REGISTERED NUMBER: |
Financial Statements for the Year Ended 31 December 2023 |
for |
Naxos Music UK Limited |
REGISTERED NUMBER: |
Financial Statements for the Year Ended 31 December 2023 |
for |
Naxos Music UK Limited |
Naxos Music UK Limited (Registered number: 02619679) |
Contents of the Financial Statements |
for the Year Ended 31 December 2023 |
Page |
Company Information | 1 |
Balance Sheet | 2 |
Notes to the Financial Statements | 3 |
Naxos Music UK Limited |
Company Information |
for the Year Ended 31 December 2023 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
SENIOR STATUTORY AUDITOR: |
AUDITORS: |
Statutory Auditor |
First Floor, West Barn |
North Frith Farm, Ashes Lane, Hadlow |
Tonbridge |
Kent |
TN11 9QU |
Naxos Music UK Limited (Registered number: 02619679) |
Balance Sheet |
31 December 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Tangible assets | 4 |
Investments | 5 |
CURRENT ASSETS |
Stocks | 6 |
Debtors | 7 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 8 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CAPITAL & RESERVES |
Called up share capital | 11 |
Retained earnings | 12 |
SHAREHOLDERS' FUNDS |
In accordance with Section 444 of the Companies Act 2006, the Statement of Income and Retained Earnings has not been delivered. |
The financial statements were approved by the Board of Directors and authorised for issue on |
Naxos Music UK Limited (Registered number: 02619679) |
Notes to the Financial Statements |
for the Year Ended 31 December 2023 |
1. | STATUTORY INFORMATION |
Naxos Music UK Limited is a |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
The financial statements have been prepared in conformity with the principles applicable to a going concern basis. The applicability of these principles is dependent upon continued availability of adequate finance in the future in view of the group's net current liabilities. There is a material uncertainty at group level relation to this condition that may cast significant doubt on the Group's ability to continue as a going concern and, therefore, the Group may be unable to realise its assets and discharge its liabilities in the normal course of business. The group directors, Mr. Klaus Heymann and Mr.Yu He, have confirmed their intention to provide financial support to the Group and not to call upon the Group to repay any of the loans due to them until it is in a position to do so without compromising the rights of the Group's creditors. Note 11 and note 18 to the financial statements indicate group debtor balances of £2,033,687 which are treated as recoverable. |
Critical accounting estimates and judgements |
Estimates and assumptions concerning the future and judgements are made by the management in the preparation of the financial statements. They affect the application of the Company's accounting policies, reported amounts of assets, liabilities, income and expenses and disclosures made. They are assessed on an on-going basis and are based on experience and relevant factors, including expectations of future events that are believed to be reasonable in the period of revision and future periods, in case the revision also effects future periods. |
Revenue recognition |
Revenue from contracts for the provision of 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. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that are recoverable. |
Revenue is recognised when it is possible that the economic benefits will flow to the company and when the revenue and costs, if applicable, can be measured reliably and on the following basis: |
Nature of goods or services |
The nature of the goods or services provided by the company is as follows: |
- | Sale of products: digital sale of musical works on retail website and sale of compact discs and DVDs |
- | Downloading and streaming services: provision of music subscriptions services via downloading or streaming |
- | Licensing services: licensing of sound recordings and other intellectual property |
- | Royalty services: administers and remits payment of mechanical royalties from underlying compositions contained on products licensed, owned, and/or controlled by its customers |
Identification of performance obligations |
At contract inception, the company assesses the goods or services promised in a contract with a customer and identifies as a performance obligation each promise to transfer to the customer either: |
(a) | a good or service (or a bundle of goods or services) that is distinct; or |
(b) | a series of distinct goods or services that are substantially the same and that have the same pattern of transfer to the customer. |
Naxos Music UK Limited (Registered number: 02619679) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
2. | ACCOUNTING POLICIES - continued |
A good or service that is promised to a customer is distinct if both of the following criteria are met: |
(a) | the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (i.e. the good or service is capable of being distinct); and |
(b) | the company's promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (i.e. the promise to transfer the good or service is distinct within the context of the contract). |
Timing of revenue recognition |
Revenue is recognised when (or as) the company satisfies a performance obligation by transferring a promised good or service (i.e. an asset) to a customer. An asset is transferred when (or as) the customer obtains control of that asset. |
The company transfers control of a good or service over time and, therefore, satisfies a performance obligation and recognises revenue over time, if one of the following criteria is met: |
(a) | the customer simultaneously receives and consumes the benefits provided by the company's performance as the company performs; |
(b) | the company's performance creates or enhances an asset (for example, work in progress) that the customer controls as the asset is created or enhanced; or |
(c) | the company's performance does not create an asset with an alternative use to the company and the company has an enforceable right to payment for performance completed to date |
If a performance obligation is not satisfied over time, the Company satisfies the performance obligation at a point in time when the customer obtains control of the promised asset. In determining when the transfer of control occurs, the Company considers the concept of control and such indicators as legal title, physical possession, right to payment, significant risks and rewards of ownership of the asset, and customer acceptance. |
Digital income, public performance income and management fee income are recognised at a point in time when services are rendered. |
Subscriptions income is recognised over time when services are provided under the terms of the online subscription agreements. Payments received in advance of providing services are recorded as deferred revenue and amortised to revenue over the term of agreement. |
Licensing income and royalty income are recognised as revenue over time or at a point in time based on the contract terms. |
For revenue recognised over time, provided the outcome of the performance obligation can be reasonably measured, the Company applies the output method (i.e. based on the direct measurements of the value to the customer of the goods or services transferred to date relative to the remaining goods or services promised under the contract) to measure the progress towards complete satisfaction of the performance obligation because the method provides a faithful depiction of the Company's performance and reliable information is available to the Company to apply the method. Otherwise, revenue is recognised only to the extent of the costs incurred until such time that it can reasonably measure the outcome of the performance obligation. |
Tangible fixed assets |
Depreciation is provided on the straight line method in order to write off each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is shorter, as follows: |
Plant & machinery | - 3 & 5 years |
Fixtures & fittings | - over the period of the lease |
Motor vehicles | - 4 years |
Computer equipment | - 3 years |
Improvements to property | - over the period of the lease |
Stocks |
Stocks of finished goods have been valued at the lower of cost and estimated selling price less costs to sell, after making due allowance for obsolete and slow moving items. |
Naxos Music UK Limited (Registered number: 02619679) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
2. | ACCOUNTING POLICIES - continued |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Foreign currencies |
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss. Foreign exchange gains and losses resulting from the retranslating of non-monetary items carried at fair value are recognised in profit or loss except for those arising on the retranslating of non-monetary items in respect of which gains and losses are recognised directly in equity, |
The results and financial position of all the Group entities that have a functional currency different from the presentation currency ("foreign operations") are translated into the presentation currency as follows: |
- | Assets and liabilities for each statement of financial position presented are translated at the closing rate at the end of the reporting period; |
- | Income and expenses for each statement of comprehensive income are translated at average exchange rate; |
- | All resulting exchange differences arising from the above translation and exchange differences arising from a monetary item that forms part of the company's net investment in a foreign operation are recognised as a separate component of equity. |
Leasing commitments |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The company operates defined contribution pension schemes. The assets of the schemes are held and controlled by independently administered funds. Contributions payable for the year are charged in the profit and loss account. |
Fixed asset investments |
Fixed asset investments , subject to review for impairment , are included at cost. Further detail is provided in note 9. |
Financial instruments |
Short term debtors and creditors with no stated interest rate are recorded at transaction price. Any losses arising from impairment are recognised in the profit or loss account. |
3. | EMPLOYEES AND DIRECTORS |
The average number of employees during the year was |
Naxos Music UK Limited (Registered number: 02619679) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
4. | TANGIBLE FIXED ASSETS |
Improvements |
to | Plant & | Fixtures |
property | machinery | & fittings |
£ | £ | £ |
COST |
At 1 January 2023 |
Additions |
Disposals | ( |
) | ( |
) |
At 31 December 2023 |
DEPRECIATION |
At 1 January 2023 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
At 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 December 2022 |
Motor | Computer |
vehicles | equipment | Totals |
£ | £ | £ |
COST |
At 1 January 2023 |
Additions |
Disposals | ( |
) | ( |
) |
At 31 December 2023 |
DEPRECIATION |
At 1 January 2023 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
At 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 December 2022 |
5. | FIXED ASSET INVESTMENTS |
Unlisted |
investments |
£ |
COST |
At 1 January 2023 |
and 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 December 2022 |
Naxos Music UK Limited (Registered number: 02619679) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
5. | FIXED ASSET INVESTMENTS - continued |
The company's investments at the Balance Sheet date in the share capital of companies include the following: |
Registered office: Vanha Helsingintie 18A, 00700 Helsinki, Finland. |
Nature of business: |
% |
Class of shares: | holding |
2023 | 2022 |
£ | £ |
Aggregate capital and reserves |
Profit for the year |
6. | STOCKS |
2023 | 2022 |
£ | £ |
Goods for resale |
In addition to its own stocks detailed above, the company holds stock on consignment of £1,163,226 (2022: £1,080,883) valued at current selling prices less the company's margin. Title to the goods remains with the consignors and the company bears no liability until the stock has been sold. |
7. | DEBTORS |
2023 | 2022 |
£ | £ |
Amounts falling due within one year: |
Trade debtors |
Other debtors |
Other group companies | 2,033,687 | 2,148,056 |
Deferred tax asset |
Accelerated capital allowances | 60,943 | 60,943 |
Accrued income |
Prepayments |
Amounts falling due after more than one year: |
Other debtors |
Aggregate amounts |
Other debtors due after more than one year includes a rent deposit of £12,666 (2022: £12,666) relating to a 10 year lease on a property which expires in September 2032. |
8. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
£ | £ |
Trade creditors |
Social security & other taxes |
Other creditors |
Other group companies | 101,843 | 277,020 |
Accruals |
Naxos Music UK Limited (Registered number: 02619679) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
9. | LEASING AGREEMENTS |
Minimum lease payments under non-cancellable operating leases fall due as follows: |
2023 | 2022 |
£ | £ |
Within one year |
Between one and five years |
In more than five years |
10. | DEFERRED TAX |
£ |
Balance at 1 January 2023 | ( |
) |
Balance at 31 December 2023 | ( |
) |
11. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
value: | £ | £ |
Ordinary | £1 | 100,000 | 100,000 |
12. | RESERVES |
Retained |
earnings |
£ |
At 1 January 2023 |
Deficit for the year | ( |
) |
At 31 December 2023 |
13. | DISCLOSURE UNDER SECTION 444(5B) OF THE COMPANIES ACT 2006 |
The Report of the Auditors was unqualified. |
for and on behalf of |
14. | PENSION COMMITMENTS |
The company operates defined contribution pension schemes. Contributions due and paid for the year amounted to £28,469 (2022: £33,383). |
Naxos Music UK Limited (Registered number: 02619679) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
15. | RELATED PARTY DISCLOSURES |
The value of group products and services purchased by the company during the year was £1,357,659 (2022 : £1,384,158). Sales to companies within the group amounted to £1,481,657 (2022: £1,661,384). Interest has been charged on amounts owing by parent and other group companies totalling £63,297 (2022: £45,940). |
Balances outstanding at 31 December 2023 were as follows: - |
2023 | 2022 |
£ | £ |
Amounts due from other group companies:- |
Naxos Rights International Limited |
Current account | 630,942 | 630,942 |
Trade accounts | 213,053 | 162,148 |
843,995 | 793,090 |
Ondine OY |
Current accounts | - | 86,746 |
Trade accounts | - | 606 |
- | 87,352 |
Other trade accounts: - |
Naxos Audio Books (UK) Limited | 12,345 | 4,336 |
Naxos Rights (Europe) Ltd | 916,440 | 677,005 |
Naxos Global Logistics GmbH | 51,166 | 282,158 |
Naxos of America Inc. | 81,624 | 296,541 |
Naxos Digital Services US Inc | 3,654 | - |
HNH International Ltd | - | 7,574 |
Select Audio-Visual Distribution Company Pty Ltd | 122,776 | - |
Naxos Deutschland Musik | 1,687 | - |
2,033,687 | 2,148,056 |
Amounts due to other group companies:- |
Orfeo International Music GmbH | - | 365 |
Oehms Classics Musikproduktion GmbH | - | 312 |
Naxos Deutschland | - | 57 |
Naxos Digital Services US Inc | - | 58,575 |
Naxos Rights US Inc | 78,367 | 216,493 |
ARC Music Productions International Ltd | 60 | 405 |
Naxos Norway AS | 6 | 54 |
Naxos Denmark ApS | 112 | 100 |
HNH International Ltd | 21,722 | - |
Naxos Global Distribution ROHQ | 219 | 659 |
Ondine Oy | 1,357 | - |
101,843 | 277,020 |
Naxos Music UK Limited (Registered number: 02619679) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2023 |
16. | ULTIMATE CONTROLLING PARTY |
The company is a wholly owned subsidiary of Naxos Global Distribution Limited, a company registered in Hong Kong. The ultimate controlling party is Desun Holding Limited , a BVI company controlled by Mr He Yu. |
The results for the year of the company are included in the group financial statements of Angelina Assets Limited (a BVI company) for the year ended 31 December 2023. The Company's registered office is located at Vistra Corporate Services Centre, Wickham's Cay II,Road Town, Tortola, VG1110, British Virgin Islands. |
The group financial statements are not publicly available |
. |