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Vision Modular Systems UK Limited
 
Reports and Financial Statements
 
for the financial year ended 30 November 2023



Vision Modular Systems UK Limited
DIRECTORS AND OTHER INFORMATION

 
Directors Christopher Hayes
Michelle Fleming
 
 
Company Registration Number 07429907
United Kingdom
 
 
Business Address Vantage Point
Woburn Road Industrial Estate
Wolesley Road
MK42 7EF
 
 
Independent Auditors Crowley Young
Chartered Accountants
Level 1
Devonshire House
One Mayfair Place
London
W1J 8AJ
 
   
Solicitors Mayer Brown International LLP
  201 Bishopsgate
  London
  EC2M 3AF



Vision Modular Systems UK Limited
STRATEGIC REPORT
for the financial year ended 30 November 2023

 
The directors present their strategic report on the company for the financial year ended 30 November 2023.
 
Review of the Company's Business
Turnover of the company for the financial year was £86m (FY22: £88.2m) and profit before tax of £6.65m (FY22: £6.93m). At the year end, the company's net assets were £42.23m (FY22: £36.57m).

The company continues to manage cost increases caused by inflation in materials and subcontractors through a careful and sensitive approach to our pricing and cost management together with the maintenance of strong relationships with our clients and suppliers.

The company finances its operations primarily from retained earnings and working capital. The directors have considered the company’s financial requirements based on the existing project commitments and the future pipeline and have deemed that the company is adequately capitalised to deliver on its strategic objectives over the coming 12 months.

The single biggest factor in our continuing success is our ability to embrace the revolution taking place in offsite construction and the development of volumetric technology. Having previously delivered the world's tallest modular building, the company continues to see success and recognition both in the UK and abroad.

During the year, Greenford Quay, a development comprising modern living with contemporary design was shortlisted for the 2023 Building Awards, Offsite Project of the Year while the volumetric development at College Road Croydon featured in Dezeen top 10 architectural projects of 2023. This recognition for Vision’s work follows on from 2022 where Vision was awarded five Awards of Excellence from the Council on Tall Buildings and Urban Habitat (CTBUH) in Chicago and an overall category win for Structural Engineering.

Volumetric construction ensures a faster, safer, less disruptive and more sustainable delivery of high quality homes. Cutting construction times by up to 50%, it allows investors and funders to get an earlier return on investment. The precision undertaken in Vision’s factory reduces the number of defects and improves the overall quality of delivering these buildings. Our manufacturing discipline significantly reduces waste, improves levels of recycling and offers safer working conditions for staff.

This construction methodology is less disruptive for local communities as it minimises construction logistics and has been proven to reduce carbon-related emissions, with a number of delivered buildings already reaching RIBA and LETI 2030 embodied carbon targets.
       
Principal Risks and Uncertainties
The directors are aware of the inherent risks within the construction industry. The company monitors and manages these risks through internal controls and maintaining awareness of the markets within which it operates.

Economic Risk
Significant political events and changing economic landscape in the UK and overseas can impact the company's business through, for example, supply chain disruption, labour costs and supply as well as the introduction of policies that may directly impact the company's business model. These risks are considered when setting the company's business strategy and operating model as well as working closely with our key suppliers to mitigate and supply chain risks.

Government regulation and planning process
Changes in the regulatory environment may affect the conditions and time taken by our clients to obtain planning approval and awarding of contracts. Consultation with government agencies and our involvement with leading industry groups and stakeholders help to monitor, understand, and plan for proposed changes.

Health and safety
The directors consider this to be an area of critical importance with the Company promoting a positive safety culture, ensuring the wellbeing of all parties involved with our work. Health and safety or environmental breaches can impact employees, sub-contractors and site visitors, and undermine the creation of a great place to work.

Dedicated health and safety teams are in place and procedures, training and reporting are all regularly reviewed to ensure that the Company maintains excellent safety standards. Safety is inherent to the volumetric methodology as up to 80% of a building is manufactured in a factory-controlled environment, removing high risk activities to the safety of a factory floor.
       
Financial Key Performance Indicators
Each individual project has budgetary and financial reporting procedures, supported by appropriate key performance indicators to manage credit, liquidity and other financial risk. Key performance indicators used by management include turnover and profitability per sqm and per project. The business continually assess each project performance against budget and carefully appraise new contracts it tenders for.
       
Section 172 Statement
The board of directors plan for the business is designed to have a long term beneficial impact on the company and to contribute to its success in delivering good quality residential accommodation.
Our employees are fundamental to the delivery of our plan. We aim to be a responsible employer in our approach to the pay and benefits our employees receive. The health, safety and well-being of our employees is one of our primary considerations in the way we do business.

We act responsibly and fairly in our dealings with our suppliers and our sub-contractors and co-operate with our regulators, all of whom are integral to the successful delivery of our plan.

We consider how our business impacts the community and the environment. The use of offsite construction methods significantly reduce traffic and pollution on and near construction sites.

As the Board of Directors, our intention is to behave responsibly and we ensure that all employees at management level act in a responsible manner, operating within the high standards of business conduct and good governance expected for a a business such as ours.

Our intention is to behave responsibly towards our shareholders and treat them fairly so they too may benefit from the successful delivery of our plan.
       
Streamlined Energy and Reporting (SECR)
Our company ethos is to drive the modernisation and decarbonisation of construction and real estate.  Our footprint in 2023 covers our Scope 1 and 2 GHG emissions. This was converted into a GHG value using our energy consumption, either as a direct impact on the environment through mobile, stationary or otherwise owned source of combusting fossil fuel, as well as indirectly procured from energy providers through the UK National Grid.  Our SECR disclosure is formulated using the Greenhouse Gas Protocol Corporate Accounting and Reporting Standard; the global standard for companies and organisations to measure and manage their GHG emissions, established and maintained by the World Resource Institute and World Business Council for Sustainable Development.

Energy Performance:                                                            
Energy Consumption (kWh) - 2,174,025 kWh
Associate Greenhouse Gas Emissions (tCO2e) - 410 tCO2e

Energy Use and GHG Emissions Figures by Scope:
Scope 1 (Stationary Combustion Fuels & Gas) - 192 tCO2e
Scope 2 (Electricity) - 218 tCO2e

Emissions intensity (per £100,000 turnover) - 0.48 tCO2e
       
       
On behalf of the board
       
       
___________________________      
Christopher Hayes      
Director      
       
       
___________________________
Michelle Fleming
Director
       
23 August 2024      



Vision Modular Systems UK Limited
DIRECTORS' REPORT
for the financial year ended 30 November 2023

 
The directors present their report and the audited financial statements for the financial year ended 30 November 2023.
 
Principal Activity
Pre-engineering and manufacture of multi-storey accommodation modules.
     
Results and Dividends
The profit for the financial year after providing for depreciation and taxation amounted to £5,658,479 (2022 - £5,850,836).
The directors do not recommend payment of a dividend.
     
Directors
The directors who served during the financial year are as follows:
     
Christopher Hayes
Michelle Fleming
   
There were no changes in shareholdings between 30 November 2023 and the date of signing the financial statements.
     
Future Developments
The company plans to continue its present activities and current trading levels. Employees are kept as fully informed as practicable about developments within the business.
     
Events After the End of the Reporting Period
There have been no significant events affecting the company since the financial year-end.
     
Political Contributions
The company did not make any disclosable political donations in the current financial year.
     
Employee Engagement
Employees are kept as fully informed as practicable about developments within the business. It is the policy of the company to offer opportunities to all employees having regard to their aptitudes and abilities in relation to jobs available.
     
Statement of Directors' Responsibilities
             
The directors are responsible for preparing the Strategic Report, Directors' Report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law 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) including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the 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 apply them consistently;
■make judgements and accounting estimates that are reasonable and prudent;
■state whether applicable UK Accounting Standards comprising FRS 102 have been followed, subject to any material departures disclosed and explained in the financial statements;
■prepare the financial statements on the going concern basis unless it is inappropriate to presume that the 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.
                 
Disclosure of Information to Auditor
Each persons who are directors at the date of approval of this report confirms that:
In so far as the directors are aware:
■there is no relevant audit information (information needed by the company's auditor in connection with preparing the auditor's report) of which the company's auditor is unaware, and
■the directors have taken all the steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.
     
Auditors
The auditors, Crowley Young, (Chartered Accountants) have indicated their willingness to continue in office in accordance with the provisions of Section 485 of the Companies Act 2006.
     
     
On behalf of the board
     
     
___________________________
Christopher Hayes
Director
     
     
___________________________
Michelle Fleming
Director
     
23 August 2024



INDEPENDENT AUDITOR'S REPORT
to the Shareholders of Vision Modular Systems UK Limited

 
Report on the audit of the financial statements
 
Opinion
We have audited the financial statements of Vision Modular Systems UK Limited ('the company') for the financial year ended 30 November 2023 which comprise the Income Statement, the Statement of Financial Position, the Statement of Changes in Equity, the Statement of Cash Flows and the related notes to the financial statements, including significant accounting policies set out in note . The financial reporting framework that has been applied in their preparation is applicable Law and United Kingdom Accounting Standards, including FRS 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 30 November 2023 and of its profit for the financial year then ended;
■have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
■have been prepared in accordance with the requirements of the Companies Act 2006.
 
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the 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 the date 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 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.
 
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 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.
 
Matters on which we are required to report by exception
In the light of our knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified any material misstatements in the Strategic Report and the Directors' Report.
 
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; or
the 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 for the financial statements
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 they 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 has 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:
 
Our procedures included: enquiry of management and those charged with Governance around actual and potential litigation and claims; enquiry of entity staff in tax and compliance functions to identify any instances of non-compliance with laws and regulations; reviewing minutes of meetings of those charged with governance; reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations; auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness.
 
A further description of our responsibilities for the audit of the financial statements is contained in the appendix to this report, located at page , which is to be read as an integral part of our 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 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.
 
 
 
__________________________________
Fintan Crowley (Senior Statutory Auditor)
for and on behalf of
CROWLEY YOUNG
Chartered Accountants
Level 1
Devonshire House
One Mayfair Place
London
W1J 8AJ
 
23 August 2024



Vision Modular Systems UK Limited
APPENDIX TO THE INDEPENDENT AUDITOR'S REPORT

Further information regarding the scope of our responsibilities as auditor
 
As part of an audit in accordance with ISAs (UK), we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
 
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
 
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company's internal control.
 
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
 
Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our Auditor's Report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our Auditor's Report. However, future events or conditions may cause the company to cease to continue as a going concern.
 
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
 
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.



Vision Modular Systems UK Limited
INCOME STATEMENT
for the financial year ended 30 November 2023
2023 2022
Notes £ £

Turnover 5 86,031,543 88,209,214
 
Cost of sales (74,335,970) (75,719,770)
───────── ─────────
Gross profit 11,695,573 12,489,444
 
Distribution costs (1,524,733) (1,403,647)
Administrative expenses (3,493,916) (4,201,207)
Other operating income 179,757 124,224
───────── ─────────
Operating profit 6 6,856,681 7,008,814
 
Investment income 7 - 254,521
Interest payable and similar expenses 8 (204,654) (329,921)
───────── ─────────
Profit before taxation 6,652,027 6,933,414
 
Tax on profit 10 (993,548) (1,082,578)
───────── ─────────
Profit for the financial year 20 5,658,479 5,850,836
───────── ─────────
Total comprehensive income 5,658,479 5,850,836
    ═════════   ═════════



Vision Modular Systems UK Limited
Company Registration Number: 07429907
STATEMENT OF FINANCIAL POSITION
as at 30 November 2023

2023 2022
Notes £ £
 
Non-Current Assets
Property, plant and equipment 12 5,804,279 6,170,347
───────── ─────────
 
Current Assets
Stocks 13 10,006,385 5,843,051
Debtors 14 36,669,416 42,678,147
Cash and cash equivalents 15 5,932,247 5,385,522
───────── ─────────
52,608,048 53,906,720
───────── ─────────
Creditors: amounts falling due within one year 16 (14,695,453) (22,113,384)
───────── ─────────
Net Current Assets 37,912,595 31,793,336
───────── ─────────
Total Assets less Current Liabilities 43,716,874 37,963,683
 
Provisions for liabilities 18 (1,487,426) (1,392,714)
───────── ─────────
Net Assets 42,229,448 36,570,969
═════════ ═════════
 
Capital and Reserves
Called up share capital 19 100 100
Retained earnings 20 42,229,348 36,570,869
───────── ─────────
Equity attributable to owners of the company 42,229,448 36,570,969
═════════ ═════════
 
           
Approved by the Board and authorised for issue on 23 August 2024 and signed on its behalf by
           
           
________________________________          
Christopher Hayes          
Director          
           
           
________________________________
Michelle Fleming
Director
           



Vision Modular Systems UK Limited
STATEMENT OF CHANGES IN EQUITY
as at 30 November 2023

Called up Retained Total
share earnings
capital
£ £ £
 
At 1 December 2021 100 44,416,969 44,417,069
───────── ───────── ─────────
Profit for the financial year - 5,850,836 5,850,836
───────── ───────── ─────────
Payment of dividends - (13,696,936) (13,696,936)
  ───────── ───────── ─────────
At 30 November 2022 100 36,570,869 36,570,969
  ───────── ───────── ─────────
Profit for the financial year - 5,658,479 5,658,479
  ───────── ───────── ─────────
At 30 November 2023 100 42,229,348 42,229,448
  ═════════ ═════════ ═════════



Vision Modular Systems UK Limited
STATEMENT OF CASH FLOWS
for the financial year ended 30 November 2023
2023 2022
Notes £ £

Cash flows from operating activities
Profit for the financial year 5,658,479 5,850,836
Adjustments for:
Investment income - (254,521)
Interest payable and similar expenses 204,654 329,921
Tax on profit on ordinary activities 993,548 1,082,578
Depreciation 615,220 591,334
───────── ─────────
7,471,901 7,600,148
Movements in working capital:
Movement in provisions - 140,000
Movement in stocks (4,163,334) 3,968,050
Movement in debtors 5,582,347 (26,919,368)
Movement in creditors 300,230 3,925,543
───────── ─────────
Cash generated from/(used in) operations 9,191,144 (11,285,627)
Interest paid (204,654) (329,921)
Tax paid (991,372) (654,367)
───────── ─────────
Net cash generated from/(used in) operating activities 7,995,118 (12,269,915)
───────── ─────────
Cash flows from investing activities
Interest received   - 254,521
Payments to acquire property, plant and equipment   (249,152) (148,563)
    ───────── ─────────
Net cash (used in)/generated from investment activities   (249,152) 105,958
    ───────── ─────────
Cash flows from financing activities
Repayment of short term loan   (5,000,000) -
Movement in funding to connected parties   426,384 25,305,755
Movement in funding from connected parties   (2,625,625) 1,407,126
Dividends paid   - (13,696,936)
    ───────── ─────────
Net cash (used in)/generated from financing activities   (7,199,241) 13,015,945
    ───────── ─────────
       
Net increase in cash and cash equivalents   546,725 851,988
Cash and cash equivalents at beginning of financial year   5,385,522 4,533,534
    ───────── ─────────
Cash and cash equivalents at end of financial year 15 5,932,247 5,385,522
    ═════════ ═════════



Vision Modular Systems UK Limited
NOTES TO THE FINANCIAL STATEMENTS
for the financial year ended 30 November 2023

   
1. General Information
 
Vision Modular Systems UK Limited is a company limited by shares incorporated and registered in the United Kingdom. The registered number of the company is 07429907. The registered office of the company is , United Kingdom. The nature of the company's operations and its principal activities are set out in the Directors' Report. The financial statements have been presented in Pound (£) which is also the functional currency of the company.
         
2. Summary of Significant Accounting Policies
 
The following accounting policies have been applied consistently in dealing with items which are considered material in relation to the company's financial statements.
 
Statement of compliance
The financial statements of the company for the financial year ended 30 November 2023 have been prepared in accordance with the Financial Reporting Standard applicable in the United Kingdom and the Republic of Ireland (FRS 102) issued by the Financial Reporting Council and in accordance with the Companies Act 2006.
 
Basis of preparation
The financial statements have been prepared on the going concern basis and in accordance with the historical cost convention except for certain properties and financial instruments that are measured at revalued amounts or fair values, as explained in the accounting policies below. Historical cost is generally based on the fair value of the consideration given in exchange for assets.
 
Turnover
Turnover comprises the invoice value of goods supplied by the company, exclusive of trade discounts and value added tax.
 
Revenue recognition and long term contracts
Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract at the reporting end date. Variations in contract work are included to the extent that the amount can be measured reliably and its receipt is considered probable. Revenue not billed to clients is included in debtors and payments on account in excess of the relevant amounts of revenue are included in creditors.

Where it is probable that total contract costs will exceed total contract turnover, the expected loss is recognised as an expense immediately.

Where the outcome of a construction contract cannot be estimated reliably, contract costs are recognised as expenses in the period in which they are incurred and contract revenue is recognised to the extent of contract costs incurred where it is probable that they will be recovered.

Where third party certificates are not available, the "percentage of completion method" is used to determine the appropriate amounts to recognise in a given period. The stage of completion is measured by the proportion of contract costs incurred for work performed to date compared to the total contract costs. Costs incurred in the year in connection with future activity on a contract are excluded from contract costs in determining the stage of completion. These costs are presented as stocks, prepayments or other assets depending on their nature, and provided it is probable they will be recovered.
 
Property, plant and equipment and depreciation
Property, plant and equipment are stated at cost or at valuation, less accumulated depreciation. The charge to depreciation is calculated to write off the original cost or valuation of property, plant and equipment, less their estimated residual value, over their expected useful lives as follows:
 
  Land and buildings freehold - 2% Straight line
  Short leasehold property - Over the period of the lease of 10 years
  Plant and machinery - 5% Straight line
  Fixtures, fittings and equipment - 20% Straight line
  Motor vehicles - 25% Straight line
 
The carrying values of tangible fixed assets are reviewed annually for impairment in periods if events or changes in circumstances indicate the carrying value may not be recoverable.
 
Leasing
Rentals payable under operating leases are dealt with in the Income Statement as incurred over the period of the rental agreement.
 
Stocks
Stocks are valued at the lower of cost and net realisable value. Stocks are determined on a first-in first-out basis. Cost comprises expenditure incurred in the normal course of business in bringing stocks to their present location and condition.  Full provision is made for obsolete and slow moving items. Net realisable value comprises actual or estimated selling price (net of trade discounts) less all further costs to completion or to be incurred in marketing and selling.
 
Trade and other debtors
Trade and other debtors are initially recognised at fair value and thereafter stated at amortised cost using the effective interest method less impairment losses for bad and doubtful debts except where the effect of discounting would be immaterial. In such cases the receivables are stated at cost less impairment losses for bad and doubtful debts.
 
Borrowing costs
Borrowing costs relating to the acquisition of assets are capitalised at the appropriate rate by adding them to the cost of assets being acquired. Investment income earned on the temporary investment of specific borrowings pending their expenditure on the assets is deducted from the borrowing costs eligible for capitalisation. All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
 
Provisions
Provisions are recognised when the company has a present legal or constructive obligation arising as a result of a past event, it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable estimate can be made. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the same value of money and the risks specific to the obligation. The increase in the provision due to passage of time is recognised as interest expense.
 
Trade and other creditors
Trade and other creditors are initially recognised at fair value and thereafter stated at amortised cost using the effective interest rate method, unless the effect of discounting would be immaterial, in which case they are stated at cost.
 
Employee benefits
The company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund.
 
Taxation and deferred taxation
Current tax represents the amount expected to be paid or recovered in respect of taxable profits for the financial year and is calculated using the tax rates and laws that have been enacted or substantially enacted at the Statement of Financial Position date.

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where transactions or events have occurred at that date that will result in an obligation to pay more tax in the future, or a right to pay less tax in the future. Timing differences are temporary differences between the company's taxable profits and its results as stated in the financial statements. Deferred tax is measured on an undiscounted basis at the tax rates that are anticipated to apply in the periods in which the timing differences are expected to reverse, based on tax rates and laws that have been enacted or substantively enacted by the Statement of Financial Position date.
 
Foreign currencies
Monetary assets and liabilities denominated in foreign currencies are translated at the rates of exchange ruling at the Statement of Financial Position date. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated at the rates of exchange ruling at the date of the transaction. Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. The resulting exchange differences are dealt with in the Income Statement.
 
Research and development
Research expenditure is written off to the Income Statement in the financial year in which it is incurred.
 
Ordinary share capital
The ordinary share capital of the company is presented as equity.
   
3. Significant accounting judgements and key sources of estimation uncertainty
 
In preparing these financial statements, the directors have made the following judgements:

Accounting for long term manufacturing and construction contracts
Long term contracts are assessed on a contract by contract basis and are reflected in the profit and loss account by recording turnover and related costs as contract activity progresses. Where the outcome of each long term contract can be assessed with reasonable certainty before its conclusion, the attributable profit is recognised in the profit and loss account as the difference between reported turnover and related costs for the contract. Where losses are foreseen, a provision for the loss is made immediately in the profit and loss account.

Revenue recognition
Assumptions are made which complement third party certifications to assess whether module manufacturing and erection on site  is physically complete and hence the company's revenue recognition policy has been satisfied.
   
4. Going concern
 
The directors are required to consider whether the company can continue in operational existence for the foreseeable future and have carried out a rigorous assessment of forecasts and cash flows and the inherent uncertainty in these forecasts caused by higher-than-expected inflation wordwide, triggering tighter financial conditions and further negative spillovers from the war in Ukraine.

The forecasts have been stress tested by considering potential downturns in performance which represent severe but plausible scenarios in these uncertain times and to establish the impact of a substantial increase in build costs. Under all scenarios, the company has significant headroom in terms of its liquidity.

The company's cash resources have remained healthy since the year end and based on current forecasted activity will continue to remain so. Therefore, the directors consider it appropriate for the financial statements to be prepared on a going concern basis.
       
5. Turnover
 
The whole of the company's turnover is attributable to its market in the United Kingdom and is derived from the principal activity of modular manufacturing and construction.
       
6. Operating profit 2023 2022
  £ £
Operating profit is stated after charging:
Depreciation of property, plant and equipment 615,220 591,334
Research and development
- expenditure in current financial year 343,064 655,470
Loss on foreign currencies 1,670 62,811
Operating lease rentals
- Land and buildings 1,297,390 775,155
Auditor's remuneration
- audit services 17,009 12,652
  ═════════ ═════════
       
7. Income from investments 2023 2022
  £ £
 
Interest from associate undertakings - 254,521
  ═════════ ═════════
       
8. Interest payable and similar expenses 2023 2022
  £ £
 
On amounts payable to connected parties 34,670 134,426
On bank loans and overdrafts 169,984 195,495
  ───────── ─────────
  204,654 329,921
  ═════════ ═════════
       
9. Employees and remuneration
 
Number of employees
The average number of persons employed (including executive directors) during the financial year was as follows:
 
  2023 2022
  Number Number
 
Management 2 2
Production and administration 155 160
  ───────── ─────────
  157 162
  ═════════ ═════════
 
The staff costs (inclusive of directors' salaries) comprise: 2023 2022
  £ £
 
Wages and salaries 6,739,412 6,689,613
Social security costs 684,980 750,510
Pension costs 136,005 163,142
  ───────── ─────────
  7,560,397 7,603,265
  ═════════ ═════════
       
10. Tax on profit
  2023 2022
  £ £
(a)     Analysis of charge in the financial year
 
Current tax:
Corporation tax at 23.01% (2022 - 19.00%) (Note 10 (b)) 898,836 937,644
  ───────── ─────────
 
Deferred tax:
Origination and reversal of timing differences 94,712 144,934
  ───────── ─────────
Total deferred tax 94,712 144,934
  ═════════ ═════════
Tax on profit  (Note 10 (b)) 993,548 1,082,578
  ═════════ ═════════
 
(b)     Factors affecting tax charge for the financial year
 
The tax assessed for the financial year differs from the standard rate of corporation tax in the United Kingdom 23.01% (2022 - 19.00%). The differences are explained below:
  2023 2022
  £ £
 
Profit taxable at 23.01% 6,652,027 6,933,414
  ═════════ ═════════
Profit before tax
multiplied by the standard rate of corporation tax
in the United Kingdom at 23.01% (2022 - 19.00%) 1,530,631 1,317,349
Effects of:
Expenses not deductible for tax purposes - 2,166
Capital allowances for period in excess of depreciation (39,683) (45,669)
Deferred tax 94,712 144,934
Patent Box relief (592,112) (336,202)
  ───────── ─────────
Total tax charge for the financial year (Note 10 (a)) 993,548 1,082,578
  ═════════ ═════════
 
       
11. Dividends 2023 2022
  £ £
Dividends on equity shares:
 
Ordinary - Final paid - 13,696,936
  ═════════ ═════════

               
12. Property, plant and equipment
  Land and Short Plant and Fixtures, Motor Total
  buildings leasehold machinery fittings and vehicles  
  freehold property   equipment    
  £ £ £ £ £ £
Cost
At 1 December 2022 1,031,761 179,608 10,022,566 390,022 101,785 11,725,742
Additions - - 214,502 - 34,650 249,152
  ───────── ───────── ───────── ───────── ───────── ─────────
At 30 November 2023 1,031,761 179,608 10,237,068 390,022 136,435 11,974,894
  ───────── ───────── ───────── ───────── ───────── ─────────
Depreciation
At 1 December 2022 148,300 90,585 4,903,381 338,397 74,732 5,555,395
Charge for the financial year 20,635 3,592 515,709 49,730 25,554 615,220
  ───────── ───────── ───────── ───────── ───────── ─────────
At 30 November 2023 168,935 94,177 5,419,090 388,127 100,286 6,170,615
  ───────── ───────── ───────── ───────── ───────── ─────────
Net book value
At 30 November 2023 862,826 85,431 4,817,978 1,895 36,149 5,804,279
  ═════════ ═════════ ═════════ ═════════ ═════════ ═════════
At 30 November 2022 883,461 89,023 5,119,185 51,625 27,053 6,170,347
  ═════════ ═════════ ═════════ ═════════ ═════════ ═════════

       
13. Stocks 2023 2022
  £ £
 
Raw materials 4,518,399 5,740,472
Work in progress 5,487,986 102,579
  ───────── ─────────
  10,006,385 5,843,051
  ═════════ ═════════
       
14. Debtors 2023 2022
  £ £
 
Trade debtors 35,672,958 36,555,159
Amounts recoverable on long term work-in-progress - 3,999,152
Amounts owed by connected parties (Note 24) - 426,384
Other debtors 3,639 -
Prepayments and accrued income 992,819 1,697,452
  ───────── ─────────
  36,669,416 42,678,147
  ═════════ ═════════
       
15. Cash and cash equivalents 2023 2022
  £ £
 
Cash and bank balances 5,931,315 5,385,522
Cash equivalents 932 -
  ───────── ─────────
  5,932,247 5,385,522
  ═════════ ═════════
       
16. Creditors 2023 2022
Amounts falling due within one year £ £
 
Bank loan - 5,000,000
Trade creditors 4,297,742 4,978,785
Amounts owed to connected parties (Note 24) - 2,625,625
Taxation  (Note 17) 2,026,853 4,527,197
Other creditors 268,396 183,138
Accruals:
Pension accrual 10,528 24,446
Other accruals 8,091,934 4,774,193
  ───────── ─────────
  14,695,453 22,113,384
  ═════════ ═════════
       
17. Taxation 2023 2022
  £ £
 
Creditors:
VAT 824,331 3,173,358
Corporation tax 757,459 849,995
PAYE / NI 445,063 503,844
  ───────── ─────────
  2,026,853 4,527,197
  ═════════ ═════════
           
18. Provisions for liabilities
 
The amounts provided for deferred taxation (due to timing differences between capital allowances and depreciation) and relocation expenses are analysed below:
 
  Capital Relocation expenses Total Total
  allowances      
         
      2023 2022
  £ £ £ £
 
At financial year start 552,714 840,000 1,392,714 1,107,780
Charged to profit and loss 94,712 - 94,712 284,934
  ───────── ───────── ───────── ─────────
At financial year end 647,426 840,000 1,487,426 1,392,714
  ═════════ ═════════ ═════════ ═════════
           
19. Share capital     2023 2022
      £ £
Description Number of shares Value of units    
 
Allotted, called up and fully paid
Ordinary 100 £1 each 100 100
 
      ═════════ ═════════
       
20. Income Statement
     
  2023 2022
  £ £
 
At 1 December 2022 36,570,869 44,416,969
Profit for the financial year 5,658,479 5,850,836
Payment of dividends - (13,696,936)
  ───────── ─────────
At 30 November 2023 42,229,348 36,570,869
  ═════════ ═════════
       
21. Financial commitments
 
Total future minimum lease payments under non-cancellable operating leases are as follows:
 
  Land and Buildings
  2023 2022
  £ £
Due:
Within one year 802,000 802,000
Between one and five years 1,069,333 1,871,333
  ───────── ─────────
  1,871,333 2,673,333
  ═════════ ═════════
       
22. Capital commitments
 
The company had no material capital commitments at the financial year-ended 30 November 2023.
       
23. Directors' remuneration 2023 2022
  £ £
 
Remuneration 50,000 50,000
  ═════════ ═════════
       
24. Related party transactions
 
The following amount is due from a connected party:
 
  Balance Balance
  2023 2022
  £ £
 
Tide Construction Limited - 426,384
 
The following amounts are due to other connected parties:
  2023 2022
  £ £
 
Donban Contracting UK Limited - 1,700,091
The Valentine Real Estate Company Limited - 57,846
Furadino Shipping Limited - 867,688
  ───────── ─────────
  - 2,625,625
  ═════════ ═════════
 
Interest of £254,521 was received on these loans in 2022.

Interest of £34,669 (2022: £134,426) was paid on these loans.

All of the above companies are controlled by the ultimate beneficial owners of this company.

Substantially all of the turnover in 2023 and 2022 is to other entities controlled by the same beneficial owners of this company. Likewise, substantially all of the trade debtors is owed by those entities.

Cost of sales includes rent of £300,000 (2022: £300,000) payable to Figsand Limited, controlled by the same beneficial owners.

Administration costs include an amount of £656,518 (2022: £679,795) for management and administration costs charged by VMS Modular Ireland Limited.
   
25. Parent company
 
The company regards Berkeley Street Investments Limited as its parent company.
 
The parent of the largest group in which the results are consolidated is Berkeley Street Investments Limited.
Berkeley Street Investments Limited is registered in United Kingdom.
 
   
26. Events After the End of the Reporting Period
 
There have been no significant events affecting the company since the financial year-end.
         
27 Reconciliation of Net Cash Flow to Movement in Net Debt
  Opening Cash Closing
  balance flows balance
       
  £ £ £
Short-term borrowings (5,000,000) 5,000,000 -
  ───────── ───────── ─────────
Total liabilities from financing activities (5,000,000) 5,000,000 -
  ═════════ ═════════ ─────────
Total net debt     -
      ═════════