Company registration number 00459742 (England and Wales)
GELITA UK LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
GELITA UK LIMITED
COMPANY INFORMATION
Directors
G Bethell
S Mansson
R Ten Vaarwerk
(Appointed 6 January 2023)
Secretary
G Bethell
Company number
00459742
Registered office
Fourth Floor
Unit 5B, The Parklands
Bolton
BL6 4SD
Auditor
Sumer Auditco Limited
The Beehive
City Place
Gatwick
RH6 0PA
Bankers
HSBC
14 Castle Street
Macclesfield
SK11 6AF
GELITA UK LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Notes to the financial statements
11 - 20
GELITA UK LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Review of the business
During the year the company has seen a decrease in gross profit margin from 18.5% to 13.41% as a result of fluctuating sales prices. During the year the cost of purchases increased which contributed towards the reduced margin in the year. Administrative expenses have increased by £233,316 which has been significantly due to foreign exchange movements and bad debt write offs.
The directors consider the financial key performance indicators to be turnover and profit before tax. Turnover has decreased by £1,365,449 largely due to a decrease in sales volume, which contributed towards the decrease of profit before tax by £1,165,980.
Dividends and interest totalling £Nil (2022: £2,500,000) and £167,665 (2022: £160,449) respectively were paid to group companies during the year.
Principal risks and uncertainties
Foreign currency risk
Finance policies have been adjusted to minimise any exchange rate variances. The policies are actively monitored on a regular basis.
Credit risk
The company's principal financial assets are its trade debtors. The company monitors credit risk closely and considers that its current policies of credit checks meets its objective of managing exposure to credit risk. Credit risk involves setting limits for customers and this is based on their payment history together with third party references. There is continuous monitoring of amounts outstanding for both time and credit limits. Policy and procedures are constantly reviewed to improve systems.
Key performance indicators
The company reviews and monitors its performance against a number of key performance indicators both financial and non-financial. The principal measures includes revenue growth, maintaining service levels and improvement of gross margins. The Directors have and will continue to monitor all the KPI's and daily operating controls and maintain a strong focus on increasing performance in all aspects of the business.
The main KPI's and corresponding results are as follows:
| | |
Turnover Revenue growth Gross profit % | | |
G Bethell
Secretary
20 August 2024
GELITA UK LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company continued to be the procurement and sale of gelatin and collagen peptides.
Results and dividends
The results for the year are set out on page 8.
Ordinary dividends were paid amounting to £Nil. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
G Bethell
R Baer
(Resigned 6 January 2023)
S Mansson
R Ten Vaarwerk
(Appointed 6 January 2023)
Auditor
Sumer Auditco Limited were appointed as auditor to the company and are deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
Medium-sized company exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium sized companies exemption.
GELITA UK LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
Creditors Payment Policy
The company ensures the payment of its creditors within specified agreed credit terms.
By order of the board
G Bethell
Secretary
20 August 2024
GELITA UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF GELITA UK LIMITED
- 4 -
Opinion
We have audited the financial statements of Gelita UK Limited (the 'company') for the year ended 31 December 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its 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.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. 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. 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.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
GELITA UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF GELITA UK LIMITED
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the 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, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of 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, 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 company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these 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.
GELITA UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF GELITA UK LIMITED
- 6 -
We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience, and through discussions with the directors (as required by auditing standards) and discussed with the directors the policies and procedures regarding compliance with laws and regulations. We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit. The potential effect of these laws and regulations on the financial statements varies considerably.
Firstly, the company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation and taxation legislation. We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.
Secondly, the company is subject to many other laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines or litigation. We identified the following areas as those most likely to have such an effect: Companies Act 2006, Health and Safety at Work Act and Employment Law.
Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the directors and inspection of regulatory and legal correspondence, if any. Through these procedures we did not become aware of any actual or suspected non-compliance.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.
We design procedures in line with our responsibilities, outlined below to detect material misstatement due to fraud:
Matters are discussed amongst the audit engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud
Identifying and assessing the design and effectiveness of controls that management have in place to prevent and detect fraud
Detecting and responding to the risks of fraud following discussions with management and enquiring as to whether management have knowledge of any actual, suspected or alleged fraud;
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
GELITA UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF GELITA UK LIMITED
- 7 -
This report is made solely to the company's member 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 member those matters we are required to state to the member in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's member, for our audit work, for this report, or for the opinions we have formed.
Helen Mills
Senior Statutory Auditor
For and on behalf of Sumer Auditco Limited
29 August 2024
Statutory Auditor
The Beehive
City Place
Gatwick
RH6 0PA
GELITA UK LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
2023
2022
Notes
£
£
Turnover
3
13,269,759
14,635,208
Cost of sales
(11,489,695)
(11,927,192)
Gross profit
1,780,064
2,708,016
Distribution costs
(129,080)
(159,328)
Administrative expenses
(603,918)
(370,602)
Other operating income
137,429
144,009
Operating profit
4
1,184,495
2,322,095
Interest receivable and similar income
7
16,852
38,016
Interest payable and similar expenses
8
(167,665)
(160,449)
Profit before taxation
1,033,682
2,199,662
Tax on profit
9
(242,313)
(416,779)
Profit for the financial year
791,369
1,782,883
The profit and loss account has been prepared on the basis that all operations are continuing operations.
GELITA UK LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 9 -
2023
2022
Notes
£
£
£
£
Current assets
Stocks
13
3,419,719
2,314,364
Debtors
14
2,243,450
2,990,467
Cash at bank and in hand
2,270,352
1,385,327
7,933,521
6,690,158
Creditors: amounts falling due within one year
15
(1,272,845)
(961,988)
Net current assets
6,660,676
5,728,170
Creditors: amounts falling due after more than one year
16
(3,273,562)
(3,132,425)
Net assets
3,387,114
2,595,745
Capital and reserves
Called up share capital
19
4,190
4,190
Profit and loss reserves
3,382,924
2,591,555
Total equity
3,387,114
2,595,745
The financial statements were approved by the board of directors and authorised for issue on 20 August 2024 and are signed on its behalf by:
G Bethell
R Ten Vaarwerk
S Mansson
Director
Director
Director
Company Registration No. 00459742
GELITA UK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 January 2022
4,190
3,308,672
3,312,862
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
1,782,883
1,782,883
Dividends
10
-
(2,500,000)
(2,500,000)
Balance at 31 December 2022
4,190
2,591,555
2,595,745
Year ended 31 December 2023:
Profit and total comprehensive income for the year
-
791,369
791,369
Balance at 31 December 2023
4,190
3,382,924
3,387,114
GELITA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
1
Accounting policies
Company information
Gelita UK Limited is a private company limited by shares incorporated in England and Wales. The registered office is Cowgills Limited, Fourth Floor, Unit 5b The Parklands, Bolton, United Kingdom, BL6 4SD.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared on the historical cost convention and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
- Section 7 ‘Statement of Cash Flows': Presentation of a statement of cash flow and related notes and disclosures;
- Section 11 ‘Basic Financial Instruments' and Section 12 ‘Other Financial Instrument Issues': Carrying amounts, interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
- Section 33 ‘Related Party Disclosures': Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of DGF Stoess Holdings Limited. These consolidated financial statements are available from Companies House.
1.2
Going concern
These accounts have been prepared on a going concern basis, the validity of which is dependant upon the continuing support of the company's immediate and ultimate parent company.true
These financial statements are prepared on the going concern basis. The directors have a reasonable expectation that the company will continue in operational existence for the foreseeable future.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Fixtures, fittings & equipment
10% - 50% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
GELITA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 12 -
1.5
Stocks
Good for resale are stated at the lower of cost and net realisable value. Cost comprises of direct materials and any other costs incurred in bringing the stocks to their present location and condition.
Net realisable value is the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution.
1.6
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.7
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Trade debtors, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as 'loans and receivables'. Loans and receivables are measured at amortised cost using the effective interest method, less any impairment.
Interest is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial. The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating the interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the debt instrument to the net carrying amount on initial recognition.
GELITA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
GELITA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
1.8
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.
1.9
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.10
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.11
Retirement benefits
The company operates a group personal pension plan. Contributions are charged in the profit and loss
account as they become payable, in accordance with the rules of the scheme.
GELITA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
1.12
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Impairment of trade debtors
Trade debtors are stated net of the allowance for the impairment of bad and doubtful debts of £139,098 (2022: £nil). Debtor balances are provided against when the directors believe the debt is potentially irrecoverable based on their detailed experience of the customer and specific matters of the case.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by class of business
Sale of gelatine & collagen peptides
13,269,759
14,635,208
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
13,269,759
14,635,208
2023
2022
£
£
Other revenue
Interest income
16,852
38,016
GELITA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
10,228
(53,951)
Fees payable to the company's auditor for the audit of the company's financial statements
13,000
12,000
Depreciation of owned tangible fixed assets
-
4,407
Profit on disposal of tangible fixed assets
-
(8,543)
Impairment of stocks recognised or reversed
54,421
Operating lease charges
10,500
14,000
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
4
6
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
88,269
180,949
Social security costs
9,816
24,955
Pension costs
3,745
14,039
101,830
219,943
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
30,000
13,200
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Other interest income
16,852
38,016
GELITA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
8
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
167,665
160,449
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
242,313
416,779
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Profit before taxation
1,033,682
2,199,662
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2022: 19.00%)
258,421
417,936
Tax effect of expenses that are not deductible in determining taxable profit
(866)
(1,157)
Effect of change in corporation tax rate
(15,242)
Taxation charge for the year
242,313
416,779
10
Dividends
2023
2022
£
£
Interim paid
2,500,000
11
Impairments
Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:
2023
2022
Notes
£
£
In respect of:
Stocks
13
54,421
Recognised in:
Cost of sales
54,421
-
GELITA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
12
Tangible fixed assets
Fixtures, fittings & equipment
£
Cost
At 1 January 2023 and 31 December 2023
25,485
Depreciation and impairment
At 1 January 2023 and 31 December 2023
25,485
Carrying amount
At 31 December 2023
At 31 December 2022
13
Stocks
2023
2022
£
£
Goods for resale
3,419,719
2,314,364
14
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
2,054,385
2,902,578
Corporation tax recoverable
179,638
49,661
Amounts owed by connected company
10,627
Other debtors
2,184
10,367
Prepayments and accrued income
7,243
17,234
2,243,450
2,990,467
Amounts owed by connected companies are unsecured, interest free and repayable on demand.
15
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
41,855
71,869
Amounts owed to connected company
1,192,644
841,372
Taxation and social security
5,946
4,662
Accruals and deferred income
32,400
44,085
1,272,845
961,988
Amounts owed to connected companies are unsecured, interest free and repayable on demand.
GELITA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
16
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Other borrowings
17
3,273,562
3,132,425
17
Loans and overdrafts
2023
2022
£
£
Loans from group undertakings
3,273,562
3,132,425
Payable after one year
3,273,562
3,132,425
Other borrowings relate to a loan with DGF Stoess Holdings Limited. The loan is repayable 12 months after it is recalled, with no set repayment date. Interest is charged annually at LIBOR+5%.
18
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
3,745
14,039
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
19
Share capital
2023
2022
£
£
Ordinary share capital
Issued and fully paid
4,190 Ordinary Shares of £1 each
4,190
4,190
All shares carry no fixed right to income and rank pari passu in every respect.
20
Reserves
The Company’s capital and reserves are as follows:
Called up share capital
Called up share capital represents the nominal value of the shares issued.
Profit and loss account
The profit and loss account represents cumulative profits and losses net of dividends paid and other adjustments.
GELITA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
21
Related party transactions
The company has taken advantage of the exemption available in accordance with FRS 102 section 1.12 (e) 'Related party disclosures' not to disclose transactions entered into between two or more members of a group, as the company is a wholly owned subsidiary undertaking of the group to which it is party to the transactions. The group prepares consolidated financial statements.
No guarantees have been given or received.
22
Ultimate controlling party
The Company's immediate parent undertaking is DGF Stoess Holdings Limited, a company registered in England and Wales with registered office Fourth Floor, Unit 5b, the Parklands, Bolton, United Kingdom, BL6 4SD.
The ultimate parent company and controlling party is GELITA AG.
The smallest group in which the results of the Company are consolidated is that headed by DGF Stoess Holdings Limited, a company registered in England and Wales with registered office Fourth Floor, Unit 5b, the Parklands, Bolton, England, BL6 4SD. The consolidated accounts are publicly available and may be obtained from Companies House, Crown Way, Cardiff, CF14 3UZ.
The largest group in which the results of the Company are consolidated is that headed by GELITA AG. which is a public limited company incorporated in Germany. Copies of its group accounts, which includes the company, are available from GELITA AG, Uferstrasse 7, 69412 Eberbach/Baden, Germany.
23
Analysis of changes in net debt
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
1,385,327
885,025
2,270,352
Borrowings excluding overdrafts
(3,132,425)
(141,137)
(3,273,562)
(1,747,098)
743,888
(1,003,210)
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