Company registration number 02787352 (England and Wales)
EUROPEAN PIPELINE GROUP LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2023
PAGES FOR FILING WITH REGISTRAR
EUROPEAN PIPELINE GROUP LIMITED
COMPANY INFORMATION
Directors
M J Barham
K V Barham
Secretary
K V Barham
Company number
02787352
Registered office
Pegham Industrial Park
Laveys Lane
Funtley
Fareham
Hampshire
United Kingdom
PO15 6SD
Accountants
Azets
24 Park Road South
Havant
Hampshire
United Kingdom
PO9 1HB
EUROPEAN PIPELINE GROUP LIMITED
CONTENTS
Page
Balance sheet
1 - 2
Notes to the financial statements
3 - 9
EUROPEAN PIPELINE GROUP LIMITED
BALANCE SHEET
AS AT
31 AUGUST 2023
31 August 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
3
1,769,885
717,171
Investment property
4
1,127,305
2,130,000
Investments
5
1
1
2,897,191
2,847,172
Current assets
Debtors
6
6,675
219,165
Cash at bank and in hand
631,581
480,993
638,256
700,158
Creditors: amounts falling due within one year
7
(750,691)
(572,484)
Net current (liabilities)/assets
(112,435)
127,674
Total assets less current liabilities
2,784,756
2,974,846
Creditors: amounts falling due after more than one year
8
(736,883)
(844,327)
Provisions for liabilities
(272,297)
(267,761)
Net assets
1,775,576
1,862,758
Capital and reserves
Called up share capital
100
100
Revaluation reserve
518,606
251,288
Non-distributable profits reserve
9
236,043
645,816
Distributable profit and loss reserves
1,020,827
965,554
Total equity
1,775,576
1,862,758
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
For the financial year ended 31 August 2023 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
The members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476.
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
EUROPEAN PIPELINE GROUP LIMITED
BALANCE SHEET (CONTINUED)
AS AT
31 AUGUST 2023
31 August 2023
- 2 -
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:
M J Barham
Director
Company Registration No. 02787352
EUROPEAN PIPELINE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2023
- 3 -
1
Accounting policies
Company information
European Pipeline Group Limited is a private company limited by shares incorporated in England and Wales. The registered office is Pegham Industrial Park, Laveys Lane, Funtley, Fareham, Hampshire, United Kingdom, PO15 6SD.
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 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
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 under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
The company has taken advantage of the exemption under section 399 of the Companies Act 2006 not to prepare consolidated accounts, on the basis that the group of which this is the parent qualifies as a small group. The financial statements present information about the company as an individual entity and not about its group.
1.2
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:
Leasehold land and buildings
1% on cost
Plant and equipment
15% on reducing balance
Fixtures and fittings
10% on reducing balance
Motor vehicles
25% on reducing balance
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.
1.3
Investment property
Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.
1.4
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. 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.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
EUROPEAN PIPELINE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
1
Accounting policies
(Continued)
- 4 -
1.5
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
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
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.
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.
EUROPEAN PIPELINE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
1
Accounting policies
(Continued)
- 5 -
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.
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
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
EUROPEAN PIPELINE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
1
Accounting policies
(Continued)
- 6 -
1.12
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
Government grants relating to turnover are recognised as income over the periods when the related costs are incurred. Grants relating to an asset are recognised in income systematically over the asset's expected useful life. If part of such a grant is deferred it is recognised as deferred income rather than being deducted from the asset's carrying amount.
1.13
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
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
2
2
3
Tangible fixed assets
Land and buildings
Plant and machinery etc
Total
£
£
£
Cost or valuation
At 1 September 2022
635,000
307,129
942,129
Additions
84,403
84,403
Disposals
(22,588)
(22,588)
Transfers
1,002,695
At 31 August 2023
1,637,695
368,944
2,006,639
Depreciation and impairment
At 1 September 2022
8,250
216,708
224,958
Depreciation charged in the year
6,350
25,773
32,123
Eliminated in respect of disposals
(20,327)
(20,327)
At 31 August 2023
14,600
222,154
236,754
Carrying amount
At 31 August 2023
1,623,095
146,790
1,769,885
At 31 August 2022
626,750
90,421
717,171
EUROPEAN PIPELINE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
3
Tangible fixed assets
(Continued)
- 7 -
Land and buildings with a carrying amount of £1,623,095were revalued at 22 July 2021 by Holloway Iliffe & Mitchell Limited, independent valuers not connected with the company on the basis of market value. The valuation conforms to International Valuation Standards and was based on recent market transactions on arm's length terms for similar properties.
4
Investment property
2023
£
Fair value
At 1 September 2022
2,130,000
Transfers
(1,002,695)
At 31 August 2023
1,127,305
The fair value of the investment property has been arrived at on the basis of a valuation carried out at 22 July 2021 by Holloway Iliffe & Mitchell Limited, Chartered Surveyors, who are not connected with the company. The valuation was made on an open market value basis by reference to market evidence of transaction prices for similar properties.
The directors have since carried out a valuation of the investment property as at the year end, and have established that there has been no material change to the valuation.
5
Fixed asset investments
2023
2022
£
£
Shares in group undertakings and participating interests
1
1
6
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
5,400
2,756
Other debtors
1,275
216,409
6,675
219,165
EUROPEAN PIPELINE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
- 8 -
7
Creditors: amounts falling due within one year
2023
2022
£
£
Bank loans
96,783
19,901
Trade creditors
420
Amounts owed to group undertakings
478,851
455,987
Taxation and social security
58,383
28,094
Other creditors
116,254
68,502
750,691
572,484
The bank loans are secured by way of a legal mortgage over the company's freehold and investment properties, a fixed and floating charge over the assets of the company, a personal guarantee given by M J Barham, a director, limited to £250,000 and a guarantee from the subsidiary company of up to £115,000 on the new loan.
The finance lease liabilities are secured over the assets to which they relate.
8
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
736,028
832,665
Obligations under finance leases
855
11,662
736,883
844,327
The bank loans are secured by way of a legal mortgage over the company's freehold and investment properties, a fixed and floating charge over the assets of the company, a personal guarantee given by M J Barham, a director, limited to £250,000 and a guarantee from the subsidiary company of up to £115,000 on the new loan.
The finance lease liabilities are secured over the assets to which they relate.
9
Non-distributable profits reserve
2023
2022
£
£
At the beginning of the year
645,816
655,816
Transfer of non-distributable profits relation to reclassification
(409,773)
(10,000)
At the end of the year
236,043
645,816
10
Financial commitments, guarantees and contingent liabilities
M J Barham, a director, has given a personal guarantee, limited to £250,000, in respect of the bank borrowings.
EUROPEAN PIPELINE GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2023
- 9 -
11
Directors' transactions
Advances or credits have been granted by the company to its directors as follows:
Description
% Rate
Opening balance
Interest charged
Amounts repaid
Closing balance
£
£
£
£
Advances to directors
2.00
215,143
2,704
(217,847)
-
215,143
2,704
(217,847)
-