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REGISTERED NUMBER: 01231883 (England and Wales)















STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

FOR

HOLDCROFT HONDA LIMITED

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

CONTENTS OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023










Page

Company Information 1

Strategic Report 2 to 5

Report of the Directors 6 to 7

Report of the Independent Auditors 8 to 11

Statement of Income and Retained Earnings 12

Statement of Financial Position 13

Notes to the Financial Statements 14 to 23


HOLDCROFT HONDA LIMITED

COMPANY INFORMATION
FOR THE YEAR ENDED 31 DECEMBER 2023







DIRECTORS: T G Holdcroft
M E Holdcroft
D A Holdcroft
M J McCormick
C Greenhall
P Holdcroft



REGISTERED OFFICE: C/o TG Holdcroft (Motors) Ltd
Leek Road
Hanley
Stoke on Trent
Staffordshire
ST1 6AT



BUSINESS ADDRESS: Sneyd Street
Cobridge
Stoke on Trent
Staffordshire
ST6 2PB



REGISTERED NUMBER: 01231883 (England and Wales)



AUDITORS: DPC Accountants Limited
Stone House
Stone Road Business Park
Stoke on Trent
ST4 6SR



BANKERS: Barclays Bank Plc
Town Road
Hanley
Stoke On Trent
Staffordshire
ST1 2PJ

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023


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

PRINCIPAL ACTIVITY AND REVIEW OF THE BUSINESS
The principal activity of the company is that of motor vehicle sales, motor vehicle servicing, motor vehicle repairs and motor vehicle parts sales. Holdcroft Honda Ltd represents the Honda brand in Stoke on Trent, Ellesmere Port (Cheshire Oaks) & Warrington. It also represents the MG Motor brand which is operated from Stoke on Trent, Ellesmere Port (Cheshire Oaks) and Warrington.

2023 has been a challenging year for the organisation with several outside factors having a negative impact to the overall profitability of the business. Interest charges being the one that has had the greatest impact with an 164% increase in Stocking plan interest versus 2022.

We believe the trading of this company has now reached the bottom of a cycle that has arisen from a number of factors including a reduction new vehicle sales within the Honda network in the UK, a shrinkage in aftersales opportunity linked directly to this unit reduction and from an MG perspective, a brand in its infancy that is building a customer base that will provide both and aftersales and used car opportunity for future years. The investment in facility costs and employment costs attributed to this have outweighed the gains this financial year, however we believe the green shoots can be seen and the 2024 result will be a much-improved picture.

Our sales departments continued to perform to a very high level and are navigating a changing new vehicle marketplace with the migration from traditional combustion engines to more environmentally friendly Hybrid and Electric vehicles. The range of vehicles available from both the Honda and MG Motor brands sit well in the market and new products launched through the year have been well received by our customers.

New car retail unit sales for the Honda brand decreased versus the 2022 year by around 5.6% which is slightly better than others have performed in the overall new car retail marketplace. We also saw a reduction in the Motability sales channel for Honda with 19 fewer vehicles sold than in 2022, this is opposite to all our other brands and demonstrates the current aims of Honda to concentrate efforts on the Retail market within the UK. We saw and dramatic increase in the number of MG Motor new car retail sales through 2023 with 755 units being delivered. This is an increase of 302 units on the 2022 result. The Motability sales of MG Motor also increased by a huge 144.6% with a total of 570 units being delivered. Our corporate department also benefited from a high number of MG Motor sales through 2023 although a significant proportion of these orders were carried over from 2022.

The aftersales departments of our Honda businesses have been under considerable pressure again this year as the number of Honda vehicles on the UK roads has decreased over the past 5 years. From an MG Motor perspective, we have seen significant growth with an ever-increasing number of units being driven on our roads. Our Parts trade division in particular continues to win additional business and provides an efficient, reliable and competitive service to franchised dealers, independent garages and accident repair centres across a large geographical area from the south midlands to the north of Manchester.

Customer satisfaction remains at the heart of our business and we are committed to providing an industry leading consumer journey for all of our customers. Throughout the year we have harvested feedback using several independent platforms from many satisfied customers. They highlight product knowledge, good attitude and professionalism as the top characteristics they see in our sales teams. We will continue to invest in our employees through training and development to ensure they have the ability to deliver customer service at the highest possible level. Through 2024 we will implement a new internship scheme where we will develop the next generation of talent that will take our business forward. This scheme will expose individuals to each department of a retail motor dealership, also head office functions such as Accounts and Marketing to give a fully rounded education. Our people have always and will always be our most important asset and their representation of our culture will not be left to chance.

The needs of our customers, employees, suppliers and business stakeholders required careful consideration through the many key decision making points during the year and the senior management team of our Holdcroft Honda outlets have again risen to these challenges.

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023


2024 will bring its own set of challenges and obstacles for us to overcome but with a strong, stable leadership team we will endeavour to make the speedy decisions for the benefit of all our stakeholders within the organisation.

FUTURE DEVELOPMENTS
The company continues to develop both current and new relationships with our OEM, finance, insurance and technology partners in pursuit of opportunities to enhance the organisation for the future. We have an open dialogue with a number of new OEM entrants that are looking to expand into both the European and the UK market and any decision we take will be with the best interests of all of our enlightened shareholders at the forefront. The only certainty within the retail motor industry for the medium term is change, and we, as an organisation, aim to ensure that we engage with all partners and fully explore all opportunities on their own merits as these present themselves.

We will continue investments in technology to advance both our customer experiences as well as that of our employees and be open minded to new initiatives that the changing landscape of global retail in general is experiencing. Within our businesses the focus of the senior team is always on the future and making changes that will benefit the entire organisation on multiple levels.

PRINCIPAL RISKS AND UNCERTAINTIES
There are a range of risks and uncertainties facing the company and the comments listed below are not intended to be exhaustive. The focus is on those specific risks and uncertainties that the Directors believe could have a significant impact on the company's performance.

As with many organisations of our size, the business environment in which we operate continues to be challenging. The retail vehicle market in the UK is undergoing significant changes to product availability with many new entrants coming into the UK market. With such a high level of choice for the consumer it will make it difficult for traditional market participants to retain their current share. We will continue to work closely with our current manufacturer partners as well as exploring opportunities with new entrants if they are in the best interests of our overall objectives.

CO2 emission regulations will also have a significant effect on the industry over the coming years with the UK government extending their deadline for the phasing out of Petrol and Diesel cars and other vehicles by 2030 to 2035. We still feel there are huge upgrades required to the charging infrastructure in the UK to be able to accommodate this increase in the number of Electric Vehicles that will be on our roads and it remains an open question how this will be achieved.

A significant number of vehicle manufacturers continue to push forward with their "direct to customer" new car sales model. This will see a huge change from the traditional dealer / customer relationship and it brings with it an uncertainty around the financial outcomes for franchised dealers.

Ultimately levels of business activity and profitability will be affected by outside factors such as consumer confidence and product cycles but we will continue to follow our processes and business principles to achieve our financial goals.

The company will strive to provide an innovative service to its existing client base, alongside continued exploitation of all the internet & social media platforms to develop in a profitable way, in what still remains to be an extremely price sensitive market.

With these risks and uncertainties in mind, we are aware that any plans for the future development of the group may be subject to unforeseen events outside of our control.


HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

ETHOS
The ongoing priorities of the business are to consolidate our position and culture within the communities we serve by providing a total customer experience from the initial sales process through to customer service, support and satisfaction. A comprehensive internal and external training and coaching program further supports our aims in providing an unrivalled, consultative experience for all our customers. By achieving this we aim to lead our industry as "the best place to work" for all our employees.

REGULATORY COMPLIANCE
The company is subject to regulatory compliance risk which could arise from a failure to comply with relevant law, regulation or codes of practice. Failure to comply would result in fines, cessation of some business activities or a public reprimand. The company mitigates this risk through a close monitoring and audit of regulatory compliance.

ENVIRONMENTAL POLICY
The company recognises its "Duty of Care" towards the environment whilst carrying out its business activities. The company always places considerable importance on complying with both legal and moral obligations towards the environment.

The company aims to encourage the reduction of energy and water consumption. Use is made of the latest building materials in the construction of new sites and the refurbishment of existing locations. For instance, modern heating and lighting controls are used. The company will assess any and all significant environmental impacts from its operations and will take the appropriate steps to reduce and manage these risks.


HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

FINANCIAL KEY PERFORMANCE INDICATORS
The Directors monitor the company's progress against its strategic objectives and the financial performance of the company's operations on an extremely regular basis. We consider that our key financial performance indicators are those that communicate the financial performance and strength of the company as a whole; these being turnover, gross margin, return on sales and return on capital employed.

Turnover (Growth)

Growth comes from taking considered risks after studying and analysing our market place in conjunction with the new product offerings available to us.

For the financial year to 31st December 2023 turnover was £140,593,529 versus £89,468,047 for the same period in 2022. The increase in overall MG Motor new unit volumes was the main factor to this increase.

Gross Margin

This year's gross margin was £8,368,460 versus a 2022 result of £8,076,051 although the overall value has increased the margin percentage has reduced from 9.03% to 5.95% which is directly linked to the mix of new car business being weighted towards the corporate sector.

Return on Sales

The return on sales for 2023 has reduced to a negative of -0.05% versus 0.61% (pre-taxation) in 2022.

Return on Capital Employed

There are a number of methods employed to calculate this particular ratio. The method we have adopted is as follows:-

Pre-tax net profit / net asset value x 100

Return on capital employed at 31st December 2023 was -7.08% versus 52.00% in the year to 31st December 2022.

ON BEHALF OF THE BOARD:





C Greenhall - Director


29 July 2024

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

REPORT OF THE DIRECTORS
FOR THE YEAR ENDED 31 DECEMBER 2023


The directors present their report with the financial statements of the company for the year ended 31 December 2023.

DIVIDENDS
Dividends paid during the year amounted to nil (2022 £600,000.) The directors have recommended that there be no final dividend.

FUTURE DEVELOPMENTS
The likely future developments of the business are included in the strategic report.

EVENTS SINCE THE END OF THE YEAR
Information relating to events since the end of the year is given in the notes to the financial statements.

DIRECTORS
The directors shown below have held office during the whole of the period from 1 January 2023 to the date of this report.

T G Holdcroft
M E Holdcroft
D A Holdcroft

Other changes in directors holding office are as follows:

S Holdcroft-Carr - resigned 16 May 2023
M J McCormick - appointed 4 July 2023
C Greenhall - appointed 4 July 2023
P Holdcroft - appointed 4 July 2023

GOING CONCERN DISCLOSURE
The Group meets its day-to-day working capital requirements through its bank provided finance facilities and vehicle stocking loans. The Group's forecast and projections, taking account of reasonably possible changes in trading performance, show that the Group should easily be able to operate within the level of its current facilities. The Group has regular discussions with its bankers about its current and future borrowing needs and understands that future requirements will be agreed on acceptable terms. Our overdraft facilities have been renewed post year end with our bankers, Barclays Bank and we will be also reviewing our medium-term borrowings through 2024 with them.

The 2023 year has seen the company make an operating loss, however, this is not typical of recent years and is not expected going forward. We have already seen an increase in new car volumes in the early stages of 2024 from the Honda franchise with a strong tactical offer being employed by the brand to kickstart the sale of the e:Ny1 Electric Vehicle. MG new car volumes are behind 2023 across the UK but with a much improving aftersales and used car opportunity we are extremely confident that the profitability of the overall company will be significantly improved in 2024 and beyond.

The Directors have a reasonable expectation that the Company and Group have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the annual report and financial statements.

DISCLOSURE IN THE STRATEGIC REPORT
The company has chosen in accordance with section 414C(11) of the Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013 to set out in the company's strategic report information required by schedule 7 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 in relation to future developments of the company.

The strategic report can be found on page 2 to 4 of these financial statements.


HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

REPORT OF THE DIRECTORS
FOR THE YEAR ENDED 31 DECEMBER 2023

STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Strategic Report, the Report of the Directors 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.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS
The auditors are deemed to have been re-appointed in accordance with section 487 of the Companies Act 2006.

ON BEHALF OF THE BOARD:





C Greenhall - Director


29 July 2024

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
HOLDCROFT HONDA LIMITED


Opinion
We have audited the financial statements of HOLDCROFT HONDA LIMITED (the 'company') for the year ended 31 December 2023 which comprise the Statement of Income and Retained Earnings, Statement of Financial Position 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 loss 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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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.

Other information
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors 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 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 the audit:
- the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
HOLDCROFT HONDA LIMITED


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 Report of the Directors.

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 seven, 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 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.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
HOLDCROFT HONDA LIMITED


Auditors' 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 a Report of the Auditors 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 identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.

Identifying and assessing potential risks related to irregularities
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:

o the nature of the industry and sector, control environment and business performance including the design of the Company's remuneration policies, key drivers for directors' remuneration, bonus levels and performance targets;
o results of our enquiries of management about their own identification and assessment of the risks of irregularities;
o any matters we identified having obtained and reviewed the Company's documentation of their policies and procedures relating to:


o
Identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of noncompliance;


o
detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;


o
the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;
o the matters discussed among the audit engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.

Based on this approach, we were able to assess the Company risks and ensure the risks were considered throughout all areas of audit testing. The audit team was professionally sceptical throughout the audit and remained alert for inaccurate or misleading information.

Audit response to risks identified

As a result of performing the above, we identified Financial Conduct Authority and Health and Safety compliance risk as key audit matters related to the potential risk of fraud or irregularities.

Our procedures to respond to risks identified included the following:
o reviewing any audits completed by regulatory bodies in the year and the outcomes of these to ensure no breach of laws and regulations;
o reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
o enquiring of management concerning actual and potential litigation and claims;
o performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
o obtained an understanding of provisions and held discussions with management to understand the basis of recognition or non-recognition of tax provisions; and
o in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
HOLDCROFT HONDA LIMITED


Audit testing was completed on a targeted sample basis based on our assessment of risk and materiality. Due to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing fraud or non-compliance with laws and regulations and cannot be expected to detect all fraud and non-compliance with laws and regulations.

As part of an audit in accordance with ISAs (UK), we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
- 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. 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.
- Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company's internal control.
- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
- Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our Report of the Auditors to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our Report of the Auditors. However, future events or conditions may cause the company to cease to continue as a going concern.
- Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

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 a Report of the Auditors 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.




MICHELLE COATES (Senior Statutory Auditor)
for and on behalf of DPC Accountants Limited
Stone House
Stone Road Business Park
Stoke on Trent
ST4 6SR

30 July 2024

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 DECEMBER 2023

31.12.23 31.12.22
Notes £    £   

TURNOVER 4 140,593,529 89,468,047

Cost of sales (132,225,069 ) (81,391,996 )
GROSS PROFIT 8,368,460 8,076,051

Distribution costs (172,191 ) (110,344 )
Administrative expenses (7,875,140 ) (7,206,148 )
OPERATING PROFIT 6 321,129 759,559


Interest payable and similar expenses 8 (390,425 ) (214,814 )
(LOSS)/PROFIT BEFORE TAXATION (69,296 ) 544,745

Tax on (loss)/profit 9 - (144,819 )
(LOSS)/PROFIT FOR THE FINANCIAL
YEAR

(69,296

)

399,926

Retained earnings at beginning of year 540,141 740,215

Dividends 10 - (600,000 )

RETAINED EARNINGS AT END OF
YEAR

470,845

540,141

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

STATEMENT OF FINANCIAL POSITION
31 DECEMBER 2023

31.12.23 31.12.22
Notes £    £   
FIXED ASSETS
Intangible assets 11 535,889 549,286
Tangible assets 12 553,148 361,484
1,089,037 910,770

CURRENT ASSETS
Stocks 13 15,654,753 14,079,324
Debtors 14 6,397,545 2,844,122
Cash at bank 400,869 -
22,453,167 16,923,446
CREDITORS
Amounts falling due within one year 15 (22,479,931 ) (16,702,647 )
NET CURRENT (LIABILITIES)/ASSETS (26,764 ) 220,799
TOTAL ASSETS LESS CURRENT
LIABILITIES

1,062,273

1,131,569

PROVISIONS FOR LIABILITIES 17 (84,012 ) (84,012 )
NET ASSETS 978,261 1,047,557

CAPITAL AND RESERVES
Called up share capital 18 131,010 131,010
Other reserves 19 376,406 376,406
Retained earnings 19 470,845 540,141
SHAREHOLDERS' FUNDS 978,261 1,047,557

The financial statements were approved by the Board of Directors and authorised for issue on 29 July 2024 and were signed on its behalf by:





C Greenhall - Director


HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023


1. STATUTORY INFORMATION

HOLDCROFT HONDA LIMITED is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

2. STATEMENT OF COMPLIANCE

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006.

3. ACCOUNTING POLICIES

BASIS OF PREPARING THE FINANCIAL STATEMENTS
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.

The financial statements are prepared in sterling, which is the functional currency of the entity.

FINANCIAL REPORTING STANDARD 102 - REDUCED DISCLOSURE EXEMPTIONS
The entity satisfies the criteria of being a qualifying entity as defined in FRS 102. Its financial statements are consolidated into the financial statements of T G Holdcroft (Holdings) Limited which can be obtained from Companies House. As such, advantage has been taken of the following disclosure exemptions available under paragraph 1.12 of FRS 102:

- No cash flow statement has been presented for the company.
- No disclosure has been given for the aggregate remuneration of key management personnel.

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


3. ACCOUNTING POLICIES - continued

SIGNIFICANT JUDGEMENTS AND ESTIMATES
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Significant judgements
The judgements (apart from those involving estimations) that management has made in the process of applying the entity's accounting policies and that have the most significant effect on the amounts recognised in the financial statements are as follows:

The carrying value of stock at the year end is reviewed in accordance with expected selling value. Demonstrator models are generally written down by 3% each month unless use would require a more appropriate percentage. Demonstrators that are intended to be used in the business for over twelve months are capitalised as tangible fixed assets and written off over the estimated useful life of 10 years. Used cars are valued against CAP (current auction price) values to ensure their carrying values are reliable.

Key sources of estimation uncertainty
Accounting estimates and assumptions are made concerning the future and, by their nature, will rarely equal the related actual outcome. The key assumptions and other sources of estimation uncertainty that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are as described below.

As described in the accounting policies of the financial statements, depreciation of intangible and tangible fixed assets has been based on estimated useful lives and residual values deemed appropriate by the directors. Estimated useful lives and residual lives are reviewed annually and revised as appropriate. Revisions take in to account actual asset lives and residual values as evidence by disposals during current and prior accounting periods.

REVENUE RECOGNITION
Turnover represents the total invoice value, excluding value added tax, of sales made during the year, together with commissions and bonuses received as a direct consequence of the invoiced amounts.

Revenue is recognised in the period when the work is complete.

GOODWILL
Goodwill, being the amount paid in connection with the acquisition of a business in 2008, is being amortised evenly over its estimated useful life of fifty years.

INTANGIBLE ASSETS
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


3. ACCOUNTING POLICIES - continued

TANGIBLE FIXED ASSETS
Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.
Plant and machinery - 20% on cost
Motor vehicles - 10% reducing balance

Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in equity, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation, is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in equity in respect of that asset. Where a a revaluation decrease exceeds the accumulated revaluation gains accumulated in equity in respect of that asset, the excess shall be recognised in profit or loss.

IMPAIRMENT OF FIXED ASSETS
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date.

For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cashgenerating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets.

STOCKS
Motor vehicle stocks are stated at the lower of net purchase price and net realisable value. A review of the net realisable values of stock is conducted on a regular basis and values are adjusted to prevailing market value. The market value is assessed with reference to external benchmarking publications and applying historical industry knowledge on the pricing of those vehicles. by reference to make and specific models. We also ensure stocks that exist at the year end are valued correctly by sampling against further post year end actual sales data. Whilst this data is deemed representative of current values it is possible that ultimate sales values can vary from those applied.

Parts stocks are valued on a first-in, first-out basis and are written down to net realisable value by providing for obsolescence on a time in stock based formula approach.

Consignment vehicle inventories are regarded as being effectively under the control of the company and are included within stock on the balance sheet as the company has the ability to direct the use of, and obtain substantially all of the remaining benefits from, the asset. Control includes the ability to prevent other entities from directing the use of, and obtaining the benefits from, an asset even though legal title has not yet passed. The corresponding liability is included in trade creditors.

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


3. ACCOUNTING POLICIES - continued

FINANCIAL INSTRUMENTS
Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

Debt instruments are subsequently measured at amortised cost.

Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately.

For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets are either assessed individually or grouped on the basis of similar credit risk characteristics.

Any reversals of impairment are recognised in profit or loss immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised.

Where the contractual obligations of financial instruments (including share capital) are equivalent to a similar debt instrument, those financial instruments are classed as financial liabilities. Financial liabilities are presented as such in the balance sheet. Finance costs and gains or losses relating to financial liabilities are included in the profit and loss account. Finance costs are calculated so as to produce a constant rate of return on the outstanding liability.

Where the contractual terms of share capital do not have any terms meeting the definition of a financial liability then this is classed as an equity instrument. Dividends and distributions relating to equity instruments are debited direct to equity.

TAXATION
Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date.

DEFERRED TAX
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

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

PENSION COSTS AND OTHER POST-RETIREMENT BENEFITS
The company operates a defined contribution plan for its employees. Amounts in respect of defined contribution plans are recognised as an expense in the profit and loss account when they are due.

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


3. ACCOUNTING POLICIES - continued

EMPLOYEE BENEFITS
The company provides a range of benefits to employees.

Short term benefits, including holiday pay, are recognised as an expense in the profit and loss account in the period in which they are incurred.

4. TURNOVER

The turnover and loss (2022 - profit) before taxation are attributable to the one principal activity of the company.

An analysis of turnover by class of business is given below:

31.12.23 31.12.22
£    £   
Sale of goods 140,593,529 89,468,047
140,593,529 89,468,047

An analysis of turnover by geographical market is given below:

31.12.23 31.12.22
£    £   
United Kingdom 140,593,529 89,468,047
140,593,529 89,468,047

5. EMPLOYEES AND DIRECTORS
31.12.23 31.12.22
£    £   
Wages and salaries 4,113,523 3,779,416
Social security costs 418,654 400,775
Other pension costs 99,565 94,246
4,631,742 4,274,437

The average number of employees during the year was as follows:
31.12.23 31.12.22

Office & management 33 31
Other operatives 79 73
112 104

31.12.23 31.12.22
£    £   
Directors' remuneration 74,223 -
Directors' pension contributions to money purchase schemes 1,000 -

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


6. OPERATING PROFIT

The operating profit is stated after charging/(crediting):

31.12.23 31.12.22
£    £   
Depreciation - owned assets 110,107 203,270
Loss/(profit) on disposal of fixed assets 8,571 (17,002 )
Goodwill amortisation 13,397 13,397

7. AUDITORS' REMUNERATION
31.12.23 31.12.22
£    £   
Fees payable to the company's auditors for the audit of the
company's financial statements

14,400

14,400

8. INTEREST PAYABLE AND SIMILAR EXPENSES
31.12.23 31.12.22
£    £   
Interest due to group undertakings 112,386 103,523
Manufacturer stocking plan interest 278,039 105,389
Other interest - 5,902
390,425 214,814

9. TAXATION

Analysis of the tax charge
The tax charge on the loss for the year was as follows:
31.12.23 31.12.22
£    £   
Current tax:
UK corporation tax - 144,819
Tax on (loss)/profit - 144,819

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


9. TAXATION - continued

RECONCILIATION OF TOTAL TAX CHARGE INCLUDED IN PROFIT AND LOSS
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

31.12.23 31.12.22
£    £   
(Loss)/profit before tax (69,296 ) 544,745
(Loss)/profit multiplied by the standard rate of corporation tax in the
UK of 25% (2022 - 19%)

(17,324

)

103,502

Effects of:
Expenses not deductible for tax purposes 3,349 3,714
Capital allowances in excess of depreciation (48,237 ) -
Depreciation in excess of capital allowances - 37,603
Group relief 62,212 -
Total tax charge - 144,819

10. DIVIDENDS
31.12.23 31.12.22
£    £   
Ordinary shares of £1 each
Interim - 600,000

11. INTANGIBLE FIXED ASSETS
Goodwill
£   
COST
At 1 January 2023
and 31 December 2023 669,859
AMORTISATION
At 1 January 2023 120,573
Amortisation for year 13,397
At 31 December 2023 133,970
NET BOOK VALUE
At 31 December 2023 535,889
At 31 December 2022 549,286

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


12. TANGIBLE FIXED ASSETS
Plant and Motor
machinery vehicles Totals
£    £    £   
COST
At 1 January 2023 1,225,593 266,014 1,491,607
Additions 96,439 394,049 490,488
Disposals - (214,203 ) (214,203 )
At 31 December 2023 1,322,032 445,860 1,767,892
DEPRECIATION
At 1 January 2023 1,099,456 30,667 1,130,123
Charge for year 66,039 44,068 110,107
Eliminated on disposal - (25,486 ) (25,486 )
At 31 December 2023 1,165,495 49,249 1,214,744
NET BOOK VALUE
At 31 December 2023 156,537 396,611 553,148
At 31 December 2022 126,137 235,347 361,484

13. STOCKS
31.12.23 31.12.22
£    £   
Finished goods 15,654,753 14,079,324

Vehicle stocks include £9,257,302 (2022: £8,404,545) of consignment stocks. The asset has been recorded on the balance sheet, matched by the corresponding liability, to accord with paragraph 2.8 of Financial Reporting Standard 102, regarding the substance of transactions. The principal terms of the consignment agreement are such that the company effectively contracts the stock, and bears the risks of ownership and obtains substantially all the remaining benefit of the assets.

The stock write down in line with the stated stock valuation policy is £347,364 (2022: £303,764).

14. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
31.12.23 31.12.22
£    £   
Trade debtors 5,572,043 2,250,052
Amounts owed by group undertakings - 185,549
Other debtors 45,826 -
VAT 121,765 172,489
Prepayments 657,911 236,032
6,397,545 2,844,122

Amounts owed by group undertakings are unsecured, interest free and are repayable on demand.

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


15. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
31.12.23 31.12.22
£    £   
Bank loans and overdrafts (see note 16) 1,186,911 2,225,983
Trade creditors 19,624,282 12,843,455
Amounts owed to group undertakings 1,215,119 1,111,172
Tax - 80,170
Social security and other taxes 86,871 72,203
Accruals and deferred income 366,748 369,664
22,479,931 16,702,647

Included in trade creditors is stocking loan agreements of £18,326,894 (2022: £9,147,457).

The aggregate amounts of bank loans and overdrafts due within one year that are secured is £1,186,911 (2022: £2,225,983). This creditor is secured as detailed below.

The bank overdraft is secured by a debenture on bank standard form dated 27th April 1995, a first legal mortgage over the freehold properties of the group and cross guarantee (unlimited) dated 26th February 1997 between T G Holdcroft (Newcastle) Limited, Holdcroft Renault Limited, Hanley Realisations Limited, Holdcroft Honda Limited, Holdcroft Hyundai Limited, Holdcroft North Staffs Limited, TMK Finance Limited, ALM Garages Limited, T G Holdcroft (Motors) Limited, Holdcroft Nissan Limited, Stuart Graham Limited, T G Holdcroft (Holdings) Limited, Holdcroft Properties Limited and HP 2011 Limited.

The company is also party to a composite banking arrangement with Barclays Bank Plc dated 28 February 2007.

Amounts owed to group undertakings are unsecured, interest free and are repayable on demand.

16. LOANS

An analysis of the maturity of loans is given below:

31.12.23 31.12.22
£    £   
Amounts falling due within one year or on demand:
Bank overdrafts 1,186,911 2,225,983

17. PROVISIONS FOR LIABILITIES
31.12.23 31.12.22
£    £   
Deferred tax
Accelerated capital allowances 84,012 84,012

Deferred
tax
£   
Balance at 1 January 2023 84,012
Balance at 31 December 2023 84,012

HOLDCROFT HONDA LIMITED (REGISTERED NUMBER: 01231883)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


18. CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:
Number: Class: Nominal 31.12.23 31.12.22
value: £    £   
131,000 Ordinary £1 131,000 131,000
1,000 Ordinary USA cent A £0.01 10 10
131,010 131,010

19. RESERVES

Profit and loss account - This reserve records retained earnings and accumulated losses.

Other reserve - This reserve represents non-distributable profits which cannot be distributed until the properties to which it relates are sold outside the group.

20. CONTINGENCIES

The company is party to a cross guarantee (unlimited) dated 26 February 1997 between T G Holdcroft (Holdings)Limited, T G Holdcroft (Newcastle) Limited, Holdcroft Renault Limited, Hanley Realisations Limited, Holdcroft Honda Limited, Holdcroft North Staffs Limited, TMK Finance Limited, T G Holdcroft (Motors) Limited, Stuart Graham Limited, Holdcroft Properties Limited, HP2011 Limited, Holdcroft Nissan Limited, Holdcroft Hyundai Limited and ALM Garages Limited. The company is also party to an additional cross guarantee dated 15 November 2013 to include HP 2011 Limited. The total indebtedness to the bank at 31 December 2023 was £16,059,640 (31 December 2022: £11,002,989).

In addition the company has a fixed and floating charge debenture over the whole of its assets in favour of T G Holdcroft (Holdings) Limited.

21. RELATED PARTY DISCLOSURES

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

22. EVENTS AFTER THE END OF THE REPORTING PERIOD

There were no material events after the end of the reporting period up to the date of approval of the financial statements by the Board.

23. ULTIMATE CONTROLLING PARTY

The company regards T. G. Holdcroft (Holdings) Limited, a company registered in England and Wales, to be the ultimate parent undertaking. The consolidated financial statements can be obtained from www.beta.companieshouse.gov.uk.

The ultimate controlling party is Mr T G Holdcroft by virtue of his 52.00% shareholding in the ultimate holding company.