,077
Amounts owed by group undertakings
3,612,035
3,612,035
Other debtors
133
Prepayments and accrued income
120,789
82,210
4,977,362
4,570,729
15
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
246,299
278,193
Corporation tax
47,035
Other taxation and social security
398,231
218,940
Other creditors
593,198
331,182
Accruals and deferred income
101,267
111,340
1,386,030
939,655
16
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
28,127
31,448
Short term timing differences
(4,710)
(3,263)
23,417
28,185
2023
Movements in the year:
£
Liability at 1 January 2023
28,185
Credit to profit or loss
(4,768)
Liability at 31 December 2023
23,417
The deferred tax liability set out above is expected to reverse within 12 months and relates to accelerated capital allowances that are expected to mature within the same period.
GRANBY MARKETING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
17
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
143,631
64,861
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.
The outstanding contributions at the end of the financial period amounted to £17,455 (2022 - £15,591).
18
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
75
75
75
75
19
Share premium account
The share premium account represents the amount received on a share issue which are in excess of the nominal value of shares issued.
20
Capital redemption reserve
The capital redemption reserve represents non-distributable reserves resulting from the purchase of the company's own shares.
21
Financial commitments, guarantees and contingent liabilities
The company is party to a composite guarantee with its parent company, Granby Marketing Solutions Limited, whereby each guarantee the bank indebtedness of the other party. At the balance sheet date the maximum liability was £493,156 (2022 - £198,382).
22
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
106,810
76,055
Between two and five years
4,203
22,768
111,013
98,823
GRANBY MARKETING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
23
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel is as follows.
2023
2022
£
£
Aggregate compensation
427,454
651,227
Transactions with related parties
During the year the company entered into the following transactions with related parties:
The principal place of business of the company is owned by a close family relative of a company director who resigned in the prior year. Rent paid during the period of directorship was £Nil (2022 - £11,875). The amount owed to the related party by the company as at the year ended date was £Nil (2022 - £Nil).
Other information
The company has taken advantage of the exemption contained in Section 33 of Financial Reporting Standard 102 'Related Party Disclosures' from disclosing transactions entered into between two or more members of a group, provided that any subsidiary which is a party to the transaction is wholly owned by such a member.
24
Ultimate controlling party
The Company's immediate parent company is Granby Marketing Solutions Limited.
Granby (EOT) Limited is the ultimate parent company.
25
Cash generated from operations
2023
2022
£
£
Profit for the year after tax
433,700
678,959
Adjustments for:
Taxation charged
136,260
98,889
Finance costs
196
Investment income
(1,814)
Amortisation and impairment of intangible assets
21,924
25,570
Depreciation and impairment of tangible fixed assets
37,075
36,472
Movements in working capital:
Increase in stocks
(2,137)
(91)
(Increase)/decrease in debtors
(426,710)
582,462
Increase in creditors
399,340
6,508
Cash generated from operations
597,638
1,428,965
GRANBY MARKETING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
26
Analysis of changes in net funds
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
698,898
(439,902)
258,996
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