Company registration number 09576146 (England and Wales)
OXFORD FLOW LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PAGES FOR FILING WITH REGISTRAR
OXFORD FLOW LIMITED
CONTENTS
Page
Balance sheet
1
Notes to the financial statements
2 - 9
OXFORD FLOW LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
5
67,428
128,793
Investments
6
2,000,100
2,000,100
2,067,528
2,128,893
Current assets
Stocks
916,486
746,506
Debtors
7
1,378,541
920,863
Cash at bank and in hand
2,122,628
1,620,045
4,417,655
3,287,414
Creditors: amounts falling due within one year
8
(903,908)
(274,174)
Net current assets
3,513,747
3,013,240
Total assets less current liabilities
5,581,275
5,142,133
Creditors: amounts falling due after more than one year
9
(2,310,904)
(3,505,768)
Net assets
3,270,371
1,636,365
Capital and reserves
Called up share capital
10
1,230
911
Share premium account
17,576,212
13,271,590
Profit and loss reserves
(14,307,071)
(11,636,136)
Total equity
3,270,371
1,636,365
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 5 September 2024 and are signed on its behalf by:
Mr N R Poxon
Director
Company registration number 09576146 (England and Wales)
OXFORD FLOW LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
1
Accounting policies
Company information
Oxford Flow Limited is a private company limited by shares incorporated in England and Wales. The registered office is Oxford Flow, Osney Mead, Oxford, OX2 0ES.
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 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
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. The principal accounting policies adopted are set out below.
The company has taken advantage of the exemption under section 399 of the Companies Act 2006 not to prepare consolidated accounts, on the basis that the group of which this is the parent qualifies as a small group. The financial statements present information about the company as an individual entity and not about its group.
1.2
Going concern
The company meets its day to day working capital requirements through cash at bank and funding from its shareholders. Detailed profit and cash flow forecasts, prepared by the directors, demonstrated that in order to continue to meet these requirements for a period of 12 months from the sign off of these financial statements, additional funding would be required. true
Subsequent to 31 December 2023, and as part of a planned fund-raising initiative, the company agreed the key terms of a potential multi-million pound investment into Oxford Flow by a major international industrial corporation and a global venture capital firm that invests in climate-focused platforms. Whilst the terms of the current arrangement do not constitute a legally-binding obligation for either party to enter into an agreement, the directors do not consider there to be any material uncertainty that may cast significant doubt on the company's ability to successfully conclude this transaction. Taking this into account, the directors remain confident that the company will continue to be able to meet its liabilities as they fall due for a period of at least 12 months following approval of these financial statements and therefore consider it appropriate to continue to prepare the company’s financial statements on a going concern basis.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
OXFORD FLOW LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 3 -
1.4
Research and development expenditure
/
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
1.5
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:
Leasehold improvements
33% straight line
Plant and equipment
20% straight line
Fixtures and fittings
10 - 20% straight line
Computers
33% straight line
Motor vehicles
25% straight line
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 credited or charged to profit or loss.
1.6
Fixed asset investments
Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.7
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible 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.
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.
1.8
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis.
OXFORD FLOW LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 4 -
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.
1.9
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand and deposits held at call with banks.
1.10
Financial instruments
The company 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 company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include 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.
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 company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors and loans, 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.
OXFORD FLOW LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 5 -
1.11
Compound instruments
The component parts of compound instruments issued by the company are classified separately as financial liabilities and equity in accordance with the substance of the contractual arrangement. At the date of issue, the fair value of the liability component is estimated using the prevailing market interest rate for a similar non-convertible instrument. This amount is recorded as a liability on an amortised cost basis using the effective interest method until extinguished upon conversion or at the instrument's maturity date. The equity component is determined by deducting the amount of the liability component from the fair value of the compound instrument as a whole. This is recognised and included in equity net of income tax effects and is not subsequently remeasured.
1.12
Equity instruments
Equity instruments issued by the company 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 company.
1.13
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 company’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 assets are not recognised when it is not probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
1.14
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense.
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.
1.15
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.16
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
OXFORD FLOW LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 6 -
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.
Government grants relating to turnover are recognised as income over the periods when the related costs are incurred. Grants relating to an asset are recognised in income systematically over the asset's expected useful life. If part of such a grant is deferred it is recognised as deferred income rather than being deducted from the asset's carrying amount.
1.18
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying 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.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Redemption premium on convertible loan note
During the year the company issued convertible loan notes of £2.2 million. A further £2.2 million redemption premium becomes payable upon maturity of the loan notes unless there is a conversion event. The directors are required to assess the likelihood of a future conversion event and have concluded that conversion is probable. Therefore the £2.2 million redemption premium has not been recognised at the balance sheet date.
Recoverability of investments held in subsidiary undertakings
The directors are required to perform an impairment review of the cost of investment held in subsidiary undertakings. They have concluded that no impairment provision is necessary based upon the projected pay back period of the investment.
Key sources of estimation uncertainty
Share options
The directors have estimated the value of the share based payment charge using the Black Scholes option pricing model. This valuation is sensitive to a number of key inputs including expected volatility, share price and the risk free rate. The directors have concluded that the share based payment charge is immaterial to recognise within the financial statements.
OXFORD FLOW LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
3
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
16
20
4
Taxation
The company has tax losses of £14,008,176, available to set against future taxable profits. The associated deferred tax asset has not been recognised at the balance sheet date due to uncertainty over the timing of future profits.
5
Tangible fixed assets
Land and buildings
Plant and machinery etc
Total
£
£
£
Cost
At 1 January 2023 and 31 December 2023
58,228
309,009
367,237
Depreciation and impairment
At 1 January 2023
38,375
200,069
238,444
Depreciation charged in the year
16,501
44,864
61,365
At 31 December 2023
54,876
244,933
299,809
Carrying amount
At 31 December 2023
3,352
64,076
67,428
At 31 December 2022
19,853
108,940
128,793
6
Fixed asset investments
2023
2022
£
£
Shares in group undertakings and participating interests
2,000,100
2,000,100
OXFORD FLOW LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
7
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
118,067
198,662
Amounts owed by group undertakings
1,094,064
391,198
Other debtors
166,410
331,003
1,378,541
920,863
8
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
532,687
58,080
Taxation and social security
43,634
38,517
Other creditors
327,587
177,577
903,908
274,174
9
Creditors: amounts falling due after more than one year
2023
2022
£
£
Convertible loans
2,310,904
3,489,863
Other creditors
15,905
2,310,904
3,505,768
In 2020 the company issued unsecured convertible loan notes of £3 million. Interest of 8% accrued and became payable upon default or conversion. The conversion criteria was met in July 2023 which triggered the conversion of the loan notes, along with all accrued interest, into new equity issues as set out in the terms of the convertible loan note agreement.
During the current year the company issued new unsecured convertible loan notes of £2.2 million. Interest of 10% accrues and is payable upon default or conversion. The loan notes have a maturity date of June 2026, prior to which there are several potential conversion events. The potential post year end fund-raising initiative disclosed in accounting policy 1.2 would qualify as a conversion event which would trigger the conversion of the loan notes, along with all accrued interest, into new equity issues. Given this fundraise is not legally binding at the date of approval of accounts, the convertible loan note balance has not been reclassified to current liabilities at the balance sheet date.
OXFORD FLOW LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
10
Called up share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of 0.01p each
6,952,342
6,942,433
696
695
Ordinary B shares of 0.0001p each
983,667
983,667
1
1
Ordinary P shares of 0.01p each
5,343,354
2,148,673
533
215
13,279,363
10,074,773
1,230
911
11
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
Senior Statutory Auditor:
Lee Van Houplines FCA
Statutory Auditor:
MHA
12
Financial commitments, guarantees and contingent liabilities
During the year the company issued convertible loan notes of £2.2 million. A further £2.2 million redemption premium becomes payable upon maturity of the loan notes unless there is a conversion event. The directors anticipate that conversion is probable and therefore the £2.2 million redemption premium has not been recognised at the balance sheet date.
13
Operating lease commitments
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
2023
2022
£
£
142,095
78,870