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REGISTERED NUMBER: 14621068 (England and Wales)

































Group Strategic Report,

Report of the Directors and

Consolidated Financial Statements

For The Year Ended

31 December 2023

for

LAKELAND LABORATORIES HOLDINGS LIMITED

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)






Contents of the Consolidated Financial Statements
For The Year Ended 31 December 2023




Page

Company Information 1

Group Strategic Report 2

Report of the Directors 4

Statement of Directors' Responsibilities 6

Report of the Independent Auditors 7

Consolidated Profit and Loss Account 11

Consolidated Other Comprehensive Income 12

Consolidated Balance Sheet 13

Company Balance Sheet 14

Consolidated Statement of Changes in Equity 15

Company Statement of Changes in Equity 16

Consolidated Cash Flow Statement 17

Notes to the Consolidated Cash Flow Statement 18

Notes to the Consolidated Financial Statements 19


LAKELAND LABORATORIES HOLDINGS LIMITED

Company Information
For The Year Ended 31 December 2023







DIRECTORS: Mr P McCormack
Mr E Seddon
Mrs C Buckley
Ms S Oliver
Mr J Clark





SECRETARY:





REGISTERED OFFICE: Peel Lane Astley Green
Tyldesley
Manchester
Greater Manchester
M29 7FE





REGISTERED NUMBER: 14621068 (England and Wales)





AUDITORS: Leavitt Walmsley Associates Limited
Chartered Certified Accountants and
Statutory Auditors
8 Eastway
Sale
Cheshire
M33 4DX

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Group Strategic Report
For The Year Ended 31 December 2023

The directors present their strategic report of the company and the group for the year ended 31 December 2023.

REVIEW OF BUSINESS
The directors are satisfied with the group's performance for the year.

This is the first year the group has been required to prepare consolidated financial statements. Lakeland Laboratories Holdings Ltd was formed to effect a management buyout of Lakeland Laboratories Limited via the acquisition of Lakeland Chemicals Ltd. The purchase method of accounting has been used to consolidate the results of the group on the basis that merger accounting was unavailable due to a change in shareholders in the subsidiary (see 'Group restructuring' below).

The group continues to specialise in the manufacture of chemicals. The year ended 31 December 2023 recorded group turnover of £6.9m. Sales volumes in the sub-subsidiary had reduced from 2022 in addition to reduced selling prices. However, the directors remain satisfied with the levels of turnover.

Group administrative expenses were £765k. The trading subsidiary saw an overall reduction in administration costs which is largely attributable to a reduction in group payroll costs. Group finance costs increased due to the group taking out a bank loan and creating loan notes in order to effect the management buyout which completed on 4 April 2023.

Group profit before tax amounted to £1.9m. With the continuation of global supply issues and a gradual reduction in inflation, the group has continued to meet customer demands and maintain its customer base.

Group restructuring
On 4 April 2023, Lakeland Laboratories Holdings Limited entered into a management buyout. The use of the purchase method of accounting has been applied in the preparation of these consolidated financial statements.

All entities within the group have an accounting reference date of 31 December. Group profit and loss reports the ultimate parent's share of group profit since the date of acquisition, which is the date on which control is passed to the ultimate parent.

PRINCIPAL RISKS AND UNCERTAINTIES
The group has identified the following principal risks and uncertainties:

Currency risk
A proportion of the group's turnover is derived from overseas. Fluctuations in currency are a principal risk and the group manages this risk through natural hedges with sales and purchases in Euros and US Dollars.

Market risk
Market risk is the risk that the group will experience losses due to factors which affect the overall market in which the entity operates. To mitigate this risk, the group ensures competitive product pricing with respect to changes in material and energy costs.

KEY PERFORMANCE INDICATORS
The directors have monitored the progress of the group with reference to certain financial key performance indicators:

Turnover £6.9m
Gross profit £1.5m
Operating profit £641k
Net current assets £2.6m
Net assets £1.8m
Cash and cash equivalents £1.9m

Key performance indicators (KPIs) include revenue, gross profit and operating profit. These KPIs are selected as 'key' on the basis that the group is driven by gross profit margins on sales and the directors strive to keep margins as high as possible in order to preserve profit. Operating profit is also a KPI on the grounds that it is an indicator of business performance, whereas profit before tax may include exceptional items.


LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Group Strategic Report
For The Year Ended 31 December 2023

FUTURE DEVELOPMENTS
The group has devised a competitive pricing model for key materials and has mitigated exposure to logistical and product price increases by a formulaic pricing matrix. This ensure the group maintains its margins on key products. The group has a costing system in place to ensure that profitability is maintained on all sales.

Management is looking to further develop relations with its key customer base and strengthen business activity in the sector.

ON BEHALF OF THE BOARD:





Mr P McCormack - Director


27 August 2024

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Report of the Directors
For The Year Ended 31 December 2023

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

INCORPORATION
The group was incorporated on 27 January 2023 .

DIVIDENDS
No dividends will be distributed for the year ended 31 December 2023.

FUTURE DEVELOPMENTS
Future developments are addressed in the strategic report.

DIRECTORS
The directors who have held office during the period from 1 January 2023 to the date of this report are as follows:

Mr P McCormack - appointed 27 January 2023
Mr E Seddon - appointed 4 April 2023
Mrs C Buckley - appointed 4 April 2023
Ms S Oliver - appointed 4 April 2023
Mr J Clark - appointed 4 April 2023

All the directors who are eligible offer themselves for election at the forthcoming first Annual General Meeting.

FINANCIAL INSTRUMENTS
The group uses financial instruments. These include investments, bank balances, trade and other debtors and creditors that arise directly from its operations, loan notes and accruals.

The existence of these financial instruments exposes the group to a number of financial risks, which are described in more detail below:

Liquidity risk
The group seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest cash safely and profitably.

Interest rate risk
The group finances its operations through retained profits and bank balances. In 2023, the group secured a bank loan to carry out the management buyout. The interest rate exposure of the financial assets and liabilities of the group as at 31 December 2023 is shown below. The table includes trade debtors and trade creditors which do not attract interest and are therefore subject to fair value interest rate risk:

Fixed Floating Zero Total
£    £    £    £   
Financial assets
Trade debtors - - 1,171 1,171
Cash - 1,869 - 1,869

Fixed Floating Zero Total
Financial liabilities £    £    £    £   
Trade creditors - - 406 406
Other creditors - - 51 51
Loan notes 1,763 - - 1,763
Accruals - - 44 44
Bank loan 752 - - 752

Credit risk
The group's principal financial assets are cash and trade debtors. The credit risk associated with trade debtors is irrecoverable debts. The group manages this risk through credit checks on customers and the creditworthiness of customers is monitored continuously.


LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Report of the Directors
For The Year Ended 31 December 2023

GOING CONCERN
As at 31 December 2023, the group had free cash flow of £1.9m. It also has a strong forward order book.

The uncertainty as to the future impact on the group of external factors has been considered as part of the group's adoption of the going concern basis. The board has completed an assessment as to the potential impact to the group in the event of certain downside scenarios, including a significant deterioration in revenues and productivity.

These consolidated financial statements have been prepared on a going concern basis which the directors believe is appropriate for the following reasons:

The group currently meets its day-to-day working capital requirements through bank balances and group retained earnings. The directors have prepared budgets and forecasts and they are confident that the group has adequate resources available to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis of accounting in preparing these consolidated financial statements.

DISCLOSURE IN THE STRATEGIC REPORT
In accordance with s414c(11), Sch 7, Companies Act 2006, the group has chosen to set out in the group's strategic report information required by The Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008. It has done so in respect of:

(a) Future developments.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

AUDITORS
The auditors, Leavitt Walmsley Associates Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:





Mr P McCormack - Director


27 August 2024

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Statement of Directors' Responsibilities
For The Year Ended 31 December 2023

The directors are responsible for preparing the Group Strategic Report, the Report of the Directors 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 the group and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

- select suitable accounting policies and then apply them consistently;
- make judgements and accounting estimates that are reasonable and prudent;
- 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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Report of the Independent Auditors to the Members of
Lakeland Laboratories Holdings Limited

Opinion
We have audited the financial statements of Lakeland Laboratories Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023 which comprise the Consolidated Profit and Loss Account, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:
-give a true and fair view of the state of the group's and of the parent company affairs as at 31 December 2023 and of the group's profit for the year then ended;
-have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-have been prepared in accordance with the requirements of the Companies Act 2006.

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

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

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

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

Other information
The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report, the Report of the Directors and the Statement of Directors' Responsibilities, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether 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 the audit:
- the information given in the Group Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Group Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Report of the Independent Auditors to the Members of
Lakeland Laboratories Holdings Limited


Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
- adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
- the parent company financial statements are not in agreement with the accounting records and returns; or
- certain disclosures of directors' remuneration specified by law are not made; or
- we have not received all the information and explanations we require for our audit.

Responsibilities of directors
As explained more fully in the Statement of Directors' Responsibilities set out on page six, 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 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 group's and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.

Report of the Independent Auditors to the Members of
Lakeland Laboratories Holdings Limited


Auditors' 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 a Report of the Auditors 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:

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

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

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

- obtained an understanding of the nature of the industry and sector, including the legal and regulatory frameworks that the group and parent company operate in and how the group and parent company are complying with the legal and regulatory frameworks;

- inquired of management, and those charged with governance, about their own identification and assessment of the risks of irregularities, including any known, actual, or alleged instances of fraud; and

- discussed matters about non-compliance with laws and regulations and how fraud may occur including an assessment of how, and where, the financial statements may be susceptible to fraud.

As a result of these procedures, we consider the most significant laws and regulations that have a direct impact on the financial statements are FRS 102, the Companies Act 2006 and tax legislation. We performed audit procedures to detect non-compliance which may have a material impact on the financial statements which included reviewing financial statement disclosures, inspecting correspondence with local tax authorities and evaluating advice received from external advisors.

The most significant laws and regulations that have an indirect impact on the financial statements are those in relation to Health and Safety and REACH legislation. We performed audit procedures to inquire of management and those charged with governance whether the group and the company is in compliance with these laws and regulations and reviewing any notices published by the Health and Safety Executive. We also made inquiries with those charged with governance to identify any live and material claims or disputes with legislating authorities or customers.

The group audit engagement team identified the risk of management override of controls and revenue recognition as the areas where the financial statements were most susceptible to material misstatement due to fraud. Audit procedures performed included, but were not limited to:

o Testing manual journal entries and other adjustments and evaluating the business rationale in relation to significant, unusual transactions and transactions entered into outside the normal course of business, assessing whether the judgements made in making accounting estimates are indicative of potential bias.

o We tested a sample of revenue transactions recognised either side of the balance sheet date to determine whether revenue was recorded in the correct period.

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 Report of the Auditors.

Report of the Independent Auditors to the Members of
Lakeland Laboratories Holdings Limited


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 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 a Report of the Auditors 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.




Steven John Collings FCCA (Senior Statutory Auditor)
for and on behalf of Leavitt Walmsley Associates Limited
Chartered Certified Accountants and
Statutory Auditors
8 Eastway
Sale
Cheshire
M33 4DX

27 August 2024

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Consolidated
Profit and Loss Account
For The Year Ended 31 December 2023

Notes £    £   

TURNOVER 3 6,935,218

Cost of sales 5,452,340
GROSS PROFIT 1,482,878

Distribution costs 77,498
Administrative expenses 764,908
842,406
640,472

Other operating income 200
OPERATING PROFIT 5 640,672

Interest receivable and similar income 68,784
709,456
Excess goodwill written off 7 (1,289,957 )
1,999,413

Interest payable and similar expenses 8 115,730
PROFIT BEFORE TAXATION 1,883,683

Tax on profit 9 218,656
PROFIT FOR THE FINANCIAL YEAR 1,665,027
Profit attributable to:
Owners of the parent 1,665,027

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Consolidated
Other Comprehensive Income
For The Year Ended 31 December 2023

Notes £   

PROFIT FOR THE YEAR 1,665,027


OTHER COMPREHENSIVE INCOME -
TOTAL COMPREHENSIVE INCOME FOR THE
YEAR

1,665,027

Total comprehensive income attributable to:
Owners of the parent 1,665,027

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Consolidated Balance Sheet
31 December 2023

Notes £    £   
FIXED ASSETS
Intangible assets 11 65,776
Tangible assets 12 1,180,588
Investments 13 -
1,246,364

CURRENT ASSETS
Stocks 14 918,294
Debtors 15 1,323,922
Cash at bank and in hand 1,869,274
4,111,490
CREDITORS
Amounts falling due within one year 16 1,510,765
NET CURRENT ASSETS 2,600,725
TOTAL ASSETS LESS CURRENT
LIABILITIES

3,847,089

CREDITORS
Amounts falling due after more than one year 17 (1,986,735 )

PROVISIONS FOR LIABILITIES 20 (95,327 )
NET ASSETS 1,765,027

CAPITAL AND RESERVES
Called up share capital 21 100,000
Retained earnings 22 1,665,027
SHAREHOLDERS' FUNDS 1,765,027

The financial statements were approved by the Board of Directors and authorised for issue on 27 August 2024 and were signed on its behalf by:





Mr P McCormack - Director


LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Company Balance Sheet
31 December 2023

Notes £    £   
FIXED ASSETS
Intangible assets 11 -
Tangible assets 12 -
Investments 13 4,434,125
4,434,125

CURRENT ASSETS
Cash at bank 18,724

CREDITORS
Amounts falling due within one year 16 2,469,996
NET CURRENT LIABILITIES (2,451,272 )
TOTAL ASSETS LESS CURRENT
LIABILITIES

1,982,853

CREDITORS
Amounts falling due after more than one year 17 1,292,509
NET ASSETS 690,344

CAPITAL AND RESERVES
Called up share capital 21 100,000
Retained earnings 22 590,344
SHAREHOLDERS' FUNDS 690,344

Company's profit for the financial year 590,344

The financial statements were approved by the Board of Directors and authorised for issue on 27 August 2024 and were signed on its behalf by:





Mr P McCormack - Director


LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Consolidated Statement of Changes in Equity
For The Year Ended 31 December 2023

Called up
share Retained Total
capital earnings equity
£    £    £   

Changes in equity
Issue of share capital 100,000 - 100,000
Total comprehensive income - 1,665,027 1,665,027
Balance at 31 December 2023 100,000 1,665,027 1,765,027

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Company Statement of Changes in Equity
For The Year Ended 31 December 2023

Called up
share Retained Total
capital earnings equity
£    £    £   

Changes in equity
Issue of share capital 100,000 - 100,000
Total comprehensive income - 590,344 590,344
Balance at 31 December 2023 100,000 590,344 690,344

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Consolidated Cash Flow Statement
For The Year Ended 31 December 2023

Notes £   
Cash flows from operating activities
Cash generated from operations 1 1,293,107
Interest paid (115,730 )
Tax paid (164,051 )
Net cash from operating activities 1,013,326

Cash flows from investing activities
Purchase of tangible fixed assets (56,907 )
Sale of tangible fixed assets 14,890
Acquisition of a subsidiary, net of cash 1,357,162
Interest received 68,784
Net cash from investing activities 1,383,929

Cash flows from financing activities
Loan repayments in year (40,486 )
Capital repayments on loan notes (587,495 )
Share issue 100,000
Net cash from financing activities (527,981 )

Increase in cash and cash equivalents 1,869,274
Cash and cash equivalents at beginning of
year

2

-

Cash and cash equivalents at end of year 2 1,869,274

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Notes to the Consolidated Cash Flow Statement
For The Year Ended 31 December 2023

1. RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS
£   
Profit before taxation 1,883,683
Depreciation charges 59,042
Profit on disposal of fixed assets (14,890 )
Adjustment for effective interest rate (7,503 )
Negative goodwill write off (1,289,958 )
Finance costs 115,730
Finance income (68,784 )
677,320
Decrease in stocks 216,062
Decrease in trade and other debtors 682,357
Decrease in trade and other creditors (282,632 )
Cash generated from operations 1,293,107

2. CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 December 2023
31.12.23 1.1.23
£    £   
Cash and cash equivalents 1,869,274 -


3. ANALYSIS OF CHANGES IN NET DEBT

At 1.1.23 Cash flow At 31.12.23
£    £    £   
Net cash
Cash at bank and in hand - 1,869,274 1,869,274
- 1,869,274 1,869,274
Debt
Debts falling due within 1 year - (527,782 ) (527,782 )
Debts falling due after 1 year - (1,986,735 ) (1,986,735 )
- (2,514,517 ) (2,514,517 )
Total - (645,243 ) (645,243 )

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Notes to the Consolidated Financial Statements
For The Year Ended 31 December 2023

1. STATUTORY INFORMATION

Lakeland Laboratories Holdings Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the General Information page.

The presentation currency of the financial statements is the Pound Sterling (£).


2. ACCOUNTING POLICIES

Basis of preparing the financial statements
These financial statements have been prepared in accordance with the provisions of FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

These consolidated financial statements consolidate the financial statements of Lakeland Laboratories Holdings Limited, Lakeland Chemicals Limited and Lakeland Laboratories Limited. All undertakings in the consolidated financial statements have financial statements that are drawn up to 31 December.

Going concern
As at 31 December 2023, the group had free cash flow amounting to £1.9m and also had a strong forward order book.

The uncertainty as to the future impact on the group of external factors has been considered as part of the group's adoption of the going concern basis of accounting. The board has completed an assessment as to the potential impact to the group in the event of certain downside scenarios.

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

o The group meets its day-to-day working capital requirements primarily through its cash balances;
o Cash balances are monitored on a regular basis and are deemed to be adequate;
o While the group has borrowing facilities, it is not wholly reliant on them; and
o The directors consider the group has adequate resources to continue in operational existence for the foreseeable future.

Basis of consolidation
The consolidated financial statements consist of the financial statements of the parent company, Lakeland Laboratories Holdings Limited, together with all entities that are controlled by the parent company (directly or indirectly) (its subsidiaries).

All financial statements are made up to 31 December each year. All intra-group transactions, balances and unrealised gains and losses on transactions between group members are eliminated on consolidation.

Business combinations
For business combinations which do not meet the criteria to apply merger accounting, the purchase method of accounting is used.

Related party exemption
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

Transactions between group entities which have been eliminated on consolidation are not disclosed within the financial statements.

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 December 2023

2. ACCOUNTING POLICIES - continued

Critical accounting judgements and key sources of estimation uncertainty
The preparation of consolidated financial statements requires management to make judgement, estimates and assumptions that affect the amounts reported for assets and liabilities as at the year end and amounts reported for revenue and expenses for the year. However, the nature of estimation is such that actual outcomes could differ from those estimates. The following judgements have the most effect on the amounts recognised in the consolidated financial statements:

Useful economic lives of property, plant and equipment and intangible assets
The annual depreciation charge for property, plant and equipment is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values (of both tangible and intangible assets) are re-assessed annually and are amended, when necessary, to reflect current estimates. Changes in residual values and economic lives are accounted for as a change in accounting estimate under FRS 102, Section 10 'Accounting Policies, Estimates and Errors'.

Stock obsolescence
Stock is valued at the lower of cost and estimated selling price. A provision is made in respect of obsolete and/or slow-moving stock when it is clear that estimated selling price is lower than cost. Stock is deemed to be obsolete when it is either damaged or the chemical mix is incorrect and hence cannot be used in other products.

Turnover
Group turnover represents sales of goods delivered to customers net of VAT and trade discounts provided in the normal course of business. Turnover is recognised when the goods leave the site, hence is the point at which the risks and rewards of ownership pass to the buyer. Revenue in respect of the sale of goods is recognised when all the following conditions are met:

o the group has transferred all significant risks and rewards of ownership of the goods;
o the group does not retain any managerial involvement or effective control over the goods;
o the amount of the sale can be reliably measured;
o it is probable that economic benefit associated with the sale will flow to the entity; and
o the costs (to be) incurred in respect of the transactions can be reliably measured.

Any transactions which do not meet the above recognition criteria are not recognised as revenue.

Where the group is unable to determine its share of revenue, such as in respect of chemicals subject to REACH licences, no revenue is recognised and the sale is treated as deferred income and presented within creditors: amounts falling due within one year until such time that the group can reliably measure its share of revenue.

Intangible assets
Group intangible assets represent REACH licences acquired in order to manufacture certain chemicals. The licences are recognised on the group balance sheet as an intangible asset at cost less accumulated amortisation and less applicable impairment losses.

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 December 2023

2. ACCOUNTING POLICIES - continued

Tangible fixed assets
Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.
Freehold property - 4% on cost
Plant and machinery - at varying rates on cost
Fixtures and fittings - at varying rates on cost
Motor vehicles - 25% on cost

Tangible fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes costs which are directly attributable in bringing the asset to its location and condition so that it is capable of operating in the manner intended by management.

Residual values used in the calculation of depreciable amount are the expected amounts which would currently be obtained from disposal of assets, after deducting the estimated costs of disposal, if the assets were already of the age and in the condition expected at the end of their useful lives.

Profits and losses on the disposal of fixed assets are included in the calculation of profit for the period.

The directors assess the group's tangible assets for evidence of impairment at each reporting date. Where there are indicators of impairment, the directors calculate recoverable amount of the asset(s) and compare this with the carrying amount. If recoverable amount is lower than carrying amount, the asset is written down to recoverable amount by way of an impairment loss which is recognised in group profit or loss for the period. Impairment losses are reversed when there is evidence that the reasons giving rise to the original impairment have ceased to apply. Impairment losses are reversed through profit and loss but only to the extent that the reversal does not increase the carrying amount of the asset to the amount which would have been stated, net of depreciation, had no impairment loss been recognised.

Investments in subsidiaries
Investments in subsidiary undertakings are recognised at cost. After initial recognition, the investments are measured at cost less impairment.

Stocks
Stocks are valued at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, freight, irrecoverable taxes and costs of conversion and other directly attributable costs which are incurred by the entity in bringing the stock to its present location and condition. The cost methodology employed by the entity is the first-in first-out method.

Group policy is to value stock on a first-in first-out (FIFO) basis.

Estimated selling price less costs to complete and sell are based on the prices available in the market in which a willing, knowledgeable and informed third party would offer in exchange for the goods.

Stocks are reviewed at each balance sheet date for evidence of obsolescence or damage and their estimated selling price less costs to complete and sell established. Where estimated selling price less costs to complete and sell are lower than cost, a write-down of stock takes place which is recognised in group profit or loss. Slow-moving items are reviewed at each reporting date for evidence that cost is lower than estimated selling price less costs to complete and sell; where any write-downs or additional write-downs are required, these are recognised in group profit or loss.

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 December 2023

2. ACCOUNTING POLICIES - continued

Financial instruments
The group has elected to apply (where applicable) the provisions of FRS 102, Section 11 'Basic Financial Instruments' and Section 12 'Other Financial Instruments Issues' to all of its financial instruments.

Financial instruments are recognised when the group becomes a party to the contractual provisions of the instrument.

Financial assets 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 trade and other debtors, cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently measured at amortised cost using the effective interest rate, unless the arrangement constitutes a financing transaction, where the financial asset is measured at the present value of the future receipts discounted at a market rate of interest.

Impairment of financial assets
Financial assets, other than those held at fair value through profit or loss, are assessed for indicators of impairment at each balance sheet date.

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

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

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

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

Basic financial liabilities
Basic financial liabilities, including trade and other creditors, bank loans, loan notes and accruals are initially recognised at transaction price unless the arrangement constitutes a financing arrangement, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest.

Debt instruments are subsequently measured at amortised cost using the effective interest method.

Derecognition of financial liabilities
Financial liabilities are derecognised when, and only when, the group's contractual obligations are discharged, cancelled or they expire.

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


LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 December 2023

2. ACCOUNTING POLICIES - continued
Taxation
Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Profit and Loss Account, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. Deferred tax is calculated using timing difference plus approach.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Pension costs and other post-retirement benefits
Defined contribution pension plan
The group operates a defined contribution pension plan. A defined contribution plan is a pension plan under which the group pays fixed contributions into a separate entity. Once the contributions have been paid, the group 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 group's balance sheet. The assets of the plan are held separately from the group in independently administered funds.

Employee benefits
Short-term employee benefits are measured at the undiscounted amount expected to be paid in exchange for the employee's services to the company. Where employees have accrued short-term benefits which the entity has not paid by the balance sheet date, an accrual is recognised within creditors: amounts falling due within one year with an associated expense in profit or loss.

3. TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the group.

An analysis of turnover by geographical market is given below:

£   
United Kingdom 2,704,735
Europe 3,328,905
Rest of world 901,578
6,935,218

4. EMPLOYEES AND DIRECTORS
£   
Wages and salaries 904,182
Social security costs 43,526
Other pension costs 104,711
1,052,419

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 December 2023

4. EMPLOYEES AND DIRECTORS - continued

The average number of employees during the year was as follows:

Management 5
Administration and technical 5
Production and sales 11
21

The average number of employees by undertakings that were proportionately consolidated during the year was NIL.

£   
Directors' remuneration 358,725

Information regarding the highest paid director is as follows:
£   
Emoluments etc 101,340

5. OPERATING PROFIT

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

£   
Hire of plant and machinery 5,526
Depreciation - owned assets 76,077
Profit on disposal of fixed assets (14,890 )
Foreign exchange differences 8,361

6. AUDITORS' REMUNERATION
£   
Fees payable to the company's auditors for the audit of the company's
financial statements

10,550

Fees for the audit of the financial statements are as follows:

Audit of the subsidiaries and consolidated financial statements: £   
Fees for the audit of the subsidiaries financial statements 10.550
Fees for the audit of the consolidated financial statements 4,000
14,550

7. EXCESS GOODWILL WRITTEN OFF
£   
Goodwill excess written off (1,289,957 )

The goodwill excess relates to the acquisition by the group of Lakeland Laboratories Ltd. Further information concerning this acquisition is shown in note 24.

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 December 2023

8. INTEREST PAYABLE AND SIMILAR EXPENSES
£   
Bank interest 1
Bank loan interest 37,551
Loan note interest 78,178
115,730

9. TAXATION

Analysis of the tax charge
The tax charge on the profit for the year was as follows:
£   
Current tax:
UK corporation tax 218,315

Deferred tax 341
Tax on profit 218,656

Reconciliation of total tax charge included in profit and loss
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below:

£   
Profit before tax 1,883,683
Profit multiplied by the standard rate of corporation tax in the UK of 25 % 470,921

Effects of:
Expenses not deductible for tax purposes 1,103
Income not taxable for tax purposes (378,580 )
Depreciation in excess of capital allowances 5,382
Deferred tax movement 341
Effect of a change in tax rate (17,026 )
Group loss available for carry forward 20,079
Pre-acquisition profit not taxable 116,436
Total tax charge 218,656

In the Budget on 3 March 2021, the UK government announced an increase in the main UK corporation tax rate from 19% to 25% with effect from 1 April 2023. This change in rate was substantively enacted on 24 May 2021. Group deferred tax assets and liabilities reflect the rate that is expected to apply on crystallisation.

10. INDIVIDUAL PROFIT AND LOSS ACCOUNT

As permitted by Section 408 of the Companies Act 2006, the Income Statement of the parent company is not presented as part of these financial statements.


LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 December 2023

11. INTANGIBLE FIXED ASSETS

Group
Patents
and
licences
£   
COST
At 1 January 2023
and 31 December 2023 65,776
NET BOOK VALUE
At 31 December 2023 65,776
At 31 December 2022 65,776

The group has not charged any amortisation on intangible assets on the grounds that the directors believe the REACH licences have an indefinite useful life.

12. TANGIBLE FIXED ASSETS

Group
Freehold Long Plant and
property leasehold machinery
£    £    £   
COST
At 1 January 2023 839,281 51,329 1,248,427
Additions - - 43,451
Disposals - - (13,544 )
Reclassification/transfer - (51,329 ) 51,329
At 31 December 2023 839,281 - 1,329,663
DEPRECIATION
At 1 January 2023 32,000 - 931,382
Charge for year 8,000 - 60,286
Eliminated on disposal - - (13,544 )
At 31 December 2023 40,000 - 978,124
NET BOOK VALUE
At 31 December 2023 799,281 - 351,539
At 31 December 2022 807,281 51,329 317,045

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 December 2023

12. TANGIBLE FIXED ASSETS - continued

Group

Fixtures
and Motor
fittings vehicles Totals
£    £    £   
COST
At 1 January 2023 352,388 25,850 2,517,275
Additions 13,456 - 56,907
Disposals (64,596 ) (25,850 ) (103,990 )
Reclassification/transfer - - -
At 31 December 2023 301,248 - 2,470,192
DEPRECIATION
At 1 January 2023 328,285 25,850 1,317,517
Charge for year 7,791 - 76,077
Eliminated on disposal (64,596 ) (25,850 ) (103,990 )
At 31 December 2023 271,480 - 1,289,604
NET BOOK VALUE
At 31 December 2023 29,768 - 1,180,588
At 31 December 2022 24,103 - 1,199,758

13. FIXED ASSET INVESTMENTS

Group
Shares in
group
undertakings
£   
COST
At 1 January 2023 (4,434,125 )
Additions 4,434,125
At 31 December 2023 -
NET BOOK VALUE
At 31 December 2023 -
At 31 December 2022 (4,434,125 )
Company
Shares in
group
undertakings
£   
COST
Additions 4,434,125
At 31 December 2023 4,434,125
NET BOOK VALUE
At 31 December 2023 4,434,125


LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 December 2023

14. STOCKS


Group
£   
Raw materials 504,885
Finished goods 413,409
918,294

15. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR


Group
£   
Trade debtors 1,171,158
VAT 47,402
Prepayments 105,362
1,323,922

16. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR


Group Company
£    £   
Bank loans and overdrafts (see note 18) 57,786 -
Other loans (see note 18) 469,996 469,996
Trade creditors 406,007 -
Amounts owed to group undertakings - 2,000,000
Tax 270,682 -
Social security and other taxes 59,853 -
Other creditors 50,980 -
Deferred income 151,849 -
Accrued expenses 43,612 -
1,510,765 2,469,996

17. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR


Group Company
£    £   
Bank loans (see note 18) 694,226 -
Other loans (see note 18) 1,292,509 1,292,509
1,986,735 1,292,509

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 December 2023

18. LOANS

An analysis of the maturity of loans is given below:


Group Company
£    £   
Amounts falling due within one year or on demand:
Bank loans 57,786 -
Other loans 469,996 469,996
527,782 469,996
Amounts falling due between one and two years:
Bank loans - 1-2 years 62,526 -
Amounts falling due between two and five years:
Bank loans - 2-5 years 631,700 -
Other loans - 2-5 years 1,292,509 1,292,509
1,924,209 1,292,509

19. SECURED DEBTS

The following secured debts are included within creditors:


Group
£   
Bank loans 752,012

The bank loan is secured by way of a debenture and cross guarantee dated 29 March 2023 with fixed and floating charges covering all the property or undertakings of the group.

20. PROVISIONS FOR LIABILITIES


Group
£   
Deferred tax 95,327

Group
Deferred
tax
£   
Charge to Profit and Loss Account during year 341
Balance at 31 December 2023 341

Group deferred tax balances are expected to reverse over the course of the next five years.

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 December 2023

21. CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:
Number: Class: Nominal
value: £   
100,000 Ordinary £1 100,000

100,000 Ordinary shares of £1 each were allotted and fully paid for cash at par during the year.

22. RESERVES

Group
Retained
earnings
£   

Profit for the year 1,665,027
At 31 December 2023 1,665,027

Company
Retained
earnings
£   

Profit for the year 590,344
At 31 December 2023 590,344

Retained earnings
Retained earnings comprise the parent and the subsidiaries' profits or losses. Retained earnings includes both distributable and non-distributable reserves.

23. ULTIMATE CONTROLLING PARTY

In the opinion of the directors, there is no one controlling party.

24. FINANCIAL INSTRUMENTS

31.12.2023
£   
Financial assets
Financial assets measured at amortised cost 3,040,432
Financial liabilities
Financial liabilities measured at amortised cost 3,015,117

Financial assets measured at amortised cost include trade and other debtors and bank balances.

Financial liabilities measured at amortised cost include trade and other creditors, accruals and loans.

LAKELAND LABORATORIES HOLDINGS LIMITED (REGISTERED NUMBER: 14621068)

Notes to the Consolidated Financial Statements - continued
For The Year Ended 31 December 2023

25. BUSINESS COMBINATIONS

On 4 April 2023, the group acquired control of Lakeland Chemicals Limited through the acquisition of 100% of the share capital for a total consideration of £4,434,125. Lakeland Chemicals Limited owns 100% of the issued share capital of Lakeland Laboratories Limited.

Negative goodwill arose on the acquisition of the businesses of £1,289,958. The non-monetary assets arising in the acquisition have been recovered in the year resulting in the excess being recognised in profit or loss for the period ended 31 December 2023. The remaining balance of negative goodwill at 31 December 2023 was £nil.

The following table summarises the consideration paid by the group and the fair value of assets acquired and liabilities assumed. The group wholly owns all subsidiaries hence there are no non-controlling interests:

Consideration at 4 April 2023
£   
Cash 2,000,000
Loan notes 2,350,000
Directly attributable costs of the acquisition 84,125
Total consideration 4,434,125

Recognised amounts of identifiable assets acquired and liabilities assumed:

Fair value £   
Property, plant and equipment 1,272,334
Stock 1,134,356
Debtors 2,048,883
Creditors (2,172,777 )
Bank overdraft (19 )
Cash and cash equivalents 3,441,306
Total identifiable net assets 5,724,083
Goodwill on acquisition (1,289,958 )
Total consideration 4,434,125

The loan notes are unsecured and attract interest at variable rates. They are repayable in quarterly instalments over five years.

Revenue from Lakeland Laboratories Limited included in the consolidated profit and loss account for 2023 was £6,935,218. Lakeland Laboratories Limited contributed £674,040 to group profit. Lakeland Chemicals Ltd contributed a loss of (£2,406). Due to the non-trading nature of Lakeland Chemicals Ltd, the subsidiary did not contribute any revenue.