Company Registration No. 01159518 (England and Wales)
CHERWELL LABORATORIES LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 29 FEBRUARY 2024
CHERWELL LABORATORIES LIMITED
COMPANY INFORMATION
Directors
Mr A R Whittard
Mr R Biskupek
(Appointed 21 December 2023)
Company number
01159518
Registered office
7 & 8 Launton Business Centre
Murdock Road
Bicester
Oxon
OX26 4XB
Auditor
Shaw Gibbs (Audit) Limited
264 Banbury Road
Oxford
OX2 7DY
Bankers
Handelsbanken (Oxford Parkway)
Oxford Parkway Branch
Latimer House
Langford Business Park
Kidlington
OX5 1GG
CHERWELL LABORATORIES LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Profit and loss account
7
Balance sheet
8
Statement of changes in equity
9
Statement of cash flows
10
Notes to the financial statements
11 - 22
CHERWELL LABORATORIES LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 29 FEBRUARY 2024
- 1 -

The directors present the strategic report for the year ended 29 February 2024.

Review of the business

The directors of the business successfully concluded the sale of all share capital to AnalytiChem UK Holdings in December 2023, joining the business into a larger group of companies located across Europe, North America and Australia.

The Directors are pleased to report a significant increase in revenue to year end February 2024, up by £1.007 million (+12.7%), driven by growth across all sectors and within domestic sales and export sales. This was against a notable headwind in the second half of the year that affected the wider life sciences market. Despite this revenue growth still outperformed the previous year of 5.4%. The inclusion of costs associated with the sale transaction and an increase in the dilapidation provision have dampened the profit before tax, down to 0.3% of revenue compared to 7.3% in 2023

Principal risks and uncertainties

Whilst the directors are confident about future growth opportunities, they recognise the potential impact from the continued development of rapid detection methods.

Key performance indicators

The Directors assess performance using revenue and profit growth, both of which are mentioned above. The business also monitors various quality KPIs.

Future Development

To mitigate the risk of continued development of rapid detection methods, the company has engaged with a provider of such technology and has secured UK distribution rights. The directors are hopeful that this new relationship will start generating revenue during 2024 and into 2025. There are also significant opportunities to explore as a result of the new group ownership structure, such as cross-selling and market accessibility, these are not yet quantified.

On behalf of the board

Mr A R Whittard
Director
29 August 2024
CHERWELL LABORATORIES LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 29 FEBRUARY 2024
- 2 -

The directors present their annual report and financial statements for the year ended 29 February 2024.

Principal activities

The principal activities of the company during the year were the manufacture and supply of ready prepared microbiological media; the manufacture, distribution, repair and servicing of cleanroom monitoring equipment and accessories.

Results and dividends

The results for the year are set out on page 7.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Mr M J Young
(Resigned 21 December 2023)
Mr A R Whittard
Mr P M Whittard
(Resigned 21 December 2023)
Mr R Biskupek
(Appointed 21 December 2023)
Auditor

The auditor, Shaw Gibbs (Audit) Limited, is 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:

 

 

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.

Strategic report

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report.

Statement of disclosure to auditor

So far as the directors are aware, there is no relevant audit information of which the company's auditor are unaware. Additionally, the directors 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 auditors are aware of that information.

CHERWELL LABORATORIES LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 29 FEBRUARY 2024
- 3 -
On behalf of the board
Mr A R Whittard
Mr R Biskupek
Director
Director
29 August 2024
CHERWELL LABORATORIES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF CHERWELL LABORATORIES LIMITED
- 4 -
Opinion

We have audited the financial statements of Cherwell Laboratories Limited (the 'company') for the year ended 29 February 2024 which comprise the profit and loss account, the balance sheet, the statement of changes in equity, the statement of cash flows 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:

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 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.

Opinions on other matters prescribed by the Companies Act 2006

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

CHERWELL LABORATORIES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CHERWELL LABORATORIES 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:

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.

 

  1. At the planning stage of the audit we gain an understanding of the laws and regulations which apply to the company and how the management seek to comply with those laws regulations. This helps us to plan appropriate risk assessments.

  2. During the audit we focused on relevant risk areas and review the compliance with the laws and regulations by making relevant enquiries and undertaking corroboration, for example by reviewing Board Minutes and other documentation.

     

  3. We assessed the risk of material misstatement in the financial statements including as a result of fraud and undertook procedures including:

    1. Reviewing the controls set in place by management

    2. Making enquiries of management as to whether they consider fraud or other irregularity may have taken place, or where such opportunity might exist

    3. Challenging management assumptions with regard to accounting estimates

    4. Identifying and testing journal entries, particularly those which appear to be unusual by size or nature

    5. Reviewing health and safety reports and obtaining BSI audit results to ensure that the company have complied with the appropriate requirements.

 

CHERWELL LABORATORIES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CHERWELL LABORATORIES LIMITED
- 6 -

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

A further description of our responsibilities 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.

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.

Stephen Howard Neal (Senior Statutory Auditor)
For and on behalf of Shaw Gibbs (Audit) Limited
30 August 2024
Chartered Certified Accountants
Statutory Auditor
264 Banbury Road
Oxford
OX2 7DY
CHERWELL LABORATORIES LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 29 FEBRUARY 2024
- 7 -
2024
2023
Notes
£
£
Turnover
3
8,912,550
7,905,087
Cost of sales
(5,465,188)
(4,649,737)
Gross profit
3,447,362
3,255,350
Administrative expenses
(3,525,315)
(2,632,066)
Operating (loss)/profit
4
(77,953)
623,284
Interest receivable and similar income
8
101,757
30,408
Interest payable and similar expenses
9
-
0
(684)
Amounts written off fixed asset investments
10
-
(75,000)
Profit before taxation
23,804
578,008
Tax on profit
11
(28,111)
(150,407)
(Loss)/profit for the financial year
(4,307)
427,601

The profit and loss account has been prepared on the basis that all operations are continuing operations.

CHERWELL LABORATORIES LIMITED
BALANCE SHEET
AS AT
29 FEBRUARY 2024
29 February 2024
- 8 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
12
995,655
733,320
Current assets
Stocks
13
687,193
742,137
Debtors
14
2,086,813
1,355,764
Cash at bank and in hand
2,060,816
2,720,608
4,834,822
4,818,509
Creditors: amounts falling due within one year
15
(1,070,559)
(1,131,518)
Net current assets
3,764,263
3,686,991
Total assets less current liabilities
4,759,918
4,420,311
Provisions for liabilities
Provisions
16
609,844
314,922
Deferred tax liability
17
227,992
147,000
(837,836)
(461,922)
Net assets
3,922,082
3,958,389
Capital and reserves
Called up share capital
19
4,125
4,000
Share premium account
27,875
-
0
Profit and loss reserves
3,890,082
3,954,389
Total equity
3,922,082
3,958,389

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved by the board of directors and authorised for issue on 29 August 2024 and are signed on its behalf by:
Mr A R Whittard
Mr R Biskupek
Director
Director
Company registration number 01159518 (England and Wales)
CHERWELL LABORATORIES LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 29 FEBRUARY 2024
- 9 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 March 2022
4,000
-
0
3,566,788
3,570,788
Year ended 28 February 2023:
Profit and total comprehensive income
-
-
427,601
427,601
Dividends
-
-
(40,000)
(40,000)
Balance at 28 February 2023
4,000
-
0
3,954,389
3,958,389
Year ended 29 February 2024:
Loss and total comprehensive expense
-
-
(4,307)
(4,307)
Issue of share capital
19
125
27,875
-
28,000
Dividends
-
-
(60,000)
(60,000)
Balance at 29 February 2024
4,125
27,875
3,890,082
3,922,082
CHERWELL LABORATORIES LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 29 FEBRUARY 2024
- 10 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
24
(102,713)
778,943
Interest paid
-
0
(684)
Income taxes paid
(130,875)
(89,761)
Net cash (outflow)/inflow from operating activities
(233,588)
688,498
Investing activities
Purchase of tangible fixed assets
(510,010)
(244,972)
Proceeds from disposal of tangible fixed assets
14,049
1,064
Interest received
101,757
30,408
Net cash used in investing activities
(394,204)
(213,500)
Financing activities
Proceeds from issue of shares
28,000
-
0
Dividends paid
(60,000)
(40,000)
Net cash used in financing activities
(32,000)
(40,000)
Net (decrease)/increase in cash and cash equivalents
(659,792)
434,998
Cash and cash equivalents at beginning of year
2,720,608
2,285,610
Cash and cash equivalents at end of year
2,060,816
2,720,608
CHERWELL LABORATORIES LIMITED
NOTES TO THE  FINANCIAL STATEMENTS
FOR THE YEAR ENDED 29 FEBRUARY 2024
- 11 -
1
Accounting policies
Company information

Cherwell Laboratories Limited is a private company limited by shares incorporated in England and Wales. The registered office is 7 & 8 Launton Business Centre, Murdock Road, Bicester, Oxon, OX26 4XB.

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. The principal accounting policies adopted are set out below.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

The turnover shown in the profit and loss account represents amounts invoiced during the year, exclusive of Value Added Tax.

 

Income is recognised when goods are dispatched from the warehouse or at the point repair and service of equipment is completed.

1.4
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost 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:

Cleanroom
10% per annum
Leasehold improvements
10% per annum
Engineering & warehouse equipment
10% to 20% per annum
Office fixtures & equipment
10% to 33% per annum
Production equipment
10% to 20% per annum

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.

1.5
Fixed asset investments

Fixed asset investments are measured at cost. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

CHERWELL LABORATORIES LIMITED
NOTES TO THE  FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 29 FEBRUARY 2024
1
Accounting policies
(Continued)
- 12 -
1.6
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs incurred in bringing the stocks to their present location and condition. Stock is valued using the FIFO method.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.7
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.

1.8
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.

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.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

CHERWELL LABORATORIES LIMITED
NOTES TO THE  FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 29 FEBRUARY 2024
1
Accounting policies
(Continued)
- 13 -
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 payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

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

 

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.

1.9
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.

1.10
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

CHERWELL LABORATORIES LIMITED
NOTES TO THE  FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 29 FEBRUARY 2024
1
Accounting policies
(Continued)
- 14 -
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.

1.11
Provisions

Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

 

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

1.12
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.

 

Where material, 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.

1.13
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.14
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

CHERWELL LABORATORIES LIMITED
NOTES TO THE  FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 29 FEBRUARY 2024
1
Accounting policies
(Continued)
- 15 -
1.15
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 where the revision affects only that period, or in the period of the revision and future periods where 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.

Useful economic life of non-current assets

The useful economic lives of non-current assets have been derived from the judgement of the directors, using their best estimate of the write-down period.

Dilapidations provision

The dilapidations provision with respect to the premises rented by the company is based on a professional dilapidations assessment that was carried out by a firm of Chartered Surveyors. The directors have used the professional assessment as a basis for estimating the value of the dilapidations provision and they have also applied their commercial judgement (by considering a number of variables such as the subsequent alterations made in the properties, the changes in the economy and the commercial properties market etc) to assess the need to revise upwards the relevant provision. The adequacy of the dilapidations provision and the necessity for an additional professional assessment is monitored by the directors on an annual basis. Adjustments are made as and when necessary to ensure the adequacy of the relevant provision.

Stock valuation and obsolescence

Stocks are valued at the lower of cost and estimated selling price less costs to complete and sell. Costs comprise direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition. Stock is valued using the FIFO method.

 

Estimated selling price less costs to complete and sell, includes, where necessary, provisions for slow moving and obsolete stocks. Calculation of these provisions requires estimates to be made, which include the forecasted customer demand, the promotional, competitive and economic environment as well as the ageing of stock and the discontinuation of certain product lines by the key suppliers. These variables are monitored by the directors and a provision is put in place where deemed reasonable to mitigate the relevant risks.

CHERWELL LABORATORIES LIMITED
NOTES TO THE  FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 29 FEBRUARY 2024
- 16 -
3
Turnover and other revenue

An analysis of the company's turnover is as follows:

2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
7,786,519
6,787,015
Europe
1,020,075
1,041,751
Rest of World
105,956
76,321
8,912,550
7,905,087
2024
2023
£
£
Other revenue
Interest income
101,757
30,408
4
Operating (loss)/profit
2024
2023
Operating (loss)/profit for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(374)
11,224
Research and development costs
14,430
36,425
Depreciation of owned tangible fixed assets
233,626
239,607
Operating lease charges
350,905
297,345
5
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
12,425
11,625
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
172,195
192,940
Company pension contributions to defined contribution schemes
59,113
42,061
231,308
235,001
The number of directors who exercised share options during the year was 1 (2023 - 0).

The number of directors who are entitled to receive shares under long term incentive schemes during the year was 0 (2023 - 1).

CHERWELL LABORATORIES LIMITED
NOTES TO THE  FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 29 FEBRUARY 2024
- 17 -
7
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2024
2023
Number
Number
Directors
3
3
Administration
19
16
Production
69
60
Total
91
79

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
3,417,927
2,680,220
Social security costs
143,339
91,875
Pension costs
90,780
67,229
3,652,046
2,839,324
8
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
101,757
29,968
Other interest income
-
0
440
Total income
101,757
30,408
9
Interest payable and similar expenses
2024
2023
£
£
Other interest
-
0
684
10
Amounts written off investments
2024
2023
£
£
Other gains and losses
-
(75,000)
CHERWELL LABORATORIES LIMITED
NOTES TO THE  FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 29 FEBRUARY 2024
- 18 -
11
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
-
0
130,364
Adjustments in respect of prior periods
(52,881)
20,043
Total current tax
(52,881)
150,407
Deferred tax
Origination and reversal of timing differences
80,992
-
0
Total tax charge
28,111
150,407

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:

2024
2023
£
£
Profit before taxation
23,804
578,008
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
5,951
109,822
Tax effect of expenses that are not deductible in determining taxable profit
45,132
64,302
Tax effect of utilisation of tax losses not previously recognised
52,881
-
0
Adjustments in respect of prior years
-
0
20,043
(Accelerated)/decelerated capital allowances
(75,853)
(43,760)
Taxation charge for the year
28,111
150,407
CHERWELL LABORATORIES LIMITED
NOTES TO THE  FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 29 FEBRUARY 2024
- 19 -
12
Tangible fixed assets
Cleanroom
Leasehold improvements
Production equipment
Office fixtures & equipment
Engineering & warehouse equipment
Total
£
£
£
£
£
£
Cost
At 1 March 2023
1,613,570
308,182
635,176
640,005
216,875
3,413,808
Additions
193,207
107,099
158,477
38,395
12,832
510,010
Disposals
(14,400)
-
0
-
0
-
0
-
0
(14,400)
At 29 February 2024
1,792,377
415,281
793,653
678,400
229,707
3,909,418
Depreciation and impairment
At 1 March 2023
1,398,176
162,782
532,469
409,141
177,920
2,680,488
Depreciation charged in the year
55,151
32,277
76,054
61,073
9,071
233,626
Eliminated in respect of disposals
(351)
-
0
-
0
-
0
-
0
(351)
At 29 February 2024
1,452,976
195,059
608,523
470,214
186,991
2,913,763
Carrying amount
At 29 February 2024
339,401
220,222
185,130
208,186
42,716
995,655
At 28 February 2023
215,394
145,400
102,707
230,864
38,955
733,320
13
Stocks
2024
2023
£
£
Raw materials and consumables
404,766
496,777
Work in progress
41,245
57,829
Finished goods and goods for resale
241,182
187,531
687,193
742,137
14
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
1,328,528
1,114,043
Corporation tax recoverable
52,881
-
0
Amounts owed by group undertakings
334,845
-
0
Prepayments and accrued income
370,559
241,721
2,086,813
1,355,764
CHERWELL LABORATORIES LIMITED
NOTES TO THE  FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 29 FEBRUARY 2024
- 20 -
15
Creditors: amounts falling due within one year
2024
2023
£
£
Trade creditors
582,400
667,240
Amounts owed to group undertakings
63,203
-
0
Corporation tax
-
0
130,875
Other taxation and social security
252,683
222,736
Accruals and deferred income
172,273
110,667
1,070,559
1,131,518
16
Provisions for liabilities
2024
2023
£
£
Provision
609,844
314,922
Movements on provisions:
Provision
£
At 1 March 2023
314,922
Additional provisions in the year
294,922
At 29 February 2024
609,844

The balance of provisions relates to property dilapidations of £609,844 (2023: £314,922) based on the cost estimated by an independent survey.

17
Deferred taxation

Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
227,992
147,000
CHERWELL LABORATORIES LIMITED
NOTES TO THE  FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 29 FEBRUARY 2024
17
Deferred taxation
(Continued)
- 21 -
2024
Movements in the year:
£
Liability at 1 March 2023
147,000
Charge to profit or loss
80,992
Liability at 29 February 2024
227,992
18
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
90,780
67,229

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.

 

At the year end date, amounts payable to the pension scheme totaled £20,716 (2023: £15,483).

19
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary A shares of 50p each
8,000
8,000
4,000
4,000
Ordinary B shares of 50p each
250
-
125
-
8,250
8,000
4,125
4,000

 

During the year the company issued 250 Ordinary B shares of 50p each, receiving consideration of £28,000.

20
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2024
2023
£
£
Amount payable within one year
402,653
291,075
Between two and five years
688,948
518,163
In over five years
547,500
-
0
1,639,101
809,238
CHERWELL LABORATORIES LIMITED
NOTES TO THE  FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 29 FEBRUARY 2024
- 22 -
21
Events after the reporting date

Since the end of the reporting period the directors have agreed in principle to terminate early one of the property leases.  Discussions are in progress with the landlord and should the decision go ahead certain costs may be incurred and assets may need to be impaired.

 

 

22
Related party transactions

The company has taken advantage of of the exemptions provided by Section 33 of FRS 102 not to disclose transactions and outstanding balances with other wholly owned members of the group headed by AnalytiChem Investment GmbH.

23
Ultimate controlling party

The immediate parent company is AnalytiChem Holding (UK) Limited, a company registered in England and Wales with a registered office, 7 & 8 Launton Business Centre Murdock Road, Murdock Road, Bicester, England, OX26 4XB.

As at the year end, the ultimate parent company is AnalytiChem Investment GmbH, a company incorporated in Germany with a registered office of Frankfurter Str. 80-82, 65760 Eschborn, Germany.

24
Cash (absorbed by)/generated from operations
2024
2023
£
£
(Loss)/profit for the year after tax
(4,307)
427,601
Adjustments for:
Taxation charged
28,111
150,407
Finance costs
-
0
684
Investment income
(101,757)
(30,408)
Depreciation and impairment of tangible fixed assets
233,626
239,607
Other gains and losses
-
75,000
Increase in provisions
294,922
10,000
Movements in working capital:
Decrease/(increase) in stocks
54,944
(116,169)
Increase in debtors
(678,168)
(182,266)
Increase in creditors
69,916
204,487
Cash (absorbed by)/generated from operations
(102,713)
778,943
25
Analysis of changes in net funds
1 March 2023
Cash flows
29 February 2024
£
£
£
Cash at bank and in hand
2,720,608
(659,792)
2,060,816
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