Registered number: 02527817
ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
COMPANY INFORMATION
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L Bertagnolio (resigned 1 October 2023)
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R Palti (resigned 30 April 2024)
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D De Jaeger (resigned 1 March 2023)
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J Wellings (resigned 23 February 2024)
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S Palti (appointed 1 October 2023)
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P Arnaud (appointed 12 April 2024)
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National Westminster Bank Plc
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
CONTENTS
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Directors' Responsibilities Statement
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Independent Auditor's Report
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Statement of Comprehensive Income
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Statement of Changes in Equity
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Notes to the Financial Statements
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors present the strategic report and financial statements for the year ended 31 December 2023. The directors, in preparing the strategic report, have complied with s414c of the Companies Act 2006.
The principal activity of the company during the year was that of a retail and shopper marketing agency.
2023 was a very strong year for HRG (UK) Limited in terms of financial results, client renewals and new business as well as staff engagement.
The 2022 investment in strategy and planning resource, and digital services has started to bear fruit with increased revenues and strong Gross Margin levels.
Over 2023 AHRG’s new business strategy was rewarded with several new client wins and notable pitches won from existing clients.
Staff engagement surpassed the UK industry averages in leadership & communication, intent to stay, enjoyment at work, mental health & wellbeing as measured by the Alliance of Independent Agencies quarterly Pulse survey. This is a reward for the company’s investment in and commitment to its people development and DEI and wellbeing initiatives.
The transformation of HRG to Altavia HRG under new management is continuing and results have vastly improved year on year as the strategy is paying off.
PRINCIPAL RISKS AND UNCERTAINTIES
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The principal financial risks faced by the company and the company’s objectives and policies in relation to those risks are as follows:
Cash flow risk
The business's cash flow is monitored very closely by the finance department and detailed cash projections are produced on a regular basis in order to highlight to the Finance Director any potential shortfall. The business continues to be in credit at the bank but has the back up of a £1,000,000 credit line with them if needed.
Credit risk
Credit risk would arise if we were unable to recover the debts due from our clients. Our business model means we usually work with very large and financially stable brands across the world whilst still operating strong and robust procedures for credit checking all clients. Alongside an excellent credit control department, we ensure that bad and doubtful debts are immaterial.
Competitor risk
The company operates in a market sector with over 27,000 UK agencies. Clarity of offer, pricing and expertise is paramount. Management continually reviews its value proposition, service lines and pricing to ensure that the business remains competitive and relevant.
Commercial relationships
The company is exposed to changes in relationships with both customers and suppliers. Management maintain and develop relationships with customers and suppliers.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Market risks
Global economic challenges remain in place. While easing the impact of continued inflation has placed sustained pressure on wages costs which are a major element of the profit & loss account. Macro and micro economic effects impacts clients desire to invest in marketing especially where there are uncertainties and weakness in consumer confidence.
Interest rate risk
The company has some borrowing against the properties from which it operates on a variable basis. It therefore has some interest rate exposure. The company in general avoids using any financial instruments.
FINANCIAL KEY PERFORMANCE INDICATORS
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The key performance indicators of the company for the financial year were:
2023 2022
Sales increase (1) 6.8% 22.6%
Margin (2) 53.0% 49.7%
Working capital (3) 2,084,903 2,074,582
(1) Movement in sales from previous year.
(2) Margin is gross profit divided by turnover as presented in the financial statements.
(3) Net current assets as presented in the financial statements.
FUTURE DEVELOPMENTS
2024 will be dominated by the merger of the two Altavia UK companies, Altavia HRG and Altavia HTT whilst also ensuring the UK businesses embed Altavia Group’s strategy and service line offering into its thinking. This is alongside trying to deliver year on year growth.
HRG (UK) Ltd, as part of the merger, will be renamed Altavia UK Group Ltd. Altavia HTT Ltd will be acquired by HRG (UK) Ltd all employees will TUPE to the new entity and all activities will be transferred. The combined company will be renamed Altavia UK Group Limited.
The directors have formed a judgement, at the time of approving the financial statements, that there is a reasonable expectation that both UK entities, subject to the merger, have adequate resources to continue their operational existence for the foreseeable future. For this reason, the directors continue to adopt the going concern basis in preparing the financial statements.
The focus remains on top line and bottom line growth, and operational efficiencies driven by the deployment of new technology, and facilitated by the adoption of AI where appropriate. A new operating model in creative services will simplify process and remove administration across all teams.
This report was approved by the board and signed on its behalf.
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J S Ward
Director
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors present their report and the financial statements for the year ended 31 December 2023.
The principal activity of the company during the year was that of a retail and shopper marketing agency.
The profit for the year, before taxation, amounted to £462,812 (2022 - £332,700).
Particulars of dividends paid are detailed in note 20 to the financial statements.
The Directors have proposed, for 2023, a dividend of £1,000,000.
The directors who served during the year were:
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L Bertagnolio (resigned 1 October 2023)
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R Palti (resigned 30 April 2024)
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D De Jaeger (resigned 1 March 2023)
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J Wellings (resigned 23 February 2024)
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S Palti (appointed 1 October 2023)
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P Arnaud (appointed 12 April 2024)
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
2024 will be dominated by the merger of the two altavia UK companies, Altavia HRG and Altavia HTT whilst also ensuring the UK businesses embed Altavia Group’s strategy and service line offering into its thinking. This is alongside trying to deliver year on year growth.
HRG (UK) Limited, as part of the merger, will be renamed Altavia UK Group Limited. All of Altavia HTT Limited's employees and activities will be transferred to the renamed company.
The focus remains on top line and bottom line growth, and operational efficiencies driven by new technology, including AI where appropriate and a new operating model in creative services which will simplify process and remove administration across all teams.
KEY FACTORS OF 2023
Inflation continued to have an impact on the business activity & operations of Altavia HRG in 2023. Particularly wage inflation, but also in respect of materials & overheads.
Altavia HRG sought continued efficiencies through process optimisation, automation, and resource reallocation. Streamlining operations helped offset costs and maintain profitability.
Strategies such as diversification of clients, efficiency improvements, strategic pricing and effective customer communication allowed Altavia HRG to navigate these challenges. A regular updated forecasting process reflect the evolving landscape.
Inflation uncertainty and its impact will continue to be monitored by the management team.
POLITICAL DONATIONS
The Company has made no political donations during the year.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
DISCLOSURE OF INFORMATION TO AUDITOR
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Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
∙so far as the director is aware, there is no relevant audit information of which the Company's auditor is unaware, and
∙the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditor is aware of that information.
POST BALANCE SHEET EVENTS
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There have been no significant events affecting the Company since the year end.
The auditor, Constantin, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
The company has chosen in accordance with Companies Act 2006, s.414C(11) to include in the company's strategic report certain information in respect of the company's principal activities, a review of the business and the company's risks and uncertainties which would be otherwise be contained in the directors' report in accordance with the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7.
This report was approved by the board and signed on its behalf.
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J S Ward
Director
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Company's financial statements and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to 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.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
In our opinion the financial statements of HRG (UK) Limited (the 'company')::
• give a true and fair view of the state of the Company's affairs as at 31 December 2023 and of its profit for the year then ended;
• have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice, including Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" ; and
• have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements which comprise:
• the statement of comprehensive income
• the balance sheet;
• the statement of changes in equity;
• the statement of accounting policies; and
• the related notes 1 to 23.
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).
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 United Kingdom, including the Financial Reporting Council'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
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In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED) (CONTINUED)
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.
RESPONSIBILITIES OF DIRECTORS
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As explained more fully in the directors’ responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED) (CONTINUED)
AUDITOR'S RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS
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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.
A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Extent to which the audit was considered capable of detecting irregularities, including fraud
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.
We considered the nature of the company’s industry and its control environment, and reviewed the company’s documentation of their policies and procedures relating to fraud and compliance with laws and regulations. We also enquired of management and the directors about their own identification and assessment of the risks of irregularities, including those that are specific to the company's business sector.
We obtained an understanding of the legal and regulatory frameworks that the company operates in, and identified the key laws and regulations that:
• had a direct effect on the determination of material amounts and disclosures in the financial statements. These
included UK Companies Act, pensions legislation, tax legislation; and
• do not have a direct effect on the financial statements but compliance with which may be fundamental to the company’s ability to operate or to avoid a material penalty. These included employment laws, GDPR regulation.
We discussed among the audit engagement team regarding the opportunities and incentives that may exist within the organisation for fraud and how and where fraud might occur in the financial statements.
In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. In addressing the risk of fraud through management override of controls, we tested the appropriateness of journal entries and other adjustments; assessed whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluated the business rationale of any significant transactions that are unusual or outside the normal course of business.
In addition to the above, our procedures to respond to the risks identified included the following:
• reviewing financial statement disclosures by testing to supporting documentation to assess compliance with
provisions of relevant laws and regulations described as having a direct effect on the financial statements;
• performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of
material misstatement due to fraud;
• enquiring of management concerning actual and potential litigation and claims, and instances of non-
compliance with laws and regulations; and
• reading minutes of meetings of those charged with governance.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED) (CONTINUED)
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
OPINIONS ON OTHER MATTERS PRESCRIBED BY THE COMPANIES ACT 2006
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In our opinion, based on the work undertaken in the course of the audit:
• the information given in the Strategic Report and the Directors’ Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
•the strategic report and the directors’ report have been prepared in accordance with applicable legal requirements.
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 any material misstatements in the strategic report or the directors’ report.
MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION
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Under the Companies Act 2006 we are required to report in respect of the following matters if, in our opinion:
• adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
• the financial statements are not in agreement with the accounting records and returns; or
• certain disclosures of directors’ remuneration specified by law are not made; or
• we have not received all the information and explanations we require for our audit.
We have nothing to report in respect of these matters.
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.
Thierry de Gennes, ACA (Senior Statutory Auditor)
for and on behalf of
Constantin
Chartered Accountants Statutory Auditor
25 Hosier Lane
London
EC1A 9LQ
United Kingdom
20 August 2024
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
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Interest payable and similar expenses
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Profit for the financial year
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Total comprehensive income for the year
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The notes on pages 14 to 28 form part of these financial statements.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
REGISTERED NUMBER: 02527817
BALANCE SHEET
AS AT 31 DECEMBER 2023
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Provisions for liabilities
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The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
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J S Ward
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The notes on pages 14 to 28 form part of these financial statements.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
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The notes on pages 14 to 28 form part of these financial statements.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Altavia UK Group Limited (formerly HRG (UK) Limited) is a company limited by shares, registered in England and Wales, registered number 02527817.
The registered office and principal place of business is Mercury House, 8 Sandy Way, Grange Park, Northampton, NN4 5EJ.
2.ACCOUNTING POLICIES
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BASIS OF PREPARATION OF FINANCIAL STATEMENTS
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
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FINANCIAL REPORTING STANDARD 102 - REDUCED DISCLOSURE EXEMPTIONS
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The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
∙the requirements of Section 7 Statement of Cash Flows;
∙the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
∙the requirements of Section 33 Related Party Disclosures paragraph 33.7.
This information is included in the consolidated financial statements of Altavia Europe SA as at 31 December 2022 and these financial statements may be obtained from 1, rue Rembrandt – 75008 Paris, France.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.ACCOUNTING POLICIES (CONTINUED)
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Sale of goods
Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
∙the Company has transferred the significant risks and rewards of ownership to the buyer;
∙the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
∙the amount of revenue can be measured reliably;
∙it is probable that the Company will receive the consideration due under the transaction; and
∙the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
∙the amount of revenue can be measured reliably;
∙it is probable that the Company will receive the consideration due under the contract;
∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and
∙the costs incurred and the costs to complete the contract can be measured reliably.
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.ACCOUNTING POLICIES (CONTINUED)
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TANGIBLE FIXED ASSETS (continued)
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Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives.
Depreciation is provided on the following basis:
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Long-term leasehold property
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reducing balance or 33% straight line
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Freehold & Leasehold improvements
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The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Statement of Income and Retained Earnings.
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.
At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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CASH AND CASH EQUIVALENTS
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.ACCOUNTING POLICIES (CONTINUED)
The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the Company's Balance Sheet when the Company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.
Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.
Other financial assets
Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.
Impairment of financial assets
Financial assets are assessed for indicators of impairment at each reporting date.
Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.
If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.
Financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.ACCOUNTING POLICIES (CONTINUED)
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FINANCIAL INSTRUMENTS (continued)
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Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
Other financial instruments
Derivatives, including forward exchange contracts, futures contracts and interest rate swaps, are not classified as basic financial instruments. These are initially recognised at fair value on the date the derivative contract is entered into, with costs being charged to the profit or loss. They are subsequently measured at fair value with changes in the profit or loss.
Debt instruments that do not meet the conditions as set out in FRS 102 paragraph 11.9 are subsequently measured at fair value through the profit or loss. This recognition and measurement would also apply to financial instruments where the performance is evaluated on a fair value basis as with a documented risk management or investment strategy.
Derecognition of financial assets
Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.
Derecognition of financial liabilities
Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.ACCOUNTING POLICIES (CONTINUED)
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FOREIGN CURRENCY TRANSLATION
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Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.
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LEASED ASSETS: THE COMPANY AS LESSEE
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Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired by finance lease are depreciated over the shorter of the lease term and their useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the company. Obligations under such agreements are included in creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to profit or loss so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.ACCOUNTING POLICIES (CONTINUED)
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the balance sheet. The assets of the plan are held separately from the Company in independently administered funds.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
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PROVISIONS FOR LIABILITIES
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Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
Increases in provisions are generally charged as an expense to profit or loss.
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CURRENT AND DEFERRED TAXATION
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The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY
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In the application of the Company's accounting policies, which are described in note 2, management is required to make judgements, estimates and assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and underlying 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 if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
Analysis of turnover by country of destination:
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The operating profit is stated after charging/(crediting):
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Depreciation of tangible fixed assets
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Defined contribution pension costs
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Fees payable to the Company's auditor for the audit of the Company's financial statements
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The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent Company.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Staff costs, including directors' remuneration, were as follows:
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Cost of defined contribution scheme
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The average monthly number of employees, including the directors, during the year was as follows:
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Company contributions to defined contribution pension schemes
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During the year retirement benefits were accruing to 3 directors (2022 - 4) in respect of defined contribution pension schemes.
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The highest paid director received remuneration of £186,565 (2022 - £130,770).
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The value of the Company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £7,200 (2022 - £5,400).
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INTEREST PAYABLE AND SIMILAR EXPENSES
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Current tax on profits for the year
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Adjustments in respect of previous periods
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Origination and reversal of timing differences
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Taxation on profit on ordinary activities
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FACTORS AFFECTING TAX CHARGE FOR THE YEAR
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The tax assessed for the year is higher than (2022 - lower than) the standard rate of corporation tax in the UK of 23.52% (2022 - 19%). The differences are explained below:
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Profit on ordinary activities before tax
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Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 23.52% (2022 - 19%)
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Adjustments to tax charge in respect of prior periods
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Total tax charge for the year
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Long-term leasehold property
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Charge for the year on owned assets
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Amounts owed by group undertakings
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Prepayments and accrued income
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CASH AND CASH EQUIVALENTS
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CREDITORS: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Accruals and deferred income
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The Bank loans relate to property mortgages and are secured by way of a Debenture charge over all of the company's assets, and by legal charges over the properties to which they relate.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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CREDITORS: Amounts falling due after more than one year
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The Bank loans relate to property mortgages and are secured by way of a Debenture charge over all of the company's assets, and by legal charges over the properties to which they relate.
The bank loan repayable in greater than 5 years is based on an interest rate of 2.9% per annum above the base rate.
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Analysis of the maturity of loans is given below:
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Amounts falling due within one year
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Amounts falling due 2-5 years
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Amounts falling due after more than 5 years
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All debtors and creditors are basic financial instruments and are held at amortised cost.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Charged to the profit or loss
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The provision for deferred taxation is made up as follows:
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Accelerated capital allowances
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Short term timing differences
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The amount of the net reversal of deferred tax expected to occur next year is £38,404 (2022: £9,478), relating to the reversal of existing timing differences on tangible fixed assets.
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Within the dividends above were dividends paid of £300,000 (2022: £1,012,500)
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Allotted, called up and fully paid
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100 (2022 - 100) Ordinary shares of £1.00 each
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100 (2022 - 100) Ordinary Class B shares of £1.00 each
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The Ordinary Class B shares have no voting rights and no winding-up rights.
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ALTAVIA UK GROUP LIMITED (FORMERLY HRG (UK) LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
The company operates a defined contribution pension scheme for the employees (excluding directors). 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 and amounted to £175,258 (2022 - £155,087). Contributions totalling £28,039 (2022 - £46,045) were payable to the fund at the balance sheet date and are included in creditors.
The company contributes towards a Self-Invested Pension Plan for the directors. The assets of the scheme are held separately from those of the company in an independently administered fund. The contributions paid to the fund for the period amounted to £10,080 (2022 - £7,080).
The immediate parent company is HRG Group Limited, a company incorporated in England. This company does not prepare consolidated financial statements.
The largest and the smallest group for which accounts are drawn up and of which the company is a member is Altavia Europe SA.
Altavia Europe SA which is incorporated and registered in France, is the ultimate holding company. Copies of consolidated financial statements for Altavia may be obtained from 1, rue Rembrandt – 75008 Paris, France. Altavia Europe SA is the ultimate controlling party at the date of signing the financial statements.
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