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Registered number: 14423604









LONGFOX LIMITED









ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 31 DECEMBER 2023

 
LONGFOX LIMITED
 
 
COMPANY INFORMATION


Directors
Mr A Kenning (appointed 17 October 2022)
Mr J Kenning (appointed 17 October 2022)




Registered number
14423604



Registered office
Kenning House Kites Park
Summerleys Road

Princes Risborough

HP27 9PX




Independent auditors
PKF Smith Cooper Audit Limited
Statutory Auditors

158 Edmund Street

Birmingham

West Midlands

B3 2HB





 
LONGFOX LIMITED
 

CONTENTS



Page
Group strategic report
1 - 2
Directors' report
3 - 4
Independent auditors' 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 - 15
Consolidated analysis of net debt
16
Notes to the financial statements
17 - 37


 
LONGFOX LIMITED
 
 
GROUP STRATEGIC REPORT
FOR THE PERIOD ENDED 31 DECEMBER 2023

Introduction
 
The directors present their strategic report and audited financial statements for the period ended 31st December 2023. In March 2023 100% of the share capital of URA Ventures Limited was purchased by the Company. This was done with full agreement of the FCA and 100% of funders who continue positively to support the aims and requirements of URA Ventures Limited. 
The Group’s principal activity during the period was that of contract hire of cars and commercial vehicles with a bias towards environmental protection; however, substantial additional depreciation affecting profits on electric vehicles has proved necessary affecting their viability, making it more difficult to achieve the environmental aim. 

Results and dividends
 
The Company received dividends of £14,520k which it also paid out in part settlement for the purchase of URA Ventures Limited.
 
The Group profit for the 10 months to 31st December 2023 £ 2,884k pre tax and £2,027k after tax, these results are after including a provision to reflect volatility on electric vehicle residual values.
No dividends were paid during the period. 

Principal risks and uncertainties
 
Competition is a continuing risk for the Group which could result in the loss of business to its competitors. To manage this risk, the Group strives to provide added-value service and a high level of commitment to delivering all business in accordance with the instructions of the clients. The Group’s return is affected by movements in residual value of ex contract hire vehicles, however, the Group monitors this very closely. As referred to above, there has, in 2023 and early 2024, been a significant adverse movement in the residual values of electric vehicles for which the Group has made due provision.
There is a risk from customers having financial difficulties; however, the Group has a broad spread of customers thereby reducing the size of such risk.
Used vehicle residual values will also affect cashflow on repayment of financed residuals, however, this risk has been allowed for by the maintenance of adequate cash resources. A strong and open working relationship is maintained with funders who, in turn, provide excellent support. 
Lack of consistency in pricing of new EVs together with insufficient follow through of Government policy to make used electric vehicles attractive to used car buyers represents a risk to support continuing growth in our EV fleet. 
Interest rates have risen after years of very low rates; however, the Group has many years of experience of operating in high interest environment and these are less of a risk due to the group’s policy of fixing rates for the duration of each contract.
 

Financial key performance indicators
 
Our key performance indicators are fleet size (additions and disposals), budgeted return built into leases, actual return from leases, disposal values against budget, and delinquency rate. All of these were strong due to favourable trading conditions, with the exception of electric vehicles as referred to above.

Page 1

 
LONGFOX LIMITED
 

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

Environmental
 
The Group is committed to reducing its carbon footprint and, where possible, those of its customers in the following key ways:
 
Operating electric vehicles for the last 7 years. This has been made far more difficult for the reasons stated above
Nearly 100% of  company cars are now full battery electric vehicles
New premises built with a full set of charging points and the Company paid for substantial extra supply and set out for doubling of capacity
Solar panel roof on new building


This report was approved by the board on 8 August 2024 and signed on its behalf.



Mr J Kenning
Director

Page 2

 
LONGFOX LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE PERIOD ENDED 31 DECEMBER 2023

The directors present their report and the financial statements for the period 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;

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.

Principal activity

The principal activity of the Company is that of a holding company. The principal activity of the Group is the contract hire and sale of motor vehicles and other related services.

Results and dividends

The profit for the period, after taxation, amounted to £2,027k.

No dividends were paid during the period.

Directors

The directors who served during the period were:

Mr A Kenning (appointed 17 October 2022)
Mr J Kenning (appointed 17 October 2022)

Page 3

 
LONGFOX LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023

Disclosure of information to auditors

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 auditors are 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 auditors are aware of that information.

Post balance sheet events

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

Auditors

The auditorsPKF Smith Cooper Audit Limitedwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 8 August 2024 and signed on its behalf.
 





Mr J Kenning
Director

Page 4

 
LONGFOX LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LONGFOX LIMITED
 

Opinion


We have audited the financial statements of Longfox Limited (the 'parent Company') and its subsidiaries (the 'Group') for the period 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 period then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the 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

 
LONGFOX LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LONGFOX LIMITED (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' 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 period 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

 
LONGFOX LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LONGFOX LIMITED (CONTINUED)


Auditors' responsibilities for the audit of the financial statements
 

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' 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, key laws and regulations that we identified included:
 
Companies Act;
Tax Legislation;
Health and Safety and Employment Legislation; and
Financial Conduct Authority.

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 judgments made;
management override of control; and
posting of unusual journals or transactions.

We focused on those areas that could give rise to a material misstatement in the Group financial statements.
Our procedures included, but were not limited to:
 
Enquiry of management and those charged with governance 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, and
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, estimation of residual values and maintenance costs.

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.
Page 7

 
LONGFOX LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LONGFOX LIMITED (CONTINUED)




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 Auditors' report.


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 Auditors' 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.





Stephen Newman (Senior statutory auditor)
  
for and on behalf of
PKF Smith Cooper Audit Limited
 
Statutory Auditors
  
158 Edmund Street
Birmingham
West Midlands
B3 2HB

8 August 2024
Page 8

 
LONGFOX LIMITED
 
 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 31 DECEMBER 2023

Period ended 31 December 2023
Note
£000

  

Turnover
 4 
19,554

Cost of sales
  
(14,285)

Gross profit
  
5,269

Administrative expenses
  
(2,838)

Profit on disposal of fixed assets
  
1,708

Other operating income
  
17

Operating profit
 5 
4,156

Income from fixed assets investments
 9 
9

Interest receivable and similar income
 10 
131

Interest payable and similar expenses
 11 
(1,412)

Profit before tax
  
2,884

Tax on profit
 12 
(857)

Profit for the financial period
  
2,027

Profit for the year attributable to:
  

Owners of the parent company
  
2,027

The notes on pages 17 to 37 form part of these financial statements.

The Consolidated statement of comprehensive Income covers the 10 months of trading post acquisition of the Group which occurred on 6 March 2023 and accordingly there are no comparatives.

Page 9

 
LONGFOX LIMITED
REGISTERED NUMBER: 14423604

CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
Note
£000

Fixed assets
  

Intangible assets
 14 
1,432

Tangible assets
 15 
44,027

Investments
 16 
330

  
45,789

Current assets
  

Stocks
 17 
153

Debtors: amounts falling due after more than one year
 18 
3,667

Debtors: amounts falling due within one year
 18 
5,280

Cash at bank and in hand
 19 
6,384

  
15,484

Creditors: amounts falling due within one year
 20 
(21,055)

Net current liabilities
  
 
 
(5,571)

Total assets less current liabilities
  
40,218

Creditors: amounts falling due after more than one year
 21 
(27,036)

Provisions for liabilities
  

Deferred tax
 25 
(550)

Net assets
  
12,632


Capital and reserves
  

Called up share capital 
 26 
4,354

Share premium account
 27 
6,251

Profit and loss account
 27 
2,027

  
12,632


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 8 August 2024.




Mr J Kenning
Director

The notes on pages 17 to 37 form part of these financial statements.

Page 10

 
LONGFOX LIMITED
REGISTERED NUMBER: 14423604

COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
Note
£000

Fixed assets
  

Investments
 16 
10,605

  

Total assets less current liabilities
  
 
10,605

  

  

Net assets
  
10,605


Capital and reserves
  

Called up share capital 
 26 
4,354

Share premium account
 27 
6,251

  
10,605


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 8 August 2024.


Mr J Kenning
Director

The notes on pages 17 to 37 form part of these financial statements.

Page 11

 
LONGFOX LIMITED
 

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


Called up share capital
Share premium account
Profit and loss account
Equity attributable to owners of parent Company
Total equity

£000
£000
£000
£000
£000

At 17 October 2022
-
-
-
-
-


Comprehensive income for the period

Profit for the period
-
-
2,027
2,027
2,027

Shares issued during the period
4,354
6,251
-
10,605
10,605


At 31 December 2023
4,354
6,251
2,027
12,632
12,632

The notes on pages 17 to 37 form part of these financial statements.

Page 12

 
LONGFOX LIMITED
 

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


Called up share capital
Share premium account
Total equity

£000
£000
£000

At 17 October 2022
-
-
-


Comprehensive income for the period

Shares issued during the period
4,354
6,251
10,605


At 31 December 2023
4,354
6,251
10,605

The notes on pages 17 to 37 form part of these financial statements.

Page 13

 
LONGFOX LIMITED
 

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

2023
£000

Cash flows from operating activities

Profit for the financial period
2,027

Adjustments for:

Amortisation of intangible assets
130

Depreciation of tangible assets
6,919

Write down of vehicle related debtors
1,066

Interest paid
1,412

Interest received
(131)

Taxation charge
857

Decrease in stocks
675

Increase in debtors
(811)

Increase in vehicle related debtors
(135)

Decrease in creditors
(1,807)

Dividends received
(9)

Profit on disposal of tangible assets
(1,708)

Fair value gain on investments
(19)

Taxation paid
(42)

Net cash generated from operating activities

8,424


Cash flows from investing activities

Purchase of tangible fixed assets
(11,546)

Sale of tangible fixed assets
6,752

Interest received
131

HP Interest paid
(1,410)

Dividends received
9

Purchase of subsidiary undertakings
(14,520)

Cash acquired
13,734

Net cash used in investing activities

(6,850)
Page 14

 
LONGFOX LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023


2023

£000



Cash flows from financing activities

Repayment of other loans
(22)

Repayment of finance leases
(7,555)

New finance leases
12,389

Interest paid
(2)

Net cash from financing activities
4,810

Net increase in cash and cash equivalents
6,384

Cash and cash equivalents at the end of period
6,384


Cash and cash equivalents at the end of period comprise:

Cash at bank and in hand
6,384

6,384


The notes on pages 17 to 37 form part of these financial statements.

Page 15

 
LONGFOX LIMITED
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE PERIOD ENDED 31 DECEMBER 2023




Cash flows
Acquisition of subsidiary
At 31 December 2023
£000

£000

£000

Cash at bank and in hand

(7,350)

13,734

6,384

Debt due after 1 year

22

(35)

(13)

Debt due within 1 year

-

(23)

(23)

Finance leases and hire purchase contracts

(4,834)

(36,037)

(40,871)


(12,162)
(22,361)
(34,523)

The notes on pages 17 to 37 form part of these financial statements.

Page 16

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

1.


General information

Longfox Limited is a private company, limited by shares, registered in England, United Kingdom. The Company's registered number and registered office address can be found on the Company information page. The principal activity is disclosed in the Directors report.

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 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 Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of comprehensive income in these financial statements.

The presentational currency of these financial statements is Sterling. All amounts in the financial statements have been rounded to the nearest £1,000.

The following principal accounting policies have been applied:

  
2.2

Reporting period

The Company was incorporated on 17 October 2022 and on 6 March 2023 it acquired 100% of the share capital in URA Ventures Limited and its subsidiary undertakings. These financial statements cover the 15 month period from the date of incorporation up to 31 December 2023 to align the group reporting period to that of its subsidiary undertakings. This is the first year financial statements have been prepared for the Group and therefore there are no comparatives.

 
2.3

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.

Page 17

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.4

Going concern

The financial statements have been prepared on the going concern basis. The directors have assessed the Group's future trading expectations which show that the Group expects to operate within the level of its working capital.
The directors therefore have a reasonable expectation that they have adequate resources to continue in operational existence for the foreseeable future. For these reasons, they continue to adopt the going concern basis in preparing the annual report and financial statements.

 
2.5

Revenue

All revenue arises in the United Kingdom from the Group's principal activity, which is the contract hire and sale of motor vehicles and other related services. Income from vehicle leasing and contract hire agreements is recognised on a straight line basis over the period of the lease. Where income from leases includes amounts to cover maintenance of vehicles, an estimated cost of maintenance is accrued based on standard industry expectations. Income from the sales of vehicles sold is recognised at the point of sale.
Revenue excludes discounts, rebates, value added tax and other sales taxes.

 
2.6

Leased assets: the Group as lessor

Finance lease, hire purchase and other installment finance receivables are apportioned between capital and interest so that the interest net of commissions is apportioned over the term of the relevant agreement to provide a constant periodic rate of return on the net investment.
In accordance with FRS 102, the minimum lease payments receivable from finance lease and other finance agreements, less appropriate future income arising from finance charges, are included in debtors.
Where motor vehicles are funded through finance leases, the amounts receivable are shown in other debtors and the amounts payable are shown in creditors.

 
2.7

Interest income

Interest income is recognised in the Consolidated statement of comprehensive income using the effective interest method.

 
2.8

Finance costs

Finance costs are charged to the Consolidated statement of comprehensive income 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.

Page 18

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.9

Pensions

Defined contribution pension plan

The Group operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The amount charged to the Consolidated statement of comprehensive income represents the contributions payable to the scheme in respect of the accounting period. An accrual or prepayment is included in the balance sheet to the extent to which such costs do not equate to the cash contributions paid in the period.


 
2.10

Current and deferred taxation

The tax expense for the period comprises current and deferred tax. Tax is recognised in the Consolidated statement of comprehensive income 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

Exceptional items

Exceptional items are transactions that fall within the ordinary activities of the Group but are presented separately due to their size or incidence.

Page 19

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.12

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 of 10 years.

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 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.

 
2.13

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 provided on all tangible fixed assets, at rates calculated to write off the cost, less estimated residual value, of each asset on a systematic basis over its expected useful life.
The cost of vehicles acquired is depreciated over the period of the lease to estimated residual values based principally on standard industry expectations.

Land is not depreciated. Depreciation on other assets is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

The estimated useful lives range as follows:

Freehold property
-
50 years
Plant and machinery
-
2-10 years
Motor vehicles
-
over the term of the contract
Fixtures and fittings
-
5 years

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 statement of comprehensive income.

Page 20

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

  
2.14

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 an indication that an asset may be impaired, the carrying value of the assets (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 (CGU's). 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.

 
2.15

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Investments in listed company shares are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in the Consolidated statement of comprehensive income for the period.

 
2.16

Stocks

Stocks of vehicles held for resale are stated at the lower of cost and net realisable value and are shown net of deposits received.

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 statement of comprehensive income.

 
2.17

Debtors and creditors

Debtors and creditors with no stated interest rate or that are receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the Consolidated  statement of comprehensive income in other administration expenses.

 
2.18

Cash and cash equivalents

Cash, for the purpose of the cash flow statement, comprises of cash in hand and deposits repayable on demand, less overdrafts repayable on demand.


Page 21

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.19

Provisions for liabilities

Provisions are made where an event has taken place that gives the Group a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to the Consolidated statement of comprehensive income in the year that the Group becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Balance sheet


 
2.20

Financial instruments

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. 
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 statement of comprehensive income.
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 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.

Page 22

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

3.


Judgments in applying accounting policies and key sources of estimation uncertainty

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the amounts reported for revenues and expenses during the period. However, the nature of estimation means that actual outcomes could differ from those estimates.
The directors conclude that the following are key sources of estimation uncertainty affecting the preparation of the financial statements:
 
 Estimation of useful lives, residual values and depreciation of car fleet
 Estimation of maintenance costs


4.


Turnover

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


Period ended 31 December 2023
£000

Sales of goods
2,792

Rendering of services
16,748

Sundry Income
14

19,554


All turnover arose within the United Kingdom.


5.


Operating profit

The operating profit is stated after charging:

Period ended 31 December 2023
£000

Depreciation of tangible fixed assets
6,919

Amortisation of intangible assets, including goodwill
130

Defined contribution pension cost
41

Page 23

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

6.


Auditors' remuneration

Period ended 31 December 2023
£000

Fees payable to the Company's auditors for the audit of the consolidated and parent Company's financial statements
4


7.


Employees

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


Group
2023
£000


Wages and salaries
1,658

Social security costs
186

Cost of defined contribution scheme
41

1,885


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


        2023
            No.






Employees
42

Page 24

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

8.


Directors' remuneration

Period ended 31 December 2023
£000

Directors' emoluments
247

Group contributions to defined contribution pension schemes
4

251


During the period retirement benefits were accruing to 2 directors in respect of defined contribution pension schemes.

The highest paid director received remuneration of £125k.

The value of the Group's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £2k.


9.


Income from investments

Period ended 31 December 2023
£000



Income from fixed asset investments
9





10.


Interest receivable

Period ended 31 December 2023
£000


Other interest receivable
131

Page 25

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

11.


Interest payable and similar expenses

Period ended 31 December 2023
£000


Other loan interest payable
2

Finance leases and hire purchase contracts
1,410

1,412


12.


Taxation


Period ended 31 December 2023
£000

Corporation tax


Current tax on profits for the year
807


Total current tax
807

Deferred tax


Origination and reversal of timing differences
50

Total deferred tax
50


Tax on profit
857
Page 26

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023
 
12.Taxation (continued)


Factors affecting tax charge for the period

The tax assessed for the period is higher than the standard rate of corporation tax in the UK of 24.4%. The differences are explained below:

Period ended 31 December 2023
£000


Profit on ordinary activities before tax
2,885


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 24.4%
704

Effects of:


Expenses not deductible for tax purposes
103

Deferred taxation
50

Total tax charge for the period
857


Factors that may affect future tax charges

There were no factors that may affect future tax charges.


13.


Parent company profit for the year

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of comprehensive income in these financial statements. The profit after tax of the parent Company for the period was £nil.

Page 27

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

14.


Intangible assets

Group 




Goodwill

£000



Cost


At 17 October 2022
-


On acquisition of subsidiary
1,562



At 31 December 2023

1,562



Amortisation


At 17 October 2022
-


Charge for the period
130



At 31 December 2023

130



Net book value



At 31 December 2023
1,432



Page 28

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

15.


Tangible fixed assets

Group






Freehold property
Plant and machinery
Motor vehicles
Fixtures and fittings
Total

£000
£000
£000
£000
£000



Cost 


At 17 October 2022
-
-
-
-
-


Additions
-
15
11,531
-
11,546


Acquisition of subsidiary
2,691
95
41,648
10
44,444


Disposals
-
-
(8,650)
-
(8,650)



At 31 December 2023

2,691
110
44,529
10
47,340



Depreciation


At 17 October 2022
-
-
-
-
-


Charge for the period
15
28
6,876
-
6,919


Disposals
-
-
(3,606)
-
(3,606)



At 31 December 2023

15
28
3,270
-
3,313



Net book value



At 31 December 2023
2,676
82
41,259
10
44,027

Land amounting to £1,126k has not been depreciated.

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


2023
£000



Motor vehicles
35,840

Page 29

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

16.


Fixed asset investments

Group





Listed investments

£000



Market value


Additions
19


On acquisition of subsidiaries
311



At 31 December 2023
330




Company





Investments in subsidiary companies

£000



Cost 


Additions
25,125


Impairment
(14,520)



At 31 December 2023
10,605





Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Class of shares

Holding

URA Ventures Limited
Ordinary
100%
Windsor Vehicle Leasing Limited*
Ordinary
100%

*denotes indirectly held via its investment in URA Ventures Limited.
Both subsidiary undertakings have a registered office address of Centenary House, Bridge Business Centre, Beresford Way, Chesterfield, S41 9FG.

Page 30

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

17.


Stocks

Group
2023
£000

Vehicles
153


During the year cost of vehicles held for resale was written down by £517k in cost of sales.


18.


Debtors

Group
2023
£000

Due after more than one year

Vehicle lease related debtors
3,197

Net investment in vehicles leased under finance leases
470

3,667


Group
2023
£000

Due within one year

Trade debtors
1,186

Other debtors
3,400

Prepayments and accrued income
110

Net investment in vehicles leased under finance leases
584

5,280


Vehicles totalling £445k at cost have been acquired during the year for the purpose of renting out under finance leases. The nature of these agreements is such that the receivables are more appropriately included within debtors rather than the vehicles shown as fixed assets. The future rentals due on these contracts are shown as net investments in vehicles under finance leases above. Of these rentals £237k are due after more than one year..


19.


Cash and cash equivalents

Group
2023
£000

Cash at bank and in hand
6,384


Page 31

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

20.


Creditors: Amounts falling due within one year

Group
2023
£000

Other loans
23

Payments received on account
2,414

Trade creditors
946

Corporation tax
515

Other taxation and social security
595

Obligations under finance lease and hire purchase contracts
13,882

Accruals and deferred income
2,680

21,055


Obligations under finance leases and hire purchase contracts are secured on the Group's fleets of hire and leasing motor vehicles and also by a deed granting the lender a prior fixed and floating charge over the amounts due to the Group from its customers under the lease and hire purchase agreements in respect of these vehicles.
There is also an unlimited debenture in place with the bank over all assets of the Group.
Other loans are secured on a number of the Group's fleet of hire motor vehicles.


21.


Creditors: Amounts falling due after more than one year

Group
2023
£000

Other loans
13

Net obligations under finance leases and hire purchase contracts
26,989

Other creditors
34

27,036


Obligations under finance leases and hire purchase contracts are secured as detailed in note 20.
Other loans are secured as detailed in note 20.

Page 32

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

22.


Loans


Analysis of the maturity of loans is given below:


Group
2023
£000

Amounts falling due within one year

Other loans
23


Amounts falling due 1-2 years

Other loans
13


36



23.


Hire purchase and finance leases


Minimum lease payments under hire purchase fall due as follows:

Group
2023
£000

Within one year
13,998

Between 1-2 years
15,463

Between 2-5 years
11,526

40,987


24.


Financial instruments

Group
2023
£000

Financial assets

Financial assets measured at fair value through profit or loss
14,167


Financial liabilities

Financial liabilities measured at transaction price
(6,074)


Financial assets measured at amortised cost comprise of trade debtors, other debtors and cash at bank and in hand.


Financial liabilities measured at amortised cost comprise payments received on account, trade creditors, other creditors and accruals and deferred income.

Page 33

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

25.


Deferred taxation


Group



2023


£000






Charged to Consolidated statement of comprehensive income
(50)


Arising on business combinations
(500)



At end of year
(550)

Group
2023
£000

Accelerated capital allowances
(550)

(550)


26.


Share capital

2023
£000
Authorised, allotted, called up and fully paid


353,986 Ordinary shares of £1.00 each
354
4,000,000 Redeemable preference shares of £1.00 each
4,000

4,354


On  the incorporation date of 17 October 2022 , the Company issued 2 ordinary shares of £1 each with an aggregate nominal value of £2.
On 6 March 2023, the Company issued 353,984 ordinary shares of £1 each and 4,000,000 redeemable preference shares of £1 each as consideration for the transfer of 150,162 ordinary shares held in URA Ventures Limited, as part of a corporate reorganisation which completed on the same date for the entire share capital of 353,986 ordinary shares.
Whilst the redeemable preference shares do not carry any voting entitlements, they do carry a entitlement to receive a fixed cumulative dividend, at a rate of 4% per annum. 
As at 31 December 2023, three key employees each held options over 7,095 ordinary shares at an exercise price of £4.23 per share. These options were originally granted under a Company Share Option Plan in the subsidiary company, URA Ventures Limited in March 2019 and were subsequently exchanged for new options in Longfox Limited following the reorganisation which completed on 6 March 2023.

Page 34

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

27.


Reserves

Share premium account

This reserve records the amount above the nominal value received for shares sold, less transaction costs.

Profit and loss account

Includes all current and prior period retained profits and losses.


28.
 

Business combinations

On 6 March 2023, the Company acquired 100% of the ordinary share capital of URA Ventures Limited and its subsidiary undertaking for a consideration of £25,125k as disclosed in note 16.

Acquisition of URA Ventures Limtied

Recognised amounts of identifiable assets acquired and liabilities assumed

Book value
Fair value
£000
£000

Fixed Assets

Tangible
44,444
44,444

Investments
311
311

44,755
44,755

Current Assets

Stocks
828
828

Debtors
9,317
9,317

Cash at bank and in hand
13,734
13,734

Total Assets
68,634
68,634

Creditors

Due within one year
(45,071)
(45,071)

Total Identifiable net assets
23,563
23,563


Goodwill
1,562

Total purchase consideration
25,125

Page 35

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

28.Business combinations (continued)

Consideration

£000


Cash
14,520

Redeemable preference shares
4,000

Scrip issue
6,605

Total purchase consideration
25,125

Cash outflow on acquisition

£000


Purchase consideration settled in cash, as above
14,520

Less: Cash and cash equivalents acquired
(13,734)

Net cash outflow on acquisition
786

The useful life of goodwill is determined to be 10 years.

The results of URA Ventures Limtied since acquisition are as follows:

Current period since acquisition
£000

Turnover
19,554

Profit for the period since acquisition
1,977


29.


Contingent liabilities

The Group has provided buy back guarantees to certain customers in respect of residual values of motor vehicles at the end of the contractual period. The directors are of the view that as 31 December 2023, and at the date of approval of these financial statements, the risk of a material liability arising from such guarantees was remote. Furthermore, these guarantees are the same in character as the remainder of the Group's risk profile in its contract hire business.
The Group has also issued a debenture guarantee, by way of a charge over the assets of the Group, to the Group's bankers National Westminster Bank PLC. As at 31 December 2023 the amount covered by this guarantee was £Nil.
The Company's subsidiary URA Ventures Limited has a group VAT registration with its subsidiary company, Windsor Vehicle Leasing Limited. All members of the VAT group are jointly and severally liable for the total amount of VAT due. The total liability is included in note 20.

Page 36

 
LONGFOX LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

30.


Capital commitments




At 31 December 2023 the Group  had capital commitments as follows:


Group
2023
£000

Contracted for but not provided in these financial statements
4,834


31.


Pension commitments

The Group operates a defined contribution 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 £41k. Contributions totalling £8k were payable to the fund at the balance sheet date and are included in creditors.


32.


Commitments under operating leases - lessor

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


Group
2023
£000

Not later than 1 year
12,384

Later than 1 year and not later than 5 years
10,752

23,136

33.


Related party transactions

The Company has taken advantage of the exemption in paragraph 33.1A of Financial Reporting Standard 102, from the requirement to disclose transactions with wholly owned members of the Group.
During the period, loan notes totalling £6,394,936 were issued and fully paid to 3 of the previous shareholders of URA Ventures Limited following the restructuring of the Group.


34.


Controlling party

At 31 December 2023, the directors' consider there to be no single controlling party.

Page 37