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Registration number: 03137835

Sunpower Group Holdings Limited

Annual Report and Financial Statements

for the Year Ended 31 December 2023

 

Sunpower Group Holdings Limited

Contents

Company Information

1

Strategic Report

2 to 3

Directors' Report

4

Statement of Directors' Responsibilities

5

Independent Auditor's Report

6 to 8

Profit and Loss Account

9

Balance Sheet

10

Statement of Changes in Equity

11

Statement of Cash Flows

12

Notes to the Financial Statements

13 to 26

 

Sunpower Group Holdings Limited

Company Information

Directors

D Dodd

A Wall

R Parr

C Maylett

Company secretary

D Dodd

Registered office

Orion House
Calleva Park
Aldermaston
Reading
RG7 8SN

Bankers

National Westminster Bank Plc
PO Box 2376
131 Crockhamwell Road
Woodley
Reading
RG5 3JX

Auditors

Hazlewoods LLP
Staverton Court
Staverton
Cheltenham
GL51 0UX

 

Sunpower Group Holdings Limited

Strategic Report for the Year Ended 31 December 2023

The directors present their strategic report for the year ended 31 December 2023.

Principal activity

The principal activity of the company is the wholesale of electrical goods.

Our business

Following the excellent performance of 2022, the headwinds predicted for 2023 impacted on revenues as demand weakened across key industrial sectors. Despite a fall in turnover year on year, gross margin was improved considerably, however underlying EBITDA was impacted by lower volume and reducing stock bought under non-favourable exchange rates and international freight costs.

Demand within the lighting market remains strong albeit with elongated decision timescales, and the ever-present influx of cheaper, lower quality imports makes the competitive landscape an ongoing challenge. Industrial power experienced a challenging year as manufacturing within the UK slowed significantly which impacted on traditional demand, however, this was tempered well with the acquisition of new customers.

Whilst 2023 returned a good performance for the business, it remained challenging throughout and the expectation is for these challenges to persist into 2024 until there is a prolonged period of economic stability. Notwithstanding this, new products and new customers present another opportunity to drive growth.

Overall, for 2023, we are satisfied with the performance and results for the year.

Key performance indicators

The company uses several key performance indicators ('KPIs') to manage and direct the performance of the business to consistently deliver a service which exceeds client expectations. These are then formally cascaded down to set the performance criteria of the Senior Management Team (SMT), all of whom now have a significant element of their pay directly related to their successful delivery against KPIs pertinent to their functional area. With a HMRC-approved Enterprise Management Incentive (EMI) scheme introduced in 2016 to ensure our staff are rewarded in line with shareholders and they can benefit from cross-divisional growth and ensure all our key staff look for cross-divisional sales opportunities.

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

 

Unit

2023

2022

Turnover

£

15,159,678

16,686,556

Gross profit

£

4,644,287

4,628,039

Underlying EBITDA

£

1,733,227

2,049,568


The company’s preferred measure of true underlying profitability – underlying EBITDA (underlying operating profit plus depreciation, amortisation, stock provisions, foreign exchange, profit/loss on sale of fixed assets, bad debt expense, share based payment expense and one off directors pension costs ) saw an decrease from £2,049,568 for 2022 to £1,730,741 for the 12 months to 31 December 2023. The decrease of EBITDA for 2023 was attributed to the market factors identified above.

Principal risks and uncertainties

The principal risks arising from the company’s activities broadly continue from previous years, primarily around foreign exchange risk and credit risk. Risks around liquidity have reduced significantly over the last financial year. All of these are monitored by the board and are not considered to be of significance to the balance sheet.

The company’s policy with respect to credit risk is to require appropriate credit checks on potential customers before sales are made. Existing customer credit limit ratings are also reviewed on a regular basis. To mitigate default risk, the company also requires deposits with all bespoke orders and stage payments for longer-term projects.

The company does not have any bank loans.

 

Sunpower Group Holdings Limited

Strategic Report for the Year Ended 31 December 2023

In respect of liquidity risk, the business has significantly added to cash balances over the trading period in question and still maintains a readily accessible mix of bank deposit accounts to ensure the company has sufficient funds for operation.

Previously identified supply chain risks have reduced over the trading period as rules around COVID-19 have been relaxed and global shipping has become more accessible. However, continued geo-political tensions remain a risk to the overall supply chain.

Issues around COVID-19 largely dissipated throughout 2023, with the main exception being an overstocked position created by uncertainties around supplier lead times and component availability. However, as the year drew to a close, this position was firmly under control and continues to ease.

Multiple new product lines were introduced throughout the year to address the requirement for reduced power consumption without loss of performance. As these products continue to bed themselves into the market, the results will flow accordingly.

The lighting market did start to slow down towards the end of the year, largely driven by news of an imminent recession and a lack of global growth, and this is symptomatic across the market. Industrial power continues to grow as expected, and the business is becoming ever closer to its main power product supply partner to drive growth in the UK market.

Geo-political events could bring more disruption to the global market in 2024 and beyond, and alternative sources of supply have started to be investigated.

Future developments

The business will invest in redeveloping its online platform for improved service and functionality, alongside which it will migrate its technical environment into a cloud-based solution.

Additionally, the business will continue to grow the product set across both brands, maintaining its position of quality and value, and also continue to invest to its people.

Approved by the Board on 29 July 2024 and signed on its behalf by:


D Dodd
Director

 

Sunpower Group Holdings 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.

Directors of the company

The directors who held office during the year were as follows:

D Dodd - Company secretary and director

A Wall

S Green (resigned 15 May 2024)

R Parr

C Maylett

M Rooker (resigned 2 January 2023)

Dividends

Dividends amounting to £nil (2022 - £1,128,810) were paid in the year. The directors do not recommend payment of a further dividend.

Qualifying third party indemnity provisions

The company has made qualifying third party indemnity provisions for the benefit of its directors during the year. These provisions remain in force at the reporting date.

Going concern

In accordance with Financial Reporting Council's 'Going Concern and Liquidity Risk: Guidance for Directors of UK Companies 2006' the directors of all companies are now required to provide disclosures regarding the adoption of the going concern basis of accounting.

The company has sufficient financial resources available and is currently trading profitably and generating cash. The directors have prepared forecasts for the next 12 months that indicate that this trend will continue. The directors believe that the company has sufficient resources to continue in operational existence for the foreseeable future and have continued to adopt the going concern basis in preparing the financial statements.

Disclosure of information to the auditors

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditors are unaware.

Reappointment of auditors

The auditors Hazlewoods LLP are deemed to be reappointed under section 487(2) of the Companies Act 2006.

Approved by the Board on 29 July 2024 and signed on its behalf by:


D Dodd
Director

 

Sunpower Group Holdings Limited

Statement of Directors' Responsibilities

The directors are responsible for preparing the Strategic Report, 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 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:

select suitable accounting policies and apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards has been followed, subject to any material departures disclosed and explained in the financial statements; and

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 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.

 

Sunpower Group Holdings Limited

Independent Auditor's Report to the Members of Sunpower Group Holdings Limited

Opinion

We have audited the financial statements of Sunpower Group Holdings Limited (the 'company') for the year ended 31 December 2023, which comprise the Profit and Loss Account, Balance Sheet, Statement of Changes in Equity, Statement of Cash Flows, and Notes to the Financial Statements, including a summary of 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:

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; and

have been prepared in accordance with the requirements of the Companies Act 2006.

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 responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the original financial statements were 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.

Other information

The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.

In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.

Opinion on other matter prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of our 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 and the Directors' Report.

 

Sunpower Group Holdings Limited

Independent Auditor's Report to the Members of Sunpower Group Holdings Limited

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

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.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page 5, 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.

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.

Extent to which the audit was 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 about their own identification and assessment of the risks of irregularities.

We obtained an understanding of the legal and regulatory framework 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, including the UK Companies Act and tax legislation, and, those that 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.

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 judgments made in 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 misstatements 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.

 

Sunpower Group Holdings Limited

Independent Auditor's Report to the Members of Sunpower Group Holdings Limited

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

A further description of our responsibilities is available on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of this 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.





Scott Lawrence (Senior Statutory Auditor)
For and on behalf of Hazlewoods LLP, Statutory Auditor

Staverton Court
Staverton
Cheltenham
GL51 0UX

29 July 2024

 

Sunpower Group Holdings Limited

Profit and Loss Account for the Year Ended 31 December 2023

Note

2023
 £

2022
 £

Turnover

3

15,159,678

16,686,556

Cost of sales

 

(10,515,391)

(12,058,517)

Gross profit

 

4,644,287

4,628,039

Administrative expenses

 

(3,890,220)

(3,967,868)

Operating profit

4

754,067

660,171

Amounts written off investments

11

38,829

134,943

Other interest receivable and similar income

13,427

1,631

Profit before tax

 

806,323

796,745

Taxation

8

(347,266)

(314,700)

Profit for the financial year

 

459,057

482,045

The above results were derived from continuing operations.

The company has no other comprehensive income for the year.

 

Sunpower Group Holdings Limited

(Registration number: 03137835)
Balance Sheet as at 31 December 2023

Note

2023
 £

2022
 £

Fixed assets

 

Intangible assets

9

7,459

9,945

Tangible assets

10

282,063

208,823

Investments

11

1,100,004

1,061,175

 

1,389,526

1,279,943

Current assets

 

Stocks

12

3,075,996

4,286,933

Debtors

13

4,010,749

3,707,007

Cash at bank and in hand

 

3,330,635

1,616,952

 

10,417,380

9,610,892

Creditors: Amounts falling due within one year

14

(2,920,810)

(3,245,568)

Net current assets

 

7,496,570

6,365,324

Total assets less current liabilities

 

8,886,096

7,645,267

Creditors: Amounts falling due after more than one year

14

(104,222)

-

Net assets

 

8,781,874

7,645,267

Capital and reserves

 

Called up share capital

18, 19

437

416

Share premium reserve

19

83,944

42,449

Profit and loss account

19

8,697,493

7,602,402

Total equity

 

8,781,874

7,645,267

Approved and authorised by the Board on 29 July 2024 and signed on its behalf by:
 


D Dodd
Director

 

Sunpower Group Holdings Limited

Statement of Changes in Equity for the Year Ended 31 December 2023

Share capital
£

Share premium
£

Profit and loss account
£

Total
£

At 1 January 2022

416

42,449

8,151,807

8,194,672

Profit for the year

-

-

482,045

482,045

Dividends

-

-

(1,128,810)

(1,128,810)

Share based payment transactions

-

-

97,360

97,360

At 31 December 2022

416

42,449

7,602,402

7,645,267

Share capital
£

Share premium
£

Profit and loss account
£

Total
£

At 1 January 2023

416

42,449

7,602,402

7,645,267

Profit for the year

-

-

459,057

459,057

New share capital subscribed

21

41,495

-

41,516

Share based payment transactions

-

-

636,034

636,034

At 31 December 2023

437

83,944

8,697,493

8,781,874

 

Sunpower Group Holdings Limited

Statement of Cash Flows for the Year Ended 31 December 2023

Note

2023
£

2022
£

Cash flows from operating activities

Profit for the year

 

459,057

482,045

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

4

78,451

628,732

Profit on disposal of tangible assets

(5,600)

(6,590)

Impairment of investments

 

(38,829)

(134,943)

Finance income

(13,427)

(1,631)

Share based payment transactions

 

636,034

97,360

Income tax expense

8

347,266

314,700

 

1,462,952

1,379,673

Working capital adjustments

 

Decrease/(increase) in stocks

12

1,210,937

(1,371,058)

(Increase)/decrease in trade debtors

13

(278,114)

202,552

(Decrease)/increase in trade creditors

14

(447,644)

220,100

Cash generated from operations

 

1,948,131

431,267

Income taxes paid

8

(286,822)

(418,330)

Net cash flow from operating activities

 

1,661,309

12,937

Cash flows from investing activities

 

Interest received

13,427

1,631

Acquisitions of tangible assets

(48,915)

(185,330)

Proceeds from sale of tangible assets

 

46,346

24,250

Acquisition of intangible assets

9

-

(12,431)

Net cash flows from investing activities

 

10,858

(171,880)

Cash flows from financing activities

 

Proceeds from issue of ordinary shares, net of issue costs

 

41,516

-

Dividends paid

21

-

(1,128,810)

Net cash flows from financing activities

 

41,516

(1,128,810)

Net increase/(decrease) in cash and cash equivalents

 

1,713,683

(1,287,753)

Cash and cash equivalents at 1 January

 

1,616,952

2,904,705

Cash and cash equivalents at 31 December

 

3,330,635

1,616,952

 

Sunpower Group Holdings Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

1

General information

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office is:
Orion House
Calleva Park
Aldermaston
Reading
RG7 8SN

 

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.

Basis of preparation

These financial statements have been prepared using the historical cost convention except for, where disclosed in these accounting policies, certain items that are shown at fair value.

The presentational currency of the financial statements is Pounds Sterling, being the functional currency of the primary economic environment in which the company operates. Monetary amounts in these financial statements are rounded to the nearest Pound.

Group accounts not prepared

The financial statements present information about the company as an individual undertaking and not its group. The company has taken exemption from preparing group accounts under section 405 of the Companies Act 2006 as the subsidiary undertakings are not material to the group.

Going concern

After reviewing the company's forecasts and projections, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The company therefore continues to adopt the going concern basis in preparing its financial statements.

Critical accounting 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 amounts 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 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.
 

Judgements

No material significant judgements have been made by management in preparing these financial statements.

Key sources of estimation uncertainty

No material key sources of estimation uncertainty have been identified by management in preparing these financial statements other than those detailed in these accounting policies.

 

Sunpower Group Holdings Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Revenue recognition

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

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.

Government grants

Government grants are recognised based on the accrual model and are measured at the fair value of the asset received or receivable. Grants relating to revenue are recognised in income over the period in which the related costs are recognised.

Foreign currency transactions and balances

Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the initial transaction dates.

Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.

Tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in the profit and loss account, except that a charge attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates taxable income.

Deferred tax is recognised on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements and on unused tax losses or tax credits in the company. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

The carrying amounts of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amounts equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.

Tangible assets

Tangible assets are stated in the statement of financial position at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class

Depreciation method and rate

Plant and equipment

5 year straight line

Furniture and fittings

3 to 5 year straight line

Motor vehicles

5 year straight line

Intangible assets

Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the company’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is held in the currency of the acquired entity and revalued to the closing rate at each reporting period date.

 

Sunpower Group Holdings Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Amortisation

Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:

Asset class

Amortisation method and rate

Goodwill

10 year straight line

Previously purchased goodwill was transferred into the company at Net book value at the date that this was acquired. The original cost of this goodwill was £5,471,664. At the date of the transfer there was 7 years of useful life remaining.

Investments

Investments in equity shares which are publicly traded or where the fair value can be measured reliably are initially measured at fair value, with changes in fair value recognised in profit or loss. Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.


Interest income on debt securities, where applicable, is recognised in income using the effective interest method. Dividends on equity securities are recognised in income when receivable.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Trade debtors

Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

Trade debtors are recognised initially at the transaction price. All trade debtors are repayable within one year and hence are included at the undiscounted cost of cash expected to be received. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the debtors.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.

The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. At each reporting date, stocks are assessed for impairment. If stocks are 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.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and all are repayable within one year and hence are included at the undiscounted amount of cash expected to be paid.

 

Sunpower Group Holdings Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Borrowings

Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the profit and loss account over the period of the relevant borrowing.

Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.

Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee.

Assets held under finance leases are recognised at the lower of their fair value at inception of the lease and the present value of the minimum lease payments. These assets are depreciated on a straight-line basis over the shorter of the useful life of the asset and the lease term. The corresponding liability to the lessor is included in the Balance Sheet as a finance lease obligation.

Lease payments are apportioned between finance costs in the Profit and Loss Account and reduction of the lease obligation so as to achieve a constant periodic rate of interest on the remaining balance of the liability.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Dividends

Dividend distribution to the company’s shareholders is recognised as a liability in the financial statements in the reporting period in which the dividends are declared.

Financial instruments

Classification
Financial instruments are classified and accounted for according to the substance of the contractual arrangement, as financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities. Where shares are issued, any component that creates a financial liability of the company is presented as a liability on the balance sheet. The corresponding dividends relating to the liability component are charged as interest expenses in the profit and loss account.

 Recognition and measurement
All financial assets and liabilities are initially measured at transaction price (including transaction costs), except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value (which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a financing transaction. If an arrangement constitutes a financing transaction, the financial asset or financial liability is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

 

Sunpower Group Holdings Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Impairment
Assets, other than those measured at fair value, are assessed for indicators of impairment at each balance sheet date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss as described below.

A non financial asset is impaired where there is objective evidence that, as a result of one or more events that occurred after initial recognition, the estimated recoverable value of the asset has been reduced. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use.

The recoverable amount of goodwill is derived from measurement of the present value of the future cash flows of the cash-generating units ('CGUs') of which the goodwill is a part. Any impairment loss in respect of a CGU is allocated first to the goodwill attached to that CGU, and then to other assets within that CGU on a pro-rata basis.

Where indicators exist for a decrease in impairment loss, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised. Where a reversal of impairment occurs in respect of a CGU, the reversal is applied first to the assets (other than goodwill) of the CGU on a pro-rata basis and then to any goodwill allocated to that CGU.

For financial assets carried at amortised cost, the amount of an impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.

For financial assets carried at cost less impairment, the impairment loss is the difference between the asset’s carrying amount and the best estimate of the amount that would be received for the asset if it were to be sold at the reporting date.

Where indicators exist for a decrease in impairment loss, and the decrease can be related objectively to an event occurring after the impairment was recognised, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired financial asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

Share based payments

The company operates an equity-settled, share-based compensation plan, under which the entity receives services from employees as consideration for equity instruments (options) of the entity. The fair value of the employee services received is measured by reference to the estimated fair value at the grant date of equity instruments granted and is recognised as an expense over the vesting period. The estimated fair value of the option granted is calculated using the Black Scholes option pricing model. The total amount expensed is recognised over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied.

The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value) and share premium when the options are exercised.

 

Sunpower Group Holdings Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

3

Turnover

The analysis of the company's turnover for the year by class of business is as follows:

2023
£

2022
£

Industrial

10,356,256

11,415,951

Lighting

2,088,805

2,496,323

Online

68,245

148,997

Wholesale

2,646,372

2,625,285

15,159,678

16,686,556

The analysis of the company's turnover for the year by market is as follows:

2023
£

2022
£

Great Britain

13,105,291

13,599,368

Europe

304,771

840,603

Rest of the World

1,749,616

2,246,585

15,159,678

16,686,556

 

4

Operating profit

Arrived at after charging:

2023
 £

2022
 £

Depreciation expense

75,965

79,110

Amortisation expense

2,486

549,622

Foreign exchange losses

90,839

229,473

Operating lease expense - property

72,000

72,000

Operating lease expense - other

47,509

56,612

 

5

Staff costs

The aggregate payroll costs (including directors' remuneration) were as follows:

2023
 £

2022
 £

Wages and salaries

1,670,239

1,579,840

Social security costs

209,615

207,707

Pension costs

42,698

356,033

Share-based payment expenses

636,034

97,360

2,558,586

2,240,940

During the year pension costs of £nil (2022 - £320,000) were incurred relating to close family members of certain directors.

 

Sunpower Group Holdings Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:

2023
 No.

2022
 No.

Administration

10

13

Sales

14

11

Operations

10

9

34

33

 

6

Directors' remuneration

The directors' remuneration for the year was as follows:

2023
£

2022
£

Remuneration

468,022

265,524

Contributions paid to money purchase schemes

16,733

10,933

484,755

276,457

During the year the number of directors who were receiving benefits and share incentives was as follows:

2023
No.

2022
No.

Accruing benefits under money purchase pension scheme

5

5

In respect of the highest paid director:

2023
£

2022
£

Remuneration

213,984

110,289

 

7

Auditors' remuneration

2023
£

2022
£

Audit of the financial statements

22,300

20,400


 

 

8

Taxation

Tax charged/(credited) in the profit and loss account

2023
£

2022
£

Current taxation

UK corporation tax

350,749

301,197

UK corporation tax adjustment to prior periods

22,145

31,253

372,894

332,450

Deferred taxation

Arising from origination and reversal of timing differences

(25,628)

(17,750)

Tax expense in the income statement

347,266

314,700

 

Sunpower Group Holdings Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

8

Taxation (continued)

The tax on profit before tax for the year is higher than the standard rate of corporation tax in the UK (2022 - higher than the standard rate of corporation tax in the UK) of 23.52% (2022 - 19%).

The differences are reconciled below:

2023
£

2022
£

Profit before tax

806,323

796,745

Corporation tax at standard rate

189,647

151,382

Effect of reversal of impairment provision against investments

(9,133)

(25,639)

Effect of expense not deductible in determining taxable profit (tax loss)

161,772

61,881

Deferred tax credit relating to changes in tax rates or laws

-

(4,260)

Increase in UK and foreign current tax from adjustment for prior periods

22,145

31,253

Tax (decrease)/increase from effect of capital allowances and depreciation

(76)

100,083

Other tax effects for reconciliation between accounting profit and tax expense (income)

(17,089)

-

Total tax charge

347,266

314,700

A corporation tax rate increase from 19% to 25% from 1 April 2023 was substantively enacted on 24 May 2021. Accordingly, the deferred tax balances have been calculated at the new rate of 25%.

Deferred tax

Deferred tax assets and liabilities

2022

Asset
£

Fixed asset timing differences

9,929

Share based payment timing differences

93,304

Short term timing differences

545

103,778

 

9

Intangible assets

Goodwill
 £

Software Development
 £

Total
£

Cost or valuation

At 1 January 2023

3,830,166

12,431

3,842,597

At 31 December 2023

3,830,166

12,431

3,842,597

Amortisation

At 1 January 2023

3,830,166

2,486

3,832,652

Amortisation charge

-

2,486

2,486

At 31 December 2023

3,830,166

4,972

3,835,138

Carrying amount

At 31 December 2023

-

7,459

7,459

At 31 December 2022

-

9,945

9,945

 

Sunpower Group Holdings Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

10

Tangible assets

Plant and equipment
 £

Furniture and fittings
£

Motor vehicles
 £

Total
£

Cost

At 1 January 2023

107,133

569,553

208,175

884,861

Additions

-

13,232

176,719

189,951

Disposals

-

-

(92,244)

(92,244)

At 31 December 2023

107,133

582,785

292,650

982,568

Depreciation

At 1 January 2023

89,745

519,425

66,868

676,038

Charge for the year

4,917

28,539

42,509

75,965

Eliminated on disposal

-

-

(51,498)

(51,498)

At 31 December 2023

94,662

547,964

57,879

700,505

Carrying amount

At 31 December 2023

12,471

34,821

234,771

282,063

At 31 December 2022

17,388

50,128

141,307

208,823

 

11

Investments

2023
£

2022
£

Investments in subsidiaries

8

8

Investments in associates

1,099,996

1,061,167

1,100,004

1,061,175

Associates

£

Cost

At 1 January 2023

1,099,996

Provision

At 1 January 2023

38,829

Provision

(38,829)

At 31 December 2023

-

Carrying amount

At 31 December 2023

1,099,996

At 31 December 2022

1,061,167

Impairment of associates

The amount of reversal of impairment recognised in profit or loss is £38,829 (2022 - £134,943).

 

Sunpower Group Holdings Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

11

Investments (continued)

Details of undertakings

Details of the investments in which the company holds 20% or more of the nominal value of any class of share capital are as follows:

Undertaking

Registered office

Holding

Proportion of voting rights and shares held

     

2023

2022

Subsidiary undertakings

AXG Lighting Technology Limited

England & Wales

Ordinary

100%

100%

Powerled (UK) Limited

England & Wales

Ordinary

100%

100%

SPMS Power Technology Limited

England & Wales

Ordinary

100%

100%

Sunpower Electronics Limited

England & Wales

Ordinary

100%

100%

Associates

Freeman Moore Investments LLP

United Kingdom

Members share

33.3%

33.3%

 

     

All subsidiary undertakings are dormant. The principal activity of Freeman Moore Investments LLP is that of consultancy services.

 

12

Stocks

2023
£

2022
£

Finished goods and goods for resale

3,075,996

4,286,933

 

13

Debtors

Note

2023
 £

2022
 £

Trade debtors

 

2,559,482

3,376,174

Amounts owed by related parties

22

1,062,978

-

Other debtors

 

9,258

2,392

Prepayments

 

249,625

224,663

Deferred tax assets

8

129,406

103,778

 

4,010,749

3,707,007

 

Sunpower Group Holdings Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

14

Creditors

Note

2023
 £

2022
 £

Due within one year

 

Loans and borrowings

15

36,814

-

Trade creditors

 

1,178,981

2,061,468

Amounts due to related parties

22

-

199,170

Social security and other taxes

 

433,076

468,574

Other creditors

 

857,921

157,490

Accrued expenses

 

238,632

269,552

Corporation tax liability

 

175,386

89,314

 

2,920,810

3,245,568

Due after one year

 

Loans and borrowings

15

104,222

-

 

15

Loans and borrowings

2023
£

2022
£

Current loans and borrowings

HP and finance lease liabilities

36,814

-

2023
£

2022
£

Non-current loans and borrowings

HP and finance lease liabilities

104,222

-

 

16

Pension and other schemes

The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £42,698 (2022 - £356,033).

Contributions totalling £5,162 (2022 - £5,090) were payable to the scheme at the end of the year and are included in creditors.

 

17

Share-based payments

Employee share scheme

Scheme details and movements

On 1 March 2019, Sunpower Group Holdings Limited granted 3,734 new share options under an equity settled share option plan for the benefit of certain employees of the company at an HMRC approved price of £24.89 per share. The employee is entitled to exercise a proportion of the share options each year over a period of six years subject to ongoing employment as well as being subject to performance conditions.

The movements in the number of share options during the year were as follows:

 

Sunpower Group Holdings Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

2023
Number

2022
Number

Outstanding, start of period

1,966

1,966

Granted during the period

2,116

-

Forfeited during the period

(394)

-

Exercised during the period

(2,116)

-

Outstanding, end of period

1,572

1,966

The movements in the weighted average exercise price of share options during the year were as follows:

2023
£

2022
£

Outstanding, start of period

24.89

24.89

Outstanding, end of period

24.89

24.89

The options outstanding at 31 December 2023 have an exercise price of £24.89 (2022 - £24.89), and a remaining contractual life of three years (2022 - four years).
 

Effect of share-based payments on profit or loss and financial position

The total expense recognised in profit or loss for the year was £636,034 (2022 - £97,360).

 

18

Share capital

Allotted, called up and fully paid shares

 

2023

2022

 

No.

£

No.

£

Ordinary A of £0.01 each

14,577

146

14,577

146

Ordinary B of £0.01 each

14,577

146

14,577

146

Ordinary C of £0.01 each

2,500

25

2,500

25

Ordinary D of £0.01 each

2,500

25

2,500

25

Ordinary F of £0.01 each

1,495

15

1,495

15

Ordinary G of £0.01 each

2,116

21

-

-

Ordinary I of £0.01 each

5,760

58

5,760

58

Ordinary J of £0.01 each

240

2

240

2

 

43,765

438

41,649

416

New shares allotted

During the year 2,116 Ordinary G having an aggregate nominal value of £21 were allotted for an aggregate consideration of £41,516.

 

Sunpower Group Holdings Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Rights, preferences and restrictions

Ordinary shares have the following rights, preferences and restrictions:
The Ordinary A shares, Ordinary B shares, Ordinary C shares, Ordinary D shares, Ordinary E shares, Ordinary F shares are entitled to full voting, dividend and capital distribution rights (including on winding up) and do not confer any rights of redemption.

The Ordinary I shares and Ordinary J shares have no voting rights. They have full rights to dividends and capital distributions (including on winding up, though only to the nominal amount paid up or credited as paid up on such shares) and do not confer any rights of redemption.

 

19

Reserves

Share capital

Share capital represents the issued equity share capital of the company.

Share premium

Share premium represents the amount by which the amount received by the company for an equity share issue exceeds its nominal value.

Profit and loss account

Represents cumulative profits or losses, net of dividends paid and other adjustments.

 

20

Obligations under leases and hire purchase contracts

Operating leases

The total of future minimum lease payments is as follows:

2023
£

2022
£

Not later than one year

8,369

50,023

Later than one year and not later than five years

7,671

11,005

16,040

61,028

The amount of non-cancellable operating lease payments recognised as an expense during the year was £39,829 (2022 - £95,112).

 

21

Dividends

2023
 £

2022
 £

Dividends paid

-

1,128,810

 

Sunpower Group Holdings Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

 

22

Related party transactions

Key management compensation

The remuneration of key management personnel of the company, which includes directors, is as follows:

 

2023
£

2022
£

Salaries and other short term employee benefits

556,075

541,654

Transactions with directors

Dividends totalling £Nil (2022- £920,170) were paid during the year in respect of shares held by the company's directors. A further £Nil (2022 - £208,640) of dividends were paid to close family members of the directors.

 

2023

At 1 January 2023
£

Advances to director
£

At 31 December 2023
£

D Dodd

(99,085)

604,804

505,719

       

A Wall

(100,085)

605,804

505,719

       

2022

At 1 January 2022
£

Repayments by director
£

Other payments made to company by director
£

At 31 December 2022
£

D Dodd

1,000

(1,000)

(99,085)

(99,085)

         
       

A Wall

-

-

(100,085)

(100,085)

         
       

 

The director loan balances are interest free and have no fixed repayment terms.

Other related party transactions

During the year, the company sold fixed assets for proceeds of £46,345 (2022- £24,250), amount advance to share holder of £51,540 (2022 - nil), purchased fixed assets for proceeds of £nil (2022 - £27,000), paid £72,000 (2022- £72,000) of rent, and paid £86,000 (2022 - £85,000) for services provided by Freeman Moore Investments LLP, a partnership in which the company has an investment.