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Registered number: 06251530










ARBO (HOLDINGS) LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

 
ARBO (HOLDINGS) LIMITED
 

COMPANY INFORMATION


Directors
J R Armstrong (appointed 4 December 2023)
I R Reid 
K P Kamienski (resigned 4 December 2023)




Company secretary
A T Motsi



Registered number
06251530



Registered office

Derbyshire

DE56 1WJ

United Kingdom




Independent auditor
PKF Smith Cooper Audit Limited
Statutory Auditors

1 Prospect Place

Millenium Way

Derby

Derbyshire

DE24 8HG





 
ARBO (HOLDINGS) LIMITED
 

CONTENTS



Page
Group strategic report
 
1 - 2
Directors' report
 
3 - 4
Independent auditor's report
 
5 - 8
Consolidated statement of comprehensive income
 
9
Consolidated balance sheet
 
10
Company balance sheet
 
11
Consolidated statement of changes in equity
 
12
Company statement of changes in equity
 
13
Consolidated statement of cash flows
 
14
Notes to the financial statements
 
15 - 34


 
ARBO (HOLDINGS) LIMITED
 

GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Business review
 
We aim to present a balanced and comprehensive review of the development and performance of our business during the year and its position at the year end. Our review is consistent with the size and non-complex nature of our business and is written in the context of the risks and uncertainties we face. The principal activity of the Group is the manufacture and sale of sealant based products and the Company is an intermediate holding company.
The Group generated a profit in the year of £1,098,206 compared to £89,665 in the previous year. 
The Group saw an increase in turnover of 7.95% during the like for like period from the previous year. Trading conditions during the year remained challenging but gross profit margins have increased by 4.9% from 27.6% in 2022 to 32.5% in 2023. This is in part due to the overall decrease in raw materials costs. 
Capital investment has been agreed and planned for 2024/25 with the intention of continually improving production efficiencies and margins. The Group is targeting new markets and new products to enable us to take advantage of the opportunities in the market place and is therefore anticipating a strong performance for 2024/25.

Principal risks and uncertainties
 
As for many businesses our size, the current business environment continues to be challenging. The Group sources many of its supplies from overseas, particularly Europe and any uncertainties in the market will  impact on the Group particularly with regards to exchange rates. The Group has also experiences fluctutaions in the  availability and prices for raw materials. The directors have sought to address these risks by holding higher levels of raw material stocks, to ensure that customer demands are met, although levels have fallen as raw materials have availibility has improved during the current year. This has had an impact upon cashflows during the year, with cashflow generated from operating activities significantly improving. Cashflow and interest risks are mitigated, as the Group participates in the Carlisle European cash pool in which all subsidiary companies contribute excess cash balances or draw current loan positions from the cash pool. The cash pool header company is Carlisle Acquisition I B.V. in the Netherlands. The contributing or loan balances are interest-bearing at SONIA +1%, ESTR +1% and SOFR +1% for the GBP, EUR and USD cashpools respectively.   With these risks and uncertainties in mind, the directors are aware that any plans for future development will be subject to unforeseen events outside of our control. We expect to approach these issues with due caution, whilst nevertheless ensuring that the business is on a sound footing and remains an important manufacturer of premium products. 
The pension report, prepared in accordance with the requirements of FRS102, for the period ended 31 December 2023 indicates a gross surplus in the scheme of £1,946k compared to £2,124k at 31 December 2022. However as it is unlikely that any of this surplus will be recovered by the Company, either by reduced contributions going forward or a refund from the scheme, in accordance with FRS 102  the surplus has not been recognised in the financial statements for the period ended 31 December 2023 or 31 December 2022.
 

Financial key performance indicators
 
We consider that our key financial performance indicators are those that communicate the financial performance and strength of the company as a whole, these being turnover, gross margin, EBITDA and cashflow.              

Page 1

 
ARBO (HOLDINGS) LIMITED
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Summary

2023
2022
        £
        £
Turnover

19,970,665

18,499,117
 
Gross margin

6,496,538

5,109,584
 
Gross profit %

33

28
 
EBITDA

1,687,991

451,520
 
Operating cash flow (excluding group)

4,525,824

686,920
 


This report was approved by the board on 19 August 2024 and signed on its behalf.



I R Reid
Director

Page 2

 
ARBO (HOLDINGS) LIMITED
 

 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

The directors present their report and the financial statements for the year ended 31 December 2023.

Directors' responsibilities statement

The directors are responsible for preparing the Group strategic report, the Directors' report and the consolidated financial statements in accordance with applicable law and regulations.
 
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 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 Company and the Group 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 for the Group's financial statements and then apply them consistently;

make judgments and accounting estimates that are reasonable and prudent;

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

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and 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.

The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Group's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements and other information included in Directors' reports may differ from legislation in other jurisdictions.

Principal activity

The Group's principal activity is the sale of sealant based products.

Results and dividends

The profit for the year, after taxation, amounted to £1,062,003 (2022 - £89,665).

A dividend of £2,500,000 was paid within the year (2022: £Nil). No further dividends are recommended.

Directors

The directors who served during the year were:

J R Armstrong (appointed 4 December 2023)
I R Reid 
K P Kamienski (resigned 4 December 2023)

Future developments

There has been no planned changes in future trading which the directors believe require disclosure in the financial statements, with the exception of the on-going capital investment noted in the Strategic report

Page 3

 
ARBO (HOLDINGS) LIMITED
 

 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Financial instruments

The Group's operations expose it to a variety of financial risks that include the effects of changes in debt market prices, credit risk, liquidity risk and foreign exchange risk. The Group has a risk management programme that seeks to limit the adverse effects on the financial performance of the Group by monitoring levels of debt finance and finance costs. The Group has implemented policies that require appropriate credit checks before a sale is made. Cashflow and interest risks are mitigated as the Group participates in the Carlisle European cash pool. Further details are included in the Strategic report.

Qualifying third party indemnity provisions

Qualifying third party indemnity provisions were in place during the year for the directors.

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 and the Group's auditor is unaware, and

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

This confirmation is given and should be interpreted in accordance with the provisions of S418 of the Companies Act 2006.

Post balance sheet events

There have been no significant events affecting the Group since the period end. 

Auditor

Under section 487(2) of the Companies Act 2006PKF Smith Cooper Audit Limited will be deemed to have been reappointed as auditor 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.

This report was approved by the board on 19 August 2024 and signed on its behalf.
 





I R Reid
Director

Page 4

 
ARBO (HOLDINGS) LIMITED
 

 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ARBO (HOLDINGS) LIMITED
 

Opinion


We have audited the financial statements of ARBO (Holdings) Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2023, which comprise the Consolidated statement of comprehensive income, the Consolidated balance sheet, the Company balance sheet, the Consolidated statement of cash flows, the Consolidated statement of changes in equity, the Company statement of changes in equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Group's and of the parent Company's affairs as at 31 December 2023 and of the Group's profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


Conclusions relating to going concern


In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.


Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's or the parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.


Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.


Page 5

 
ARBO (HOLDINGS) LIMITED
 

 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ARBO (HOLDINGS) LIMITED (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditor's report thereon. The directors are responsible for the other information contained within the Annual ReportOur opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.


We have nothing to report in this regard.


Opinion on other matters prescribed by the Companies Act 2006
 

In our opinion, based on the work undertaken in the course of the audit:


the information given in the Group strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Group strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.


Matters on which we are required to report by exception
 

In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group strategic report or the Directors' report.


We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:


adequate accounting records have not been kept 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.


Responsibilities of directors
 

As explained more fully in the Directors' responsibilities statement set out on page 3, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.


In preparing the financial statements, the directors are responsible for assessing the Group's and the 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 the directors either intend to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so.


Page 6

 
ARBO (HOLDINGS) LIMITED
 

 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ARBO (HOLDINGS) LIMITED (CONTINUED)


Auditor's responsibilities for the audit of the financial statements
 

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Group financial statements.


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Based on our understanding of the Group and industry, we identify the key laws and regulations affecting the Group. We identified that the principal risk of fraud or non-compliance with laws and regulations related to:
• management bias in respect of accounting estimates and judgements made;
• management override of control;
• posting of unusual journals or transactions 
We focused on those areas that could give rise to a material misstatement in the Group and Company financial statements. Our procedures included, but were not limited to:
• Enquiry of management and those charged with governance/review of correspondence around actual and           potential litigation and claims, including instances of non-compliance with laws and regulations and fraud;
• Reviewing minutes of meetings of those charged with governance where available;
• Reviewing legal expenditure in the year to identify instances of non-compliance with laws and regulations   and fraud;
• Reviewing financial statement disclosures and testing to supporting documentation to assess compliance   with applicable laws and regulations;
• Performing audit work over the risk of management override of controls, including testing of journal entries  and other adjustments for appropriateness, evaluating the business rationale of significant transactions    outside the normal course of business and reviewing accounting estimates for bias. In particular, the    estimates and judgements in relation to the assets and liabilities of the defined benefit pension scheme;           the useful lifre of goodwill; analytical procedures to identify any unexpected or unusual relationships    that might indicate material misstatement due to fraud.
It is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.


Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditor's report.


Page 7

 
ARBO (HOLDINGS) LIMITED
 

 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ARBO (HOLDINGS) LIMITED (CONTINUED)


Use of our report
 

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006Our 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.





James Delve (Senior statutory auditor)
for and on behalf of
PKF Smith Cooper Audit Limited
Statutory Auditors
1 Prospect Place
Millenium Way
Derby
Derbyshire
DE24 8HG

20 August 2024
Page 8

 
ARBO (HOLDINGS) LIMITED
 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
19,970,665
18,499,117

Cost of sales
  
(13,474,127)
(13,389,533)

Gross profit
  
6,496,538
5,109,584

Distribution costs
  
(1,470,878)
(1,698,470)

Administrative expenses
  
(3,673,459)
(3,267,201)

Operating profit
 5 
1,352,201
143,913

Interest receivable and similar income
 9 
124,091
4,775

Interest payable and similar expenses
 10 
(4,871)
-

Profit before taxation
  
1,471,421
148,688

Tax on profit
 11 
(409,418)
(59,023)

Profit for the financial year
  
1,062,003
89,665

  

Actuarial losse/(gains) on defined benefit pension scheme
 22 
157,000
(1,842,000)

Return on assets, excluding interest income
 22 
71,000
1,578,000

Change in the amount of surplus that is not recoverable, excluding net interest income
 22 
(228,000)
264,000

Other comprehensive income for the year
  
-
-

  

Total comprehensive income for the year
  
1,062,003
89,665

Profit for the year attributable to:
  

Owners of the parent Company
  
1,062,003
89,665

The notes on pages 15 to 34 form part of these financial statements.

Page 9

 
ARBO (HOLDINGS) LIMITED
REGISTERED NUMBER: 06251530

CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Intangible assets
 12 
10,695
139,042

Tangible assets
 13 
827,151
971,039

  
837,846
1,110,081

Current assets
  

Stocks
 15 
3,065,489
4,674,060

Debtors: amounts falling due within one year
 16 
5,013,989
3,121,060

Cash at bank and in hand
 17 
-
974

  
8,079,478
7,796,094

Creditors: amounts falling due within one year
 18 
(3,105,713)
(1,634,752)

Net current assets
  
 
 
4,973,765
 
 
6,161,342

Total assets less current liabilities
  
5,811,611
7,271,423

Provisions for liabilities
  

Deferred taxation
 19 
(49,544)
(71,359)

Net assets
  
5,762,067
7,200,064


Capital and reserves
  

Called up share capital 
 20 
751
751

Share premium account
 21 
1,058,722
1,058,722

Capital redemption reserve
 21 
250
250

Profit and loss account
 21 
4,702,344
6,140,341

  
5,762,067
7,200,064


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 19 August 2024.




I R Reid
Director

The notes on pages 15 to 34 form part of these financial statements.

Page 10

 
ARBO (HOLDINGS) LIMITED
REGISTERED NUMBER: 06251530

COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Investments
 14 
3,295,378
3,295,378

  
3,295,378
3,295,378

  

Creditors: amounts falling due within one year
 18 
(2,235,655)
(2,235,655)

Net current liabilities
  
 
 
(2,235,655)
 
 
(2,235,655)

Total assets less current liabilities
  
1,059,723
1,059,723

Net assets
  
1,059,723
1,059,723


Capital and reserves
  

Called up share capital 
 20 
751
751

Share premium account
 21 
1,058,722
1,058,722

Capital redemption reserve
 21 
250
250

  
1,059,723
1,059,723


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 19 August 2024.


I R Reid
Director

The notes on pages 15 to 34 form part of these financial statements.

Page 11

 
ARBO (HOLDINGS) LIMITED
 

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


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

£
£
£
£
£


At 1 January 2022
751
1,058,722
250
6,050,676
7,110,399


Comprehensive income for the year

Profit for the year
-
-
-
89,665
89,665
Total comprehensive income for the year
-
-
-
89,665
89,665



At 1 January 2023
751
1,058,722
250
6,140,341
7,200,064


Comprehensive income for the year

Profit for the year
-
-
-
1,062,003
1,062,003
Total comprehensive income for the year
-
-
-
1,062,003
1,062,003


Contributions by and distributions to owners

Dividends: Equity capital
-
-
-
(2,500,000)
(2,500,000)


At 31 December 2023
751
1,058,722
250
4,702,344
5,762,067


The notes on pages 15 to 34 form part of these financial statements.

Page 12

 
ARBO (HOLDINGS) LIMITED
 

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


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

£
£
£
£
£

At 1 January 2022
751
1,058,722
250
-
1,059,723
Total comprehensive income for the year
-
-
-
-
-


At 31 December 2022
751
1,058,722
250
-
1,059,723


Comprehensive income for the year

Profit for the year
-
-
-
2,500,000
2,500,000
Total comprehensive income for the year
-
-
-
2,500,000
2,500,000


Contributions by and distributions to owners

Dividends: Equity capital
-
-
-
(2,500,000)
(2,500,000)


At 31 December 2023
751
1,058,722
250
-
1,059,723


The notes on pages 15 to 34 form part of these financial statements.

Page 13

 
ARBO (HOLDINGS) LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
£
£

Cash flows from operating activities

Profit for the financial year
1,062,003
89,665

Adjustments for:

Amortisation of intangible assets
128,346
128,346

Depreciation of tangible assets
207,444
179,259

Loss on disposal of tangible assets
(3,900)
-

Interest paid
4,871
-

Interest received
(124,091)
(4,775)

Taxation charge
409,418
59,023

Decrease/(increase) in stocks
1,608,571
(458,077)

Decrease in debtors
193,432
358,506

Increase in amounts owed by groups
(2,086,361)
(398,950)

Increase/(decrease) in creditors
1,487,519
(306,217)

Corporation tax (paid)/received
(447,790)
-

Decrease in amounts owed to groups
-
(39,442)

Corporation tax received
-
641,192

Net cash generated from operating activities

2,439,462
248,530


Cash flows from investing activities

Purchase of tangible fixed assets
(66,937)
(253,305)

Sale of tangible fixed assets
7,281
-

Interest received
124,091
4,775

Net cash from investing activities

64,435
(248,530)

Cash flows from financing activities

Dividends paid
(2,500,000)
-

Interest paid
(4,871)
-

Net cash used in financing activities
(2,504,871)
-

Net (decrease)/increase in cash and cash equivalents
(974)
-

Cash and cash equivalents at beginning of year
974
974

Cash and cash equivalents at the end of year
-
974


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
-
974


The notes on pages 15 to 34 form part of these financial statements.

Page 14

 
ARBO (HOLDINGS) LIMITED
 

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

1.


General information

The Company is a private company limited by shares  incorporated in the United Kingdom and registered in England and Wales. The registered office is Derby Road, Belper, Derbyshire DE56 1WJ.
The principal activity of the group is the manufacture and sale of sealant based products. The principal activity of the Company is a holding company.

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 requirements of the Companies Act 2006.
The financial statements are rounded to the nearest £.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3).
The following principal accounting policies have been applied:

 
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 statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date control ceases.

 
2.3

Going concern

After reviewing the Group's budgets, the directors have a reasonable expectation that the Group has adequate resources, including access to the Carlisle Group cash pools which are used for capital and operational purposes, to continue in operational existence for at least 12 months from the date of approval of the financial statements. The Group therefore continues to adopt the going concern basis in preparing its consolidated financial statements.

Page 15

 
ARBO (HOLDINGS) LIMITED
 

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

2.Accounting policies (continued)

 
2.4

Foreign currency translation

Functional and presentation currency

The Group'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 profit or loss 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 statement of comprehensive income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.

 
2.5

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
the Group has transferred the significant risks and rewards of ownership to the buyer;
the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the Group will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Revenue is recognised upon despatch of the goods.

 
2.6

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.

 
2.7

Interest income

Interest income is recognised in profit or loss using the effective interest method.

Page 16

 
ARBO (HOLDINGS) LIMITED
 

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

2.Accounting policies (continued)

 
2.8

Finance costs

Finance costs are charged to profit or loss 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.

 
2.9

Pensions

Defined contribution pension plan

The Group operates a defined contribution plan for its employees. A defined contribution 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.

Defined benefit scheme
The Group operates a defined benefit pension scheme.
The scheme provides benefits based on final pensionable pay, and the assets of the scheme are held separately from those of the company in an independently administered fund. The scheme was closed to future accruals with effect from  July 2007. Contributions are made based upon the recommendations of qualified actuaries and are charged to the profit and loss account so as to spread the cost of providing pensions over employees' working lives with the company. The cost of the defined benefit pension plan and other post-employment medical benefits and the present value of the pension obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases, mortality rates and future pension increases. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.
The parameter most subject to change is the discount rate. In determining the appropriate discount rate, management considers the interest rates of corporate bonds in currencies consistent with the currencies of the post-employment benefit obligation with at least an 'AA' rating or above, as set by an internationally acknowledged rating agency, and extrapolated as needed along the yield curve to correspond with the expected term of the defined benefit obligation. The underlying bonds are further reviewed for quality. Those having excessive credit spreads are excluded from the analysis of bonds on which the discount rate is based, on the basis that they do not represent high quality corporate bonds.
The mortality rate is based on publicly available mortality tables for the specific countries. Those mortality tables tend to change only at intervals in response to demographic changes.
Future salary increases and pension increases are based on expected future inflation rates for the respective countries.
Further details about pension obligations are given in Note 22.
 

Page 17

 
ARBO (HOLDINGS) LIMITED
 

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

2.Accounting policies (continued)

 
2.10

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.

 
2.11

Intangible assets

 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 Group's share of its 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 statement of comprehensive income over its useful economic life. Intangible assets are initially recognised at cost.
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:

Goodwill
-
10
years

 
2.12

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.

Page 18

 
ARBO (HOLDINGS) LIMITED
 

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

2.Accounting policies (continued)


2.12
Tangible fixed assets (continued)

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Plant & machinery
-
10-33%
Motor vehicles
-
33%
Fixtures & fittings
-
25%

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 profit or loss.

Assets in the course of construction are not depreciated. An asset is depreciated, once it is available for use.

 
2.13

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.14

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 profit or loss.

 
2.15

Debtors

Short term debtors are measured at transaction price, less any impairment.

 
2.16

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. 

 
2.17

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.

 
2.18

Financial instruments

The Group has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the Group's Balance sheet when the Group becomes party to the contractual provisions of the instrument.

Page 19

 
ARBO (HOLDINGS) LIMITED
 

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

2.Accounting policies (continued)


2.18
Financial instruments (continued)

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Other financial assets

Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting date. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

Financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Group after the deduction of all its liabilities.

Basic financial liabilities, which include trade and other payables, bank loans, other loans and loans due to fellow group companies are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.

Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary
Page 20

 
ARBO (HOLDINGS) LIMITED
 

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

2.Accounting policies (continued)


2.18
Financial instruments (continued)

course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

Derivative financial instruments are used to manage risks arising from changes in foreign currency exchange rates relating to the purchase of overseas source products. In accordance with the Group's foreign exchange policy, the Group does not enter into derivatives for speculative purposes. Derivatives are stated at their fair value, being the estimated amount that the Group would receive or pay to terminate them at the balance sheet date based on prevailing currency exchange rates.
Changes in fair value of foreign currency derivatives which are designated and effective as hedges of future cash flows are recognised in equity in the fair value reserve and subsequently transferred to the carrying value of the hedged item or the profit and loss account. Realised gains and losses on cash flow hedges are therefore recognised in the profit and loss account in the same period as the hedged item.
Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated or exercised, or no longer qualifies for hedge accounting. At that time, any cumulative gain or loss on the hedging instrument previously recognised in equity is retained in equity until the hedged transaction occurs. If the hedged transaction is no longer expected to occur, the net cumulative gain or loss recognised in equity is then transferred to the profit and loss account.
Changes in fair value of derivatives which are ineffective or do not meet the criteria for hedge accounting in FRS102 are recognised in the profit and loss account.

Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Group transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Group will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

Financial liabilities are derecognised when the Group's contractual obligations expire or are discharged or cancelled.

 
2.19

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 21

 
ARBO (HOLDINGS) LIMITED
 

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

3.


Critical accounting Judgments and key sources of estimation uncertainty

In the application of the Group’s accounting policies, the directors are required to make judgements (other than those involving estimations) that have a significant impact on the amounts recognised and to make 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.
There were no key sources of estimation uncertainty. The key areas of judgment are:
Defined benefit scheme
The Group has an obligation to pay pension benefits to certain employees. The cost of these benefits and the present value of the obligation depend on a number of factors, including: life expectancy, salary increases, asset valuations and the discount rate on corporate bonds. Management take external specialist advice in estimating these factors in determining the net pension obligation. The assumptions reflect historical experience and current trends. See note 22 for the disclosures relating to the defined benefit scheme.
Goodwill
Paragraph 19.23(a) of FRS102 states that goodwill shall be considered to have a finite useful life and when an entity is unable to make a reliable estimate of the useful life, the life shall not exceed 10 years.The previous policy of the Group was to amortise goodwill over 20 years and the life of goodwill has been revised to 10 years from the date of transition, as this is assessed to be a more reliable estimate of useful life.
 


4.


Turnover

An analysis of turnover by class of business is as follows:


2023
2022
£
£

Sales of sealant based products
19,970,665
18,499,117


Analysis of turnover by country of destination:

2023
2022
£
£

United Kingdom
15,473,849
14,708,447

Rest of Europe
1,825,451
3,046,134

Rest of the world
2,671,365
744,536

19,970,665
18,499,117


Page 22

 
ARBO (HOLDINGS) LIMITED
 

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

5.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Depreciation of tangible fixed assets
207,444
179,261

Amortisation of intangible fixed assets
128,346
128,346

Exchange differences
(22,456)
57,671

Other operating lease rentals
279,668
223,128

Pension cost
103,472
81,981


6.


Auditor's remuneration

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


2023
2022
£
£

Fees payable to the Company's auditor for the audit of the consolidated and parent Company's financial statements
28,500
28,500


7.


Employees

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


Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£


Wages and salaries
2,638,168
2,069,456
-
-

Social security costs
279,722
193,484
-
-

Pension costs
163,472
136,981
-
-

3,081,362
2,399,921
-
-


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


        2023
        2022
            No.
            No.







Production
49
41



Distribution
5
4



Office and management
23
36

77
81

Page 23

 
ARBO (HOLDINGS) LIMITED
 

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

8.


Directors' remuneration

2023
2022
£
£

Fees for directors' services
-
27,596


The directors' received no remuneration from the Group during the year. Their remuneration is met by other Carlisle Group companies.


9.


Interest receivable

2023
2022
£
£


Other interest receivable
124,091
4,775


10.


Interest payable and similar expenses

2023
2022
£
£


Other loan interest payable - on cashpool balances
4,871
-


11.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
430,859
59,449

Adjustments in respect of previous periods
374
12


Total current tax
431,233
59,461

Deferred tax


Origination and reversal of timing differences
(54,584)
(333)

Changes to tax rates
(3,434)
(105)

Adjustment in respect of prior periods
36,203
-

Total deferred tax
(21,815)
(438)


Taxation on profit on ordinary activities
409,418
59,023
Page 24

 
ARBO (HOLDINGS) LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
11.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022 - higher than) the standard rate of corporation tax in the UK of 23.52% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
1,471,421
148,688


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 23.52% (2022 - 19%)
346,078
28,251

Effects of:


Non-tax deductible amortisation of goodwill and impairment
30,187
24,385

Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
10
6,480

Capital allowances for year in excess of depreciation
(3,434)
(105)

Adjustments to tax charge in respect of prior periods
36,577
12

Total tax charge for the year
409,418
59,023


Factors that may affect future tax charges

There were no factors that may affect future tax charges.

Page 25

 
ARBO (HOLDINGS) LIMITED
 

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

12.


Intangible assets

Group





Goodwill

£



Cost


At 1 January 2023
1,878,240



At 31 December 2023

1,878,240



Amortisation


At 1 January 2023
1,739,198


Charge for the year on owned assets
128,346



At 31 December 2023

1,867,544



Net book value



At 31 December 2023
10,696



At 31 December 2022
139,042



Page 26

 
ARBO (HOLDINGS) LIMITED
 

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

13.


Tangible fixed assets

Group






Plant & machinery
Motor vehicles
Fixtures & fittings
Total

£
£
£
£



Cost 


At 1 January 2023
3,055,340
40,023
112,480
3,207,843


Additions
43,415
14,732
8,790
66,937


Disposals
(931,235)
(40,023)
(94,590)
(1,065,848)



At 31 December 2023

2,167,520
14,732
26,680
2,208,932



Depreciation


At 1 January 2023
2,098,361
40,023
98,420
2,236,804


Charge for the year on owned assets
199,686
818
6,940
207,444


Disposals
(927,855)
(40,023)
(94,589)
(1,062,467)



At 31 December 2023

1,370,192
818
10,771
1,381,781



Net book value



At 31 December 2023
797,328
13,914
15,909
827,151



At 31 December 2022
956,979
-
14,060
971,039


14.


Fixed asset investments

Company





Investments in subsidiary companies

£



Cost 


At 1 January 2023
3,295,378



At 31 December 2023
3,295,378




Page 27

 
ARBO (HOLDINGS) LIMITED
 

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

Subsidiary undertaking


The following was a subsidiary undertaking of the Company:

Name

Registered office

Class of shares

Holding

Adshead Ratcliffe & Company Limited
Derby Road Belper Derbyshire DE56 1WJ
Ordinary
100%


15.


Stocks

Group
Group
2023
2022
£
£

Raw materials and consumables
1,682,054
3,007,835

Work in progress (goods to be sold)
25,270
66,759

Finished goods and goods for resale
1,358,165
1,599,466

3,065,489
4,674,060


The carrying value of stocks are stated net of impairment losses totalling £605,760 (2022 - £1,003,154). Impairment losses totalling  £241,213 (2022 - £1,003,154) were recognised in the profit and loss.


16.


Debtors

Group
Group
2023
2022
£
£


Trade debtors
1,830,314
2,061,906

Amounts owed by group undertakings
3,048,484
962,123

Prepayments and accrued income
135,191
97,031

5,013,989
3,121,060


The Company participates in the Carlisle European cash pool in which all subsidiary companies contribute excess cash balances or draw current loan positions from the cash pool. The cash pool header company is Carlisle Acquisition I B.V. in the Netherlands. The contributing or loan balances are interest-bearing at SONIA +1%, ESTR +1% and SOFR +1% for the GBP, EUR and USD cashpools respectively.
Contributions of excess cash balances are recognised in amounts owed by group undertakings and drawing of loan positions from the cash pool are recognised in amounts owed to group undertakings. 


17.


Cash and cash equivalents

Group
Group
2023
2022
£
£

Cash at bank and in hand
-
974


Page 28

 
ARBO (HOLDINGS) LIMITED
 

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

18.


Creditors: Amounts falling due within one year

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Trade creditors
1,463,344
434,423
-
-

Amounts owed to group undertakings
-
-
2,235,655
2,235,655

Corporation tax
42,892
59,449
-
-

Other taxation and social security
514,326
624,439
-
-

Other creditors
79,364
5,815
-
-

Accruals and deferred income
1,005,787
510,626
-
-

3,105,713
1,634,752
2,235,655
2,235,655


Amounts due to Group companies are unsecured, interest free and repayable on demand.


19.


Deferred taxation


Group



2023


£






At beginning of year
(71,359)


Charged to profit or loss
21,815



At end of year
(49,544)

The provision for deferred taxation is made up as follows:

Group
Group
2023
2022
£
£

Accelerated capital allowances
(139,932)
(124,544)

Other short term timing differences
90,388
53,185

(49,544)
(71,359)


The expected net reversal of deferred tax is not considered to be material to the accounts.


20.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



751 (2021 : 751) Ordinary shares of £1.00 each
751
751

Page 29

 
ARBO (HOLDINGS) LIMITED
 

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

20.Share capital (continued)


The shares have full voting rights, the right to receive dividends and participate in a distribution on winding up.



21.


Reserves

Share premium account

This represents the premium, on the issue of shares in the Company and is non distributable.

Capital redemption reserve

The  capital redemption reserve  arose on the repurchase of issued shares and is non distributable.

Profit & loss account

Included are all current and prior period profit and losses. These relate to distributable reserves.

Page 30

 
ARBO (HOLDINGS) LIMITED
 

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

22.


Pension commitments

The Group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to to £103,472 ( 2022: £81,981).
There was £Nil of outstanding contributions at 31 December 2023 (2022: £Nil).

The Group operates a defined benefit pension scheme.
The scheme provides benefits based on final pensionable pay, and the assets of the scheme are held separately from those of the company in an independently administered fund. The scheme was closed to future accruals with effect from July 2007. Contributions are made based upon the recommendations of qualified actuaries and are charged to the profit and loss account so as to spread the cost of providing pensions over employees' working lives with the company.



Reconciliation of present value of plan liabilities:


2023
2022
£
£

Reconciliation of present value of plan liabilities


At the beginning of the year
4,386,000
6,388,000

Interest income
208,000
113,000

Actuarial gains/losses
157,000
(1,842,000)

Benefits paid
(294,000)
(273,000)

At the end of the year
4,457,000
4,386,000



Reconciliation of present value of plan assets:


2023
2022
£
£


At the beginning of the year
6,510,000
8,286,000

Interest income
313,000
147,000

Return on asset excluding interest income
(71,000)
(1,578,000)

Contributions
60,000
60,000

Benefits paid
(294,000)
(273,000)

Scheme administrative costs
(115,000)
(132,000)

Derecognition of surplus
(1,946,000)
(2,124,000)

At the end of the year
4,457,000
4,386,000

Page 31

 
ARBO (HOLDINGS) LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
22.Pension commitments (continued)


Composition of plan assets:


2023
2022
£
£


Buy and Maintain Credit
1,815,000
2,418,000

Multi Sector Credit
701,000
679,000

Cash and deposits
1,518,000
1,200,000

LDI
2,369,000
2,213,000

Total plan assets
6,403,000
6,510,000

2023
2022
£
£


Fair value of plan assets
4,457,000
4,386,000

Present value of plan liabilities
(4,457,000)
(4,386,000)

Net pension scheme liability
-
-


The amounts recognised in profit or loss are as follows:

2023
2022
£
£


Scheme administration expenses
115,000
(132,000)


The cumulative amount of actuarial gains and losses recognised in the Consolidated statement of comprehensive income was £Nil (2022:£Nil). The Group expects to contribute £60,000 to its Defined benefit scheme in 2024.

2023
2022
£
£



Actual return less interest income included in net interest income
157,000
(1,842,000)

Experience gains and losses arising on the scheme liabilities
71,000
1,578,000

Changes in amounts of surplus that is not recoverable
(228,000)
264,000

-
-

Page 32

 
ARBO (HOLDINGS) LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
22.Pension commitments (continued)


Principal actuarial assumptions at the balance sheet date (expressed as weighted averages):

2023
2022
%
%
Discount rate


4.5

4.9
 
Rate of inflation (RPI)


3.0

3.1
 
Rate of inflation (CPI)


2.5

2.5
 
Rate of increase to pensions in payment RPI max 12.5% increases


3.0

3.1
 
Mortality rates



 
- for a male aged 65 now


21.5

22.0
 
- at 65 for a male aged 45 now


23.8

24.2
 
- for a female aged 65 now


22.8

23.3
 
- at 65 for a female member aged 45 now


25.2

25.6
 

Lowering the discount rate by 0.25% per annum would increase the value of scheme liabilities by £104,000 . Changing the life expectancy by a long term rate of improvement by 1.5% would increase liabilities by £23,000. increase the rate of inflation (RPI) and associated assumptions by 0.25% per annum would increase liabilities by £66,000.



Amounts for the current and previous two periods are as follows:


Defined benefit pension schemes

2023
2022
2021
£
£
£
Defined benefit obligation

(4,457,000)

(4,386,000)

(6,388,000)
 
Scheme assets

6,403,000

6,510,000

8,286,000
 
Surplus
1,946,000

2,124,000

1,898,000
 

Experience adjustments on scheme liabilities
157,000
1,842,000
(281,000)
Experience adjustments on scheme assets
71,000
(1,578,000)
161,000
228,000
264,000
(120,000)


Page 33

 
ARBO (HOLDINGS) LIMITED
 

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

23.


Commitments under operating leases

At 31 December 2023 the Group had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
2023
2022
£
£

Not later than 1 year
278,265
237,004

Later than 1 year and not later than 5 years
117,823
217,210

396,088
454,214


24.


Related party transactions

The Company has taken advantage of the exemption available within Financial Reporting Standard 102 not to disclose details of any transactions between itself and fellow group undertakings on the basis that it is a subsidiary undertaking where 100% of the voting rights are controlled within the group whose consolidated accounts are publicly available.

Key management personnel remuneration in the period totalled £228,937 (2022: £165,759). Fees in relation to directors' services are included in note 8 to the financial statements.


25.


Controlling party

At 31 December 2023, the ultimate parent undertaking was Carlisle Companies Inc due to their 100% interest in the equity share capital of the immediate parent undertaking. There is no one controlling party as no one person or party holds greater than 50% of the issued share capital of that company. Copies of the parent company's accounts can be obtained from www.carlisle.com. The registered office of the ultimate parent company is, 16430 N.Scottsdale Road, Suite 400 Scottsdale, AZ 85254.

Page 34