Company registration number SC065519 (Scotland)
ALLIED INTERNATIONAL UK LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
ALLIED INTERNATIONAL UK LTD
COMPANY INFORMATION
Directors
Mr V Alberici
Mrs S Kirby
Mr M Kirby
Mr M Duncan
Secretary
Mrs S Kirby
Company number
SC065519
Registered office
Allied Buildings
Earls Road
Grangemouth
Falkirk
FK3 8XG
Auditor
Johnston Smillie Ltd
5 South Gyle Crescent Lane
Edinburgh
EH12 9EG
ALLIED INTERNATIONAL UK LTD
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Statement of comprehensive income
7
Balance sheet
8
Statement of changes in equity
9
Statement of cash flows
10
Notes to the financial statements
11 - 23
ALLIED INTERNATIONAL UK LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -

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

 

The Company remains part of the Allied International Group of Companies who support the business with products from its global manufacturing resources. The Company continues to make very good use of these production facilities in its UK marketplace business.

 

The business had an exceptional year and once again saw an increase in projected turnover & profit against initial projections. This can be associated with various factors such as continually high energy prices, material supply constraints and release of new projects to meet the demands of energy supply.

 

Turnover increased from £14.7m in 2022 to £24.4m in 2023.

 

The business continues to adapt to changing market conditions, notably increasing focus on nuclear and green energy projects, whilst continuing to have focus on oil and gas markets. All commercial activities have been restructured to our geographical locations in Grangemouth, Aberdeen & Teeside.

 

The principal activity of the company continued to be that of manufacture and supply of pipeline products to the home and overseas oil, gas, petrochemical and nuclear sectors, with the focus remaining on the UK marketplace. The business continues to manage foreign exchange risk and currency fluctuations through continuing assessment and regular reviews with relevant processes implemented to monitor such risks. The company continues to ensure supply payments are made in accordance with the latest regulations.

 

The continued strength of trading has again enabled a strong liquidity to support growth for the business over its UK locations, supporting an even larger range of stock and opportunities with previously unattainable projects. The company continues to review its position in the marketplace and continues to explore new opportunities in all market sectors which utilise the products of the business. To ensure the company's position in the marketplace is maintained, diversification remains key to its success.

 

Key business risks were again identified as strong competition in the sectors in which the company operates along with currency exchange impacts. Any gains and losses as a result of currency exchanges were absorbed in currency fluctuations in the Profit & Loss Account. All risks continue to be regularly assessed by the Directors, with appropriate IT system controls and processes used to monitor them. KPIs and 5S strategies continue to be operated for the on-going improvement of the business. The business continues to invest in accreditation of ISO9001, I4001 & 45001 in recognition of major customers increasing requirements on its supply sources.

 

The upward trend of the marketplace is expected to continue in the following year but the company will continue to act cautiously.

 

On the basis of the Directors continuing assessment of the marketplace and our customers, the Company is still expected to return a reasonable contribution for 2024 in line with budget expectations.

On behalf of the board

Mr M Duncan
Director
24 July 2024
ALLIED INTERNATIONAL UK LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -

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

Principal activities
The principal activity of the Company continued to be that of manufacture and supply of pipeline products to the home and overseas oil and gas sectors.
Results and dividends

The results for the year are set out on page 7.

Ordinary dividends were paid amounting to £1,609,590. 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 V Alberici
Mrs S Kirby
Mr M Kirby
Mr M Duncan
Auditor

The Auditors, Johnston Smillie Ltd, are deemed to be reappointed under section 487(2) of the Companies Act 2006.

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 company’s auditor 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 company’s auditor is aware of that information.

On behalf of the board
Mr M Duncan
Director
24 July 2024
ALLIED INTERNATIONAL UK LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -

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 company and of the profit or loss of the company 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 company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

ALLIED INTERNATIONAL UK LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ALLIED INTERNATIONAL UK LTD
- 4 -
Opinion

We have audited the financial statements of Allied International UK Ltd (the 'company') for the year ended 31 December 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, the 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 company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

 

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

ALLIED INTERNATIONAL UK LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ALLIED INTERNATIONAL UK LTD
- 5 -
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:

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 company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

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

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

We obtained an understanding of the legal and regulatory frameworks applicable to the company, focusing on provisions of those laws and regulations which could have a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act and local tax legislation.

 

We assessed the susceptibility of the company’s financial statements to material misstatement, including how fraud might occur, by considering our knowledge of the company and the sector in which it operates and by discussion with staff and those charged with governance. We considered the procedures and controls that are in place to address risks identified, or that otherwise prevent, deter and detect fraud.

 

Based on this understanding we designed our audit procedures to detect circumstances in which irregularities could result in material misstatement and to identify irregularities which may have occurred. Our procedures included: journal entry testing; enquiries of staff and those charged with governance; review of Board minutes; review of specific transactions and documentation; analytical procedures; and review of the presentation and disclosures in the financial statements.

 

We communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or non compliance with laws and regulations throughout the audit.

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

ALLIED INTERNATIONAL UK LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ALLIED INTERNATIONAL UK LTD
- 6 -

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.

For and on behalf of Johnston Smillie Ltd
24 July 2024
Chartered Accountants
Statutory Auditor
5 South Gyle Crescent Lane
Edinburgh
EH12 9EG
ALLIED INTERNATIONAL UK LTD
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
24,463,111
14,664,901
Cost of sales
(17,862,936)
(11,236,891)
Gross profit
6,600,175
3,428,010
Distribution costs
(519,825)
(431,530)
Administrative expenses
(2,301,132)
(1,388,430)
Operating profit
4
3,779,218
1,608,050
Interest receivable and similar income
15,769
-
0
Interest payable and similar expenses
6
(20,544)
(17,275)
Profit before taxation
3,774,443
1,590,775
Tax on profit
7
(914,175)
(305,313)
Profit for the financial year
2,860,268
1,285,462

The profit and loss account has been prepared on the basis that all operations are continuing operations.

ALLIED INTERNATIONAL UK LTD
BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
9
2,118,200
2,073,595
Investments
10
4,800
4,800
2,123,000
2,078,395
Current assets
Stocks
11
5,851,240
4,727,587
Debtors
12
2,291,300
2,124,160
Cash at bank and in hand
2,799,672
2,296,851
10,942,212
9,148,598
Creditors: amounts falling due within one year
13
(4,564,480)
(3,695,877)
Net current assets
6,377,732
5,452,721
Total assets less current liabilities
8,500,732
7,531,116
Creditors: amounts falling due after more than one year
14
-
0
(290,114)
Provisions for liabilities
Deferred tax liability
17
46,402
37,350
(46,402)
(37,350)
Net assets
8,454,330
7,203,652
Capital and reserves
Called up share capital
20
70,000
70,000
Profit and loss reserves
8,384,330
7,133,652
Total equity
8,454,330
7,203,652
The financial statements were approved by the board of directors and authorised for issue on 24 July 2024 and are signed on its behalf by:
Mrs S Kirby
Mr M Duncan
Director
Director
Company registration number SC065519 (Scotland)
ALLIED INTERNATIONAL UK LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 January 2022
70,000
6,473,190
6,543,190
Year ended 31 December 2022:
Profit and total comprehensive income
-
1,285,462
1,285,462
Dividends
8
-
(625,000)
(625,000)
Balance at 31 December 2022
70,000
7,133,652
7,203,652
Year ended 31 December 2023:
Profit and total comprehensive income
-
2,860,268
2,860,268
Dividends
8
-
(1,609,590)
(1,609,590)
Balance at 31 December 2023
70,000
8,384,330
8,454,330
ALLIED INTERNATIONAL UK LTD
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
24
3,377,432
2,054,541
Interest paid
(20,544)
(17,275)
Income taxes paid
(698,044)
(104,766)
Net cash inflow from operating activities
2,658,844
1,932,500
Investing activities
Purchase of tangible fixed assets
(161,405)
(93,664)
Proceeds on disposal of tangible fixed assets
4,250
13,820
Interest received
15,769
-
0
Net cash used in investing activities
(141,386)
(79,844)
Financing activities
Repayment of bank loans
(388,261)
(121,824)
Payment of finance leases obligations
(16,786)
(46,643)
Dividends paid
(1,609,590)
(625,000)
Net cash used in financing activities
(2,014,637)
(793,467)
Net increase in cash and cash equivalents
502,821
1,059,189
Cash and cash equivalents at beginning of year
2,296,851
1,180,822
Cash and cash equivalents at end of year
2,799,672
2,296,851
ALLIED INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
1
Accounting policies
Company information

Allied International UK Ltd is a private company limited by shares incorporated in Scotland. The registered office is Allied Buildings, Earls Road, Grangemouth, Falkirk, FK3 8XG.

1.1
Accounting convention
The financial statements are prepared under the historical cost convention as modified by the revaluation of certain assets.

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.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company 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.

1.3
Turnover
Turnover represents amounts derived from the provision of goods and services which fall within the company's ordinary activities after deduction of trade discounts and value added tax.

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.

1.4
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.

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 property
2% Straight line
Plant and machinery
25% on reducing balance and 10% on reducing balance
Office equipment
25% on cost and 20% - 25% on reducing balance
Motor vehicles
25% on reducing balance

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.

1.5
Fixed asset investments

Interests in subsidiaries, associates and jointly controlled entities 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.

ALLIED INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 12 -

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 company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

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

1.6
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, 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.

1.7
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.

1.8
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.

ALLIED INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
1.9
Financial instruments
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.

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.

Trade debtors, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as 'loans and receivables'. Loans and receivables are measured at amortised cost using the effective interest method, less any impairment.

 

Interest is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial.

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 company 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 company after deducting all of its liabilities.

ALLIED INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
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.

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.

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.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.10
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.

1.11
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.

ALLIED INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
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 when the company has 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.

1.12
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.

1.13
Retirement benefits

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

1.14
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.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

1.15
Foreign exchange
Monetary assets and liabilities denominated in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Exchange differences are taken into account in arriving at the operating result.
ALLIED INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
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.

3
Turnover and other revenue

An analysis of the company's turnover is as follows:

2023
2022
£
£
Turnover analysed by class of business
Sales of goods
24,463,111
14,664,901
2023
2022
£
£
Turnover analysed by geographical market
UK
19,658,981
12,426,416
Overseas
4,804,130
2,238,485
24,463,111
14,664,901
2023
2022
£
£
Other revenue
Interest income
15,769
-
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses
118,790
56,682
Fees payable to the company's auditor for the audit of the company's financial statements
18,810
10,840
Depreciation of owned tangible fixed assets
113,817
90,181
Depreciation of tangible fixed assets held under finance leases
-
24,309
Profit on disposal of tangible fixed assets
(1,267)
(5,797)
Operating lease charges
84,756
60,298
ALLIED INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
5
Employees

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

2023
2022
Number
Number
Sales
16
17
Production/Warehouse
31
33
Administration
6
6
Total
53
56

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
2,712,224
1,949,660
Social security costs
302,124
212,887
Pension costs
43,841
31,913
3,058,189
2,194,460

 

6
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
19,448
15,397
Other finance costs:
Interest on finance leases and hire purchase contracts
1,096
1,878
20,544
17,275
7
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
905,123
298,044
Deferred tax
Origination and reversal of timing differences
9,052
7,269
Total tax charge
914,175
305,313
ALLIED INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
7
Taxation
(Continued)
- 18 -

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
3,774,443
1,590,775
Expected tax charge based on the standard rate of corporation tax in the UK of 23.50% (2022: 19.00%)
886,994
302,247
Tax effect of expenses that are not deductible in determining taxable profit
8,328
2,151
Permanent capital allowances in excess of depreciation
9,801
(6,354)
Deferred tax movement
9,052
7,269
Taxation charge for the year
914,175
305,313
8
Dividends
2023
2022
£
£
Interim paid
1,609,590
625,000
9
Tangible fixed assets
Leasehold property
Plant and machinery
Office equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2023
2,139,419
1,333,452
197,673
139,671
3,810,215
Additions
107,465
19,097
15,853
18,990
161,405
Disposals
-
0
-
0
(4,670)
(8,800)
(13,470)
At 31 December 2023
2,246,884
1,352,549
208,856
149,861
3,958,150
Depreciation and impairment
At 1 January 2023
379,539
1,138,476
161,329
57,276
1,736,620
Depreciation charged in the year
33,720
46,467
12,689
20,941
113,817
Eliminated in respect of disposals
-
0
-
0
(3,654)
(6,833)
(10,487)
At 31 December 2023
413,259
1,184,943
170,364
71,384
1,839,950
Carrying amount
At 31 December 2023
1,833,625
167,606
38,492
78,477
2,118,200
At 31 December 2022
1,759,880
194,976
36,344
82,395
2,073,595
ALLIED INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
9
Tangible fixed assets
(Continued)
- 19 -

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

2023
2022
£
£
Plant and machinery
-
0
116,818
10
Fixed asset investments
2023
2022
£
£
Unlisted investments
4,800
4,800

The company has not designated any financial assets that are not classified as financial assets at fair value through profit or loss.

11
Stocks
2023
2022
£
£
Finished goods and goods for resale
5,851,240
4,727,587
12
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
2,221,909
2,046,682
Prepayments and accrued income
69,391
77,478
2,291,300
2,124,160

Trade debtors disclosed above are measured at amortised cost.

Total trade debtors (net of allowances) held by the company at 31 December 2023 amounted to £2,221,909 (2022 - £2,046,682), comprising the amount presented above and trade debtors classified as held for sale amounting to £- (2022 - £-).

ALLIED INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
13
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans
15
-
0
98,147
Obligations under finance leases
16
-
0
16,786
Trade creditors
807,233
1,464,582
Amounts owed to group undertakings
2,552,167
708,495
Corporation tax
505,123
298,044
Other taxation and social security
485,074
353,911
Deferred income
18
-
0
524,229
Other creditors
178,560
203,560
Accruals and deferred income
36,323
28,123
4,564,480
3,695,877
14
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
15
-
0
290,114
15
Loans and overdrafts
2023
2022
£
£
Bank loans
-
0
388,261
Payable within one year
-
0
98,147
Payable after one year
-
0
290,114

Bank borrowings are secured by a standard security over the properties at Grangemouth and Aberdeen and a floating charge over the assets of the company.

The loan taken out in March 2019, provided by the Clydesdale Bank, was repaid during the year.

16
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
-
0
16,786

Net obligations under hire purchase contracts are secured over the assets to which they relate.

ALLIED INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
17
Deferred taxation

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

Liabilities
Liabilities
2023
2022
Balances:
£
£
ACAs
46,402
37,350
2023
Movements in the year:
£
Liability at 1 January 2023
37,350
Charge to profit or loss
9,052
Liability at 31 December 2023
46,402
18
Deferred income
2023
2022
£
£
Other deferred income
-
524,229
19
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
43,841
31,913

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

20
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
A Ordinary shares of 10p each
700,000
700,000
70,000
70,000
ALLIED INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
21
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2023
2022
£
£
Within one year
62,000
66,950
Between two and five years
310,000
248,000
In over five years
5,167
5,167
377,167
320,117
22
Related party transactions
Remuneration of key management personnel

The remuneration of key management personnel is as follows.

2023
2022
£
£
Aggregate compensation
1,062,290
501,440
Transactions with related parties

During the year the company entered into the following transactions with related parties:

Sales
Sales
Purchases
Purchases
2023
2022
2023
2022
£
£
£
£
Entities with control, joint control or significant influence over the company
-
0
-
0
2,784,902
392,839
Other related parties
87,228
399,514
5,758,305
1,459,701

The following amounts were outstanding at the reporting end date:

2023
2022
Amounts due to related parties
£
£
Entities with control, joint control or significant influence over the company
2,031,622
780,348
Other related parties
520,545
-
ALLIED INTERNATIONAL UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
22
Related party transactions
(Continued)
- 23 -

The following amounts were outstanding at the reporting end date:

2023
2022
Amounts due from related parties
£
£
Other related parties
-
71,853
23
Ultimate controlling party

At the reporting end date the company was ultimately controlled by Allied International S.R.L., which owns 100% of the shares in the company and is registered in Italy.

24
Cash generated from operations
2023
2022
£
£
Profit for the year after tax
2,860,268
1,285,462
Adjustments for:
Taxation charged
914,175
305,313
Finance costs
20,544
17,275
Investment income
(15,769)
-
0
Gain on disposal of tangible fixed assets
(1,267)
(5,797)
Depreciation and impairment of tangible fixed assets
113,817
114,490
Movements in working capital:
Increase in stocks
(1,123,653)
(845,495)
Increase in debtors
(167,140)
(41,706)
Increase in creditors
1,300,686
700,770
(Decrease)/increase in deferred income
(524,229)
524,229
Cash generated from operations
3,377,432
2,054,541
25
Analysis of changes in net funds
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
2,296,851
502,821
2,799,672
Borrowings excluding overdrafts
(388,261)
388,261
-
Obligations under finance leases
(16,786)
16,786
-
1,891,804
907,868
2,799,672
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