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Registered number: 01093795












CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

CONTENTS



Page
Company information
 
1
Strategic report
 
2 - 4
Directors' report
 
5 - 6
Directors' responsibilities statement
 
7
Independent auditor's report
 
8 - 11
Profit and loss account
 
12
Balance sheet
 
13
Statement of changes in equity
 
14
Notes to the financial statements
 
15 - 29

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)
 
COMPANY INFORMATION


Directors
L M Felton 
A Clerici (appointed 1 July 2024)
S G Caverzaschi (appointed 1 July 2024)




Registered number
01093795



Registered office
Unit 280 Centennial Park
Centennial Avenue

Elstree

Hertfordshire

WD6 3ST




Independent auditor
Blick Rothenberg Audit LLP
Chartered Accountants & Statutory Auditor

16 Great Queen Street

Covent Garden

London

WC2B 5AH




Page 1

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Introduction
 
The directors present their strategic report for the year ended 31 December 2023.
The principal activity of the company during the year continued to be that of the selling and maintenance of coffee machines.

Business review
 
The profit and loss account on page 12 of the financial statements provides a summary of the company's results for the year. The performance and results for the year were challenging, as expected given economic uncertainty and market conditions, however the directors remain optimistic about the future of the company and its group.
During the year, turnover decreased by 3% from £14.0m to £13.6m. This decrease comprises a reduction of £1.5m in the sale of machinery, spare parts and maintenance contracts mitigated by an increase of £1.1m in turnover from repairs and servicing. This change in sales mix partly reflects the timing of capital investment projects by customers for new machinery as well as a shift towards extending appliance lifespan through service and repairs considering current macro-economic uncertainties faced in the industry. 
Gross profit amounted to £2.9m, in 2023, a decrease of £0.6m compared to £3.5m in 2022. The company experienced a decrease in the gross profit margin from 25% in 2022 to 21% for the reporting year, partly as a result of changes in the product mix and inflationary pressures.
Prior to exceptional income, the operating loss for the year was £1.2m in 2023 (2022: £37k operating profit). The directors continued to maintain a policy of cost control whilst simultaneously ensuring it focuses on investing in its people, showrooms and facilities to continue with the over-arching strategy to promote the brand and products as well as ultimately seek to enhance the customer experience.
The exceptional income of £1.2m (2022: £Nil) represents a loan waiver the company received from its parent undertaking.
The company has net assets of £505k at the reporting date, (2022: £491k), net current assets of £525k, (2022: £249k), and a cash balance of £1.1m as at the reporting date, (2022: £2.5m). Stock held at the reporting date amounted to £2.0m compared to £3.1m at 31 December 2022, reflecting a lower volume of finished goods held at year-end. 
The company continues to enjoy a strong and collaborative relationship with group companies and has the full financial support of its parent company as explained further in note 2.3.
The directors continue to review the business and industry to minimise or mitigate the risks that are prevalent in a commercial environment. The company, and its group, continue to monitor the market closely in order to make informed decisions on the development and investment in products and services.

Principal risks and uncertainties
 
The company continues to monitor the key risks and uncertainties it faces relating to the competitive environment in which it operates and the prevailing economic and geo-political conditions.
Risk management is embedded in the company's internal control processes and also as part of the year end reporting procedures. The major risk categories, together with examples, are:

Strategic e.g. reputation, product obsolescence, cost competition, short-term customer confidence levels.
Operational e.g. product failure, loss of key personnel.
Financial e.g. major contract management, inventory control, credit control.
Hazard, health and safety and product liability.

These risks are identified and managed through regular dialogue with customers, other stakeholders and internal reporting procedures. Appropriate safeguards are put in place wherever possible.
 
Page 2

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

The directors have not delegated the responsibility of monitoring financial risk management and the company's finance department implements the policies set by the company's directors. The department has specific guidelines agreed by the directors to manage credit risk.
Customer risk
The company's relationship with its customers is a principal business risk. Maintaining this relationship is pivotal to the company's own success.
Credit risk
The company has implemented policies that require appropriate credit checks on potential customers before new accounts are accepted. Furthermore, credit limits are set in place and reviewed on an ongoing basis. Receivable balances are monitored on an ongoing basis and provisions are made for doubtful debts where necessary.
Liquidity and cash flow risk
The directors consider the company to have sufficient available funds for operations. The directors are presented
with cashflow reporting on a monthly basis when future plans, opportunities and risks are discussed.
Price risk
Expenditure made by the company is authorised prior to it being made by management in order to ensure that goods and services are not obtained at a higher price than necessary.
Data and compliance risk
The company is aware of the increased risk of ransomware and other IT security issues. To mitigate this risk, the company ensures it is running the latest versions of all software and maintains a strict firewall discipline. Data is regularly backed up.
The directors consider compliance risk including the requirement to comply with the Data Protection Act 2018 and UK General Data Protection Regulations ("GDPR") as essential to the operations of its core activities. Ensuring customers data is protected under GDPR is fundamental for both compliance and reputation.
Health and safety risk
The company ensures compliance with all relevant health and safety as well as product conformity to regulations.
Engagement with employees
Ensuring the company has the right culture and values is critical to the delivery of a first-class customer experience and our employees are fundamental to this. We aim to be a responsible employer in our approach to the pay and benefits our employees receive. The health, safety and well being of our employees is one of our primary considerations in the way we conduct business.

Key performance indicators
 
The company's key financial objectives which the directors judge to be effective in measuring the delivery of their strategies and managing the business concentrate on turnover, gross profit, profit before taxation, net current assets and net assets, all of which are shown in the accompanying pages and have been discussed above.
Key performance indicators are maintained across all parts of the business to ensure we are constantly monitoring and improving our business and supporting our people.

Page 3

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023


This report was approved by the board and signed on its behalf.



L M Felton
Director

Date: 21 August 2024
Page 4

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

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

On 29 July 2024, the directors resolved to change the name of the company from Cimbali UK Limited to Cimbali Group UK Limited.

Results and dividends

The profit for the year, after taxation, amounted to £13,568 (2022 - £41,980).

The directors do not recommend a dividend (2022 - £nil).

Directors

The directors who served during the year were:

E Bracesco (resigned 1 July 2024)
M Cimbali (resigned 1 July 2024)
L M Felton 

On 1 July 2024, A Clerici and S G Caverzaschi were appointed as directors.

Future developments

Whilst the directors continue to maintain a policy of cost control, the company has invested in its people, showrooms and facilities and continued with its long term strategy to promote the brand and products as well as ultimately seek to enhance the customer experience.
Matters covered in the Strategic report
As permitted by S414c(11) of the Companies Act 2006, the directors have elected to disclose information, required to be in the directors' report by Schedule 7 of the "Large and Medium Sized Companies and Groups (Accounts and Reports) Regulations 2008", in the strategic report.
Disclosure of information to auditor
Each of the persons who are directors at the time when this directors' report is approved has confirmed that:

so far as the director is aware, there is no relevant audit information of which the company's auditor is unaware; and
the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the company's auditor is aware of that information.

Going concern

As explained in Note 2.3 the directors have performed a thorough and robust assessment regarding the claims outlined in Note 21. They have carried out a detailed review of cash flow forecasts covering 12 months from the approval of these financial statements. The latest projections, show that the company is dependent on the support of its parent company, Cimbali Group SpA. The parent company has confirmed that it will continue to support the company for a minimum period of at least 12 months from the date of this report.
After making enquiries, and an assessment of the ability of Cimbali Group SpA, to support the company, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future, being a period of at least 12 months from approval of these accounts. Accordingly, they continue to adopt the going concern basis in preparing the annual report and accounts.

Page 5

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

This report was approved by the board and signed on its behalf.
 





L M Felton
Director

Date: 21 August 2024
Page 6

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)
 
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023

The directors are responsible for preparing the strategic report, the directors' report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period.

 In preparing these financial statements, the directors are required to:

select suitable accounting policies for the company's financial statements and then apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

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

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Page 7

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)
 FOR THE YEAR ENDED 31 DECEMBER 2023

Opinion


We have audited the financial statements of Cimbali Group UK Limited (Formerly Cimbali UK Limited) (the 'company') for the year ended 31 December 2023, which comprise the profit and loss account, the balance sheet, the statement of changes in equity and the notes to the financial statements, including significant accounting policiesThe 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 loss 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's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


Emphasis of matter - significant claims


We draw attention to Notes 2.3 and 21 of the Financial Statements, which describes significant claims that the company has received. Our opinion is not modified in respect of this matter.


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 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.


Page 8

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED) (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

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 reportOur 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.


Opinion on other matters 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 the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.


Matters on which we are required to report by exception
 

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


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


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 directors' responsibilities statement set out on page 7, 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.


Page 9

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED) (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

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.


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:

the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the company's sector;
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, and taxation legislation;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

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

making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

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

performed analytical procedures to identify any unusual or unexpected relationships;
tested a sample of journal entries to identify unusual transactions;
assessed whether judgements and assumptions made in determining the accounting estimates set out in note 3 were indicative of potential bias; and
investigated the rationale behind significant or unusual transactions.

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

agreeing financial statement disclosures to underlying supporting documentation;
reading the minutes of meetings of those charged with governance;
enquiring of management as to actual and potential litigation and claims; and
reviewing correspondence with HM Revenue and Customs, and the company’s legal advisors.
Page 10

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED) (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

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

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


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


Use of our report
 

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006Our 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.





Jaykishan Shah (senior statutory auditor)
  
for and on behalf of
Blick Rothenberg Audit LLP
 
Chartered Accountants
Statutory Auditor
  
16 Great Queen Street
Covent Garden
London
WC2B 5AH

 
Date: 
2 September 2024
Page 11

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)
 
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
13,552,037
14,026,904

Cost of sales
  
(10,736,121)
(10,567,111)

Gross profit
  
2,815,916
3,459,793

Distribution costs
  
(601,787)
(532,581)

Administrative expenses
  
(3,430,580)
(2,890,290)

Exceptional income
 5 
1,200,387
-

Operating (loss)/profit
 6 
(16,064)
36,922

Interest receivable and similar income
 9 
13,456
3,885

(Loss)/profit before taxation
  
(2,608)
40,807

Tax on (loss)/profit
 10 
16,176
(82,787)

Profit/(loss) for the financial year
  
13,568
(41,980)

There are no items of other comprehensive income for either the year or the prior year other than the profit for the year and loss for the prior year. Accordingly, no statement of other comprehensive income has been presented.

Page 12


 
REGISTERED NUMBER:01093795
CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 11 
846,234
929,463

Current assets
  

Stocks
 12 
2,008,281
3,089,100

Debtors: amounts falling due within one year
 13 
3,729,177
2,945,865

Cash at bank and in hand
 14 
1,160,946
2,463,584

  
6,898,404
8,498,549

Creditors: amounts falling due within one year
 15 
(6,373,835)
(8,249,971)

Net current assets
  
 
 
524,569
 
 
248,578

Total assets less current liabilities
  
1,370,803
1,178,041

Provisions for liabilities
  

Deferred tax
 16 
(66,611)
(82,787)

Other provisions
 17 
(799,674)
(604,304)

  
 
 
(866,285)
 
 
(687,091)

Net assets
  
504,518
490,950


Capital and reserves
  

Called up share capital 
 18 
10,000
10,000

Profit and loss account
 19 
494,518
480,950

Total equity
  
504,518
490,950


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




L M Felton
Director

Date: 21 August 2024

The notes on pages 15 to 29 form part of these financial statements.
Page 13

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023


Called up share capital
Profit and loss account
Total equity

£
£
£


At 1 January 2022
10,000
522,930
532,930


Comprehensive income for the year

Loss for the financial year
-
(41,980)
(41,980)
Total comprehensive income for the year
-
(41,980)
(41,980)



At 1 January 2023
10,000
480,950
490,950


Comprehensive income for the year

Profit for the financial year
-
13,568
13,568
Total comprehensive income for the year
-
13,568
13,568


At 31 December 2023
10,000
494,518
504,518
Page 14

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

The principal activity of the company during the year continued to be that of the selling and maintenance of coffee machines.
The company is a private company limited by shares incorporated in England and Wales. The address of its registered office is Unit 280, Centennial Avenue, Elstree, Hertfordshire, WD6 3ST.
The company is a wholly owned subsidiary of Cimbali Group S.p.A, a company incorporated in Italy. It is included in the consolidated financial statements of Cimbali Group S.p.A which are publicly available. Copies of the group financial statements are available to the public from Cimbali Group S.p.A, Via A Manzoni 17, 20082 Binasco (MI), Italy.
The financial statements are presented in Sterling (£), which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £. 

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the company's accounting policies (see note 3).

The following principal accounting policies have been applied:

 
2.2

Financial Reporting Standard 102 - reduced disclosure exemptions

The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
the requirements of Section 7 Statement of Cash Flows;
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of Cimbali Group S.p.A as at 31 December 2023 and these financial statements may be obtained from its registered office.

Page 15

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.3

Going concern

The company’s business activities, together with the factors likely to affect its future development, its financial position, financial risk management objectives and its exposure to risks are described in the strategic report.
The directors have performed a thorough and robust assessment regarding the claims outlined in Note 21. They have carried out a detailed review of cash flow forecasts covering 12 months from the approval of these financial statements. The latest projections, show that the company is dependent on the support of its parent company, Cimbali Group S.p.A. The parent company has confirmed that it will continue to support the company for a minimum period of at least 12 months from the date of this report.
After making enquiries, and an assessment of the ability of Cimbali Group S.p.A, to support the company, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future, being a period of at least 12 months from approval of these accounts. Accordingly, they continue to adopt the going concern basis in preparing the annual report and accounts.

 
2.4

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
the company has transferred the significant risks and rewards of ownership to the buyer;
the company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the company will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Sale of maintenance contracts and rendering of repairs and servicing
Revenue from sales of maintenance contracts is recognised on a straight-line basis over the term of the contract.
Revenue from repairs and servicing is recognised in the period in which the services are provided.

Page 16

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.5

Foreign currency translation

Functional and presentation currency

The company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss.

 
2.6

Operating leases: the company as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.7

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.8

Pensions

Defined contribution pension plan

The company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid the company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the balance sheet. The assets of the plan are held separately from the company in independently administered funds.

Page 17

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.9

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in the profit and loss account, except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
 
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

 
2.10

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.

Land is not depreciated. Depreciation on other assets is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Freehold property
-
4%
Short-term leasehold property
-
Straight line over the lease term
Plant and machinery
-
20% - 33%
Fixtures and fittings
-
20% - 33%

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

Page 18

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.11

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis.

At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.
 

2.12

Financial instruments

The company has elected to apply Sections 11 and 12 of FRS 102 in respect of financial instruments.

Financial assets and financial liabilities are recognised when the company becomes party to the contractual provisions of the instrument. 

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 company after deducting all of its liabilities. 
 
The company’s policies for its major classes of financial assets and financial liabilities are set out below. 

Financial assets
Basic financial assets, including trade and other debtors, and cash and bank balances are initially recognised at transaction price, 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 for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate.

Such assets are subsequently carried at amortised cost using the effective interest method, less any impairment.

Financial liabilities

Basic financial liabilities, including trade and other creditors, and loans from fellow group companies 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 for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate.

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

Page 19

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)





Financial instruments (continued)

Impairment of financial assets
Financial assets measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the profit and loss account. 

For financial assets measured at cost less impairment, the impairment loss is measured as the difference between the asset's carrying amount and the best estimate of the amount the company would receive for the asset if it were to be sold at the reporting date. 

For financial assets measured at amortised cost, the impairment loss is measured as the difference between the asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If the financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.

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 and financial liabilities
Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions. 
 
Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.

Offsetting of financial assets and financial liabilities
Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is an 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.

 
2.13

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. 

Page 20

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.14

Provisions for liabilities

Provisions are made where an event has taken place that gives the company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charge as an expense to the profit or loss in the year that the company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation.
When payments are eventually made, they are charge to the provision carried in the balance sheet.

  
2.15

Provision for product warranty

Provisions for warranty liabilities are recognised at the time of sale, based on historic experience of total cost of the warranty period and actual costs incurred.

  
2.16

Share capital

Ordinary shares are classified as equity.

 
2.17

Exceptional items

Exceptional items are transactions that fall within the ordinary activities of the company but are presented separately due to their size or incidence.

Page 21

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

3.


Judgements in applying accounting policies and key sources of estimation uncertainty

In the application of the company's accounting policies, which are described in note 2, the company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The key estimates and assumptions that have been made in arriving at the carrying amounts of assets and liabilities are addressed below:
(i) Stock provisioning
The carrying value of stock, at the lower of cost and net realisable value, is dependent on key judgements and estimates that are made by management. The judgements relating to stock include an estimation of future expected average sales prices and disposal costs. These judgements also include consideration of specific factors and the developments in the market that have been identified throughout the year and subsequent to the year end. Actual outcomes could be different to the assumptions used in determining the estimates.
(ii) Provision for liabilities
The company assesses all potential liabilities and uncertainties in light of requirements of FRS102 Section 21 Provisions and Contingencies. In particular, the company assesses whether the likelihood of settlement is probable in which case provisions are recognised when the amounts can be reliably estimated. These provisions require management's best estimate of the costs that will be incurred based on legislative and contractual requirements. In addition, the timing of the cash flows and the discount rates used to establish net present value of the obligations require management's judgement. Potential liabilities that are either not probable and/or cannot be reliably measured are treated as contingent liabilities and separately disclosed in the financial statements.
(iii) Provision for product warranty
The company provides a warranty for its products for specific periods of time.
The company provides for estimated warranty costs at the time the products are sold based on historical warranty claim experience, with consideration given to the expected level of future warranty costs, including current sales trends, the expected number of units to be affected and the estimated average repair cost per unit for warranty claims. This provision is continuously monitored to ensure that it is adequate to cover estimated warranty expenses. 


4.


Turnover

An analysis of turnover by class of business is as follows:


2023
2022
£
£

Machinery and spare parts
8,458,090
9,383,547

Maintenance contracts
1,944,215
2,569,859

Repairs and servicing
3,149,732
2,073,498

13,552,037
14,026,904


All turnover arose within the United Kingdom.

Page 22

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

5.


Exceptional income

2023
2022
£
£

Intercompany loan writen off
1,200,387
-



6.


Operating (loss)/profit

The operating (loss)/profit is stated after charging:

2023
2022
£
£

Depreciation of tangible fixed assets
280,275
189,350

Audit fees payable to the company's auditor
37,200
36,000

Non-audit fees payable to the company's auditor
27,423
15,103

Movement in bad debt provision
(6,060)
(42,908)

Foreign exchange losses
1,465
2,517

Operating lease rentals
222,167
221,406

Movement in stock provision
(2,220)
(34,734)


7.


Employees

Staff costs, including directors' remuneration, were as follows:


2023
2022
£
£

Wages and salaries
3,198,413
3,045,062

Social security costs
401,528
342,849

Cost of defined contribution scheme
190,759
143,551

3,790,700
3,531,462


The amount of defined contributions outstanding as at 31 December 2023 was £nil (2022: £nil).

The average monthly number of employees, including the directors, during the year was as follows:


        2023
        2022
            No.
            No.







Administrative staff
16
16



Engineers and technicians
59
47



Selling and distribution staff
9
15

84
78

Page 23

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

8.


Directors' remuneration




During the year retirement benefits were accruing to 1 director (2022 - 1) in respect of defined contribution pension schemes.

Key management includes the directors and members of senior management. The compensation paid or payable to key management for employees services for the year was £506,649 (2022: £668,722).


9.


Interest receivable

2023
2022
£
£


Other interest receivable
13,456
3,885


10.


Taxation


2023
2022
£
£



Deferred tax


Origination and reversal of timing differences
(16,176)
82,787


Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022 - higher than) the standard rate of corporation tax in the UK of 23.5% (2022 - 19%). The differences are explained below:

2023
2022
£
£


(Loss)/profit on ordinary activities before tax
(2,608)
40,807


(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 23.5% (2022 - 19%)
(613)
7,753

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
337
403

Capital allowances for year in excess of depreciation
43,413
(15,754)

Short-term timing difference leading to an increase in taxation
(16,176)
82,787

Non-taxable income less expenses not deductible for tax purposes, other than goodwill and impairment
(282,091)
-

Unrelieved tax losses carried forward
238,954
7,598

Total tax charge for the year
(16,176)
82,787

Page 24

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
10.Taxation (continued)



Factors that may affect future tax charges
At 31 December 2023 the company had a deferred tax asset in respect of losses carried forward of £672,167 (2022: £427,645), valued at 25%, which has not been recognised in the financial statements due to uncertainty over timing of future profits to utilise the losses.


11.


Tangible fixed assets





Freehold property
Short-term leasehold property
Plant and machinery
Fixtures and fittings
Total

£
£
£
£
£



Cost


At 1 January 2023
1,205,252
749,782
73,604
201,745
2,230,383


Additions
-
108,300
46,262
42,484
197,046



At 31 December 2023

1,205,252
858,082
119,866
244,229
2,427,429



Depreciation


At 1 January 2023
704,756
435,718
54,988
105,458
1,300,920


Charge for the year
41,640
175,041
13,526
50,068
280,275



At 31 December 2023

746,396
610,759
68,514
155,526
1,581,195



Net book value



At 31 December 2023
458,856
247,323
51,352
88,703
846,234



At 31 December 2022
500,496
314,064
18,616
96,287
929,463

Included within freehold property is land at an estimated cost of £129,200 (2022: £129,200) which is not depreciated.


12.


Stocks

2023
2022
£
£

Finished goods and goods for resale
2,008,281
3,089,100


There is no significant difference between the replacement cost of the stock and its carrying value.

Page 25

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

13.


Debtors

2023
2022
£
£


Trade debtors
3,218,298
2,704,999

Other debtors
3,659
3,659

Prepayments and accrued income
507,220
237,207

3,729,177
2,945,865



14.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
1,160,946
2,463,584



15.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
784,531
562,031

Amounts owed to group undertakings
4,412,010
6,453,869

Corporation tax
242
242

Other taxation and social security
350,471
172,013

Other creditors
418,738
408,410

Accruals and deferred income
407,843
653,406

6,373,835
8,249,971


Amounts owed to group undertakings are interest free, have no fixed repayment date and are repayable on demand.

Page 26

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

16.


Deferred taxation




2023


£






At beginning of year
(82,787)


Charged to profit or loss
16,176



At end of year
(66,611)

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Accelerated capital allowances
(66,611)
(82,787)


17.


Provisions




Warranty provision
Other provisions
Dilapidation provision
Total

£
£
£
£





At 1 January 2023
266,304
48,000
290,000
604,304


Charged to profit or loss
719,629
-
108,300
827,929


Utilised in year
(632,559)
-
-
(632,559)



At 31 December 2023
353,374
48,000
398,300
799,674


18.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



10,000 (2022 - 10,000) Ordinary shares of £1.00 each
10,000
10,000


The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the company.


19.


Reserves

Profit and loss account

The profit and loss reserve includes all current and prior period retained profits and losses.
Page 27

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
20.


Analysis of net debt





At 1 January 2023
Cash flows
Other non-cash changes
At 31 December 2023
£

£

£

£

Cash at bank and in hand

2,463,584

(1,302,638)

-

1,160,946

Amounts owed to parent undertaking

(6,453,869)

841,472

1,200,387

(4,412,010)


(3,990,285)
(461,166)
1,200,387
(3,251,064)


21.


Contingent liabilities

As at the year-end date, the company has two formal claims open in relation to separate incidents at customer sites with a total claims value of £23.63m. 
 
As with any company in this industry there is a risk of claims arising from supplies and services that we perform. The directors are aware of two claims in relation to incidents at customer sites which occurred in 2016 and 2021 respectively. The directors’ view is that the obligations are uncertain and the amount of economic benefit that the company will transfer cannot be reliably estimated. At the date of this report, the company is seeking legal advice in respect of the two claims, however no legal proceedings have been initiated. 
 
Whilst the company will continue to vigorously defend their position the directors have taken a cautious view and disclosed the full amount of the claims as a contingent liability, reflecting a worst-case scenario. As with all estimates there is a possibility that the actual economic outflow in relation to the claims could be materially lower than the amounts disclosed, particularly as any possible outflow could be partially covered by an insurance policy held by the company.
 
The directors have considered the implications of a material outflow on their going concern assessment of the company and this assessment is disclosed in Note 2.3 of these financial statements.

Page 28

 

CIMBALI GROUP UK LIMITED (FORMERLY CIMBALI UK LIMITED)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

22.


Commitments under operating leases

At 31 December 2023 the company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£

Land and buildings


Not later than 1 year
209,416
210,666

Later than 1 year and not later than 5 years
191,964
401,380

Total land and buildings lease commitments
401,380
612,046

2023
2022

£
£

Other leases


Not later than 1 year
117,944
79,888

Later than 1 year and not later than 5 years
191,992
98,595

Total other lease commitments
309,936
178,483


23.


Related party transactions

The company has taken advantage of the exemption contained in FRS 102 section 33 "Related Party Disclosures" from disclosing transactions with entities which are a wholly owned part of the group.


24.


Ultimate parent undertaking and controlling party

The immediate parent undertaking is Cimbali Group S.p.A.
The parent undertaking of the smallest group of undertakings for which group financial statements are drawn up and of which the company is a member is Cimbali Group S.p.A a company incorporated in Italy, whose registered office is at Via A Manzoni 17, 20082 Binasco (MI), Italy. Copies of these group financial statements are available to the public from its registered office.
The ultimate parent company is Cimbali Group S.p.A, a company incorporated in Italy.
In the opinion of the directors the ultimate controlling party is the Cimbali family.
 
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