Company registration number NI034377 (Northern Ireland)
LARNE CHEMISTS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
LARNE CHEMISTS LIMITED
COMPANY INFORMATION
Directors
Mr P. McCullough
A. McGrath
Secretary
Mr P. McCullough
Company number
NI034377
Registered office
14a Old Glenarm Road
Larne
Co Antrim
BT40 1RW
Auditor
Falconer Stewart Chartered Accountants
248 Upper Newtownards Road
Belfast
BT4 3EU
LARNE CHEMISTS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Directors' responsibilities statement
5
Independent auditor's report
6 - 9
Profit and loss account
10
Group statement of comprehensive income
11
Group balance sheet
12
Company balance sheet
13
Group statement of changes in equity
14
Company statement of changes in equity
15
Group statement of cash flows
16
Company statement of cash flows
17
Notes to the financial statements
18 - 34
LARNE CHEMISTS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 1 -

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

Principal activities

The principle activities of the business are the operation of a chain of retail pharmacy and opticians outlets.

 

Review of the business

The business operates a number of community pharmacies and opticians in Northern Ireland. Over recent years the company has made significant investment in acquiring new pharmacy outlets. The company made further acquisitions during the year.

 

The directors are satisified with the performance of the business during the year given the challenging market conditions. During the year the company further improved its stock buying policies and practices. The directors expect the general level of activity to improve in the forseeable future.

 

There were no significant events subsequent to the year end requiring disclosure. The company has continued to develop policies to maintain service levels. The directors are satisified that the overall performance levels of the business have been maintained and that the company is well positioned to maintain the performance levels.

Principal risks and uncertainties

The directors consider the principle risks and uncertainties faced by the company are as follows:

 

Competition Risk: The directors manage competition risk through close attention to customer service levels and service innovation.

 

Financial Risk: the company has budgetary and financial reporting procedures supported by appropriate key performance indicators to manage credit, liquidity and other financial risk.

 

Economic Risk: Economic factors, particularly the continuing uncertainty of the Uk's exit from the European Union and the Northern Ireland Protocol and the Windsor Framework, may impact upon the company and in particular the supply and cost of medicines etc imported from both the European Union and Great Britain. The effect of Brexit is still subject to a considerable degree of uncertainty with the full range of outcomes.

LARNE CHEMISTS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -
Key performance indicators

Key performance indicators used by management include perscription item growth, retail turnover and expenses. These are monitored on an ongoing basis and on an individual shop basis.

 

A summary of key performance indicators are below:

 

Turnover 2023        £25.5m        2022     £18.6m

Gross Profit % 2023    33.91%        2022    32.98%

Return on capital    2023    1.06%        2023    3.92%

 

Return on capital has decreased as overall profitability has decreased due to the increase in amortisation of goodwill.        

 

Management and personnel

The company places considerable value on the involvement of its employees. The continued commitment and dedication of all its employees is appreciated by the directors.

 

Financial risk management

Liquidity Risk: The company manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the company has sufficient liquid resources to meet the operating needs of the business.

 

Interest Rate Risk: The company is exposed to interest rate risk on its fixed borrowings and cash flow interest rate risk on floating rate deposits, bank overdrafts and loans. The company uses a mix of fixed and variable rate debt to reduce its exposure to changes in interest rates.

 

Credit Risk: All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary. Business conducted with customers on credit terms is minimal.

 

Price Risk: The company is exposed to commodity price risk as a result of operations. The company seeks to minimise this risk by actively monitoring price trends and actively seeks out appropriate buying opportunities.

 

Foreign Exchange Risk: The company undertakes some transactions in Euros. No hedging takes place.

On behalf of the board

Mr P. McCullough
Director
30 August 2024
LARNE CHEMISTS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 3 -

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

Results and dividends

The results for the year are set out on page 10.

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

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

Directors

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

Mr P. McCullough
A. McGrath
Disabled persons

Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the group continues and that the appropriate training is arranged. It is the policy of the group that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.

Employee involvement

The group's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.

 

Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the group's performance.

 

There is no employee share scheme at present, but the directors are considering the introduction of such a scheme as a means of further encouraging the involvement of employees in the company's performance.

Auditor

The auditor, Falconer Stewart, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Strategic report

The truegroup has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the group's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report.

Statement of disclosure to auditor

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

LARNE CHEMISTS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 4 -
On behalf of the board
Mr P. McCullough
Director
30 August 2024
LARNE CHEMISTS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2023
- 5 -

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

LARNE CHEMISTS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF LARNE CHEMISTS LIMITED
- 6 -
Opinion

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

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

 

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

 

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

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

LARNE CHEMISTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF LARNE CHEMISTS LIMITED
- 7 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

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

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the parent company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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

LARNE CHEMISTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF LARNE CHEMISTS LIMITED
- 8 -

The extent to which the audit was considered capable of detecting irregularies, including fraud

 

Irregularities are instances of non-compliance with laws and regulations. The objectives of our audit are to obtain sufficient appropriate audit evidence regarding compliance with laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements, to perform audit procedures to help identify instances of non-compliance with other laws and regulations that may have a material effect on the financial statements, and to respond appropriately to identified or suspected non-compliance with laws and regulations identified during the audit.

 

In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the financial statements due to fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud through designing and implementing appropriate responses and to respond appropriately to fraud or suspected fraud identified during the audit.

 

However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conduced in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.

 

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team:

As a result of these procedures we consider the most significant laws and regulations that have a direct impact on the financial statements are FRS102 and compliance with Companies Act 2006 and Tax compliance regulations and government grant income. We performed audit procedures to detect non-compliances which may have a material impact on the financial statements which included, reviewing financial statement disclosures, completion of disclosure checklists to identify areas of non-compliance, inspecting correspondence with local tax authorities and evaluating advice obtained from external tax advisors.

 

The most significant laws and regulations that have an indirect impact on the financial statements are those in relation to health and safety and employment law. We performed audit procedures to inquire of management and those charged with governance whether the company is in compliance with these laws and regulations and inspected and inspected correspondence with the relevant authorities.

 

The audit engagement team identified the risk of management of controls, revenue recognition and stock provisioning as areas where the financial statements were most susceptible to material misstatement due to fraud. Audit procedures performed included but were not limited to testing entries and other adjustments and evaluating the business rationale in relation to significant, unusual transactions and transactions entered into outside the normal course of business. Audit procedures performed over the revenue recognition included testing the operating effectiveness of controls, performing cut off testing, analytical review and tests of detail to cover all revenue assertions. procedures performed over stock provisioning included re-calculation of the provision based on the provision methodology for reasonableness, challenging judgements and estimates applied in the methodology adopted in establishing stock provisions.

 

A further description of our responsibilities for the audit of financial statements is located on the Financial Reporting Councils website at: http://.frc.org.uk/auditorsresponsibilites. This description forms part of our auditor's report.

 

 

LARNE CHEMISTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF LARNE CHEMISTS LIMITED
- 9 -

The purpose of our audit work and to whom we owe our responsibilities

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.

Michael J Crooks (Senior Statutory Auditor)
For and on behalf of Falconer Stewart Chartered Accountants
30 August 2024
Chartered Accountants
Statutory Auditor
248 Upper Newtownards Road
Belfast
BT4 3EU
LARNE CHEMISTS LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2023
- 10 -
2023
2022
Notes
£
£
Turnover
3
25,533,166
18,638,442
Cost of sales
(16,875,996)
(12,490,929)
Gross profit
8,657,170
6,147,513
Administrative expenses
(7,713,972)
(5,687,814)
Other operating income
-
59,394
Operating profit
4
943,198
519,093
Interest receivable and similar income
7
446
92
Interest payable and similar expenses
8
(590,170)
(174,518)
Profit before taxation
353,474
344,667
Tax on profit
9
(313,343)
(197,957)
Profit for the financial year
40,131
146,710
Profit for the financial year is all attributable to the owners of the parent company.
LARNE CHEMISTS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
- 11 -
2023
2022
£
£
Profit for the year
40,131
146,710
Other comprehensive income
-
-
Cash flow hedges gain arising in the year
-
0
-
0
Total comprehensive income for the year
40,131
146,710
Total comprehensive income for the year is all attributable to the owners of the parent company.
LARNE CHEMISTS LIMITED
GROUP BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 12 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
10
14,207,771
10,892,928
Tangible assets
11
1,386,216
1,397,185
Investments
12
2
1
15,593,989
12,290,114
Current assets
Stocks
14
2,255,130
1,788,250
Debtors
15
3,021,522
2,275,396
Cash at bank and in hand
2,065,355
1,424,666
7,342,007
5,488,312
Creditors: amounts falling due within one year
16
(7,129,303)
(5,282,387)
Net current assets
212,704
205,925
Total assets less current liabilities
15,806,693
12,496,039
Creditors: amounts falling due after more than one year
17
(11,911,268)
(8,668,887)
Provisions for liabilities
Deferred tax liability
19
104,234
76,092
(104,234)
(76,092)
Net assets
3,791,191
3,751,060
Capital and reserves
Called up share capital
21
600,000
600,000
Profit and loss reserves
3,191,191
3,151,060
Total equity
3,791,191
3,751,060
The financial statements were approved by the board of directors and authorised for issue on 30 August 2024 and are signed on its behalf by:
30 August 2024
Mr P. McCullough
Director
Company registration number NI034377 (Northern Ireland)
LARNE CHEMISTS LIMITED
COMPANY BALANCE SHEET
AS AT 31 MARCH 2023
31 March 2023
- 13 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
10
14,207,771
10,892,928
Tangible assets
11
1,386,216
1,397,185
Investments
12
3
2
15,593,990
12,290,115
Current assets
Stocks
14
2,255,130
1,788,250
Debtors
15
3,011,522
2,265,396
Cash at bank and in hand
2,065,355
1,424,666
7,332,007
5,478,312
Creditors: amounts falling due within one year
16
(7,129,303)
(5,282,387)
Net current assets
202,704
195,925
Total assets less current liabilities
15,796,694
12,486,040
Creditors: amounts falling due after more than one year
17
(11,911,268)
(8,668,887)
Provisions for liabilities
Deferred tax liability
19
104,234
76,092
(104,234)
(76,092)
Net assets
3,781,192
3,741,061
Capital and reserves
Called up share capital
21
600,000
600,000
Profit and loss reserves
3,181,192
3,141,061
Total equity
3,781,192
3,741,061

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £40,131 (2022 - £146,710 profit).

The financial statements were approved by the board of directors and authorised for issue on 30 August 2024 and are signed on its behalf by:
30 August 2024
Mr P. McCullough
Director
Company registration number NI034377 (Northern Ireland)
LARNE CHEMISTS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 14 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 April 2021
600,000
3,004,350
3,604,350
Year ended 31 March 2022:
Profit and total comprehensive income
-
146,710
146,710
Balance at 31 March 2022
600,000
3,151,060
3,751,060
Year ended 31 March 2023:
Profit and total comprehensive income
-
40,131
40,131
Balance at 31 March 2023
600,000
3,191,191
3,791,191
LARNE CHEMISTS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 15 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 April 2021
600,000
2,994,351
3,594,351
Year ended 31 March 2022:
Profit and total comprehensive income for the year
-
146,710
146,710
Balance at 31 March 2022
600,000
3,141,061
3,741,061
Year ended 31 March 2023:
Profit and total comprehensive income
-
40,131
40,131
Balance at 31 March 2023
600,000
3,181,192
3,781,192
LARNE CHEMISTS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 16 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
24
2,103,192
2,008,745
Interest paid
(590,170)
(174,518)
Income taxes paid
(7,188)
(213,494)
Net cash inflow from operating activities
1,505,834
1,620,733
Investing activities
Purchase of intangible assets
(4,470,000)
(5,550,000)
Purchase of tangible fixed assets
(75,313)
(121,701)
Purchase of subsidiaries, net of cash acquired
(3)
-
Repayment of loans
(200,000)
-
Interest received
446
92
Net cash used in investing activities
(4,744,870)
(5,671,609)
Financing activities
Repayment of bank loans
3,879,725
3,024,421
Net cash generated from financing activities
3,879,725
3,024,421
Net increase/(decrease) in cash and cash equivalents
640,689
(1,026,455)
Cash and cash equivalents at beginning of year
1,424,666
2,451,121
Cash and cash equivalents at end of year
2,065,355
1,424,666
LARNE CHEMISTS LIMITED
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 17 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
25
2,103,192
2,008,745
Interest paid
(590,170)
(174,518)
Income taxes paid
(7,188)
(213,494)
Net cash inflow from operating activities
1,505,834
1,620,733
Investing activities
Purchase of intangible assets
(4,470,000)
(5,550,000)
Purchase of tangible fixed assets
(75,313)
(121,701)
Purchase of subsidiaries
(3)
-
0
Repayment of loans
(200,000)
-
0
Interest received
446
92
Net cash used in investing activities
(4,744,870)
(5,671,609)
Financing activities
Repayment of bank loans
3,879,725
3,024,421
Net cash generated from financing activities
3,879,725
3,024,421
Net increase/(decrease) in cash and cash equivalents
640,689
(1,026,455)
Cash and cash equivalents at beginning of year
1,424,666
2,451,121
Cash and cash equivalents at end of year
2,065,355
1,424,666
LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 18 -
1
Accounting policies
Company information

Larne Chemists Limited (“the company”) is a private limited company domiciled and incorporated in Northern Ireland. The registered office is .

 

The group consists of Larne Chemists Limited and all of its subsidiaries.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, [modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value]. The principal accounting policies adopted are set out below.

1.2
Business combinations

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

 

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

1.3
Basis of consolidation

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

 

All financial statements are made up to 31 March 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

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

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

LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 19 -

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

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

 

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

 

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

1.4
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.5
Turnover

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

 

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

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

1.6
Intangible fixed assets - goodwill

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

 

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

1.7
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 20 -

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Leasehold land and buildings
Enter depreciation rate via StatDB - cd75
Plant and equipment
Enter depreciation rate via StatDB - cd76

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

1.8
Fixed asset investments

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

 

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

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

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

 

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

 

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

 

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

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

1.9
Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

 

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

LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 21 -

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.10
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

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

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.11
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.12
Financial instruments

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 22 -
Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 23 -
Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

1.13
Equity instruments

Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.

1.14
Taxation

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

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 24 -
1.15
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.16
Retirement benefits

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

1.17
Government grants

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

 

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

2
Judgements and key sources of estimation uncertainty

In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by geographical market
UK
25,533,166
18,638,442
2023
2022
£
£
Other revenue
Interest income
446
92
Grants received
-
59,394
LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 25 -
4
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Government grants
-
(59,394)
Depreciation of owned tangible fixed assets
86,282
66,688
Amortisation of intangible assets
1,155,157
707,840
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
15,000
3,500
6
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Office and management
12
12
12
12
Operations
293
184
293
184
Total
305
196
305
196

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
4,358,508
3,132,706
4,358,508
3,132,706
Social security costs
343,458
233,004
343,458
233,004
Pension costs
79,389
51,997
79,389
51,997
4,781,355
3,417,707
4,781,355
3,417,707
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
446
92
LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
7
Interest receivable and similar income
(Continued)
- 26 -
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
446
92
8
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
526,193
174,518
Other finance costs:
Other interest
63,977
-
Total finance costs
590,170
174,518
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
285,201
182,483
Deferred tax
Origination and reversal of timing differences
28,142
15,474
Total tax charge
313,343
197,957

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

2023
2022
£
£
Profit before taxation
353,474
344,667
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
67,160
65,487
Tax effect of expenses that are not deductible in determining taxable profit
219,480
134,488
Permanent capital allowances in excess of depreciation
26,703
(2,018)
Taxation charge
313,343
197,957
LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 27 -
10
Intangible fixed assets
Group
Goodwill
£
Cost
At 1 April 2022
19,660,808
Additions
4,470,000
At 31 March 2023
24,130,808
Amortisation and impairment
At 1 April 2022
8,767,880
Amortisation charged for the year
1,155,157
At 31 March 2023
9,923,037
Carrying amount
At 31 March 2023
14,207,771
At 31 March 2022
10,892,928
Company
Goodwill
£
Cost
At 1 April 2022
19,660,808
Additions
4,470,000
At 31 March 2023
24,130,808
Amortisation and impairment
At 1 April 2022
8,767,880
Amortisation charged for the year
1,155,157
At 31 March 2023
9,923,037
Carrying amount
At 31 March 2023
14,207,771
At 31 March 2022
10,892,928

Goodwill is amortised on a straight line basis over 13 years.

The following are amounts of amortisation still to be amortised:

£2,710,651 over 8.5 years

£2,247,563 over 9.7 years

£4,953,900 over 11.6 years

£4,295,659 over 12.5 years

Goodwill has arisen on the purchase by the business of a number of pharmacies. Goodwill is recognised and measured as the excess of the cost of the acquisitions of the business over the company's interest in the fair value of the identifiable assets, liabilities and contingent liabilities of the acquired business. Goodwill is amortised through the profit and loss account over 13 years.

LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 28 -
11
Tangible fixed assets
Group
Leasehold land and buildings
Plant and equipment
Total
£
£
£
Cost
At 1 April 2022
1,321,456
808,027
2,129,483
Additions
-
0
75,313
75,313
At 31 March 2023
1,321,456
883,340
2,204,796
Depreciation and impairment
At 1 April 2022
327,785
404,513
732,298
Depreciation charged in the year
26,429
59,853
86,282
At 31 March 2023
354,214
464,366
818,580
Carrying amount
At 31 March 2023
967,242
418,974
1,386,216
At 31 March 2022
993,671
403,514
1,397,185
Company
Leasehold land and buildings
Plant and equipment
Total
£
£
£
Cost
At 1 April 2022
1,321,456
808,027
2,129,483
Additions
-
0
75,313
75,313
At 31 March 2023
1,321,456
883,340
2,204,796
Depreciation and impairment
At 1 April 2022
327,785
404,513
732,298
Depreciation charged in the year
26,429
59,853
86,282
At 31 March 2023
354,214
464,366
818,580
Carrying amount
At 31 March 2023
967,242
418,974
1,386,216
At 31 March 2022
993,671
403,514
1,397,185
12
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
13
2
1
3
2
LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
12
Fixed asset investments
(Continued)
- 29 -
Movements in fixed asset investments
Group
Shares in subsidiaries
£
Cost or valuation
At 1 April 2022
1
Additions
3
At 31 March 2023
4
Impairment
At 1 April 2022
-
Impairment losses
2
At 31 March 2023
2
Carrying amount
At 31 March 2023
2
At 31 March 2022
1
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 April 2022
2
Additions
3
At 31 March 2023
5
Impairment
At 1 April 2022
-
Impairment losses
2
At 31 March 2023
2
Carrying amount
At 31 March 2023
3
At 31 March 2022
2
13
Subsidiaries

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

LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
13
Subsidiaries
(Continued)
- 30 -
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Park Pharmacy Limited
Northern Ireland
Ordinary £1
100.00
Fegan's Pharmacy Limited
Northern Ireland
Ordinary
100.00
McAleer and Donelly Pharmacy Limited
Northern Ireland
Ordinary
100.00
14
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Finished goods and goods for resale
2,255,130
1,788,250
2,255,130
1,788,250
15
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
2,240,173
1,819,721
2,240,173
1,819,721
Other debtors
781,349
455,675
771,349
445,675
3,021,522
2,275,396
3,011,522
2,265,396
16
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans
18
1,344,081
883,836
1,344,081
883,836
Trade creditors
4,119,001
2,814,192
4,119,001
2,814,192
Corporation tax payable
728,208
450,195
728,208
450,195
Other taxation and social security
86,871
43,996
86,871
43,996
Other creditors
727,861
1,079,665
727,861
1,079,665
Accruals and deferred income
123,281
10,503
123,281
10,503
7,129,303
5,282,387
7,129,303
5,282,387
LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 31 -
17
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
18
11,896,005
8,476,525
11,896,005
8,476,525
Other creditors
15,263
192,362
15,263
192,362
11,911,268
8,668,887
11,911,268
8,668,887
18
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
13,240,086
9,360,361
13,240,086
9,360,361
Payable within one year
1,344,081
883,836
1,344,081
883,836
Payable after one year
11,896,005
8,476,525
11,896,005
8,476,525

The bank loans are secured by four charges over the land and property known as Larne Medical Centre, Old Glenarm Road, Larne and property at 1-3 Downpatrick Street, Crossgar. There are also fixed and floating charges over all assets of the company both present and future.

 

The bank lending was restructured in the year.

19
Deferred taxation

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

Liabilities
Liabilities
2023
2022
Group
£
£
Accelerated capital allowances
104,234
76,092
Liabilities
Liabilities
2023
2022
Company
£
£
Accelerated capital allowances
104,234
76,092
LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
19
Deferred taxation
(Continued)
- 32 -
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 April 2022
76,092
76,092
Charge to profit or loss
28,142
28,142
Liability at 31 March 2023
104,234
104,234
20
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
79,389
51,997

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

21
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
300,000
300,000
300,000
300,000
2023
2022
2023
2022
Preference share capital
Number
Number
£
£
Issued and fully paid
Redeemable preference shares of £1 each
300,000
300,000
300,000
300,000
Preference shares classified as equity
300,000
300,000
Total equity share capital
600,000
600,000

Ordinary Shares have full and equal voting and participation rights and equal right on dissolution.

 

Redeemable Preference shares are 2.5% non cumulative discretionary upon a simple majority in an annual vote of the holders of the ordinary shares. No rights to capital dividends on winding up. Nominal value of shares to rank above ordinary shares upon winding up. Redeemable at par upon a simple majority in a vote of the holders of the ordinary shares. There is no set date for redemption of shares.

LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 33 -
22
Directors' transactions

At the year end Mr Paul McCullough owed the company £200,000. This has been repaid after the year end.

23
Controlling party

The controlling party is Mr Paul McCullough.

 

24
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
40,132
146,710
Adjustments for:
Taxation charged
313,343
197,957
Finance costs
590,170
174,518
Investment income
(446)
(92)
Amortisation and impairment of intangible assets
1,155,157
707,840
Depreciation and impairment of tangible fixed assets
86,282
66,688
Movements in working capital:
Increase in stocks
(466,880)
(1,788,250)
Increase in debtors
(546,126)
(2,275,396)
Increase in creditors
931,560
4,140,718
Cash generated from operations
2,103,192
1,370,693
25
Cash generated from operations - company
2023
2022
£
£
Profit for the year after tax
40,132
146,710
Adjustments for:
Taxation charged
313,343
197,957
Finance costs
590,170
174,518
Investment income
(446)
(92)
Amortisation and impairment of intangible assets
1,155,157
707,840
Depreciation and impairment of tangible fixed assets
86,282
66,688
Movements in working capital:
Increase in stocks
(466,880)
(1,788,250)
Increase in debtors
(546,126)
(2,265,396)
Increase in creditors
931,560
4,140,718
Cash generated from operations
2,103,192
1,380,693
LARNE CHEMISTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 34 -
26
Analysis of changes in net debt - group
1 April 2022
Cash flows
31 March 2023
£
£
£
Cash at bank and in hand
1,424,666
640,689
2,065,355
Borrowings excluding overdrafts
(9,360,361)
(3,879,725)
(13,240,086)
(7,935,695)
(3,239,036)
(11,174,731)
27
Analysis of changes in net debt - company
1 April 2022
Cash flows
31 March 2023
£
£
£
Cash at bank and in hand
1,424,666
640,689
2,065,355
Borrowings excluding overdrafts
(9,360,361)
(3,879,725)
(13,240,086)
(7,935,695)
(3,239,036)
(11,174,731)
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