Company Registration No. 08425685 (England and Wales)
SGP HOLDINGS (UK) LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 NOVEMBER 2023
SGP HOLDINGS (UK) LIMITED
COMPANY INFORMATION
Directors
P A Natar
J R Stobart
Company number
08425685
Registered office
2 Pentagon South
Barton Lane
Abingdon
Oxfordshire
OX14 3PZ
Auditor
TC Group
Brightfield Business Hub
Bakewell Road
Orton Southgate
Peterborough
Cambridgeshire
PE2 6XU
SGP HOLDINGS (UK) LIMITED
CONTENTS
Page
Company infomation
Strategic report
1 - 2
Directors' report
3 - 4
Directors' responsibilities statement
5
Independent auditor's report
6 - 10
Group profit and loss
11
Group statement of comprehensive income
12
Group balance sheet
13 - 14
Company balance sheet
15
Group statement of changes in equity
16
Company statement of changes in equity
17
Group statement of cash flows
18
Notes to the financial statements
19 - 41
SGP HOLDINGS (UK) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 1 -

The directors present the strategic report for the year ended 30 November 2023.

Fair review of the business

The Directors are pleased that the Company has returned to normalised revenue levels following the pandemic years of 2021 and 2022 in which demand spiked to unprecedented levels.

 

Most importantly, a £1m increase in pre-tax profits was achieved despite a £25m drop in sales, thanks largely to sea freight costs having reduced to pre-Covid rates. In consequence inventory has been significantly reduced, strengthening further the Company’s robust balance sheet.

 

Continued success in developing its relatively new Christmas and Pet businesses has also made the Company less seasonal and more productive year-round.

 

The Company is well placed to build further meaningful growth.

Principal risks and uncertainties

The following continue to be closely monitored and addressed as required:

 

  1. Inventory levels.

  2. Foreign exchange fluctuations & Sea Freight costs.

  3. Supply Chain volatility.

 

Key performance indicators

The company's key financial and other performance indicators during the period were as follows:

 

Unit          2023         2022

Sales                £         80,363,085     105,831,048

Sales decline year on year        £         (25,467,963)     (3,241,942)

Sales per head            £000         470     572

Profit before interest and taxation    £         9,805,365     9,446,335

Stock turnover            Multiple         3.8     3.7

SGP HOLDINGS (UK) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 2 -
Promoting the success of the company

The directors and shareholders have a legal responsibility under section 172 of the Companies Act 2006 to act in good faith whilst promoting the company’s success for the benefit of the company, its stakeholders and the wider garden products industry.

Company

The directors are committed to developing and delivering market leading products that innovate and help to grow the garden products market whilst being aware of and reducing the environmental impact of these activities. The key to delivering this commitment is to maintain strong relationships with customers, suppliers and employees around the globe.

Customers

Smart Garden Products strives to provide market leading products and service levels despite the impacts of world events and the wider economy. The directors are constantly seeking to improve service levels by investing in infrastructure, branding, merchandising materials, inventory, operating systems and, last but not least, a team of dedicated employees focussed on delivering and improving the customer experience.

Suppliers

The company has always recognised the importance of its supply chain given that a large percentage of its products are seasonal in nature with extended lead times.

Employees

The company's most valuable asset is its relationship with its employees. The directors have endeavoured to maintain a flexible approach to working hours and working location and to engender a collective 'can-do' approach to meeting the needs of customers and the wider business.

Community & Environment

The company is proud of its continued support of the Greenfingers charity as well as its support of local charitable organisations and community activities. The environmental footprint of the company is now measured in these financial statements and will be further enhanced with an ESOS report in 2023. The directors continue to review the environmental impact of the company's products and packaging which has recently been recognised by winning a Garden Industry Manufacturers Association award.

On behalf of the board

P A Natar
J R Stobart
Director
Director
30 August 2024
SGP HOLDINGS (UK) LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 3 -

The directors present their annual report and financial statements for the year ended 30 November 2023.

Principal activities

The principal activity of the company and group continued to be that of the development, design and supply of garden products.

Branches

Office:

Smart Garden Products Ltd

9, rue de Condé

33064 Bordeaux Cedex

France

 

Showroom:

Smart Garden Products Ltd

20 Allee de Chateau Blanc

Batiment D

59290, Wasquehal

Lille

France

Results and dividends

The results for the year are set out on page 11.

Ordinary dividends were paid amounting to £3,000,000. The directors do not recommend payment of a further dividend.

Directors

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

P A Natar
J R Stobart
Future developments

The company continues to develop market leading products and extend its product ranges and customer base, in June 2024 we opened a showroom in France to support our European development.

Energy and carbon report
SGP HOLDINGS (UK) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 4 -

The following figures represent the UK operations of Smart Garden Products Ltd for the year to 30th November 2023. They have been calculated by collating expense data and converting the collated data to kWh and CO2e using the UK Government Greenhouse Gas (GHG) Conversion Factors for 2023.

 

2023                2022

     kWh         CO2e         kWh         CO2e

Transport - Transport of Products    41,226        9,856        0        0

Transport - Other            206,262        47,862        216,920        50,528

Gas                110,761        21,617        131,875        25,751

Electricity                626,861        129,807        696,613        134,711

Total                985,110        209,142        1,045,408    210,990

 

Intensity Ratio            3.40        0.72        3.61        0.73

(per square foot of office and warehouse space)

 

The table above now splits out energy consumed in the transport of products to customers, which had previously been contracted out and therefore fell out of scope.

 

As a company we remain committed to becoming more energy efficient and thus reducing the greenhouse gases emitted from our operations. Over the past twelve months we have continued to move towards a more environmentally friendly fleet of company cars, increasing the number of hybrid electric vehicles to replace older petrol and diesel vehicles.

 

We have also complied with ESOS Phase 3 which assisted us to identify other energy savings opportunities such as ensuring that heating and hot water are turned off when not required such as non-working days and outside of working hours, amending our server room temperatures to a more optimal temperature, and upgrades to lighting.

 

Our project to install solar panels at our sites has been held back by formal approvals from regional DNO’s. We hope to make progress with this project in 2024. During the last financial year, we have pushed forward with plans to increase the number of electric vehicle charging points at our sites.

 

 

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

On behalf of the board
P A Natar
J R Stobart
Director
Director
30 August 2024
SGP HOLDINGS (UK) LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 5 -

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 group and company, and of the profit or loss of the group 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 group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

SGP HOLDINGS (UK) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SGP HOLDINGS (UK) LIMITED
- 6 -
Opinion

We have audited the financial statements of SGP Holdings (UK) Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 November 2023 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group 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 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:

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 group's and parent company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

SGP HOLDINGS (UK) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SGP HOLDINGS (UK) LIMITED
- 7 -

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:

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the 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:

 

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 parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

SGP HOLDINGS (UK) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SGP HOLDINGS (UK) LIMITED
- 8 -
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.

Extent to which the audit was considered capable of detecting irregularities, including fraud

The objectives of our audit, in respect to fraud, are: to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and its management.

 

SGP HOLDINGS (UK) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SGP HOLDINGS (UK) LIMITED
- 9 -

Our approach was as follows:

 

 

Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Where the risk was considered to be higher, we performed audit procedures to address each identified fraud risk. These procedures included: testing manual journals; reviewing the financial statement disclosures and testing to supporting documentation; performing analytical procedures; and enquiring of management, and were designed to provide reasonable assurance that the financial statements were free from fraud or error.

 

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

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.

SGP HOLDINGS (UK) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SGP HOLDINGS (UK) LIMITED
- 10 -

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.

John Grant (Senior Statutory Auditor)
For and on behalf of TC Group
30 August 2024
Office: Peterborough
SGP HOLDINGS (UK) LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 11 -
2023
2022
Notes
£
£
Turnover
2
80,363,085
105,831,048
Cost of sales
(51,300,486)
(77,438,832)
Gross profit
29,062,599
28,392,216
Distribution costs
(4,585,101)
(6,788,089)
Administrative expenses
(14,672,133)
(12,157,792)
Operating profit
3
9,805,365
9,446,335
Interest receivable and similar income
7
384,535
340
Interest payable and similar expenses
8
(30,996)
(268,231)
Profit before taxation
10,158,904
9,178,444
Tax on profit
9
(2,377,296)
(1,756,508)
Profit for the financial year
7,781,608
7,421,936
Profit for the financial year is all attributable to the owners of the parent company.
SGP HOLDINGS (UK) LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 12 -
2023
2022
£
£
Profit for the year
7,781,608
7,421,936
Other comprehensive income
Cash flow hedges (loss)/gain arising in the year
(1,335,089)
927,113
Total comprehensive income for the year
6,446,519
8,349,049
Total comprehensive income for the year is all attributable to the owners of the parent company.
SGP HOLDINGS (UK) LIMITED
GROUP BALANCE SHEET
AS AT
30 NOVEMBER 2023
30 November 2023
- 13 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
11
908,276
1,006,417
Tangible assets
12
1,346,033
1,548,120
2,254,309
2,554,537
Current assets
Stocks
16
12,816,425
18,125,766
Debtors
17
15,703,122
21,706,646
Cash at bank and in hand
15,264,609
2,713,706
43,784,156
42,546,118
Creditors: amounts falling due within one year
18
(12,866,813)
(14,988,700)
Net current assets
30,917,343
27,557,418
Total assets less current liabilities
33,171,652
30,111,955
Creditors: amounts falling due after more than one year
19
(165,268)
(201,397)
Provisions for liabilities
Provisions
22
330,000
400,000
Deferred tax liability
23
169,669
450,362
(499,669)
(850,362)
Net assets
32,506,715
29,060,196
Capital and reserves
Called up share capital
24
4,000,000
4,000,000
Hedging reserve
87,083
1,422,172
Profit and loss reserves
28,419,632
23,638,024
Total equity
32,506,715
29,060,196
SGP HOLDINGS (UK) LIMITED
GROUP BALANCE SHEET (CONTINUED)
AS AT
30 NOVEMBER 2023
30 November 2023
- 14 -
The financial statements were approved by the board of directors and authorised for issue on 30 August 2024 and are signed on its behalf by:
30 August 2024
P A Natar
J R Stobart
Director
Director
SGP HOLDINGS (UK) LIMITED
COMPANY BALANCE SHEET
AS AT 30 NOVEMBER 2023
30 November 2023
- 15 -
2023
2022
Notes
£
£
£
£
Fixed assets
Investments
13
5,041,367
5,041,367
Current assets
Cash at bank and in hand
99
79
Creditors: amounts falling due within one year
18
(952,363)
(951,163)
Net current liabilities
(952,264)
(951,084)
Net assets
4,089,103
4,090,283
Capital and reserves
Called up share capital
24
4,000,000
4,000,000
Profit and loss reserves
89,103
90,283
Total equity
4,089,103
4,090,283

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £2,998,820 (2022 - £2,608,820 profit).

These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the board of directors and authorised for issue on 30 August 2024 and are signed on its behalf by:
30 August 2024
P A Natar
J R Stobart
Director
Director
Company Registration No. 08425685
SGP HOLDINGS (UK) LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 16 -
Share capital
Hedging reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 December 2021
4,000,000
495,059
18,826,088
23,321,147
Year ended 30 November 2022:
Profit for the year
-
-
7,421,936
7,421,936
Other comprehensive income:
Cash flow hedges gains arising in the period
-
927,113
-
927,113
Total comprehensive income for the year
-
927,113
7,421,936
8,349,049
Dividends
10
-
-
(2,610,000)
(2,610,000)
Balance at 30 November 2022
4,000,000
1,422,172
23,638,024
29,060,196
Year ended 30 November 2023:
Profit for the year
-
-
7,781,608
7,781,608
Other comprehensive income:
Cash flow hedges gains arising in the year
-
(1,335,089)
-
(1,335,089)
Total comprehensive income for the year
-
(1,335,089)
7,781,608
6,446,519
Dividends
10
-
-
(3,000,000)
(3,000,000)
Balance at 30 November 2023
4,000,000
87,083
28,419,632
32,506,715
SGP HOLDINGS (UK) LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 17 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 December 2021
4,000,000
91,463
4,091,463
Year ended 30 November 2022:
Profit and total comprehensive income for the year
-
2,608,820
2,608,820
Dividends
10
-
(2,610,000)
(2,610,000)
Balance at 30 November 2022
4,000,000
90,283
4,090,283
Year ended 30 November 2023:
Profit and total comprehensive income for the year
-
2,998,820
2,998,820
Dividends
10
-
(3,000,000)
(3,000,000)
Balance at 30 November 2023
4,000,000
89,103
4,089,103
SGP HOLDINGS (UK) LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 18 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
29
19,597,464
11,316,030
Interest paid
(30,996)
(268,231)
Income taxes paid
(2,549,161)
(2,049,548)
Net cash inflow from operating activities
17,017,307
8,998,251
Investing activities
Purchase of tangible fixed assets
(371,436)
(131,867)
Proceeds on disposal of tangible fixed assets
14,949
79,325
Movement in cash flow hedging instrument
(1,335,089)
927,113
Interest received
384,535
340
Net cash (used in)/generated from investing activities
(1,307,041)
874,911
Financing activities
Payment of finance leases obligations
(68,168)
(440,987)
Dividends paid to equity shareholders
(3,000,000)
(2,610,000)
Net cash used in financing activities
(3,068,168)
(3,050,987)
Net increase in cash and cash equivalents
12,642,098
6,822,175
Cash and cash equivalents at beginning of year
2,622,511
(4,199,664)
Cash and cash equivalents at end of year
15,264,609
2,622,511
Relating to:
Cash at bank and in hand
15,264,609
2,713,706
Bank overdrafts included in creditors payable within one year
-
(91,195)
SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 19 -
1
Accounting policies
Company information

SGP Holdings (UK) Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 2 Pentagon South, Barton Lane, Abingdon, Oxfordshire, OX14 3PZ.

 

The group consists of SGP Holdings (UK) Limited and all of its subsidiaries.

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 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 is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

 

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 20 -
1.2
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

1.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company SGP Holdings (UK) Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 30 November 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 21 -

Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

 

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

 

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

1.4
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group 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.

1.5
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.6
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 20 years.

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

1.7
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.

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 22 -

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:

Plant and equipment
10-33% on cost
Fixtures and fittings
20-33% on cost
Computers
20-33% on cost
Motor vehicles
20-25% on cost

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 recognised in the profit and loss account.

1.8
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

 

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

 

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

 

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 23 -
1.9
Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible 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.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

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.

1.10
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 and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

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.

1.11
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.

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 24 -
1.12
Financial instruments

The group 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 group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and 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.

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 group 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.

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 25 -
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 group 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 group's contractual obligations expire or are discharged or cancelled.

1.13
Equity instruments

Equity instruments issued by the group 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 group.

1.14
Taxation

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

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 26 -
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 group’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 if, and only if, there is 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.

1.15
Provisions

Provisions are recognised when the group has a legal or constructive present obligation as a result of a past event, it is probable that the group 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.

1.16
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.

1.17
Retirement benefits

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

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
1
Accounting policies
(Continued)
- 27 -
1.18
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.

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 leased asset are consumed.

1.19
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.

1.20

Judgements

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the amounts reported for revenues and expenses during the year, However, the nature of estimation means that actual outcomes differ from those estimates. the following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

 

Stocks

 

Stocks carry an inherent risk factor relating to obsolescence, returns and warranties. Directors have provided for impairment over the year end stock balance based on historical data and/or anticipated future effects based on the most relevant reliable information available to them.

Fair value of hedging instruments

 

The basis for determining the value of hedging instruments at the year end is taken from external valuations provided that are then reviewed by the directors to ensure they are reasonable.

 

Display stands

 

Display stands which are purchased for use by customers at their premises are written off to the profit and loss account at the time of issue as any residual value remaining at the point that the customer assumes all of the risks and rewards is considered to be negligible.

 

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 28 -
2
Turnover and other revenue
2023
2022
£
£
Turnover analysed by geographical market
UK
65,495,042
86,552,706
Europe
14,868,043
19,278,342
80,363,085
105,831,048
3
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Depreciation of owned tangible fixed assets
415,764
275,796
Depreciation of tangible fixed assets held under finance leases
157,759
315,093
Profit on disposal of tangible fixed assets
(14,949)
(64,859)
Amortisation of intangible assets
98,141
98,141
Operating lease charges
1,581,205
1,501,284
4
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
1,000
1,000
Audit of the financial statements of the company's subsidiaries
20,000
17,000
21,000
18,000
For other services
Other taxation services
1,500
1,500
Accounts preparation services
1,500
1,500
Payroll services
21,394
22,077
24,394
25,077
SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 29 -
5
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Wages and salaries
10
10
-
-
Social security costs
131
149
-
-
Pension costs
30
26
-
-
Total
171
185
-
0
-
0

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
7,224,564
6,449,370
-
0
-
0
Social security costs
737,041
600,251
-
-
Pension costs
535,948
228,907
-
0
-
0
8,497,553
7,278,528
-
0
-
0
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
273,000
201,583
Company pension contributions to defined contribution schemes
7,000
-
280,000
201,583
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
150,000
129,583
SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 30 -
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
384,535
-
0
Other interest income
-
340
Total income
384,535
340
8
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
10,250
103,361
Interest on finance leases and hire purchase contracts
19,545
33,630
Other interest
1,201
131,240
Total finance costs
30,996
268,231
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
2,353,421
1,782,740
Deferred tax
Origination and reversal of timing differences
23,875
(26,232)
Total tax charge
2,377,296
1,756,508
SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
9
Taxation
(Continued)
- 31 -

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Profit before taxation
10,158,904
9,178,444
Expected tax charge based on the standard rate of corporation tax in the UK of 23.00% (2022: 19.00%)
2,336,548
1,743,904
Tax effect of expenses that are not deductible in determining taxable profit
-
0
3,706
Tax effect of income not taxable in determining taxable profit
(3,602)
-
0
Effect of change in corporation tax rate
1,124
-
Permanent capital allowances in excess of depreciation
24,753
(9,749)
Amortisation on assets not qualifying for tax allowances
22,573
18,647
Other permanent differences
(4,100)
-
0
Taxation charge
2,377,296
1,756,508

The expected tax charge of 23.00% is a pro-rates amount based on standard rate of corporation tax in the UK of 19.00% up to 31 March 2023 and 25.00% from 1 April 2023.

10
Dividends
2023
2022
Recognised as distributions to equity holders:
£
£
Final paid
3,000,000
2,610,000
11
Intangible fixed assets
Group
Goodwill
£
Cost
At 1 December 2022 and 30 November 2023
2,062,819
Amortisation and impairment
At 1 December 2022
1,056,402
Amortisation charged for the year
98,141
At 30 November 2023
1,154,543
SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
11
Intangible fixed assets
(Continued)
- 32 -
Carrying amount
At 30 November 2023
908,276
At 30 November 2022
1,006,417
The company had no intangible fixed assets at 30 November 2023 or 30 November 2022.
12
Tangible fixed assets
Group
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 December 2022
1,667,210
1,293,514
774,986
778,523
4,514,233
Additions
154,846
1,182
81,419
133,989
371,436
Disposals
(275,602)
(72,373)
(108,083)
(24,495)
(480,553)
At 30 November 2023
1,546,454
1,222,323
748,322
888,017
4,405,116
Depreciation and impairment
At 1 December 2022
1,053,852
808,412
705,843
398,006
2,966,113
Depreciation charged in the year
221,259
108,973
49,926
193,365
573,523
Eliminated in respect of disposals
(275,602)
(72,373)
(108,083)
(24,495)
(480,553)
At 30 November 2023
999,509
845,012
647,686
566,876
3,059,083
Carrying amount
At 30 November 2023
546,945
377,311
100,636
321,141
1,346,033
At 30 November 2022
613,358
485,102
69,143
380,517
1,548,120
The company had no tangible fixed assets at 30 November 2023 or 30 November 2022.
SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
12
Tangible fixed assets
(Continued)
- 33 -

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

Group
Company
2023
2022
2023
2022
£
£
£
£
Plant and equipment
130,747
312,554
-
0
-
0
Fixtures and fittings
-
0
421,428
-
0
-
0
Motor vehicles
268,390
166,224
-
0
-
0
399,137
900,206
-
-

The total net book value of the group's tangible fixed assets was pledged as security over the group's loans and borrowings at the end of the current and prior year.

13
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
14
-
0
-
0
5,041,367
5,041,367
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 December 2022 and 30 November 2023
5,041,367
Carrying amount
At 30 November 2023
5,041,367
At 30 November 2022
5,041,367
14
Subsidiaries

Details of the company's subsidiaries at 30 November 2023 are as follows:

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
14
Subsidiaries
(Continued)
- 34 -
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Smart Garden Products Limited
England & Wales
Ordinary
100.00
Smart Solar Limited
England & Wales
Ordinary
100.00

Subsidiary undertakings

Smart Garden Products Limited

The principal activity of Smart Garden Products Limited is the design and sale of solar and battery powered lighting and garden decor products.

 

Smart Solar Limited

The principal activity of Smart Solar Limited is dormant.

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 35 -
15
Financial instruments
Group
Financial assets measured at fair value

Hedge of forward exchange contracts

During the year, to hedge the potential volatility in future exchange rates on which the group bases its pricing policy, the group entered into various forward currency exchange contracts.

 

These derivatives are accounted for as a currency hedge of forward cash flows, in accordance with FRS 102 and had a fair value of £116,111 financial asset (2022 - £1,755,768 financial asset) at the balance sheet date.

 

The cash flows arising from the forward currency contracts will continue until their maturity within 12 months of the balance sheet date. The change in fair value in the period was (£1,639,656) with the movement recognised in other comprehensive income as the contracts were deemed to be 100% effective hedges. A deferred tax liability has been recognised of £29,028 (2022 - £333,595 deferred tax liability) with the movement recognised in other comprehensive income. The net movement in other comprehensive income in the year was (£1,335,089).

16
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Finished goods and goods for resale
12,816,425
18,125,766
-
0
-
0

The amount of impairment loss included in profit or loss is £656,560 (2022 - £591,730).

The carrying amount of stocks pledged as security for liabilities amount to £12,816,425 (2022 - £18,125,766).

17
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
14,512,664
18,980,379
-
0
-
0
Other debtors
125,353
1,770,125
-
0
-
0
Prepayments and accrued income
1,065,105
956,142
-
0
-
0
15,703,122
21,706,646
-
-

At the year end date, the total impairment included in debtors was £160,864 (2022 - £267,000).

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 36 -
18
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
20
-
0
91,195
-
0
-
0
Obligations under finance leases
21
169,621
201,660
-
0
-
0
Trade creditors
2,612,073
4,062,587
-
0
-
0
Amounts owed to group undertakings
-
0
-
0
951,363
950,163
Corporation tax payable
1,075,920
967,092
-
0
-
0
Other taxation and social security
1,035,857
1,653,195
-
-
Other creditors
309,947
265,925
-
0
-
0
Accruals and deferred income
7,663,395
7,747,046
1,000
1,000
12,866,813
14,988,700
952,363
951,163
19
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Obligations under finance leases
21
165,268
201,397
-
0
-
0
20
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank overdrafts
-
0
91,195
-
0
-
0
Payable within one year
-
0
91,195
-
0
-
0

Bank overdrafts totalling £nil (2022 - £91,195) were secured at the balance sheet date. Security over these amounts is held by way of a fixed and floating charge created on 5 January 2004 over all property and assets of the group. There is a further charge over contract monies dated 22 January 2013.

 

The group has a composite company unlimited multilateral guarantee dated 16 April 2013 given by the parent company, Smart Garden Products Limited and Smart Solar Limited. The group's bankers hold a group set-off between all members.

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 37 -
21
Finance lease obligations
Group
Company
2023
2022
2023
2022
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
169,621
201,661
-
0
-
0
In two to five years
165,268
201,396
-
0
-
0
334,889
403,057
-
-

Finance lease liabilities are secured against the assets to which they relate.

22
Provisions for liabilities
Group
Company
2023
2022
2023
2022
£
£
£
£
Warranty provision
330,000
400,000
-
-
Movements on provisions:
Group
£
At 1 December 2022
400,000
Other movements
(70,000)
At 30 November 2023
330,000
SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 38 -
23
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

Liabilities
Liabilities
2023
2022
Group
£
£
Accelerated capital allowances
140,642
116,767
Revaluations
29,027
333,595
169,669
450,362
The company has no deferred tax assets or liabilities.
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 December 2022
450,362
-
Charge to profit or loss
23,875
-
Credit to other comprehensive income
(304,568)
-
Liability at 30 November 2023
169,669
-

The deferred tax liability set out above relates to accelerated capital allowances that are expected to mature within the same period.

24
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary A shares of £1 each
3,320,000
3,320,000
3,320,000
3,320,000
Ordinary B shares of £1 each
680,000
680,000
680,000
680,000
4,000,000
4,000,000
4,000,000
4,000,000
SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 39 -
25
Operating lease commitments
Lessee

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

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
1,579,247
1,553,456
-
-
Between two and five years
4,848,891
5,046,160
-
-
In over five years
6,893,942
8,410,783
-
-
13,322,080
15,010,399
-
-

The amount of non-cancellable lease payments recognised as an expense during the period was £1,571,086 (2022 - £1,476,093).

26
Related party transactions
Group
Remuneration of key management personnel

In the opinion of the directors, there was no key management compensation other than that shown in directors' remuneration.


During the year the group repaid loans to key management totalling £nil (2021 - £nil). The balance due to key management at the year end was £nil (2021 - £nil).

Transactions with entities with joint control or significant interest

During the year the group made purchases and paid rent to entities with joint control or significant influence totalling £2,241,354 (2022 - £1,744,991). At the year end the balance due from entities with joint control or significant influence was £nil (2021- £nil).

Company
Summary of transactions with key management

During the year key management received remuneration of £2,639,499 (2022 - £1,575,951).


During the year the group repaid loans to key management totalling £nil (2021 - £nil). The balance due to key management at the year end was £nil (2021 - £nil).

27
Controlling party

SGP Holdings (UK) Limited is the ultimate holding company. The ultimate controlling party is PA Natar by virtue of his majority shareholding.

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 40 -
28
Reserves

Group

Called up share capital

This represents the nominal value of shares that have been issued prior to the balance sheet date.

 

Share premium reserve

This represents the total amount paid for share capital in excess of its nominal value.

 

Cash flow hedging reserve

This reserve includes cumulative gains and/or losses on cash flow hedges held at the balance sheet date.

 

Profit and loss account

This includes all current and prior period retained profits and losses at the balance sheet date, exclusive of any cumulative cash flow hedging gains and/or losses

 

 

 

 

 

 

 

Company

Called up share capital

This represents the nominal value of shares that have been issued prior to the balance sheet date.

 

Profit and loss account

This includes all current and prior period retained profits and losses at the balance sheet date, exclusive of any cumulative cash flow hedging gains and/or losses

SGP HOLDINGS (UK) LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 NOVEMBER 2023
- 41 -
29
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
7,781,608
7,421,936
Adjustments for:
Taxation charged
2,377,296
1,756,508
Finance costs
30,996
268,231
Investment income
(384,535)
(340)
Gain on disposal of tangible fixed assets
(14,949)
(64,859)
Amortisation and impairment of intangible assets
98,141
98,141
Depreciation and impairment of tangible fixed assets
573,523
590,889
(Decrease)/increase in provisions
(70,000)
237,015
Movements in working capital:
Decrease in stocks
5,309,341
2,837,774
Decrease in debtors
6,003,524
2,279,117
Decrease in creditors
(2,107,481)
(4,108,382)
Cash generated from operations
19,597,464
11,316,030
30
Analysis of changes in net funds - group
1 December 2022
Cash flows
30 November 2023
£
£
£
Cash at bank and in hand
2,713,706
12,550,903
15,264,609
Bank overdrafts
(91,195)
91,195
-
0
2,622,511
12,642,098
15,264,609
Obligations under finance leases
(403,057)
68,168
(334,889)
2,219,454
12,710,266
14,929,720
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