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Registered number: 01202866









DAY LEWIS PLC









ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2024

 
DAY LEWIS PLC
 
 
COMPANY INFORMATION


Directors
Mr K C Patel Jnr (Jay) 
Mr J C Patel Jnr (Sam) 
Mr P J Glover 
Miss H Patel 
Mr C C Edwards 
Mrs R Patel 




Company secretary
Mr J C Patel Jnr (Sam)



Registered number
01202866



Registered office
2 Peterwood Way

Croydon

Surrey

CR0 4UQ




Independent auditor
KPMG LLP, Statutory Auditor
Chartered Accountants

Global House

High Street

Crawley

RH10 1DQ




Banker
National Westminster Bank Plc
89 Mount Pleasant Road

Tunbridge Wells

Kent

TN1 1PX




Solicitor
Cripps LLP
23 Kings Hill Avenue

West Malling

Kent

ME19 4UA





 
DAY LEWIS PLC
 

CONTENTS



Page
Group Strategic Report
1 - 6
Directors' Report
7 - 13
Independent Auditor's Report to the Members of Day Lewis Plc
14 - 18
Consolidated Profit and Loss Account
19
Consolidated Balance Sheet
20 - 21
Company Balance Sheet
22 - 23
Consolidated Statement of Changes in Equity
24 - 25
Company Statement of Changes in Equity
26
Consolidated Statement of Cash Flows
27 - 28
Consolidated Analysis of Net Debt
29
Notes to the Financial Statements
30 - 68


 
DAY LEWIS PLC
 
 
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024

Business review
 
Day Lewis is the UK’s second largest independent pharmacy chain, with 255 pharmacies owned or managed (at 31 March 2024) across England. 

The group was founded in 1975 and remains a family-owned entity, now managed in the second generation by Kirit Patel Jnr (Jay), Rupa Patel and Jayanti Patel Jnr (Sam). Day Lewis has developed strong relationships across the market and has unique insight and influence on factors affecting the pharmacy sector. 
The English pharmacy sector represents a secure, growing market, underpinned by an increasing need for dispensing of prescription drugs and a government that wants to see community pharmacies expand and improve the range of services they offer to relieve the burden on an overstretched NHS. 
The Group's pharmacies are typically located in local communities, in or near health centres and GP surgeries, delivering increased footfall, developing strong relationships with the local healthcare community, and building Day Lewis’s brand as a trusted healthcare provider. 
Day Lewis prides itself on its service led approach; putting the patient at the heart of its decisions is a key differentiator for the business enabling it to build a large base of loyal, recurring customers, evidenced by repeat prescriptions making up almost 66% of the Group's dispensing activities. 
Pharmacy performance remained strong during the financial year to 31 March 2024 with strong year-on-year growth in dispensing prescriptions, retail (over the counter) sales and pharmacy services.
Day Lewis continued to outperform the market with the Group dispensing 28.3m prescriptions in the year to 31 March 2024, a 4.5% like-for-like increase compared to the prior year. Day Lewis has continued to increase in services delivery as well as expanding its services through the introduction of two new advanced services (Contraception and Pharmacy First).
The majority of administration costs are linked to headline inflation rates such as staff costs, energy, utilities and rent and rates. In the current period administration costs includes various exit costs relating to EM
Pharma's move to their new state-of-the art facilities. Despite persistent high inflation, administrative expenses were well managed during the year, increasing by 2.5% to £112.2m for the year ending 31 March 2024 (2023: £109.5m). Operating profit reduced to £14.2m (2023: £16.0m) due to impairment of the pharmacy fixed assets.
Day Lewis continued to enhance our estate through relocating branches to superior locations, focusing on added value services, merging multiple pharmacies into larger single sites, and disposing of pharmacies with particularly low footfall.
During the financial year, Day Lewis continued its policy of investing free cashflow into upgrading key infrastructure, investing in dispensing automation and improving our operational resilience to ensure Day Lewis has robust foundations to continue to grow our Business. Two of our key projects are our 24/7 prescription collection kiosks, which Day Lewis has installed in 77 pharmacies, and our investment in the Pharmacy Hub and Spoke Dispensing Automation at the Croydon distribution centre.
The Group maximises its margin by focusing heavily on its pharmaceutical distribution operations. Day Lewis holds all relevant MHRA Wholesaler Dealer Authorisations in order to distribute both prescription and over the counter medicines. The Group purchases from multiple pharmaceutical manufacturers and self distributes to its pharmacies in order to maximise margin wherever possible. In addition, Day Lewis distributes medicines in further external channels including the supply of generics to associated pharmacy retail groups and the global supply of medicines to offshore energy businesses, maritime, cruise and ambulance services.
Due to its position in the marketplace, long trading history and strength of relationships Day Lewis has unique access to a wide range of drugs across Europe that it purchases for redistribution. The Day Lewis procurement and distribution teams are highly experienced and knowledgeable providing the Group with an in depth
Page 1

 
DAY LEWIS PLC
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

understanding of market dynamics. 
The East Midlands Pharma business performed strongly in the year, seeing turnover increase by 13% through winning new business and growing its ear care brand to become the 3rd largest brand in the UK. Growth in turnover is expected to continue into our 2024/25 financial year due to the servicing of new contracts seen towards the end of the financial year 2023/24. During 23-24 Day Lewis successfully completed our major re-location to state-of-the-art facilities.

Statement on business relationships

The Day Lewis Group aims to operate fairly, transparently and with integrity in the marketplace. Day Lewis builds strong external networking with representation on key national bodies including Community Pharmacy England, Centre for Pharmacy Post Graduate Education and the Independent Pharmacies Association.

Day Lewis engages with its customers, suppliers and other key stakeholders through multiple channels including face to face, telephone, conferences and social media. All members of the Senior Management Team are expected to maintain relationships with their key partners. This should provide a broad understanding of the wider market and ensure that their views are considered in decision making.

Statement on Employee Engagement

Maintaining a caring family culture is one of our core values. Day Lewis runs a monthly People Board whose goal is to ensure:

Our colleagues feel safe and secure whilst working at Day Lewis.

Our colleagues add value to society and understand and are committed to how they do that at Day Lewis.

Day Lewis selects, train and develop the right people in the right role in order to align our people resources
    to fit our strategic intentions.

Our colleagues are given the opportunity to reach their full potential.

Our colleagues feel happy and valued being part of the Day Lewis family.


The above goals are measured in an annual colleague engagement survey.

The Day Lewis Group’s long-term objectives are:

Driving growth

To be the pharmacy destination of choice locally for prescriptions and services. 

To maintain a high-quality estate of community pharmacies.

To grow the business in international markets. 

To diversify investment into other pharmacy related sectors.


Enhancing margins

To improve purchasing mix of medicines between generic and branded products.

To maintain efficient stock control and overall cost control.

To increase professional services income.


Page 2

 
DAY LEWIS PLC
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

Principal risks and uncertainties
 
Principal risks and uncertainties and risk management objectives and policies are as follows:
Price risk
The Group, through its investments, is exposed to the inherent risks of economic and financial market developments, including recession, inflation, availability of affordable credit and currency fluctuations that could lower revenues. The current system of correcting generic reimbursement prices through the mechanism of "Category M" has continued through the current financial year. Category M was introduced with the new pharmacy contract in 2005 and allows the retail pharmacy industry to retain an amount of £800m of generic procurement profit annually. The system is therefore used retrospectively by the Department of Health to claw back surplus procurement profits or reimburse any shortfall. Through a continual business review process and monitoring of the business environment, the Directors of the company and the wider Group seek to mitigate these potential risks.
Liquidity risk
In September 2020, the Group entered into a long-term financing agreement with its banks. A Revolving Credit Facility (RCF) of £125m was agreed until at least 2023, which was subsequently extended to December 2025. The facility was voluntarily reduced to £110m in September 2021. 
The Directors believe the Group has sufficient current and future cash reserves and facilities available to meet its liabilities and financing obligations for at least twelve months from the signing of these financial statements.
There is significant headroom in the banking covenants at 31 March 2024. At the year end £100m (2023: £95m) of the £110m facility was drawn down and additionally there were cash balances in the Group of £38m (2023: £26m). 
The Directors' assessment of the Group's and the Company's ability to adopt the going concern basis of accounting is set out in note 2. 
Interest rate risk
The interest rate risk is significantly mitigated by an interest rate swap arrangement that was entered into in September 2020. Under this agreement interest is fixed at a rate of 0.088% for £40m of debt. The swap instrument is in place until September 2025. The balance of debt (£60m at 31 March 2024) is exposed to movements in SONIA.
Macroeconomic, political risk
The Group could be adversely affected by the impact of the current macroeconomic and political environment on key suppliers and customer groups.  
The Group notes that the 5-year pharmacy funding deal expired on the 31st March 2024, and although no formal contract has been agreed beyond 31st March 2024 - discussions are ongoing, Day Lewis continues to be funded on broadly the same basis as 2023/24. Day Lewis expects the contract negotiations to conclude within the next few months following the conclusion of the recent General Election. 
Over the past few years, the Group and industry has lobbied for additional funding to recognise the recent impact of inflation on operating costs. In May 2023 as part of the Primary Car Recovery Plan, the Government noted the critical role of Community Pharmacies and announced that they will be providing a further £645m additional funding to Community Pharmacy over the next 2 years. From 2023/2024 pharmacies have been providing prescription medications for those with common conditions and rolling out a contraception service to ease the burden on GP practices.
 
Page 3

 
DAY LEWIS PLC
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

Cash flow risk
The Group's activities expose it primarily to the financial risks of changes in foreign currency exchange rates and interest rates. The Group uses interest rate swap contracts to hedge interest rate exposures. Foreign currency rates risk is mitigated by buying currency at spot and one month forward rates. 
Interest bearing assets and liabilities are held at fixed rates to ensure certainty of cash flows.
Credit risk
The Group's principal financial assets are bank balances and cash, trade and other receivables. The credit risk on trade and other receivables is limited as the majority of the Group's retail exposure is with the Department of Health. Exposure to credit risk on wholesale customers is mitigated through credit insurance taken out on the wholesale debtor book. The amounts presented in the balance sheet are net of allowances for doubtful receivables. The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are banks with high credit ratings assigned by international credit rating agencies.

Financial key performance indicators
 
Day Lewis continued to outperform the market with the Group dispensing 28.3m prescriptions, a 4.5% like-for-like increase compared to the prior year.
Turnover in the year increased by 5.9% to £502.1m (
2023£474.0m).
Gross profit increased by £1.9m to £127.4m (
2023£125.5m). The gross margin percentage marginally decreased to 25.4% (202326.5%).
Total administrative expenses increased by £2.7m to £112.2m (2023£
109.5m). A key driver for this has been the rise in headline inflation rates which has driven increases in staff costs, energy, utilities and rent & rates.
Overall, this enabled the Group to achieve an operating profit of £14.2m (
2023£16.0m profit).
Net debt has decreased by £7.6m to £65.6m (2023: £73.2m). This is a result of an increase in the RCF drawn of £5m (£100m in March 2024, £95m in March 2023) offset by increased cash balances of £12m.

Page 4

 
DAY LEWIS PLC
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

Directors' statement of compliance with duty to promote the success of the Group
 
Section 172 of the Companies Act 2006 requires the directors of the Group to act in the way that they consider, in good faith, would most likely promote the success of the Group for the benefit of its owners and stakeholders.
In doing so section 172 requires a director to have regard (amongst other matters) to:
a) The likely consequences of any decisions in the long-term.
b) The interests of the Group’s employees.
c) The need to foster the Group’s business relationships with suppliers, customers and others.
d) The impact of the Group’s operations on the community and the environment.
e) The desirability of the Group maintaining a reputation for high standards of business conduct.
f) The need to act fairly as between members of the Group.
Since the passing of Kirit Patel MBE in 2016, the business is led by Jay, Rupa, and Sam as joint Executive Directors. JC Patel Snr is still involved in an advisory role. Day Lewis remains a family owned entity with no plans to change this structure in the short or longer terms.
As with any other large organisation, the Executive Directors of Day Lewis delegate authority for the day-to-day management of the Group to the Senior Management Team and then engage management in setting, approving and overseeing execution of the business strategy and related policies.
The Executive Directors are also supported by a group of senior advisors with expertise in Finance, Banking, Commercial, HR, IT and Legal giving a wide range of insight and experience. Day Lewis employs one non-executive director.
The Executive Directors and the Senior Management Team provide supervision and guidance to the wider teams, making decisions concerning operational planning, evaluating performance, workforce planing, reuneration and assessing pharmacy and business acquisitions and international expansion plans.
Day Lewis is regularly recognised as a good place to work and during the year our pharmacy colleagues were recognised for many national awards. In recent years the Executive Directors have been presented with an Entrepreneurship Award at the European Pharmacists Forum, the Day Lewis Group was ranked 49th on the Sunday Times and Grant Thornton Top Track 250 List and individuals have been recognised within the industry for Team Innovation, Healthy Living Advice and a Public Health Pharmacist Award.
Relationships with universities have also developed further with the appointment of Teacher Practitioners at Bath, Reading, UCL, UEA and Sussex. Day Lewis are also supporting the development of a new Pharmacy School in Plymouth. Day Lewis clearly recognises the importance of education for the next generation of pharmacists and healthcare leaders. 
As part of Day Lewis' commitment to the community, pharmacies are encouraged to support local charities and sponsor local events and causes. Every year to mark the first day of Kirit and JC buying their first pharmacy, the support office, warehouses, and pharmacies across the country take part in the annual charity fun day, in which all teams are invited to participate. All teams participate in raising money for a local registered charity of their choice, to ensure that the Group as a whole is able to support as many charities as possible. Pharmacy teams and the support office raise money through fund-raising activities such as cake sales, raffles and recently throwing pies at Directors. 
The KCJC Foundation was set up by the Patel family in memory of the late Kirit Patel MBE. The foundation matches funds raised across the business, pound for pound.
In 2019 Day Lewis became founder patrons of ‘Legacy’, an OnSide Youth Zone providing a 21st century youth club in Croydon. Legacy provides a safe environment where young people can come and enjoy themselves and will enable young people to raise their aspirations and confidence to create a happier and healthier generation. During the current financial year many events have taken place in order to support this charity such as a Golf Day.
Page 5

 
DAY LEWIS PLC
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024



This report was approved by the board and signed on its behalf.





Mr J C Patel Jnr (Sam)
Director

Date: 9 August 2024

Page 6

 
DAY LEWIS PLC
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024

The Directors present their report and the financial statements for the year ended 31 March 2024.

Directors' responsibilities statement

The Directors are responsible for preparing the Strategic Report, the Directors' 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 they have elected to prepare the Group and Company financial statements in accordance with UK accounting standards and applicable law (UK Generally Accepted Accounting Practice), including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland. 
 
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 Group and Company  and of the profit or loss of the Group for that period.

 In preparing these financial statements, the Directors are required to:


select suitable accounting policies and then apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

prepare the financial statements on the going concern basis.

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

Principal activities

The principal activities of the Company and the Group in the year under review continued to be those of retail pharmacy and distribution of pharmaceutical supplies.

Results and dividends

The profit for the year, after taxation and minority interests, amounted to £5,172k (2023 - £8,994k).

During the year, the Company declared an interim dividend of £3,000k (2023: £2,633k).
The Directors do not recommend the payment of a final dividend (
2023£nil).

Directors

The Directors who served during the year were:

Mr K C Patel Jnr (Jay) 
Mr J C Patel Jnr (Sam) 
Mr P J Glover 
Miss H Patel 
Mr C C Edwards 
Mrs R Patel 

Page 7

 
DAY LEWIS PLC
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

Political contributions

Neither the Company nor any of its subsidiaries made any political donations or incurred any political expenditure during the year.

Engagement with employees

The Group has undertaken several actions to keep its employees informed of matters affecting them as employees and the financial and economic factors affecting the performance of the Group. This is achieved through consultations with local branch managers and other employee representatives.

Disabled employees

Applications for employment by disabled persons are given full and fair consideration for all vacancies in accordance with their particular aptitudes and abilities. In the event of employees becoming disabled, every effort is made to retrain them in order that their employment with the Group may continue. It is the policy of the Group that training, career development and promotion opportunities should be available to all employees.

Page 8

 
DAY LEWIS PLC
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

Task force on climate-related financial disclosures (TCFD)

This statement contains the Group’s TCFD-aligned disclosure in accordance with BEIS statutory instrument on climate-related financial disclosures. This statement complies with the recommended disclosures and is in compliance with the the Companies (Strategic Report) (Climate-related Financial Disclosure) Regulations 2022.
Governance 
(a) description of the governance arrangements of the company and group in relation to assessing and managing climate-related risks and opportunities.
The Board of Directors at Day Lewis PLC oversees climate-related risks and opportunities as an integral part of their strategic reviews. These reviews ensure that climate-related factors are embedded in Day Lewis’ decision-making processes. Day Lewis has strong external networks as Day Lewis has representation on key national bodies including Community Pharmacy England, Independent Pharmacies Association which assists Day Lewis to stay abreast of industry developments and impacts. Day Lewis partakes in an SECR energy audit as required. Day Lewis consults with Redwood Energy whom assist with Streamlined Energy and Carbon Reporting (SECR), Energy Saving Opportunity Scheme (ESOS) and Net Zero.
The Property team lead by R. Patel (Director) is largely responsible for assessing and managing climate-related risks and opportunities, ensuring that Day Lewis’ governance framework effectively addresses all climate related risks and opportunities critical areas, in particular around Day Lewis’ carbon footprint associated with Day Lewis’ property assets.
Risk Management 
(b) a description of how the company and group identifies, assesses, and manages climate-related risks and opportunities.
(c) a description of how processes for identifying, assessing, and managing climate-related risks are integrated into the overall risk management process in the company and group.
Day Lewis identifies climate-related risks through comprehensive scenario analyses and stakeholder consultations. Day Lewis perform regular environmental impact evaluations which supports compliance with environmental regulations such as SECR and ESOS regulatory scheme audits.
Identified risks are regularly documented and updated in the risk register where the likelihood and magnitude are assessed. Day Lewis’ risk management process involves integrating climate considerations into Day Lewis’ overall risk management framework, ensuring that all identified risks are effectively mitigated. This approach allows Day Lewis to proactively manage potential impacts on our business operations.
Strategy 
(d) a description of - (i) the principal climate-related risks and opportunities arising in connection with the operations of the company and group, and (ii) the time periods by reference to which those risks and opportunities are assessed.
(e) a description of the actual and potential impacts of the principal climate-related risks and opportunities on the business model and strategy of the company and group.
(f) an analysis of the resilience of the business model and strategy of the company and group, taking into consideration of different climate-related scenarios.
Day Lewis have a long-standing commitment to reducing carbon emissions from Day Lewis operations and have been actively improving energy efficiency while minimising fuel use. The overall kWh consumption has reduced by 9%, from 2020 to 2024 (2020:6,884,958 to 2024:6,235,514 kWh). The overall Kg CO2e consumption has reduced by 15%, from 2020 to 2024 (2020:1,647,614 to 2024: 1,398,919 Kg CO2e).
Day Lewis has increased investment in renewable energy sources and ensured energy efficient technology and materials are implemented in all business operations. A decarbonisation plan has been prepared which includes measures such as switching to renewable energy, reducing energy usage, and installing solar panels.
 
Page 9

 
DAY LEWIS PLC
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

Day Lewis has defined Short term as a period within the next 5 years, medium-term as a period between 5-10 years and Long-term as a period greater than 10 years. 
In the short term, Day Lewis have, and continue to mitigate travel-related emissions through encouraging our staff to use trains and other public transport modes whenever possible, thereby reducing the reliance on motor vehicles. Additionally, Day Lewis have implemented a rolling program to install LED lights throughout our retail pharmacies. This initiative is supported by a company-wide memo urging all staff, both in the field and at the support office, to switch off lights and computer/office equipment when not in use and at the end of the day. Photocopiers and printers are set to “energy saver” or “standby” mode when not in use. Throughout the office space, the lighting system have been upgraded to be on PIR sensors which allows lights in the office and meeting rooms to be off when not in use. Solar panels have been installed at the support office on the roof top to generate clean energy which is put back into the operation business. The business has also installed Electric Vehicle (EV) charging stations allowing both visitors and staff to charge vehicles.
The business operates a hybrid working model allowing staff to work from home 2 days a week, significantly reducing travelled related emissions. Furthermore, Day Lewis has taken conscious steps to ensure that all heating and cooling systems are correctly set (timeclocks and temperatures) and that no systems are left on overnight or when not required. Measures have been put in place to ensure all doors and windows are closed when heating or colling systems are on. Additionally, all standalone portable heaters are turned off when ceiling units are cooling.
There remains short term risk around climate-related risk regulatory changes, that may impact operational costs due to the rise in energy costs and an increase in compliance risks due to enhanced disclosure requirements.
In the medium term, there are further opportunities to invest to energy efficiency projects to reduce operational costs and enhance sustainability, as well as looking at reducing emissions from the logistics as EV technology improves. 
Long-term, although Day Lewis remain largely a UK based operation, products Day Lewis distribute do arrive from across the globe, and there is potential for supply chain disruption due to climate-related events. Due to climate change and the world experiences extreme weather conditions, working conditions may be negatively impacted through potentially warmer and colder periods which could impact employees, in particular warehouse staff, productivity and or wellbeing. Extreme weather conditions (Storms, floods, winds, fire) could impact Day Lewis infrastructure resulting in business shut down and a reduction in revenue.
As part of our strategy, Day Lewis have evaluated the resilience of our business model under various climate scenarios, including a 2°C or lower scenario. This assessment confirms that our strategy is robust and well-prepared to handle future climate-related challenges.
Metrics and Targets
(g) a description of the targets used by the company or LLPs to manage climate-related risks and to realise climate-related opportunities and of performance against those targets.
(h) the key performance indicators used to assess progress against targets used to manage climate-related risks and realise climate-related opportunities and a description of the calculations on which those key performance indicators are based.
Day Lewis’s is committed to ongoing tracking and monitoring of climate related metrics to assist meeting the target of becoming a zero-waste organisation, reducing the carbon footprint throughout the supply chain, reducing energy usage, and switching to 100% renewable energy procurement. The intensity ratio for Day Lewis is the total carbon used (using Scopes 1 and 2 data only).
Day Lewis’ key metrics used to measure and manage climate-related risks and opportunities include the purchase of electricity for its own use (excluding transport), combustion of gas and consumption of fuel (excluding transport) and involving the combustion of gas and consumption of fuel and purchase of electricity. The business metric used is the number of sites.
Page 10

 
DAY LEWIS PLC
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024


Greenhouse gas emissions, energy consumption and energy efficiency action

The Group's greenhouse gas emissions (in kilograms of CO2 equivalent) and energy consumption (in kilowatt hours) are as follows:
              
2024     2023


Energy consumption
kWh
 
Emissions
kg CO2e
Energy consumption
kWh
Emissions
kg CO2e
In connection with activities for which the Group is responsible involving the purchase of electricity for its own use (excluding transport)
 
3,668,666
759,685
3,909,658
756,050
In connection with activities for which the Group is responsible involving the combustion of gas and consumption of fuel (excluding transport)
 
87,053
15,924
239,985
43,723
In connection with transport for which the Group is responsible involving the combustion of gas and consumption of fuel and purchase of electricity
 
2,479,795
623,309
3,002,138
753,280
Total
6,235,514
1,398,918
7,151,781
1,553,053


Business metric used
The business metric used is number of sites. The number of sites in 2023/24 was 228. The number of sites in 2022/23 was 246. 

Statement
Day Lewis have a long-standing commitment to reducing carbon emissions from our operations and have been actively improving energy efficiency while minimising fuel use.

Intensity ratio
The intensity ratio for Day Lewis is calculated as total carbon emissions (using Scopes 1 and 2 data only), being 1,398,919 kg CO2e (2023:1,553,053 kg CO2e), divided by the business metric of 228 sites (2023: 246 sites), giving an intensity ratio of 6,135.61 kg CO2e / site (2023: 6,313kg CO2e / site). Transport carbon emissions have decreased by 17%. Gas has consistently reduced year on year, with electricity having increased by 0.5% from 2023.

Page 11

 
DAY LEWIS PLC
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

Other information

An indication of likely future developments in the business and statements of business relationship, employee engagement and particulars of significant events which have occurred since the end of the financial year have been included in the Strategic Report.

Statement of corporate governance arrangements

For the year to 31 March 2024, the Group has not used any formal Corporate Governance guidelines, although on review and considering the size, scope and future plans of the Group the Directors have plans in place to apply the guidelines from the Wates Corporate Governance Principles for Large Private Companies (“the Wates Principles”) as far as is considered appropriate.  
The Group remains committed to ensuring effective governance is in place to deliver its core values as this is the foundation on which it manages and controls its business and provides the platform for sustainable growth and profitability. 
The Wates Principles provide a framework for the Group to demonstrate how the Directors make decisions for the long-term success of the business, and also how the Group complies with the requirements of Section 172 of the Companies Act.  
The Group has in place many of the controls, processes and procedures that would typically be found in larger organisations. In this regard, while not in a position to assert full compliance in every aspect, the Directors have assessed performance against the Wates Principles: 

Principle 1 - Purpose & Leadership
The Group has a family led Executive Leadership team. These siblings have separate skills and experiences outside of the Group, are all highly educated (degree and MBAs) and manage and lead in areas relating to their specific skills. 
The Core Purpose of the Group is ‘to help people in the community stay healthy and feel better’ which is achieved through the provision of healthcare through retail, distribution, and manufacturing businesses. 
This is driven by the core values: 
 To keep our caring family culture. 
 To look after our customers. 
 To be disciplined and professional. 
 To be different through innovation. 
 To reward, recognise and empower.
 To have fun. 

Principle 2 -  Board Composition 
The three Executive Directors are supported by one Non-Executive Director, Carey Edwards, who is Managing Director of LMQ, a strategic planning and training consultancy, Peter Glover, who supports as an experienced Pharmacist Superintendent, and Heena Patel, who has been an employee of the group from 2011 and is a member of the Institute of Chartered Accountants.
The Group runs monthly board meetings on all separate divisions of the business and also runs four sub-board committees specifically looking at People, Finance, IT and Risk Management Oversight. These sub-committees bring together the Board, Senior Management and external expertise.
 
Page 12

 
DAY LEWIS PLC
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024


Principle 3 - Director Responsibilities
The Directors are fully aware of their responsibilities to the Group, the shareholders and wider stakeholders. Various presentations have been delivered to the Directors outlining their legal, fiscal and other obligations Updates are provided as the environments in which the Group operates evolves.
Principle 4 - Opportunity & Risk
The Group looks to optimise commercial opportunities with a fast moving and agile Senior Management team. All commercial risk is managed through the divisional board meetings. Health and Safety, data protection and regulatory compliance are overseen by the Board of Directors via the Risk Management Oversight Committee.
Principle 5 - Remuneration
Remuneration of all Directors is aligned to market rates, irrespective of whether they hold a financial interest in the Group.
Principle 6 - Stakeholder Relationships & Engagement
This is covered in the Strategic Report under the section "Directors' statement of compliance with their duty to promote the success of the Group".

Disclosure of information to auditor

Each of the persons who are Directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the Director is aware, there is no relevant audit information of which the Company's and the Group's auditor is unaware, and

the Director has taken all the steps that they ought to have been taken as a Director in order to be aware of any relevant audit information and to establish that the Company's and the Group's auditor is aware of that information.

Auditor

The statutory auditor, KPMG LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board and signed on its behalf.
 





Mr J C Patel Jnr (Sam)
Director
Date: 9 August 2024
 
2 Peterwood Way
Croydon
Surrey
CR0 4UQ

Page 13

 
DAY LEWIS PLC
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF DAY LEWIS PLC
 


Opinion 

We have audited the financial statements of Day Lewis Plc (“the company”) for the year ended 31 March 2024 which comprise the Consolidated Profit and Loss Account, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Statement of Cash Flows, and related notes, including the accounting policies in note 2. 

In our opinion the financial statements: 

give a true and fair view of the state of the Group’s and of the parent Company’s affairs as at 31 March 2024 and of the Group’s profit for the year then ended; 

have been properly prepared in accordance with UK accounting standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland; 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 are described below.  We have fulfilled our ethical responsibilities under, and are independent of the Group in accordance with, UK ethical requirements including the FRC Ethical Standard as applied to other entities of public interest.  We believe that the audit evidence we have obtained is a sufficient and appropriate basis for our opinion.  

Going concern 

The directors have prepared the financial statements on the going concern basis as they do not intend to liquidate the Group or the Company or to cease their operations, and as they have concluded that the Group and the Company’s financial position means that this is realistic. They have also concluded that there are no material uncertainties that could have cast significant doubt over their ability to continue as a going concern for at least a year from the date of approval of the financial statements (“the going concern period”). 

We used our knowledge of the Group, its industry, and the general economic environment to identify the inherent risks to its business model and analysed how those risks might affect the Group’s and Company’s financial resources or ability to continue operations over the going concern period. The risks that we considered most likely to adversely affect the Group’s and Company’s available financial resources and/or metrics relevant to debt covenants over this period were: 

Plausible reduction in growth of revenue

Ability to repay NHS clawbacks 

Inflationary increases including wages and salaries

Inability to comply with their banking covenants.


We considered whether these risks could plausibly affect the liquidity or covenant compliance in the going concern period by comparing severe, but plausible, downside scenarios that could arise from these risks individually and collectively against the level of available financial resources and covenants indicated by the Group’s financial forecasts.

We considered whether the going concern disclosure in note 2.3 to the financial statements gives a full and accurate description of the Directors’ assessment of going concern.

 
Page 14

 
DAY LEWIS PLC
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF DAY LEWIS PLC
 


Our conclusions based on this work:

we consider that the directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate;

we have not identified, and concur with the directors’ assessment that there is not, a material uncertainty related to events or conditions that, individually or collectively, may cast significant doubt on the group and company's ability to continue as a going concern for the going concern period;

we found the going concern disclosure in note 2.3 to be acceptable. 


However, as we cannot predict all future events or conditions and as subsequent events may result in outcomes that are inconsistent with judgements that were reasonable at the time they were made, the above conclusions are not a guarantee that the Group or the Company will continue in operation.  

Fraud and breaches of laws and regulations – ability to detect

Identifying and responding to risks of material misstatement due to fraud

To identify risks of material misstatement due to fraud (“fraud risks”) we assessed events or conditions that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud. Our risk assessment procedures included:

Enquiring of directors and management as to the Group’s high-level policies and procedures to prevent and detect fraud, including the Group’s channel for “whistleblowing”, as well as whether they have knowledge of any actual, suspected or alleged fraud.

Reading Board minutes.

Considering remuneration incentive schemes and performance targets for management.

Using analytical procedures to identify any unusual or unexpected relationships.


We communicated identified fraud risks throughout the audit team and remained alert to any indications of fraud throughout the audit.

As required by auditing standards, we perform procedures to address the risk of management override of controls, in particular the risk that Group management may be in a position to make inappropriate accounting entries. 
On this audit we do not believe there is a fraud risk related to revenue recognition due to the simple nature and low value of revenue transactions.
 
Revenue is made up of high volume, low value transactions; and
 
There is minimal judgement for revenue recognition.

We did not identify any additional fraud risks.
We performed procedures including: 
 
Identifying journal entries to test for all full scope components based on risk criteria and comparing the identified entries to supporting documentation. These included unexpected pairings with cash accounts or those that affect classification of earnings in the profit and loss account above EBITDA.



Page 15

 
DAY LEWIS PLC
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF DAY LEWIS PLC
 

Identifying and responding to risks of material misstatement due to non-compliance with laws and regulations

We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience, through discussion with the directors and other management (as required by auditing standards), and discussed with the directors and other management the policies and procedures regarding compliance with laws and regulations.  

We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit. 

The potential effect of these laws and regulations on the financial statements varies considerably.

Firstly, the Group is subject to laws and regulations that directly affect the financial statements including financial reporting legislation (including related companies legislation), distributable profits legislation, and taxation legislation, and we assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.  

Secondly, the Group is subject to many other laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines or litigation or the loss of the Group’s pharmacy licenses to operate.  We identified the following areas as those most likely to have such an effect: Medicines and Healthcare Products Regulatory Agency (MHRA) legislation, PCI legislation, General Pharmaceutical Council (GPhC) legislation, health and safety, data protection laws, anti-bribery, employment law, and certain aspects of company legislation recognising the financial and regulated nature of the Group’s activities. Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the directors and other management and inspection of regulatory and legal correspondence, if any. Therefore if a breach of operational regulations is not disclosed to us or evident from relevant correspondence, an audit will not detect that breach.

Context of the ability of the audit to detect fraud or breaches of law or regulation

Owing 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, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it.  

In addition, as with any audit, there remained a higher risk of non-detection of fraud, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. Our audit procedures are designed to detect material misstatement. We are not responsible for preventing non-compliance or fraud and cannot be expected to detect non-compliance with all laws and regulations.

Strategic report and directors’ report  

The directors are responsible for the strategic report and the directors’ report.  Our opinion on the financial statements does not cover those reports and we do not express an audit opinion thereon.  

Our responsibility is to read the strategic report and the directors’ report and, in doing so, consider whether, based on our financial statements audit work, the information therein is materially misstated or inconsistent with the financial statements or our audit knowledge.  Based solely on that work:

we have not identified material misstatements in the strategic report and the directors’ report;  

in our opinion the information given in those reports for the financial year is consistent with the financial statements; and  

in our opinion those reports have been prepared in accordance with the Companies Act 2006.  
Page 16

 
DAY LEWIS PLC
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF DAY LEWIS PLC
 


Matters on which we are required to report by exception 

Under the Companies Act 2006, we are required to report to you if, in our opinion: 

adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or

the parent Company 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.


We have nothing to report in these respects.  

Directors' responsibilities

As explained more fully in their statement set out on page 7, the directors are responsible for: the preparation of the financial statements and for being satisfied that they give a true and fair view; such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error; assessing the Group and parent 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 they either intend to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so.  

Auditors' responsibilities

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 our opinion in an auditor’s report.  Reasonable assurance is a high level of assurance but does not 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 aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.  

A fuller description of our responsibilities is provided on the FRC’s website at









 
Page 17

 
DAY LEWIS PLC
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF DAY LEWIS PLC
 

The purpose of our audit work and to whom we owe our responsibilities  

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. 





Mark Sheppard (Senior statutory auditor)
  
for and on behalf of
KPMG LLP, Statutory Auditor
 
Chartered Accountants
  
Global House
High Street
Crawley
RH10 1DQ

9 August 2024
Page 18

 
DAY LEWIS PLC
 
 
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2024


2024
2023
Note
£000
£000

  

Turnover
 4 
502,101
473,993

Cost of sales
  
(374,704)
(348,501)

Gross profit
  
127,397
125,492

Administrative expenses
  
(112,174)
(109,489)

Impairment of fixed assets
  
(1,433)
(278)

Other operating income
 5 
409
307

Operating profit
 6 
14,199
16,032

Group's share of profit in associates
  
293
531

Profit/(loss) on disposal of subsidiary, associates and unincorporated businesses
  
-
(3,000)

Interest receivable and similar income
 10 
2,380
2,387

Interest payable and similar expenses
 11 
(8,899)
(4,237)

Profit before tax
  
7,973
11,713

Tax on profit
 12 
(2,523)
(2,384)

Profit for the financial year
  
5,450
9,329

Profit for the year attributable to:
  

Non-controlling interests
  
278
335

Owners of the parent
  
5,172
8,994

  
5,450
9,329

There are no items of other comprehensive income for 2024 or 2023 other than the profit for the yearAs a result, no separate Statement of Comprehensive Income has been presented.

The notes on pages 30 to 68 form part of these financial statements.

Page 19

 
DAY LEWIS PLC
REGISTERED NUMBER: 01202866

CONSOLIDATED BALANCE SHEET
AS AT 31 MARCH 2024

2024
2023
Note
£000
£000

Fixed assets
  

Intangible assets
 14 
173,667
177,921

Tangible assets
 15 
33,884
30,151

Investments
 16 
9,821
10,661

  
217,372
218,733

Current assets
  

Stocks
 17 
48,928
48,046

Debtors: amounts falling due within one year
 18 
57,567
67,320

Cash at bank and in hand
 19 
38,274
26,026

  
144,769
141,392

Creditors: amounts falling due within one year
 20 
(72,039)
(78,050)

Net current assets
  
 
 
72,730
 
 
63,342

Total assets less current liabilities
  
290,102
282,075

Creditors: amounts falling due after more than one year
 21 
(103,476)
(98,441)

Provisions for liabilities
  

Deferred taxation
 25 
(34,091)
(32,520)

Other provisions
 26 
(4,385)
(5,095)

Net assets
  
148,150
146,019


Capital and reserves
  

Called up share capital 
 27 
100
100

Share premium account
 28 
418
418

Capital redemption reserve
 28 
1,694
1,694

Merger reserve
 28 
757
757

Profit and loss account
 28 
143,244
142,026

Equity attributable to owners of the parent Company
  
146,213
144,995

Non-controlling interests
  
1,937
1,024

  
148,150
146,019


Page 20

 
DAY LEWIS PLC
REGISTERED NUMBER: 01202866
    
CONSOLIDATED BALANCE SHEET (CONTINUED)
AS AT 31 MARCH 2024

The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




Mr J C Patel Jnr (Sam)
Director

Date: 9 August 2024

The notes on pages 30 to 68 form part of these financial statements.

Page 21

 
DAY LEWIS PLC
REGISTERED NUMBER: 01202866

COMPANY BALANCE SHEET
AS AT 31 MARCH 2024

2024
2023
Note
£000
£000

Fixed assets
  

Intangible assets
 14 
157,954
162,007

Tangible assets
 15 
20,480
20,334

Investments
 16 
16,079
19,226

  
194,513
201,567

Current assets
  

Stocks
 17 
11,955
12,232

Debtors: amounts falling due within one year
 18 
53,528
55,042

Cash at bank and in hand
 19 
14,797
17,453

  
80,280
84,727

Creditors: amounts falling due within one year
 20 
(59,356)
(66,222)

Net current assets
  
 
 
20,924
 
 
18,505

Total assets less current liabilities
  
215,437
220,072

  

Creditors: amounts falling due after more than one year
 21 
(100,000)
(95,037)

Provisions for liabilities
  

Deferred taxation
 25 
(28,903)
(27,957)

Other provisions
 26 
(4,080)
(4,870)

Net assets
  
82,454
92,208


Capital and reserves
  

Called up share capital 
 27 
100
100

Share premium account
 28 
418
418

Profit and loss account
 28 
81,936
91,690

  
82,454
92,208


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 



Mr J C Patel Jnr (Sam)
Director
Date: 9 August 2024

The notes on pages 30 to 68 form part of these financial statements.
Page 22

 
DAY LEWIS PLC
REGISTERED NUMBER: 01202866
    
COMPANY BALANCE SHEET (CONTINUED)
AS AT 31 MARCH 2024


Page 23

 

 
DAY LEWIS PLC


 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024



Called up share capital
Share premium account
Capital contribution reserve
Merger reserve
Profit and loss account
Equity attributable to owners of parent Company
Non-controlling interests
Total equity


£000
£000
£000
£000
£000
£000
£000
£000


At 1 April 2023
100
418
1,694
757
142,026
144,995
1,024
146,019



Comprehensive income for the year


Profit for the year
-
-
-
-
5,172
5,172
278
5,450



Other comprehensive income for the year
-
-
-
-
-
-
-
-



Total comprehensive income for the year
-
-
-
-
5,172
5,172
278
5,450


Dividends: Equity capital
-
-
-
-
(3,000)
(3,000)
-
(3,000)


Dividends: Equity capital
-
-
-
-
-
-
(319)
(319)


Transfer
-
-
-
-
(954)
(954)
954
-



Total transactions with owners
-
-
-
-
(3,954)
(3,954)
635
(3,319)



At 31 March 2024
100
418
1,694
757
143,244
146,213
1,937
148,150



The notes on pages 30 to 68 form part of these financial statements.

Page 24

 

 
DAY LEWIS PLC


 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023



Called up share capital
Share premium account
Capital contribution reserve
Merger reserve
Profit and loss account
Equity attributable to owners of parent Company
Non-controlling interests
Total equity


£000
£000
£000
£000
£000
£000
£000
£000


At 1 April 2022
100
418
1,694
757
135,665
138,634
1,006
139,640



Comprehensive income for the year


Profit for the year
-
-
-
-
8,994
8,994
335
9,329



Other comprehensive income for the year
-
-
-
-
-
-
-
-



Total comprehensive income for the year
-
-
-
-
8,994
8,994
335
9,329


Dividends: Equity capital
-
-
-
-
(2,633)
(2,633)
-
(2,633)


Dividends: Equity capital
-
-
-
-
-
-
(317)
(317)



Total transactions with owners
-
-
-
-
(2,633)
(2,633)
(317)
(2,950)



At 31 March 2023
100
418
1,694
757
142,026
144,995
1,024
146,019



The notes on pages 30 to 68 form part of these financial statements.

Page 25

 
DAY LEWIS PLC
 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024


Called up share capital
Share premium account
Profit and loss account
Total equity

£000
£000
£000
£000

At 1 April 2023
100
418
91,690
92,208


Comprehensive income for the year

Loss for the year
-
-
(6,754)
(6,754)
Total comprehensive income for the year
-
-
(6,754)
(6,754)

Dividends: Equity capital
-
-
(3,000)
(3,000)


Total transactions with owners
-
-
(3,000)
(3,000)


At 31 March 2024
100
418
81,936
82,454



COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023


Called up share capital
Share premium account
Profit and loss account
Total equity

£000
£000
£000
£000

At 1 April 2022
100
418
92,261
92,779


Comprehensive income for the year

Profit for the year
-
-
2,062
2,062
Total comprehensive income for the year
-
-
2,062
2,062


Contributions by and distributions to owners

Dividends: Equity capital
-
-
(2,633)
(2,633)


Total transactions with owners
-
-
(2,633)
(2,633)


At 31 March 2023
100
418
91,690
92,208


The notes on pages 30 to 68 form part of these financial statements.

Page 26

 
DAY LEWIS PLC
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2024

2024
2023
£000
£000

Cash flows from operating activities

Profit for the financial year
5,450
9,329

Adjustments for:

Amortisation of intangible assets
2,260
2,248

Depreciation of tangible assets
3,466
3,242

Impairments of fixed assets
1,433
299

Loss/(profit) on disposal of tangible assets
(730)
33

(Profit)/loss on disposal of subsidiary, associates and unincorpated business
-
3,000

Interest payable
8,899
4,237

Interest receivable
(2,381)
(2,387)

Taxation charge
2,523
2,384

(Increase) in stocks
(873)
(5,936)

Decrease/(increase) in debtors
8,291
(3,314)

(Decrease)/increase in creditors
(6,275)
14,188

(Decrease) in provisions
(709)
(2,262)

Share of operating (loss) in associates
(293)
(531)

Corporation tax (paid)
(713)
(2,113)

Net cash generated from operating activities

20,348
22,417


Cash flows from investing activities

Purchase of intangible fixed assets
(203)
(2,697)

Sale of businesses
3,921
-

Purchase of tangible fixed assets
(7,390)
(10,596)

Associates loans (repaid) / received
(919)
415

Purchase of unlisted and other investments
-
(250)

Purchase of subsidiary undertakings and unincorporated businesses
(8)
(4,493)

Cash and cash equivalents acquired on acquisition
66
407

Interest received
2,381
1,324

Associates income received
390
815

Net cash from investing activities

(1,762)
(15,075)

Cash flows from financing activities

Net movement in bank loans and revolving credit facility
4,738
21,446

Repayment of finance leases
(46)
(213)

Dividends paid
(3,000)
(2,633)

Non-controlling interest dividends paid
(319)
(317)

Interest paid
(7,708)
(4,220)

HP interest paid
(3)
(17)
Page 27

 
DAY LEWIS PLC
 

CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024


2024
2023

£000
£000


Net cash used in financing activities
(6,338)
14,046

Net increase in cash and cash equivalents
12,248
21,388

Cash and cash equivalents at beginning of year
26,026
4,638

Cash and cash equivalents at the end of year
38,274
26,026


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
38,274
26,026

38,274
26,026


The notes on pages 30 to 68 form part of these financial statements.

Page 28

 
DAY LEWIS PLC
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 MARCH 2024






At 1 April 2023
Cash flows
Acquisition and disposal of subsidiaries
Other non-cash changes
At 31 March 2024
£000

£000

£000

£000

£000

Cash at bank and in hand

26,026

12,182

66

-

38,274

Debt due within 1 year

(705)

334

-

-

(371)

Debt due after 1 year

(98,404)

(5,072)

-

-

(103,476)

Finance leases

(82)

46

-

(3)

(39)


-

-

-

-

-


(73,165)
7,490
66
(3)
(65,612)

The notes on pages 30 to 68 form part of these financial statements.

Page 29

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

1.


General information

Day Lewis Plc (the “Company”) is a public limited company limited by shares and incorporated, domiciled and registered in England in the United Kingdom. The address of the registered office is given on the Company information page. The nature of the Company's operations and its principal activities are set out in the strategic report on pages 1 to 6.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland, and the Companies Act 2006.
The Company is included in the consolidated financial statements and is considered to be a qualifying entity under FRS 102 paragraphs 1.8 to 1.12. The following exemptions available under FRS 102 in respect of certain disclosures for the Company financial statements have been applied:

The reconciliation of the number of shares outstanding from the beginning to the end of the period has not been included;
No separate Company Cash Flow Statement with related notes is included;
Key Management Personnel compensation has not been included;
Certain disclosures required by FRS 102.11 Basic Financial Instruments and FRS 102.12; and
Other Financial Instrument Issues in respect of financial instruments not falling within the fair value accounting rules of Paragraph 36(4) of Schedule 1.
 

 
2.2

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between Group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Profit and Loss Account from the date on which control is obtained. They are deconsolidated from the date control ceases.
In accordance with the transitional exemption available in FRS 102, the Group has chosen not to retrospectively apply the standard to business combinations that occurred before the date of transition to FRS 102, being 1 April 2014.
Therefore, the Group continues to recognise a merger reserve which arose on a past business combination that was accounted for as a merger in accordance with UK GAAP as applied at that time.The Company is entitled to merger relief by Section 612 of the Companies Act 2006 in respect of the consideration received in excess of the nominal value of the equity shares issued in connection with the acquisition of the following subsidiary: Cradlecrest Limited
Goodwill arising on consolidation, representing the excess of fair value of the consideration given over the fair values of the identifiable net assets acquired, is capitalised and is amortised on a straight line basis over its estimated useful economic life of 20 years.

Page 30

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

 
2.3

Going concern

In assessing the validity of the going concern basis, and taking account of reasonably plausible downsides covering a period of at least 12 months from the date of approval of these financial statements, the Directors have considered the cash flow forecasts they have prepared for the period until December 2025. In doing so they have considered the level of bank facilities available to the Company and the Group, and compliance with bank covenant tests both during the period and for the period ahead. In July 2024, the company extended its existing £110m RCF finance facility with 4 banks until December 2025.
Having considered the Company’s and Group's financial forecasts and investment and financing commitments (including the downside scenario, increase in cost and interest rates), the Directors believe the Company and Group have sufficient current and future cash reserves and facilities available for them to meet their liabilities including financing obligations whilst in compliance with its banking covenants for at least twelve months from the date of signing of the financial statements.
Having considered the above, the Directors conclude that it is appropriate to adopt the going concern basis of accounting because there are no material uncertainties related to events or conditions that may cast significant doubt about the ability of the Company and Group to continue as a going concern. Thus they continue to adopt the going concern basis of accounting in preparing the financial statements.

  
2.4

Turnover

Turnover comprises revenue recognised by the Group in respect of goods and services supplied to Retail and Distribution markets, the NHS, private prescriptions and counter services during the year, exclusive of Value Added Tax and trade discounts.

 
2.5

Intangible assets

Retail Pharmacy Licences
The difference between amounts paid on the acquisition of a pharmacy business and the fair value of its identifiable assets and liabilities is capitalised as an intangible asset as the retail pharmacy licence. Retail pharmacy licences are grouped into cash generating units as appropriate and are subject to an annual impairment review by the directors in accordance with section 27 of FRS102.
Any deficiency arising from the impairment review is written off to the Consolidated Profit and Loss Account in the year in which it arises. Any increases in value are not recognised in the financial statements.

Goodwill

Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Consolidated Profit and Loss Account over its useful economic life.

Other intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment
Page 31

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)


2.5
Intangible assets (continued)

losses.

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

 The estimated useful lives range as follows:

Retail pharmacy licences
-
100
years on straight-line basis
Goodwill
-
20
years on straight-line basis
Trademarks
-
20
years on straight-line basis

  
2.6

Impairment of fixed assets and goodwill

Assets that are subject to depreciation or amortisation are assessed at each Balance Sheet date to determine whether there is any indication that the assets are impaired. Where there is any indication that an asset may be impaired, the carrying value of the asset (or cash-generating unit to which the asset has been allocated) is tested for impairment. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's (or CGU's) fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (CGUs). Non-financial assets that have been previously impaired are reviewed at each Balance Sheet date to assess whether there is any indication that the impairment losses recognised in prior periods may no longer exist or may have decreased.

 
2.7

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Depreciation is charged to allocate the cost of assets less their residual value over their estimated useful lives. 

Depreciation is provided on the following basis:


 Freehold property   - not depreciated 
  Leasehold property   - over period of lease
  Plant and machinery               - 10 - 33.3% straight-line
  Motor Vehicles   - 25% per annum on reducing balance
  Fixtures and fittings  - 15% per annum on reducing balance
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Consolidated Profit and Loss Account.

Page 32

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

 
2.8

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Investments in unlisted Group shares, whose market value can be reliably determined, are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in the Consolidated Profit and Loss Account for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment.

 
2.9

Associates and joint ventures

An entity is treated as a joint venture where the Group is a party to a contractual agreement with one or more parties from outside the Group to undertake an economic activity that is subject to joint control.
An entity is treated as an associated undertaking where the Group exercises significant influence in that it has the power to participate in the operating and financial policy decisions.
In the consolidated financial statements, interests in associated undertakings are accounted for using the equity method of accounting. Under this method an equity investment is initially recognised at the transaction price (including transaction costs) and is subsequently adjusted to reflect the investors share of the profit and loss, other comprehensive income and equity of the associate. The Consolidated Profit and Loss Account includes the Group's share of the operating results, interest, pre-tax results and attributable taxation of such undertakings applying accounting policies consistent with those of the Group. In the Consolidated Balance Sheet, the interests in associated undertakings are shown as the Group's share of the identifiable net assets, including any unamortised premium paid on acquisition.
Any premium on acquisition is dealt with in accordance with the goodwill policy. 

 
2.10

Operating leases: the Group as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.11

Leased assets: the Group as lessee

Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired by finance lease are depreciated over the shorter of the lease term and their useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the Company. Obligations under such agreements are included in creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to profit or loss so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.

Page 33

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

 
2.12

Research and development

In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight-line basis over their useful economic lives, which range from 3 to 6 years.
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.

 
2.13

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Consolidated Profit and Loss Account in the same period as the related expenditure.

 
2.14

Interest income

Interest income is recognised in the Consolidated Profit and Loss Account using the effective interest method.

 
2.15

Finance costs

Finance costs are charged to the Consolidated Profit and Loss Account over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.16

Borrowing costs

All borrowing costs are recognised in the Consolidated Profit and Loss Account in the year in which they are incurred.

 
2.17

Pensions

Defined contribution pension plan
The Group operates a defined contribution pension plan for its employees. A defined contribution pension plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Group in independently administered funds.

Page 34

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

 
2.18

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.
At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in the Consolidated Profit and Loss Account.

 
2.19

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.20

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Consolidated Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.

 
2.21

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.22

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

 
2.23

Onerous leases

Where the unavoidable costs of a lease exceed the economic benefit expected to be received from it, a provision is made for the present value of the obligations under the lease.

Page 35

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

 
2.24

Foreign currency translation

Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Consolidated Profit and Loss Account except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Consolidated Profit and Loss Account within 'finance income or costs'. All other foreign exchange gains and losses are presented in the Consolidated Profit and Loss Account within 'other operating income'.

 
2.25

Financial instruments

Other than the interest rate swap disclosed in note 24, the Group only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Consolidated Profit and Loss Account.
For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the
Page 36

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)


2.25
Financial instruments (continued)

contract.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Group would receive for the asset if it were to be sold at the Balance Sheet date.
Financial assets and liabilities are offset and the net amount reported in the Balance Sheet when there is an 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.
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in the Profit and Loss Account in finance costs or income as appropriate. The Company does not currently apply hedge accounting for interest rate and foreign exchange derivatives.

 
2.26

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.

Page 37

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.Accounting policies (continued)

 
2.27

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company and the Group operate and generate income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits;
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Page 38

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

3.


Judgements in applying accounting policies and key sources of estimation uncertainty

In the application of the Company's accounting policies, which are described in note 2, the directors are required to make judgements, estimates and assumptions about the carrying amounts 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 if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
Critical judgements in applying the Company's and Group's accounting policies
The following are the critical judgements, apart from those involving estimations (which are dealt with separately below), that the directors have made in the process of applying the Company's and Group's accounting policies and that have the most significant effect on the amounts recognised in the financial statements.
Key source of estimation uncertainty - impairment of retail pharmacy licences
Determining whether the values of retail pharmacy licenses are impaired requires an estimation of the value in use of the cash-generating units to which retail pharmacy licenses have been allocated. The impairment value is based on the applicable discount rate and turnaround plan for cash-generating units that may have been impaired. The carrying amount of retail pharmacy licenses at the balance sheet date was £170(2023 - £174m) after an impairment loss of £805(2023 - £278k) was recognised during the year.
Key source of estimation uncertainty - useful life of retail pharmacy licences
The directors believe that the right for dispensing UK NHS prescriptions, being the pharmacy licence which is attached to a particular pharmacy, has a continuing value. Such rights, conferred by the Department of Health as contracts to dispense prescriptions, are not generally granted to new pharmacies in the same locality. Consequently the directors consider that the value of a retail pharmacy licence has a long life of 100 years and therefore should be amortised over that period.


4.


Turnover

The whole of the turnover is attributable to the sale of pharmaceutical products.

Analysis of turnover by country of destination:

2024
2023
£000
£000

United Kingdom
493,759
467,600

Rest of the world
8,342
6,393

502,101
473,993


Turnover is not disclosed by activity due to commercial reasons.

Page 39

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

5.


Other operating income

2024
2023
£000
£000

Other operating income
-
4

Net rents receivable
398
299

Insurance claims receivable
11
4

409
307



6.


Operating profit

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

2024
2023
£000
£000

Depreciation of tangible fixed assets
3,466
3,242

Amortisation of intangible assets, including goodwill
2,260
2,247

Impairment of fixed assets
1,433
299

(Profit)/loss on disposal of fixed assets
(730)
33

Exchange differences
(6)
-

Other operating lease rentals
9,433
7,861

Defined contribution pension cost
1,781
1,413


7.


Auditor's remuneration

During the year, the Group obtained the following services from the Company's auditor and its associates:


2024
2023
£000
£000

Fees payable to the Company's auditor and its associates for the audit of the consolidated and parent Company's financial statements
184
178

Page 40

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

8.


Employees

Staff costs, including Directors' remuneration, were as follows:


Group
Group
Company
Company
2024
2023
2024
2023
£000
£000
£000
£000


Wages and salaries
65,239
58,565
53,045
47,970

Social security costs
5,325
4,953
4,299
4,082

Cost of defined contribution scheme
1,781
1,413
1,432
1,171

72,345
64,931
58,776
53,223


The average monthly number of employees, including the Directors, during the year was as follows:



Group
Group
Company
Company
        2024
        2023
        2024
        2023
            No.
            No.
            No.
            No.









Management and pharmacists
530
515
504
490



Sales assistants
1,710
1,703
1,699
1,696



Distribution staff
360
307
280
236

2,600
2,525
2,483
2,422


9.


Directors' remuneration

2024
2023
£000
£000

Directors' emoluments
777
755

Company contributions to defined contribution pension schemes
48
40

825
795


During the year retirement benefits were accruing to 1 Director (2023 - 1) in respect of defined contribution pension schemes.

The highest paid Director received remuneration of £208k (2023 - £202k).

The value of the Group's contributions paid to a defined contribution pension scheme in respect of the highest paid Director amounted to £NIL (2023 - £NIL).

Page 41

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

10.


Interest receivable

2024
2023
£000
£000


Net changes in fair value of interest rate swap
-
1,063

Swap interest income
1,945
1,054

Share of associates' interest receivable
54
53

Other interest receivable
381
217

2,380
2,387


11.


Interest payable and similar expenses

2024
2023
£000
£000


Bank interest payable
7,697
4,210

Other interest payable
7
9

Hire purchase interest payable
3
18

Net changes in fair value of interest rate swap
1,192
-

8,899
4,237


12.


Taxation


2024
2023
£000
£000

Corporation tax


Current tax on profits for the year
1,467
986

Adjustments in respect of previous periods
(11)
(1)


Total current tax
1,456
985

Deferred tax


Origination and reversal of timing differences
1,161
1,235

Changes to tax rates
-
232

Prior year adjustment
(94)
(68)

Total deferred tax
1,067
1,399


Taxation on profit
2,523
2,384
Page 42

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
 
12.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is higher than (2023 - higher than) the standard rate of corporation tax in the UK of 25% (2023 - 19%). The differences are explained below:

2024
2023
£000
£000


Profit before tax
7,974
11,713


Profit multiplied by standard rate of corporation tax in the UK of 25% (2023 - 19%)
1,994
2,226

Effects of:


Non-tax deductible amortisation of goodwill and impairment
344
300

Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
1,083
214

Super deduction capital allowances
-
(460)

Adjustments to tax charge in respect of prior periods
(11)
(1)

Non-taxable income
(79)
(17)

Deferred tax not recognised previously
(714)
(42)

Deferred tax prior year adjustment
(94)
(68)

Tax rate changes
-
232

Total tax charge for the year
2,523
2,384


Factors that have affected the tax charge

The rate of UK corporation tax applied for the year ended 31 March 2024 was 25% and for the year ended 31 March 2023 was 19%.
The UK deferred tax liability as at 31 March 2024 was calculated at 25% (2023: 25%). 


13.


Dividends

2024
2023
£000
£000


Dividends paid at £30.00 per share (2023: £26.33 per share)
3,000
2,633

3,000
2,633

Page 43

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

14.


Intangible assets

Group





Retail Pharmacy Licences
Other intangible assets
Goodwill
Total

£000
£000
£000
£000



Cost


At 1 April 2023
187,574
951
11,774
200,299


Additions
3,815
203
227
4,245


Disposals
(5,701)
-
-
(5,701)



At 31 March 2024

185,688
1,154
12,001
198,843



Amortisation


At 1 April 2023
13,495
380
8,503
22,378


Charge for the year on owned assets
1,842
131
287
2,260


Released on disposals
(267)
-
-
(267)


Impairment losses
805
-
-
805



At 31 March 2024

15,875
511
8,790
25,176



Net book value



At 31 March 2024
169,813
643
3,211
173,667



At 31 March 2023
174,079
571
3,271
177,921



Page 44

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
 
           14.Intangible assets (continued)

Company




Retail pharmacy licenses
Other intangible assets
Total

£000
£000
£000



Cost


At 1 April 2023
173,126
1,003
174,129


Additions
3,814
194
4,008


Disposals
(5,701)
-
(5,701)


Transfers
(71)
-
(71)



At 31 March 2024

171,168
1,197
172,365



Amortisation


At 1 April 2023
11,577
545
12,122


Charge for the year
1,644
107
1,751


Released on disposals
(267)
-
(267)


Impairment losses
805
-
805



At 31 March 2024

13,759
652
14,411



Net book value



At 31 March 2024
157,409
545
157,954



At 31 March 2023
161,549
458
162,007

Page 45

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

15.


Tangible fixed assets

Group






Freehold property
Leasehold property
Plant and machinery
Motor vehicles
Fixtures and fittings

£000
£000
£000
£000
£000



Cost or valuation


At 1 April 2023
6,981
7,215
2,605
909
37,188


Additions
-
2,337
884
-
4,113


Disposals
-
(35)
(8)
-
(383)



At 31 March 2024

6,981
9,517
3,481
909
40,918



Depreciation


At 1 April 2023
303
5,532
870
690
22,374


Charge for the year on owned assets
-
413
497
53
2,503


Disposals
-
(27)
(6)
-
(202)



At 31 March 2024

303
5,918
1,361
743
24,675



Net book value



At 31 March 2024
6,678
3,599
2,120
166
16,243



At 31 March 2023
6,678
1,683
1,735
219
14,814
Page 46

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

           15.Tangible fixed assets (continued)


Assets under construction
Total

£000
£000



Cost or valuation


At 1 April 2023
5,022
59,920


Additions
56
7,390


Disposals
-
(426)



At 31 March 2024

5,078
66,884



Depreciation


At 1 April 2023
-
29,769


Charge for the year on owned assets
-
3,466


Disposals
-
(235)



At 31 March 2024

-
33,000



Net book value



At 31 March 2024
5,078
33,884



At 31 March 2023
5,022
30,151

The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2024
2023
£000
£000



Motor vehicles
-
11

Furniture, fittings and equipment
41
614

41
625

Page 47

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

           15.Tangible fixed assets (continued)


Company






Freehold property
Leasehold property
Plant and machinery
Motor vehicles
Fixtures and fittings

£000
£000
£000
£000
£000

Cost or valuation


At 1 April 2023
465
5,188
1,519
683
28,755


Additions
-
22
298
-
2,517


Disposals
-
(35)
(8)
-
(383)



At 31 March 2024

465
5,175
1,809
683
30,889



Depreciation


At 1 April 2023
141
3,704
396
520
16,537


Charge for the year on owned assets
-
292
210
38
2,016


Disposals
-
(27)
(6)
-
(202)



At 31 March 2024

141
3,969
600
558
18,351



Net book value



At 31 March 2024
324
1,206
1,209
125
12,538



At 31 March 2023
324
1,484
1,123
163
12,218
Page 48

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

           15.Tangible fixed assets (continued)


Assets under construction
Total

£000
£000

Cost or valuation


At 1 April 2023
5,022
41,632


Additions
56
2,893


Disposals
-
(426)



At 31 March 2024

5,078
44,099



Depreciation


At 1 April 2023
-
21,298


Charge for the year on owned assets
-
2,556


Disposals
-
(235)



At 31 March 2024

-
23,619



Net book value



At 31 March 2024
5,078
20,480



At 31 March 2023
5,022
20,334






The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2024
2023
£000
£000



Motor vehicles
-
11

Furniture, fittings and equipment
41
614

41
625

Page 49

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

16.


Fixed asset investments

Group





Investments in and loans to associates
Unlisted investments
Retail pharmacy licences in associates (net of deferred tax)
Total

£000
£000
£000
£000



Cost


At 1 April 2023
626
3,006
8,274
11,906


Loans issued to associates
919
-
-
919


Share of losses
(1,534)
-
-
(1,534)



At 31 March 2024

11
3,006
8,274
11,291



Impairment


At 1 April 2023
-
-
1,245
1,245


Charge for the period
-
150
75
225



At 31 March 2024

-
150
1,320
1,470



Net book value



At 31 March 2024
11
2,856
6,954
9,821



At 31 March 2023
626
3,006
7,029
10,661

Page 50

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
Company





Investments in subsidiary companies
Unlisted investments
Total

£000
£000
£000



Cost


At 1 April 2023
21,645
328
21,973


Additions
1,541
-
1,541


Transfers
71
-
71



At 31 March 2024

23,257
328
23,585



Impairment


At 1 April 2023
2,747
-
2,747


Charge for the period
4,759
-
4,759



At 31 March 2024

7,506
-
7,506



Net book value



At 31 March 2024
15,751
328
16,079



At 31 March 2023
18,898
328
19,226

The impairment charge for the period in respect of investments in subsidiary companies has arisen following the distribution of dividends from the subsidiary companies up to the Company prior to the proposed dissolution of the relevant subsidiary companies.

Page 51

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

Direct subsidiary undertakings


The following were direct subsidiary undertakings of the Company:

Name

Principal activity

Class of shares

Holding

Day Lewis Chemists Limited (Company number:
01586170)
Dormant
Ordinary 
shares £1 
each
100%
Day Lewis Medical Limited (Company number:
01904504)
Distribution of 
Pharmaceuticals
Ordinary 
shares £1 
each
100%
Cradlecrest Limited (Company number: 01612286)
Distribution of 
Pharmaceuticals
Ordinary 
shares £1 
each
100%
Leach and Burton Limited (Company number:
02302184)
Dormant
Ordinary 
shares £1 
each
100%
Tayzana Limited (Company number: 02022221)
Retail pharmacies
Ordinary 
shares £1 
each
51%
Medi Options Limited (Company number: 08157624)
Holding investment in
  pharmacy companies
Ordinary 
shares £1 
each
100%
Healthcare Drugstores Limited (Company number:
07264746)
Holding investment in
  pharmacy companies
Ordinary 
shares £1 
each
100%
East Midlands Pharma Limited (Company number:
05365532)
Pharmaceutical products 
and medical services
Ordinary 
shares £1 
each
100%
Narrowcliff Medical Services Limited (Company
number: 07372866)
Holding investment in
  pharmacy companies
Ordinary 
shares £1 
each
100%
Stargazer Drug Stores Limited (Company number:
08375218)
Holding investment in
  pharmacy companies
Ordinary 
shares £1 
each
100%
Newlands Pharmacies Limited (Company number:
01896141)
Dormant
Ordinary 
shares £1 
each
100%
Keyshare Limited (Company number: 04395746)
Holding investment in
  pharmacy companies
Ordinary 
shares £1 
each
100%
Gleadless Valley Pharmacy Limited (Company
number: 04747975)
Dormant
Ordinary 
shares £1 
each
100%
Day Lewis Properties Limited (Company number:
10509005)
Investment properties
Ordinary 
shares £1 
each
100%
Liptrots (Calverley) Limited (Company number:
05994082)
Holding investment in
  pharmacy companies
Ordinary 
shares £1 
each
100%
Gnosall Healthcare Limited (Company number:
03222950)
Dormant
Ordinary 
shares £1 
each
100%
Page 52

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
Direct subsidiary undertakings (continued)


Name

Principal activity

Class of shares

Holding

Ramsay Enterprises Limited (Company number:
05543446)
Holding investment in
  pharmacy companies
Ordinary 
shares £1 
each
100%
Readesmoor Healthcare LLP (Company number:
OC379373)
Dormant
Partnership
100%
Denmark Street Healthcare LLP (Company number:
OC377647)
Dormant
Partnership
100%
Finchampstead Healthcare LLP (Company number:
OC378219)
Dormant
Partnership
100%
APM Healthcare Limited (Company number:
068889809)
Holding investment in
  pharmacy companies
Ordinary 
shares £1 
each
100%
Nailsea Healthcare LLP (Company number:
OC375502)
Dormant
Partnership
100%
Norsworthy Limited (Company number: 05883457)
Dormant
Ordinary 
shares £1 
each
100%
The Essential Pharmacy Limited (Company number:
05410890)
Dormant
Ordinary 
shares £1 
each
100%
Axbridge Square Company Limited (Company
number: 06456709)
Dormant
Ordinary 
shares £1 
each
100%
Drury's Pharmacies Limited (Company number:
03602459)
Dormant
Ordinary 
shares £1 
each
100%
Plymstock Wellcare Limited (Company number:
10551223)
Distribution of
  Pharmaceuticals
Ordinary 
shares £1 
each
100%
Una Murray Limited (Company number: 05521483)
Dormant
Ordinary 
shares £1 
each
100%

The above companies only have one class of share capital and were registered at 2 Peterwood Way,
Croydon, Surrey, CR0 4UQ except East Midlands Pharma Ltd which is registered at Unit 2a Old Dalby
Business Park, Station Road, Old Dalby, Leicestershire, LE14 3NJ.
All companies have accounting year ends of 31 March.
All of the subsidiary undertakings have been consolidated in the Group financial statements.
All of the subsidiary undertakings except Day Lewis Medical Limited are exempt from the Companies Act
2006 requirements relating to the audit of their individual financial statements by virtue of Section 479A of
the Act as this Company has guaranteed each subsidiary undertaking under Section 479C of the Act.

Page 53

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
Direct subsidiary undertakings (continued)

The aggregate of the share capital and reserves as at 31 March 2024 and the profit or loss for the year ended on that date for the subsidiary undertakings were as follows:

Name
Aggregate of share capital and reserves
Profit/(Loss)
£000
£000

Day Lewis Chemists Limited
-
-

Day Lewis Medical Limited
54,898
14,046

Cradlecrest Limited
4,582
(291)

Leach and Burton Limited
638
31

Tayzana Limited
1,401
251

Medi Options Limited
444
126

Healthcare Drugstores Limited
(1,284)
-

East Midlands Pharma Limited
(3,134)
(1,643)

Narrowcliff Medical Services Limited
-
-

Stargazer Drug Stores Limited
152
228

Newlands Pharmacies Limited
-
-

Keyshare Limited
1
-

Gleadless Valley Pharmacy Limited
-
-

Day Lewis Properties Limited
1,784
256

Liptrots (Calverley) Limited
-
-

Gnosall Healthcare Limited
-
-

Ramsay Enterprises Limited
1
-

Readesmoor Healthcare LLP
-
-

Denmark Street Healthcare LLP
715
-

Finchampstead Healthcare LLP
64
-

APM Healthcare Limited
571
-

Nailsea Healthcare LLP
874
-

Norsworthy Limited
-
-

The Essential Pharmacy Limited
-
-

Axbridge Square Company Limited
1,350
-

Drury's Pharmacies Limited
1
-

Plymstock Wellcare Limited
1,592
1,508

Una Murray Limited
-
-

Page 54

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

Indirect subsidiary undertakings


The following were indirect subsidiary undertakings of the Company:

Name

Principal activity

Class of shares

Holding

ABC Drug Stores Limited (Company number:
02825947)
Retail pharmacies
Ordinary 
shares £1 
each
100%
Community Stores Limited (Company number:
07066644)
Holding investment in
  pharmacy companies
Ordinary 
shares £1 
each
100%
Cape Holdings Limited (Company number:
09440413)
Retail pharmacies
Ordinary 
shares £1 
each
51%
R.S. Marsden (Chemist) Limited (Company number:
01200990)
Dormant
Ordinary 
shares £1 
each
100%
Budget Pharma UK Limited (Company number:
05690554)
Dormant
Ordinary 
shares £1 
each
100%
Pollenase Limited (Company number: 09261222)
Dormant
Ordinary 
shares £1 
each
100%
Sem Pharma Limited (Company number: 10405819)
Dormant
Ordinary 
shares £1 
each
100%
HQEM Pharma Limited (Company number:
10517180)
Dormant
Ordinary 
shares £1 
each
100%
HQEMP Limited (Company number: 10517228)
Dormant
Ordinary 
shares £1 
each
100%
Liptrots (Farsley) Limited (Company number:
05994048)
Dormant
Ordinary 
shares £1 
each
100%
Community Pharmacies (UK) Ltd (Company number:
06912826)
Holding investment in
  pharmacy companies
Ordinary 
shares £1 
each
100%
Ramsay Pharmacy Limited (Company number:
04259371)
Dormant
Ordinary 
shares £1 
each
100%
Harlequin BPI Limited (Company number: 08132968)
Dormant
Ordinary 
shares £1 
each
100%
Cradlecrest USA, Inc
Wholesale trade
Shares of common stock $0.10 each
100%
Littlefields Holding Ltd (Company number: 14211203)
Dormant
Ordinary 
shares £1 
each
100%
Littlefields Limited (Company number: 01764387)
Dormant
Ordinary 
shares £1 
each
100%
Page 55

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
Indirect subsidiary undertakings (continued)


The above companies only have one class of share capital and were registered at 2 Peterwood Way,
Croydon, Surrey, CR0 4UQ except Budget Pharma UK Ltd, Pollenase Limited, Sem Pharma Limited,
HQEMP Pharma Limited, HQEMP Limited and Harlequin BPI Limited which are registered at Unit 2a Old
Dalby Business Park, Station Road, Old Dalby, Leicestershire, LE14 3NJ and Cradlecrest USA, Inc which
is registered at 19632 70th Ave South - Suite 4-3, Kent, WA 98032-2176.
All companies have accounting year ends of 31 March.
All of the indirect subsidiary undertakings have been consolidated in the Group financial statements.
All of the indirect subsidiary undertakings are exempt from the Companies Act 2006 requirements
relating to the audit of their individual financial statements by virtue of Section 479A of the Act as this
Company has guaranteed each subsidiary undertaking under Section 479C of the Act.

The aggregate of the share capital and reserves as at 31 March 2024 and the profit or loss for the year ended on that date for the subsidiary undertakings were as follows:

Name
Aggregate of share capital and reserves
Profit/(Loss)
£000
£000

ABC Drug Stores Limited
2,080
-

Community Stores Limited
-
-

Cape Holdings Limited
2,553
317

R.S. Marsden (Chemist) Limited
1
-

Budget Pharma UK Limited
-
-

Pollenase Limited
-
-

Sem Pharma Limited
-
-

HQEM Pharma Limited
-
-

HQEMP Limited
-
-

Liptrots (Farsley) Limited
-
-

Community Pharmacies (UK) Ltd
3,217
505

Ramsay Pharmacy Limited
1
-

Harlequin BPI Limited
-
-

Cradlecrest USA, Inc
282
(85)

Littlefields Holding Ltd
1,289
-

Littlefields Limited
-
-

Page 56

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

Associates


The following were associates of the Company:


Name

Principal activity

Class of shares

Holding

Arlington Road Healthcare LLP
Retail pharmacy
Partnership
50%
Camberley Healthcare LLP
Retail pharmacy
Partnership
50%
Crewkerne Healthcare LLP
Retail pharmacy
Partnership
50%
Felixstowe Healthcare LLP
Retail pharmacy
Partnership
50%
Gale Farm Healthcare LLP
Retail pharmacy
Partnership
50%
Harrogate Healthcare LLP
Retail pharmacy
Partnership
50%
Haslemere Healthcare LLP
Retail pharmacy
Partnership
50%
Hope Farm Healthcare LLP
Retail pharmacy
Partnership
50%
Newton Place Healthcare LLP
Retail pharmacy
Partnership
50%
Priory Fields Healthcare LLP
Retail pharmacy
Partnership
50%
Somerset Gardens Healthcare LLP
Retail pharmacy
Partnership
50%
South Kirkby Healthcare LLP
Retail pharmacy
Partnership
30%
Stockton Heath Healthcare LLP
Retail pharmacy
Partnership
50%

The above associates were registered at 2 Peterwood Way, Croydon, Surrey, CR0 4UQ.
All associates have accounting year ends of 31 March.


17.


Stocks

Group
Group
Company
Company
2024
2023
2024
2023
£000
£000
£000
£000

Finished goods and goods for resale
48,928
48,046
11,955
12,232

48,928
48,046
11,955
12,232


The difference between the purchase price or production cost of stocks and their replacement cost is not material.
Stock recognised in cost of sales during the year as an expense was £374,704k (2023 - £348,501k).

Page 57

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

18.


Debtors

Group
Group
Company
Company
2024
2023
2024
2023
£000
£000
£000
£000


Trade debtors
39,639
46,389
2,064
3,851

Amounts owed by group undertakings
-
-
39,741
38,519

Other debtors
7,341
7,410
2,728
3,099

Prepayments and accrued income
8,006
9,298
5,178
4,294

Corporation tax receivable
-
454
1,236
1,510

Financial instruments (note 24)
2,581
3,769
2,581
3,769

57,567
67,320
53,528
55,042



19.


Cash and cash equivalents

Group
Group
Company
Company
2024
2023
2024
2023
£000
£000
£000
£000

Bank and cash balances
38,274
26,026
14,797
17,453

38,274
26,026
14,797
17,453



20.


Creditors: Amounts falling due within one year

Group
Group
Company
Company
2024
2023
2024
2023
£000
£000
£000
£000

Bank loans
371
705
-
-

Trade creditors
63,262
70,483
22,835
26,180

Amounts owed to group undertakings
-
-
31,098
36,144

Corporation tax payable
289
-
-
-

Other taxation and social security
1,601
1,499
1,390
1,347

Obligations under finance lease and hire purchase contracts
39
45
39
45

Other creditors
3,807
2,685
3,246
1,806

Accruals and deferred income
2,670
2,633
748
700

72,039
78,050
59,356
66,222


See Note 22 for details of the terms for the loans.

Page 58

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

21.


Creditors: Amounts falling due after more than one year

Group
Group
Company
Company
2024
2023
2024
2023
£000
£000
£000
£000

Bank loans
103,476
98,404
100,000
95,000

Net obligations under finance leases and hire purchase contracts
-
37
-
37

103,476
98,441
100,000
95,037


There are no loans falling due after more than 5 years. See Note 22 for details of the terms for the loans.

Page 59

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

22.


Loans

The long term Revolving Credit Facility (''RCF'') has a maturity date ending 4 December 2025. The drawn amount is reset monthly and repayable as a final bullet repayment of the outstanding balance due at the end of the term. The loan bears interest between 2% and 3% per annum above SONIA depending on the financial leverage.
Total balances in respect of bank loans and the RCF amounting to £103,847,000 (2023 - £99,109,000) as at the year end were secured as follows:
a) Unlimited inter-company guarantees supported by legal charges over various properties and other assets.
b) Debentures by the Company and certain subsidiaries.


Analysis of the maturity of loans is given below:


Group
Group
Company
Company
2024
2023
2024
2023
£000
£000
£000
£000

Amounts falling due within one year

Bank loans
371
705
-
-


371
705
-
-

Amounts falling due 1-2 years

Bank loans
102,296
705
100,000
-


102,296
705
100,000
-

Amounts falling due 2-5 years

Bank loans
1,180
97,699
-
95,000


1,180
97,699
-
95,000


103,847
99,109
100,000
95,000


Page 60

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

23.


Hire purchase and finance leases


Minimum lease payments under hire purchase fall due as follows:

Group
Group
Company
Company
2024
2023
2024
2023
£000
£000
£000
£000

Within one year
37
45
37
45

Between 1-5 years
-
37
-
37

37
82
37
82


24.


Financial instruments

Group
Group
Company
Company
2024
2023
2024
2023
£000
£000
£000
£000

Financial assets

Financial assets measured at fair value
38,274
26,026
14,731
17,453

Financial assets measured at amortised cost
54,941
63,097
49,310
49,763

Assets measured at fair value through profit and loss
2,581
3,769
2,581
3,769

95,796
92,892
66,622
70,985


Financial liabilities

Financial liabilities measured at amortised cost
(70,149)
(76,551)
(57,966)
(64,875)

Fair value of assets and liabilities

Under FRS102 section 11 and 12, the Group is required to recognise the fair value of derivative financial instruments in the balance sheet. The following instrument existed at the year end:

An interest rate swap on a notional amount of £50m of loan funding, which reduced to £40m in March 2023, at a fixed rate of 0.0880% until September 2025. As at 31 March 2024, the fair value of the swap is £2,581,000 asset (2023 - £3,769,251 asset).


The fair value of interest rate swaps is based on bank valuations.

Page 61

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

25.


Deferred taxation


Group



2024
2023


£000

£000






At beginning of year
(32,520)
(29,227)


Charged to profit or loss
(1,069)
(1,399)


Arising on business combinations
(502)
(1,894)



At end of year
(34,091)
(32,520)

Company


2024
2023


£000

£000






At beginning of year
(27,957)
(24,508)


Charged to profit or loss
(477)
(1,909)


Arising on business combinations
(502)
(1,540)


Removed on business disposals
33
-



At end of year
(28,903)
(27,957)

The provision for deferred taxation is made up as follows:

Group
Group
Company
Company
2024
2023
2024
2023
£000
£000
£000
£000

Accelerated capital allowances
(4,045)
(3,251)
(3,009)
(2,832)

General provision
143
439
(5)
325

Deferred tax on retail pharmacy licences
(30,188)
(29,708)
(25,889)
(25,450)

(34,090)
(32,520)
(28,903)
(27,957)

Page 62

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

26.


Provisions


Group



NHS reimbursement
Onerous leases
Others
Total

£000
£000
£000
£000





At 1 April 2023
2,559
1,516
1,020
5,095


Charged to profit or loss
300
10
(1,020)
(710)



At 31 March 2024
2,859
1,526
-
4,385

The NHS reimbursement provision is to cover clawback of potential over-reimbursement received in the current financial year.

Company


NHS reimbursement
Onerous leases
Others
Total

£000
£000
£000
£000





At 1 April 2023
2,459
1,391
1,020
4,870


Charged to profit or loss
300
(70)
(1,020)
(790)



At 31 March 2024
2,759
1,321
-
4,080

The NHS reimbursement provision is to cover clawback of potential over-reimbursement received in the current financial year.


27.


Share capital

2024
2023
£000
£000
Allotted, called up and fully paid



100,000 (2023 - 100,000) Ordinary shares of £1.00 each
100
100


Page 63

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

28.


Reserves

The Group and Company's other reserves are as follows:

Share premium account

The share premium reserve contains the premium arising on issue of equity shares, net of issue expenses.

Merger Reserve

The merger reserve represents the cumulative merger relief on acquisition of subsidiaries.

Profit and loss account

The profit and loss reserve represents cumulative profits or losses, including dividends paid and other adjustments.
Group reserves includes the reserves of the Company and its subsidiary undertakings.

Capital contribution reserves
On 18 February 2016 Day Lewis PLC acquired Healthcare Drugstore Limited at book value from a company wholly owned by its ultimate parent (Day Lewis Holdings Ltd). The difference between the book value and the fair value is treated as a capital contribution as merger accounting in this instance was not allowed.

Page 64

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

29.
 

Business combinations

The Group acquired the following businesses during the year using acquisition accounting:

100% of the share capital of Plymstock Wellcare Limited on 29 February 2024. Plymstock Wellcare Limited is a company which specialises in the distribution of pharmaceutical products.

Recognised amounts of identifiable assets acquired and liabilities assumed are as follows:

Book value
Fair value adjustments
Fair value
£000
£000
£000

Fixed Assets

Tangible
4
(4)
-

Intangible
-
2,011
2,011

4
2,007
2,011

Current Assets

Stocks
155
-
155

Debtors
399
-
399

Cash at bank and in hand
66
-
66

Total Assets
624
2,007
2,631

Creditors

Due within one year
(539)
-
(539)

Deferred taxation
-
(502)
(502)

Total Identifiable net assets
85
1,505
1,590


Consideration

£000

Non-cash settlement
1,582

Directly attributable costs
8

Total purchase consideration
1,590

Page 65

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

29.Business combinations (continued)

Cash outflow on acquisition

£000


Directly attributable costs
8

8

Less: Cash and cash equivalents acquired
(66)

Net cash outflow on acquisition
(58)

The non-cash settlement comprised the value of two retail pharmacy licenses transferred to the former shareholders of Plymstock Wellcare Limited as part of a separate transaction which completed on the same day.


30.


Non-controlling interests

2024
2023
£000
£000



At beginning of year
1,024
1,006

Transfers
954
-

Profit for the year
278
335

Dividends paid
(319)
(317)

At end of year
1,937
1,024


31.


Pension commitments

The Group operates two defined contributions pension schemes for the benefit of the eligible employees and directors. The assets of the schemes are held separately from those of the Group in independently administered funds. The pension cost charge represents contributions payable by the Group to the funds and amounted to £1,781k (2023 - £1,413k).

Page 66

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

32.


Commitments under operating leases

At 31 March 2024 the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
Company
Company
2024
2023
2024
2023
£000
£000
£000
£000

Not later than 1 year
8,030
7,512
5,254
5,304

Later than 1 year and not later than 5 years
25,881
24,276
17,639
17,490

Later than 5 years
25,106
20,714
14,844
17,285

59,017
52,502
37,737
40,079


33.


Related party transactions

During the year the Group entered into the transactions set out below with the Directors and other related parties. All amounts are stated gross of VAT.
Rent:
The following companies paid rent for premises owned by Q H Estates Limited, a company in which The KCTP Will Trust, K C Patel and J C Patel have an interest:
Day Lewis Plc £400,492 (2023 - £459,603)
Day Lewis Medical Limited £958,291 (2023 - £586,247)
In addition the Group paid rentals to the following entities:
Day Lewis Pension Fund £232,196 (2023 - £238,096)
Ms R Patel, K C Patel's daughter, £48,967 (2023 - £67,600)  
Tayzana Pension Fund £37,300 (2023 - £37,300)
Loans:
During the year, the Group purchased goods totalling £330,720 (2023 - £82,083) from Quadrant Pharmaceuticals. The KCTP Will Trust has an interest in this company. At the year end the balance outstanding to Quadrant Pharmaceuticals was £41,601 (2023 - £17,430).
During the year, the Group purchased goods totalling £2,561,238 (2023 - £1,893,387) from Maxearn Limited. The KCTP Will Trust has a material interest in this company. At the year end the balance outstanding to Maxearn Limited was £93,255 (2023 - £57,009).
During the year, the Group sold goods totalling £2,281,571 (2023 - £2,322,722) to Health Counter Limited and recharged expenses of £144,762 (2023 - £263,113). Health Counter Limited is a subsidiary of the ultimate parent company, Day Lewis Holdings Limited, and is under common control. Included in the trade debtors as an amount owed to the group is £146,894 (2023: £255,536). Included in the creditors as an amount owed by the group is £58,334 (2023: £57,181).
 
Page 67

 
DAY LEWIS PLC
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

33.Related party transactions (continued)


34.


Controlling party

The ultimate parent company is Day Lewis Holdings Limited, a company registered in Cyprus and controlled by the trustees of the KCTP Will Trust.
Copies of the financial statements of the ultimate parent and of its group are not publicly available.

Page 68