Company registration number 02435931 (England and Wales)
HARTE HANKS UK LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
HARTE HANKS UK LIMITED
COMPANY INFORMATION
Directors
P J Kitley
S J Hoffman
M Sheehan
(Appointed 18 October 2023)
D Garrison
(Appointed 20 August 2024)
Company number
02435931
Registered office
PO Box 1231
The Charter Building
Charter Place
Uxbridge
Middlesex
UB8 1JG
Auditor
CLA Evelyn Partners Limited
22 Wycombe End
Beaconsfield
Buckinghamshire
HP9 1NB
HARTE HANKS UK LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Statement of comprehensive income
7
Balance sheet
8
Statement of changes in equity
9
Notes to the financial statements
10 - 20
HARTE HANKS UK LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -

The directors present the strategic report and financial statements for the year ended 31 December 2023.

Fair review of the business

The results for the year and the financial position at the year end were considered to be good by the directors, returning a profit before tax of 22% which is a pleasing return.

Principal risks and uncertainties

2023 saw a small revenue decline compared to the previous year, due to a reduction in business with a couple of clients.

 

The company is continually subject to financial risk from exchange rate fluctuations, as a result of significant trading in other European countries and the USA.  In the current financial year the exchange rate fluctuations however were significantly below the previous year’s gain, and thus reducing its overall operating profit.

 

The company currently has little risk from debtors as the majority of its customers are considered ‘blue chip.

Development and performance

2023 continued the positive trend of the business and this trend is expected to continue into 2024 with further investment in marketing planned.

The company has invested in growing the business and continues to seek new business initiatives in order to maintain the positive performance.

Key Performance indicators

The Directors consider the following areas to be the key performance indicators of the company’s performance.

Turnover of £10,395,028 compared to £11,197,889 in the previous year.

Cost of Sales of £5,317,917 compared to £5,298,780 in the previous year.

Gross Profit of £5,077,111 compared to £5,899,109 in the previous year.

Gross Profit % of turnover of 48.84% compared to 52.7% in the previous year.

Profit before tax of £2,244,602 compared to £5,391,958 in the previous year.

Profit before tax % of turnover of 21.5% compared to 48.1% in the previous year.

On behalf of the board

P J Kitley
Director
30 August 2024
HARTE HANKS UK LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -

The directors present their annual report and financial statements for the year ended 31 December 2023.

Principal activities

The principal activities of the company continued to be that of marketing consultants, provision of database marketing solutions and marketing, communications and advertising specialists in information technology.

Results and dividends

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

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

Directors

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

P J Kitley
S J Hoffman
L Kearnes
(Resigned 18 October 2023)
M Sheehan
(Appointed 18 October 2023)
D Garrison
(Appointed 20 August 2024)
Auditor

The auditor, CLA Evelyn Partners 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.

HARTE HANKS UK LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
Statement of disclosure to auditor

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

On behalf of the board
P J Kitley
Director
30 August 2024
HARTE HANKS UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HARTE HANKS UK LIMITED
- 4 -
Opinion

We have audited the financial statements of Harte Hanks UK Limited (the 'company') for the year ended 31 December 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

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.

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 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:

HARTE HANKS UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HARTE HANKS UK LIMITED
- 5 -
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 are 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.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

 

We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

To address the risk of fraud through management bias and override of controls, we:

HARTE HANKS UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HARTE HANKS UK LIMITED
- 6 -

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

 

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

 

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

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.

Keir Singleton
Senior Statutory Auditor
For and on behalf of CLA Evelyn Partners Limited
30 August 2024
Chartered Accountants
Statutory Auditor
22 Wycombe End
Beaconsfield
Buckinghamshire
HP9 1NB
HARTE HANKS UK LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
10,395,028
11,197,889
Cost of sales
(5,317,917)
(5,298,780)
Gross profit
5,077,111
5,899,109
Administrative expenses
(2,597,431)
(748,953)
Other operating income
-
0
83,439
Operating profit
4
2,479,680
5,233,595
Interest receivable and similar income
7
-
0
236,482
Interest payable and similar expenses
8
(235,078)
(78,119)
Profit before taxation
2,244,602
5,391,958
Tax on profit
9
(529,259)
(1,005,202)
Profit for the financial year
1,715,343
4,386,756

The accompanying accounting policies and notes form part of these financial statements.

 

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

HARTE HANKS UK LIMITED
BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
10
545,167
25,895
Investments
11
42
42
545,209
25,937
Current assets
Debtors
13
22,706,262
22,539,968
Cash at bank and in hand
764,806
410,190
23,471,068
22,950,158
Creditors: amounts falling due within one year
14
(6,987,155)
(7,662,316)
Net current assets
16,483,913
15,287,842
Net assets
17,029,122
15,313,779
Capital and reserves
Called up share capital
17
100
100
Capital redemption reserve
11,688,937
11,688,937
Profit and loss reserves
5,340,085
3,624,742
Total equity
17,029,122
15,313,779

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 30 August 2024 and are signed on its behalf by:
P J Kitley
Director
Company registration number 02435931 (England and Wales)
HARTE HANKS UK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
Share capital
Capital redemption reserve
Profit and loss reserves
Total
£
£
£
£
Balance at 1 January 2022
100
11,688,937
(762,014)
10,927,023
Year ended 31 December 2022:
Profit and total comprehensive income
-
-
4,386,756
4,386,756
Balance at 31 December 2022
100
11,688,937
3,624,742
15,313,779
Year ended 31 December 2023:
Profit and total comprehensive income
-
-
1,715,343
1,715,343
Balance at 31 December 2023
100
11,688,937
5,340,085
17,029,122
HARTE HANKS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
1
Accounting policies
Company information

Harte Hanks UK Limited is a private company limited by shares incorporated in England and Wales. The registered office is The Charter Building, Uxbridge, Middlesex, UB8 1JG.

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 certain financial instruments at fair value. The principal accounting policies adopted are set out below.

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

 

 

The financial statements of the company are consolidated in the financial statements of Harte Hanks, Inc.

The company has taken advantage of the exemption under section 401 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.

 

Harte Hanks UK Limited is a wholly owned subsidiary of Harte Hanks, Inc. and the results of Harte Hanks UK Limited are included in the consolidated financial statements of that company which are available from its registered office, 9601 McAllister Freeway, Suite 610, San Antonio, TX 78216, United States of America.

HARTE HANKS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 11 -
1.2
Turnover

Turnover represents amounts receivable for goods and services net of VAT and trade discounts.

 

Revenue is recognised when all of the following criteria are satisfied: (i) persuasive evidence of an arrangement exists; (ii) the price is fixed or determinable; (iii) collectability is reasonably assured; and (iv) the service has been performed or the product has been delivered.

 

Turnover in respect of long term contracts and contracts for on-going services represents the value of the work done in the year, including estimates of amounts not invoiced, determined by reference to the stage of completion of each contract which in turn is measured as the proportion which costs to date bears to the expected total cost for the contract.

 

Profit on long term contracts for services is recognised in the profit and loss account if the final outcome can be assessed with reasonable certainty by including turnover and related costs as contract activity progresses.

 

Amounts recoverable on long term contracts are included in debtors and stated at the net sales value of the work done after provision of contingencies and anticipated future losses on contracts, less amounts received as progress payments on account.

 

Excess progress payments are included in creditors as payment on account.

 

Payments received in advance of the performance of services or delivery of the product are recorded as deferred revenue until such time as the services are performed or the product is delivered.

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.

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

1.3
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

 

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

Amortisation 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:

Software licences
straight line over the term of the licence
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.

HARTE HANKS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 12 -
1.5
Impairment of fixed assets

At each reporting period end date, the company 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).

1.6
Financial instruments

The company has elected to apply the provisions of Section 11 ”Basic Financial Instruments” 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.

Basic financial assets

Short term debtors are measured at transaction price less any provision for impairment. Loans receivable are measured initially at fair value, net of transaction costs and are subsequently carried at amortised costs using the effective interest method, less any provision for impairment.

Basic financial liabilities

Short term creditors are measured at transaction price. Other financial liabilities, including bank loans and other loans, are measured initially at fair value, net of transaction costs and are subsequently carried at amortised costs using the effective interest method.

1.7
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.

 

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.

1.8
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.

1.9
Retirement benefits

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

HARTE HANKS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
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.

Revenue recognition in respect of services

The accounting policy for revenue recognition has an impact on reported results and relies on certain estimates that require judgments on the part of management.

 

Revenue is derived from a variety of services and products, and may be billed at hourly rates, monthly rates, or a fixed price. All sales require either a purchase order, a statement of work signed by the client, a written contract, or some other form of written authorisation from the client.

 

Revenue from agency and creative services, analytical services, and market research is typically billed based on time and materials.

Revenue from email marketing, social media marketing, digital techniques such as search engine maximisation ("SEM"), and other digital solutions is recognised as the work is performed. Revenue from these services is typically based on a fixed price or rate given to the client.

 

Revenue associated with new marketing database builds is deferred until complete or until client acceptance. Upon completion or acceptance, revenue and direct build costs are then recognised over the term of the related arrangement as the services are provided. Revenue from database and website hosting services is recognised ratably over the contractual hosting period. Pricing for database builds are typically based on a fixed price and hosting fees are typically based on a fixed price per month or per contract.

 

Revenue from database subscriptions is based on a fixed price and is recognised ratably over the term of the subscription. Revenue from standalone technology data sales is recognised at the time of delivery.

 

Revenue related to contact centres, including inbound and outbound calling, and email management, is also typically based on a fixed price per transaction or service provided. Revenue from these services is recognised as the service or activity is performed.

 

For certain arrangements, the company enters into contracts that include delivery of a combination of two or more service offerings. Such arrangements are divided into separate units of accounting, provided that the delivered element(s) has stand-alone value and objective and reliable evidence of the fair value of the undelivered element(s) exist(s).

 

When it is not possible to un-bundle the arrangement into separate units of accounting, revenue from each service is recognised separately, and in accordance with our revenue recognition policy for each element. If it is not possible to un-bundle the arrangement into separate units of accounting, one of the revenue recognition policies is applied to the entire arrangement. This might impact the timing of revenue recognition, but would not change the total revenue recognised from the arrangement.

HARTE HANKS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
2
Judgements and key sources of estimation uncertainty
(Continued)
- 14 -
Recoverability of receivables

The allowance for doubtful accounts is maintained at a balance adequate to reduce accounts receivable to the amount of cash expected to be realised upon collection. The methodology used to determine the minimum allowance balance is based on prior collection experience and is generally related to the accounts receivable balance in various aging categories. The balance is also influenced by specific clients’ financial strength and circumstance.

3
Turnover and other revenue

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

2023
2022
£
£
Turnover analysed by class of business
Marketing consultants
7,072,491
7,460,110
Database solutions
3,254,220
3,544,338
Agency services
68,317
193,441
10,395,028
11,197,889
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
718,210
539,526
Other European Union countries
2,173,381
1,491,538
Rest of the world
7,503,437
9,166,825
10,395,028
11,197,889
2023
2022
£
£
Other revenue
Interest income
-
236,482
Rental income arising from investment properties
-
0
83,439
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange gains
(148,927)
(2,333,385)
Fees payable to the company's auditor for the audit of the company's financial statements
48,674
36,800
Depreciation of owned tangible fixed assets
-
5,088
Amortisation of intangible assets
60,290
9,310
Operating lease charges
31,461
135,140
HARTE HANKS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 15 -
5
Employees

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

2023
2022
Number
Number
Administration and support
4
4
Marketing
16
19
Total
20
23

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
1,438,726
1,586,648
Social security costs
166,008
272,425
Pension costs
64,779
68,771
1,669,513
1,927,844
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
106,884
105,160
Company pension contributions to defined contribution schemes
7,885
7,885
114,769
113,045

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2022 - 1).

7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest receivable from group companies
-
0
236,482
8
Interest payable and similar expenses
2023
2022
£
£
Interest payable to group undertakings
235,078
78,119
HARTE HANKS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
518,598
1,015,774
Deferred tax
Origination and reversal of timing differences
10,661
(10,572)
Total tax charge
529,259
1,005,202

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
2,244,602
5,391,958
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
527,930
1,024,472
Effect of change in corporation tax rate
632
(19,325)
Depreciation on assets not qualifying for tax allowances
697
55
Taxation charge for the year
529,259
1,005,202

The main rate of corporation tax increased by 6% to 25% on 1 April 2023. The effect was to increase the company's current and future tax charges accordingly and has impacted the deferred tax balance which has been calculated using 25% as that will be the tax rate when the timing differences are reversed

HARTE HANKS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
10
Intangible fixed assets
Software licences
£
Cost
At 1 January 2023
35,205
Additions
579,562
At 31 December 2023
614,767
Amortisation and impairment
At 1 January 2023
9,310
Amortisation charged for the year
60,290
At 31 December 2023
69,600
Carrying amount
At 31 December 2023
545,167
At 31 December 2022
25,895
11
Fixed asset investments
2023
2022
Notes
£
£
Investments in subsidiaries
12
42
42
12
Subsidiaries

These financial statements are separate company financial statements for Harte Hanks UK Limited.

Details of the company's subsidiaries at 31 December 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Harte-Hanks SRL
Romania
Ordinary
100.00
HARTE HANKS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
13
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
732,764
833,459
Amounts due from fellow group undertakings
21,784,381
21,312,674
Other debtors
28,802
105
Prepayments and accrued income
90,455
313,209
22,636,402
22,459,447
Deferred tax asset (note 15)
69,860
80,521
22,706,262
22,539,968

Amounts due to and from group undertakings are unsecured and repayable on demand. The interest rate on amounts due to and from group undertakings is 4.90% (2022 - 1.68%).

14
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
573,141
385,445
Amounts owed to group undertakings
4,920,286
5,160,960
Corporation tax
218,598
635,774
Other taxation and social security
6,868
40,441
Other creditors
10,530
9,215
Accruals and deferred income
1,257,732
1,430,481
6,987,155
7,662,316

Amounts due to and from group undertakings are unsecured and repayable on demand. The interest rate on amounts due to and from group undertakings is 4.90% (2022 - 1.68%).

15
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:

Assets
Assets
2023
2022
Balances:
£
£
Accelerated capital allowances
69,860
80,521
HARTE HANKS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
15
Deferred taxation
(Continued)
- 19 -
2023
Movements in the year:
£
Asset at 1 January 2023
(80,521)
Charge to profit or loss
10,661
Asset at 31 December 2023
(69,860)
16
Defined contribution schemes

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. The pension cost charge represents contributions payable by the company to the fund. There were no contributions outstanding at the end of the current or previous periods.

 

2023
2022
£
£
Charge to profit or loss in respect of defined contribution schemes
64,779
68,771
17
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100
100
100
100

 

There is a single class of ordinary shares which carry voting rights and the right to receive dividends.

18
Operating lease commitments
Lessee

Operating lease payments represent rentals payable by the company for certain of its properties. Leases are negotiated for an average term of 10 years and rentals are fixed for an average of 5 years.

 

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:

2023
2022
£
£
Within one year
19,675
47,220
Between two and five years
-
0
19,675
19,675
66,895
19
Related party transactions
HARTE HANKS UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
19
Related party transactions
(Continued)
- 20 -

The company is a wholly owned member of Harte Hanks, Inc. and as such has taken advantage of the exemption permitted by Section 33 'Related Party Disclosures', not to provide disclosures of transactions entered into with other wholly-owned members of the group.

20
Ultimate controlling party

The immediate & ultimate parent undertaking of Harte Hanks UK Limited is Harte Hanks, Inc. a company incorporated in the state of Delaware. Its registered office is 9601 McAllister Freeway, Suite 610, San Antonio, TX 78216, United States of America. No singular individual has control of Harte-Hanks Inc..

 

The largest and smallest group of undertakings for which group financial statements have been drawn up including Harte Hanks UK Limited is that headed by Harte Hanks, Inc. whose financial statements are publicly available from the U.S. Securities and Exchange Commission.

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