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REGISTERED NUMBER: 15022050 (England and Wales)















GROUP STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

AUDITED CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

FOR

POTTO GROUP LIMITED

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

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










Page

Company Information 1

Group Strategic Report 2

Report of the Directors 4

Report of the Independent Auditors 6

Consolidated Statement of Income and Retained Earnings 9

Consolidated Balance Sheet 10

Company Balance Sheet 11

Consolidated Cash Flow Statement 12

Notes to the Consolidated Cash Flow Statement 13

Notes to the Consolidated Financial Statements 15


POTTO GROUP LIMITED

COMPANY INFORMATION
FOR THE YEAR ENDED 31 DECEMBER 2023







DIRECTORS: Mrs A Preston MBE
Mr J D Preston
Mr J R Godwin


REGISTERED OFFICE: Goulton Lane
Potto
Northallerton
DL6 3HX


REGISTERED NUMBER: 15022050 (England and Wales)


SENIOR STATUTORY AUDITOR: Anne Cowley BA FCA


INDEPENDENT AUDITORS: Baines Jewitt Limited
Statutory Auditors
Spitfire House
19 Falcon Court
Preston Farm Industrial Estate
Stockton-on-Tees
TS18 3TU


BANKERS: HSBC
PO Box 117
60 Albert Road
Middlesbrough
TS1 1RS

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023


The directors present their strategic report of the company and the group for the year ended 31 December 2023.

Potto Group Limited was incorporated on 24 July 2023

The business was established in 1936 at our head office at Potto in North Yorkshire. It now operates from a further three depots at Teesside, West Yorkshire and the South East.

In addition to the principal activity of road haulage, the company also offers warehousing services in the North and South East.

The company is long established, has a strong balance sheet and the directors are confident in retaining its high position in the market.

REVIEW OF BUSINESS
During the year there was a group reconstruction, with the incorporation of Potto Group Limited and completion of a share for share exchange resulting in a new ultimate parent company, Potto Group Limited.

The group reconstruction was effected on 30 November 2023, the combining entities were:

Richard Preston & Son Limited
Freeman, Volkers & Stuart Limited
Teesside Steel Distribution Limited
C.W. Tinkler & Co. Limited

The Merger accounting method has been applied to the Consolidated Accounts with restated comparatives to enable the Company to achieve uniformity of accounting policies and comparability of the results.

Turnover for the year ending 31 December 2023 totalled £16,583,690 (2022: £17,479,309) and there was a profit before taxation £800,812 (2022: £1,947,428). The company monitors asset / employee productivity and the directors are very pleased with the company's performance.

During last year the company has invested heavily in its fleet and has continued with extensive renovation and improvements at all of its depots.

The group tightly manages its cash flow and working capital and uses several KPI's to further monitor its performance. These include a range of financial ratios as follows:

- Gross profit %
- Operating profit %
- Debtor days
- Cash balance
- Staff utilisation


POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

PRINCIPAL RISKS AND UNCERTAINTIES
The company closely monitors any potential risks and uncertainties within the haulage industry. The principal risks are detailed below.

Economy
The company is always at risk of the economy and customers reactions to the state of the economy, we strive to offer the highest level of customer service in order to mitigate this risk as much as possible.

Competition
The company closely monitors the performance levels of drivers and vehicles with the aim of ensuring an efficient operation for its customers.

Fuel
The company faces fluctuating fuel costs, however the business uses variable fuel surcharges to mitigate this risk.

Credit
The company trades with many businesses, both local and further afield. All customers are initially subject to credit vetting procedures and receivable balances and monitored on an ongoing basis.

Cashflow/liquidity risk
Cashflow and liquidity are monitored regularly against forecasts and available finance facilities to ensure the group has sufficient headroom. The group actively maintains a mixture of long-term and short-term committed facilities which are designed to ensure the group has sufficient available funds for operations and planned investment.The group continues to be well supported by their bankers.

Skills availability (people)
The company continues to offer training to all employees.

FUTURE DEVELOPMENTS
The company has made progress in the last twelve months and the prospects for the current financial year are good.

The company is continuing to invest in its fleet to maintain its high fleet standards.

Additional land purchased in 2021 is earmarked for future development as new opportunities arise.

ON BEHALF OF THE BOARD:





Mrs A Preston MBE - Director


9 August 2024

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

REPORT OF THE DIRECTORS
FOR THE YEAR ENDED 31 DECEMBER 2023


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

PRINCIPAL ACTIVITY
The principal activity of the group in the year under review was that of a haulage contractor and storage.

DIVIDENDS
No dividends will be distributed for the year ended 31 December 2023.

DIRECTORS
The directors who have held office during the period from 1 January 2023 to the date of this report are as follows:

Mrs A Preston MBE - appointed 24 July 2023
Mr J D Preston - appointed 24 July 2023
Mr J R Godwin - appointed 26 July 2023

EMPLOYEES
The group has continued its practice of keeping employees informed on matters affecting them as employees and the financial and economic factors affecting the performance of the group.

DISABLED EMPLOYEES
Applications for employment by disabled persons are given full and fair consideration for all vacancies in accordance with their particular aptitudes and abilities.

In the event of an employee becoming disabled, every effort is given to retrain them in order that their employment with the group may continue.

It is the policy of the group that training, career development and promotion opportunities should be available to all employees.

DISCLOSURE IN THE STRATEGIC REPORT
The principal risks and uncertainties facing the company and the likely future developments have been outlined within the strategic report.

STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Group Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and 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 and then apply them consistently;
- make judgements and accounting estimates that are reasonable and prudent;
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

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

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

REPORT OF THE DIRECTORS
FOR THE YEAR ENDED 31 DECEMBER 2023


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

AUDITORS
The auditors, Baines Jewitt Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:





Mrs A Preston MBE - Director


9 August 2024

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
POTTO GROUP LIMITED


Opinion
We have audited the financial statements of Potto Group Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023 which comprise the Consolidated Statement of Income and Retained Earnings, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:
-give a true and fair view of the state of the group's and of the parent company 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 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 UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

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

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and 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.

Other information
The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the Group Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Group Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
POTTO GROUP LIMITED


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 Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
- adequate accounting records have not been kept 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 Statement of Directors' Responsibilities set out on page four, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the 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.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
POTTO GROUP LIMITED


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

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Based on our understanding of the company and industry, we identified that the principal risks of non-compliance with laws and regulations related to Health & Safety and Employment law, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006.

We evaluated management's opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls). Audit procedures performed by the engagement team included:

- discussions with management, including consideration of known or suspected instances of non-compliance with
laws and regulation and fraud;
- evaluation and testing of the operating effectiveness of management's controls designed to prevent and detect
irregularities;
- challenging assumptions and judgements made by management in their significant accounting estimates; and
- identifying and testing journal entries, in particular any journal entries posted with unusual account combinations
or posted by senior management.

There are inherent limitations in the audit procedures described above and the further removed noncompliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.

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 Report of the Auditors.

Use of our report
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.




Anne Cowley BA FCA (Senior Statutory Auditor)
for and on behalf of Baines Jewitt Limited
Statutory Auditors
Spitfire House
19 Falcon Court
Preston Farm Industrial Estate
Stockton-on-Tees
TS18 3TU

12 August 2024

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

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

2023 2022
(Re-stated)
Notes £ £

TURNOVER 3 16,583,690 17,479,308

Cost of sales 14,342,491 14,294,688
GROSS PROFIT 2,241,199 3,184,620

Administrative expenses 1,679,579 1,506,327
561,620 1,678,293

Other operating income 4 360,855 345,449
OPERATING PROFIT 6 922,475 2,023,742

Interest receivable and similar income 7 30,814 -
953,289 2,023,742

Interest payable and similar expenses 8 152,477 83,314
PROFIT BEFORE TAXATION 800,812 1,940,428

Tax on profit 9 189,360 316,240
PROFIT FOR THE FINANCIAL YEAR 611,452 1,624,188

Retained earnings at beginning of year 5,093,911 3,469,723

RETAINED EARNINGS FOR THE
GROUP AT END OF YEAR

5,705,363

5,093,911

Profit attributable to:
Owners of the parent 611,452 1,624,188

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

CONSOLIDATED BALANCE SHEET
31 DECEMBER 2023

2023 2022
(Re-stated)
Notes £ £ £ £
FIXED ASSETS
Tangible assets 11 11,927,301 9,302,604
Investments 12 - -
11,927,301 9,302,604

CURRENT ASSETS
Stocks 13 159,676 212,434
Debtors 14 2,708,363 3,052,061
Cash at bank and in hand 1,067,304 1,504,805
3,935,343 4,769,300
CREDITORS
Amounts falling due within one year 15 2,905,503 2,887,157
NET CURRENT ASSETS 1,029,840 1,882,143
TOTAL ASSETS LESS CURRENT
LIABILITIES

12,957,141

11,184,747

CREDITORS
Amounts falling due after more than one
year

16

(2,923,041

)

(1,951,459

)

PROVISIONS FOR LIABILITIES 20 (909,000 ) (719,640 )
NET ASSETS 9,125,100 8,513,648

CAPITAL AND RESERVES
Called up share capital 21 5,000 5,000
Revaluation reserve 22 3,414,737 3,414,737
Retained earnings 22 5,705,363 5,093,911
SHAREHOLDERS' FUNDS 9,125,100 8,513,648

The financial statements were approved by the Board of Directors and authorised for issue on 9 August 2024 and were signed on its behalf by:





Mrs A Preston MBE - Director


POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

COMPANY BALANCE SHEET
31 DECEMBER 2023

2023 2022
(Re-stated)
Notes £ £ £ £
FIXED ASSETS
Tangible assets 11 16 -
Investments 12 5,000 -
5,016 -

CREDITORS
Amounts falling due within one year 15 16 -
NET CURRENT LIABILITIES (16 ) -
TOTAL ASSETS LESS CURRENT
LIABILITIES

5,000

-

CAPITAL AND RESERVES
Called up share capital 21 5,000 -
SHAREHOLDERS' FUNDS 5,000 -

Company's profit for the financial year - -

The financial statements were approved by the Board of Directors and authorised for issue on 9 August 2024 and were signed on its behalf by:





Mrs A Preston MBE - Director


POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023

2023 2022
(Re-stated)
Notes £ £
Cash flows from operating activities
Cash generated from operations 1 1,918,287 2,688,297
Interest paid (18 ) (875 )
Interest element of hire purchase payments
paid

(152,459

)

(82,439

)
Tax paid - (20,044 )
Net cash from operating activities 1,765,810 2,584,939

Cash flows from investing activities
Purchase of tangible fixed assets (852,565 ) (851,582 )
Sale of tangible fixed assets 6,500 398,590
Interest received 30,814 -
Net cash from investing activities (815,251 ) (452,992 )

Cash flows from financing activities
Capital repayments in year (1,434,756 ) (860,731 )
Amount introduced by directors 14,230 12,187
Amount withdrawn by directors (12,010 ) (14,782 )
Net cash from financing activities (1,432,536 ) (863,326 )

(Decrease)/increase in cash and cash equivalents (481,977 ) 1,268,621
Cash and cash equivalents at beginning of
year

2

1,504,805

236,184

Cash and cash equivalents at end of year 2 1,022,828 1,504,805

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023


1. RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM
OPERATIONS
2023 2022
(Re-stated)
£ £
Profit before taxation 800,812 1,940,428
Depreciation charges 999,452 666,886
Profit on disposal of fixed assets (4,909 ) (40,602 )
Reclassification of asset to stock 19,000 -
Finance costs 152,477 83,314
Finance income (30,814 ) -
1,936,018 2,650,026
Decrease in stocks 52,758 17,554
Decrease/(increase) in trade and other debtors 341,494 (122,888 )
(Decrease)/increase in trade and other creditors (411,983 ) 143,605
Cash generated from operations 1,918,287 2,688,297

2. CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 December 2023
31.12.23 1.1.23
£ £
Cash and cash equivalents 1,067,304 1,504,805
Bank overdrafts (44,476 ) -
1,022,828 1,504,805
Year ended 31 December 2022
31.12.22 1.1.22
(Re-stated)
£ £
Cash and cash equivalents 1,504,805 236,184


POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023


3. ANALYSIS OF CHANGES IN NET DEBT

Other
non-cash
At 1.1.23 Cash flow changes At 31.12.23
£ £ £ £
Net cash
Cash at bank
and in hand 1,504,805 (437,501 ) 1,067,304
Bank overdrafts - (44,476 ) (44,476 )
1,504,805 (481,977 ) 1,022,828
Debt
Finance leases (2,663,334 ) 1,434,756 (2,792,175 ) (4,020,753 )
(2,663,334 ) 1,434,756 (2,792,175 ) (4,020,753 )
Total (1,158,529 ) 952,779 (2,792,175 ) (2,997,925 )

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

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


1. STATUTORY INFORMATION

Potto Group Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the General Information page.

2. ACCOUNTING POLICIES

Basis of preparing the financial statements
These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.

The financial statements cover a period of less than twelve months. the accounting period end was shortened to 31 December to bring it in line with the rest of the group.

Financial Reporting Standard 102 - reduced disclosure exemptions
The group has taken advantage of the following disclosure exemption in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

the requirement of paragraph 33.7.

Basis of consolidation
During the year there was a group reconstruction, with the incorporation of Potto Group Limited and completion of a share for share exchange resulting in a new ultimate parent company, Potto Group Limited.

The Merger accounting method has been applied to the Consolidated Accounts with restated comparatives to enable the Company to achieve uniformity of accounting policies and comparability of the results.

The group financial statements consolidate those of the company and its subsidiary undertakings drawn up to 31 December 2023. Profits and losses on intra-group transactions are eliminated in full. On acquisition of a subsidiary, all of the subsidiary's assets and liabilities which exist at the date of acquisition are recorded at their fair values reflecting their condition at that date.

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

Transactions between group entities which have been eliminated on consolidation are not disclosed within the financial statements.

Turnover
Turnover is the amount derived from ordinary activities, and stated after trade discounts, other sales taxes and net of VAT. Revenue is recognised on the date that the service is provided.

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

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


2. ACCOUNTING POLICIES - continued

Tangible fixed assets
Depreciation is provided to write down the cost of all tangible fixed assets over their expected useful lives. The rates applicable are as follows:

Freehold propertyNot provided

Plant & machinery15% on the reducing balance

Motor vehiclesLorries

17.5% of the cost for the first four years,
the remaining balance at the end of the
fourth year at 20% on the reducing balance

Trailers

12.5% of the cost for the first five years,
the remaining balance at the end of the
fifth year at 20% on the reducing balance.

Other motor vehicles

25% on the reducing balance.

The company has a policy and practice of regular maintenance and repair of freehold property so as to ensure that there is no deterioration in its useful life. The property is considered unlikely to suffer from economic or technical obsolescence. The company therefore does not provide depreciation on the freehold or leasehold property on the grounds that it would not be material. The company carries out annual

Stocks
Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

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

Current or deferred taxation assets and liabilities are not discounted.

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


POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

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


2. ACCOUNTING POLICIES - continued
Deferred tax
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

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

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

Hire purchase and leasing commitments
Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the future payments is treated as a liability.

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

Pension costs and other post-retirement benefits
The group operates a defined contribution pension scheme. Contributions payable to the group's pension scheme are charged to profit or loss in the period to which they relate.

3. TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the group.

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

2023 2022
(Re-stated)
£ £
Provision of haulage services 16,583,690 17,479,308
16,583,690 17,479,308

4. OTHER OPERATING INCOME
2023 2022
(Re-stated)
£ £
Rents received 360,855 345,449

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

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


5. EMPLOYEES AND DIRECTORS
2023 2022
(Re-stated)
£ £
Wages and salaries 5,220,947 4,722,321
Social security costs 532,277 496,954
Other pension costs 145,852 122,842
5,899,076 5,342,117

The average number of employees during the year was as follows:
2023 2022
(Re-stated)

Drivers and maintenance staff 127 119
Office management 22 24
149 143

2023 2022
(Re-stated)
£ £
Directors' remuneration 152,080 155,080
Directors' pension contributions to money purchase schemes 6,327 1,527

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes 2 2

6. OPERATING PROFIT

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

2023 2022
(Re-stated)
£ £
Hire of plant and machinery 601,138 972,403
Depreciation - owned assets 279,478 102,955
Depreciation - assets on hire purchase contracts 719,974 563,931
Profit on disposal of fixed assets (4,909 ) (40,602 )
Auditors' remuneration 21,000 20,513
Auditors' remuneration for non audit work 11,541 5,000

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

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


7. INTEREST RECEIVABLE AND SIMILAR INCOME
2023 2022
(Re-stated)
£ £
Bank interest 30,785 -
Other interest 29 -
30,814 -

8. INTEREST PAYABLE AND SIMILAR EXPENSES
2023 2022
(Re-stated)
£ £
Bank interest 18 875
Hire purchase 152,459 82,439
152,477 83,314

9. TAXATION

Analysis of the tax charge
The tax charge on the profit for the year was as follows:
2023 2022
(Re-stated)
£ £
Deferred tax:
Accelerated capital allowances 189,360 316,240
Tax on profit 189,360 316,240

Reconciliation of total tax charge included in profit and loss
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below:

2023 2022
(Re-stated)
£ £
Profit before tax 800,812 1,940,428
Profit multiplied by the standard rate of corporation tax in the UK of 25 %
(2022 - 19 %)

200,203

368,681

Effects of:
Expenses not deductible for tax purposes 4,021 1
Superdeduction allowances (13,581 ) (127,336 )
Deferred tax rounding (1,726 ) (1,321 )
Deferred tax asset not provided 443 -
Change in deferred tax rates - 76,215
Total tax charge 189,360 316,240

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

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


9. TAXATION - continued

In the Spring Budget 2021, the Government announced that from 1 April 2023 the corporation tax rate would increase to 25%. this was substantively enacted on 24 May 2021. The effects of this have been reflected in the financial position at 31 December 2023.

The expected net reversal of deferred tax assets and liabilities in 2024 is £227,000 this is due to the reversal of accelerated capital allowances and short term timing differences.

10. INDIVIDUAL STATEMENT OF COMPREHENSIVE INCOME

As permitted by Section 408 of the Companies Act 2006, the Income Statement of the parent company is not presented as part of these financial statements.


11. TANGIBLE FIXED ASSETS

Group
Freehold Plant and Motor
property machinery vehicles Totals
£ £ £ £
COST OR VALUATION
At 1 January 2023 5,050,093 430,293 10,632,607 16,112,993
Additions - 8,000 3,636,740 3,644,740
Disposals - (2,819 ) (199,611 ) (202,430 )
Reclassification/transfer - - (19,000 ) (19,000 )
At 31 December 2023 5,050,093 435,474 14,050,736 19,536,303
DEPRECIATION
At 1 January 2023 - 361,727 6,448,662 6,810,389
Charge for year - 11,090 988,362 999,452
Eliminated on disposal - (2,832 ) (198,007 ) (200,839 )
At 31 December 2023 - 369,985 7,239,017 7,609,002
NET BOOK VALUE
At 31 December 2023 5,050,093 65,489 6,811,719 11,927,301
At 31 December 2022 5,050,093 68,566 4,183,945 9,302,604

Cost or valuation at 31 December 2023 is represented by:

Freehold Plant and Motor
property machinery vehicles Totals
£ £ £ £
Valuation in 2021 5,015,000 - - 5,015,000
Cost 35,093 435,474 14,050,736 14,521,303
5,050,093 435,474 14,050,736 19,536,303

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

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


11. TANGIBLE FIXED ASSETS - continued

Group

If Freehold Land & Buildings had not been revalued they would have been included at the following historical cost:

2023 2022
(Re-stated)
£ £
Cost 2,230,016 2,230,016
Aggregate depreciation 594,660 594,660

Value of land in freehold land and buildings 837,047 837,047

Freehold Land & Buildings were valued on an open market basis on 9 March 2021 by Sanderson Weatherall .

The carrying value of motor vehicles includes £4,881,813 (2022: £3,061,056) of assets held under hire purchase agreements.

Company
Plant and
machinery
£
COST
Additions 16
At 31 December 2023 16
NET BOOK VALUE
At 31 December 2023 16

12. FIXED ASSET INVESTMENTS

Company
Shares in
group
undertakings
£
COST
Additions 5,000
At 31 December 2023 5,000
NET BOOK VALUE
At 31 December 2023 5,000

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

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


12. FIXED ASSET INVESTMENTS - continued

The group or the company's investments at the Balance Sheet date in the share capital of companies include the following:

Subsidiaries

Richard Preston & Son Limited
Registered office: Potto, Northallerton, North Yorkshire, DL6 3HX
Nature of business: Haulage contractor & storage
%
Class of shares: holding
Ordinary £1 shares 100.00
(held directly)

Freeman, Volkers & Stuart Limited
Registered office: Church Road, Stockton on Tees, Cleveland
Nature of business: Haulage contractor
%
Class of shares: holding
Ordinary £1 shares 100.00
(held by subsidiary)

C.W. Tinkler & Co. Limited
Registered office: Potto, Northallerton, North Yorkshire, DL6 3HX
Nature of business: dormant company
%
Class of shares: holding
Ordinary £1 shares 100.00
(held by subsidiary)

Teesside Steel Distribution Limited
Registered office: Potto, Northallerton, North Yorkshire, DL6 3HX
Nature of business: Dormant company
%
Class of shares: holding
Ordinary £1 shares 100.00
(held by subsidiary)


13. STOCKS

Group
2023 2022
(Re-stated)
£ £
Stocks 159,676 212,434

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

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


14. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group
2023 2022
(Re-stated)
£ £
Trade debtors 2,479,024 2,850,431
Other debtors 41,558 22,880
Directors' current accounts 6,681 8,885
Prepayments and accrued income 181,100 169,865
2,708,363 3,052,061

15. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group Company
2023 2022 2023 2022
(Re-stated) (Re-stated)
£ £ £ £
Bank loans and overdrafts (see note 17) 44,476 - - -
Hire purchase contracts (see note 18) 1,097,712 711,875 - -
Trade creditors 1,119,358 1,178,202 - -
Social security and other taxes 202,750 499,439 - -
Directors' current accounts 16 - 16 -
Accruals and deferred income 441,191 497,641 - -
2,905,503 2,887,157 16 -

16. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE
YEAR

Group
2023 2022
(Re-stated)
£ £
Hire purchase contracts (see note 18) 2,923,041 1,951,459

17. LOANS

An analysis of the maturity of loans is given below:

Group
2023 2022
(Re-stated)
£ £
Amounts falling due within one year or on demand:
Bank overdrafts 44,476 -

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

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


18. LEASING AGREEMENTS

Minimum lease payments fall due as follows:

Group
Hire purchase contracts
2023 2022
(Re-stated)
£ £
Net obligations repayable:
Within one year 1,097,712 711,875
Between one and five years 2,923,041 1,882,163
In more than five years - 69,296
4,020,753 2,663,334

Group
Non-cancellable
operating leases
2023 2022
(Re-stated)
£ £
Within one year 252,931 -
Between one and five years 249,518 -
502,449 -

Lease payments recognised as an expense in the year amounted to £601,138 (2022: £972,425).

19. SECURED DEBTS

The following secured debts are included within creditors:

Group
2023 2022
(Re-stated)
£ £
Bank overdraft 44,476 -
Hire purchase contracts 4,020,753 2,663,334
4,065,229 2,663,334

The bank overdraft s secured by a fixed and floating charge over the assets of the group.

The hire purchase contracts are secured on the assets to which they relate.

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

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


20. PROVISIONS FOR LIABILITIES

Group
2023 2022
(Re-stated)
£ £
Deferred tax
Accelerated capital allowances 909,000 719,640

Group
Deferred tax
£
Balance at 1 January 2023 719,640
Charge to Statement of Comprehensive Income during year 189,360
Balance at 31 December 2023 909,000

21. CALLED UP SHARE CAPITAL

Allotted and issued:
Number: Class: Nominal 2023 2022
value: £ £
5,000 Ordinary £1 5,000 5,000

22. RESERVES

Group
Retained Revaluation
earnings reserve Totals
£ £ £

At 1 January 2023 5,093,911 3,414,737 8,508,648
Profit for the year 611,452 611,452
At 31 December 2023 5,705,363 3,414,737 9,120,100

Company
Retained
earnings
£

Profit for the year -
At 31 December 2023 -


23. PENSION COMMITMENTS

Amounts payable in relation to pension contributions as at 31 December 2023 amounted to £16,481 (2022: £4,633).

POTTO GROUP LIMITED (REGISTERED NUMBER: 15022050)

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


24. DIRECTORS' ADVANCES, CREDITS AND GUARANTEES

During the year the following transactions with Directors occurred:

Advances made to Directors totalling £12,010 (2022: £14,782).

Repayments made by Directors totalling £14,214 (2022: £12,187).

The Directors' loans are interest free and repayable on demand.

Total outstanding loans to Directors as at 31 December 2023 amounted to £6,681 (2022: £8,885).

25. RELATED PARTY DISCLOSURES

Key management personnel of the entity or its parent (in aggregate)
2023 2022
(Re-stated)
£ £
Sales 19,347 500
Purchases 156 156
Fixed asset purchase - 17,460
Amount due from related party 19,347 -

26. ULTIMATE CONTROLLING PARTY

The controlling party is Mrs A Preston MBE.

27. GROUP RECONSTRUCTION

A group reconstruction was effected on 30 November 2023, the combining entities were:

Richard Preston & Son Limited
Freeman, Volkers & Stuart Limited
Teesside Steel Distribution Limited
C.W. Tinkler & Co. Limited

The reconstruction has been accounted for as a merger, adopting the merger accounting method.