Company registration number 10588493 (England and Wales)
ON DIRECT GROUP LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
ON DIRECT GROUP LIMITED
COMPANY INFORMATION
Directors
B Raynes
J S Hall
S M Furber
J Birger Syvertsen
(Appointed 13 April 2023)
Secretary
Speafi Secretarial Limited
Company number
10588493
Registered office
1 London Street
Reading
Berkshire
United Kingdom
RG1 4QW
Auditor
Azets Audit Services
Suites B & D
Burnham Yard
London End
Beaconsfield
Buckinghamshire
United Kingdom
HP9 2JH
ON DIRECT GROUP LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Profit and loss account
8
Group statement of comprehensive income
9
Group balance sheet
10
Company balance sheet
11
Group statement of changes in equity
12
Company statement of changes in equity
13
Group statement of cash flows
14
Notes to the financial statements
15 - 34
ON DIRECT GROUP LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -

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

Review of business

On Direct Group Ltd, trading as Cloud Direct, helps organisations modernise and manage their business technologies so they can grow better. We are a cloud services provider specializing in Microsoft Public Cloud solutions, including Microsoft Azure, Microsoft 365, as well as data and security services. Cloud Direct is a certified Azure Expert Managed Services Provider and holds multiple Microsoft Advanced Specialization accreditations.

We have consistently expanded our public cloud offerings, achieving growth through both our existing customer base and by acquiring new, mid-market clients. Our deepening relationship with Microsoft has led to an increase in commercial opportunities, both one-time and recurring monthly revenues, which complements our own organic lead generation efforts.

Integration and Global delivery

We have successfully completed the decommissioning of legacy capital-intensive infrastructure and systems inherited from previous acquisitions, resulting in reduced costs and a more agile investment strategy. This allows us to allocate more capital and resources towards expanding our core cloud services.

Our investment in the Cape Town-based service centre continues, with ongoing enhancements to our 24/7 support and managed services for specialist cloud and hybrid cloud environments.

Principal risks and uncertainties

The principal risks facing the Group are as follows:

 

 

 

 

 

 

Business Model

Our business model centres on modernising and managing critical technologies within organisations to support their growth. This approach enables us to generate income from both Professional Services and from recurring Managed Services.

 

ON DIRECT GROUP LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Key performance indicators

The most relevant indicators for the Group:

 

* Excludes non-recurring profits related to disposal of non-cloud legacy licensing.

 

On behalf of the board

B Raynes
Director
25 June 2024
ON DIRECT GROUP LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -

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

Principal activities

The principal activity of the group in the year under review was that of providing data management services to businesses.

 

The principal activity of the company is that of a holding company.

Results and dividends

The results for the year are set out on page 8.

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

Directors

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

B Raynes
J S Hall
M A Mulholland
(Resigned 13 April 2023)
S M Furber
J Birger Syvertsen
(Appointed 13 April 2023)
Financial instruments
Fair value

The directors consider that there is no material difference between the fair value of the Company's and the Group's financial assets and liabilities and their carrying value in the balance sheet.

Research and development

The group continues to develop its products in line with its principal activities.

Auditor

In accordance with the company's articles, a resolution proposing that Azets Audit Services be reappointed as auditor of the group will be put at a General Meeting.

Statement of disclosure to auditor

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

On behalf of the board
B Raynes
Director
25 June 2024
ON DIRECT GROUP LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -

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

 

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

 

 

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

ON DIRECT GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ON DIRECT GROUP LIMITED
- 5 -
Opinion

We have audited the financial statements of On Direct Group Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows 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 FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

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

Conclusions relating to going concern

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

 

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

 

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

Other information

The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report 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 there is a material misstatement in the financial statements or a material misstatement of the other information. 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:

ON DIRECT GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ON DIRECT GROUP LIMITED
- 6 -
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 strategic report and the directors' report.

 

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:

Responsibilities of directors

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

Auditor's responsibilities for the audit of the financial statements

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

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.

ON DIRECT GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ON DIRECT GROUP LIMITED
- 7 -

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

 

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework.  Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.  This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

 

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

 

 

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation.  This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.  The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

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 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.

Adam East ACA (Senior Statutory Auditor)
For and on behalf of Azets Audit Services
26 June 2024
Chartered Accountants
Statutory Auditor
Suites B & D
Burnham Yard
London End
Beaconsfield
Buckinghamshire
United Kingdom
HP9 2JH
ON DIRECT GROUP LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
2023
2022
Notes
£
£
Turnover
3
29,307,828
26,165,012
Cost of sales
(19,315,861)
(14,992,125)
Gross profit
9,991,967
11,172,887
Administrative expenses
(9,033,146)
(8,965,627)
Operating profit
7
958,821
2,207,260
Interest receivable and similar income
8
40,534
2,090
Interest payable and similar expenses
9
(1,481,128)
(1,331,696)
(Loss)/profit before taxation
(481,773)
877,654
Tax on (loss)/profit
10
-
0
455,865
(Loss)/profit for the financial year
25
(481,773)
1,333,519
(Loss)/profit for the financial year is all attributable to the owners of the parent company.
ON DIRECT GROUP LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
£
£
(Loss)/profit for the year
(481,773)
1,333,519
Other comprehensive income
-
-
Total comprehensive income for the year
(481,773)
1,333,519
Total comprehensive income for the year is all attributable to the owners of the parent company.
ON DIRECT GROUP LIMITED
GROUP BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
11
-
0
533,662
Other intangible assets
11
111,106
88,273
Total intangible assets
111,106
621,935
Tangible assets
12
143,598
161,383
254,704
783,318
Current assets
Stocks
15
45,619
11,166
Debtors
16
8,972,646
8,325,470
Cash at bank and in hand
2,889,634
1,653,998
11,907,899
9,990,634
Creditors: amounts falling due within one year
17
(8,444,126)
(6,571,900)
Net current assets
3,463,773
3,418,734
Total assets less current liabilities
3,718,477
4,202,052
Creditors: amounts falling due after more than one year
18
(14,413,174)
(14,413,174)
Provisions for liabilities
Provisions
21
8
1,810
(8)
(1,810)
Net liabilities
(10,694,705)
(10,212,932)
Capital and reserves
Called up share capital
24
1,917
1,917
Share premium account
25
5,978,446
5,978,446
Profit and loss reserves
25
(16,675,068)
(16,193,295)
Total equity
(10,694,705)
(10,212,932)
The financial statements were approved by the board of directors and authorised for issue on 25 June 2024 and are signed on its behalf by:
25 June 2024
B Raynes
Director
Company registration number 10588493 (England and Wales)
ON DIRECT GROUP LIMITED
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 11 -
2023
2022
Notes
£
£
£
£
Fixed assets
Investments
13
1,058
1,058
Current assets
Debtors
16
5,979,305
5,979,305
Net current assets
5,979,305
5,979,305
Net assets
5,980,363
5,980,363
Capital and reserves
Called up share capital
24
1,917
1,917
Share premium account
25
5,978,446
5,978,446
Total equity
5,980,363
5,980,363

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £Nil.

The financial statements were approved by the board of directors and authorised for issue on 25 June 2024 and are signed on its behalf by:
25 June 2024
B Raynes
Director
Company registration number 10588493 (England and Wales)
ON DIRECT GROUP LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
Share capital
Share premium account
Profit and loss reserves
Total
£
£
£
£
Balance at 1 January 2022
1,917
5,978,446
(17,526,814)
(11,546,451)
Year ended 31 December 2022:
Profit and total comprehensive income
-
-
1,333,519
1,333,519
Balance at 31 December 2022
1,917
5,978,446
(16,193,295)
(10,212,932)
Year ended 31 December 2023:
Loss and total comprehensive income
-
-
(481,773)
(481,773)
Balance at 31 December 2023
1,917
5,978,446
(16,675,068)
(10,694,705)
ON DIRECT GROUP LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
Share capital
Share premium account
Total
£
£
£
Balance at 1 January 2022
1,917
5,978,446
5,980,363
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
-
0
Balance at 31 December 2022
1,917
5,978,446
5,980,363
Year ended 31 December 2023:
Profit and total comprehensive income
-
-
-
0
Balance at 31 December 2023
1,917
5,978,446
5,980,363
ON DIRECT GROUP LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
30
3,013,698
2,061,866
Interest paid
(1,481,128)
(1,331,696)
Income taxes (paid)/refunded
(126)
661
Net cash inflow from operating activities
1,532,444
730,831
Investing activities
Purchase of intangible assets
(93,938)
(57,729)
Purchase of tangible fixed assets
(93,404)
(24,014)
Proceeds on disposal of tangible fixed assets
-
3,133
Payment of deferred consideration
(150,000)
-
Interest received
40,534
2,090
Net cash used in investing activities
(296,808)
(76,520)
Net increase in cash and cash equivalents
1,235,636
654,311
Cash and cash equivalents at beginning of year
1,653,998
999,687
Cash and cash equivalents at end of year
2,889,634
1,653,998
ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 15 -
1
Accounting policies
Company information

On Direct Group Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 1 London Street, Reading, Berkshire, United Kingdom, RG1 4QW. The company's principal place of business is Cambridge House, Henry Street, Bath, BA1 1BT.

 

The group consists of On Direct Group Limited and all of its subsidiaries.

1.1
Accounting convention

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

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

The financial statements have been prepared under the historical cost convention, modified to include certain financial instruments at fair value. The principal accounting policies adopted are set out below.

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

 

1.2
Basis of consolidation

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

 

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

ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -

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

 

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

 

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

1.3
Going concern

Since the beginning of the new financial year and despite the current market conditions, the group has generated operating profits (before depreciation and amortisation charges) and has seen improvements in its overall ability to convert current revenue recognised into cash. Debt funders of existing loans have been supportive with interest deferrals. Interest payments have subsequently restarted. No material capital redemption on these loans is due within 12 months of the date of these financial statements.

In assessing the going concern position of the group for the year ended 31 December 2023 the directors have considered the group's cash flows, liquidity and likely business activities over a period of over 12 months from the date of approval of the financial statements. At the time of this review in June 2024 there was sufficient cash available for operations.

The group has a diversified client base of corporate clients, with no concentration of risk into any one particular sector. As a result of this, the base case and downsides scenarios applied by the directors in their assessment of going concern shows that the group will have adequate resources to continue in operational existence for the next 12 months.

The directors have also considered a reverse stress test to identify the downside sensitivity assumptions which would need to arise in order for the business to need additional funding to continue in operation. Having identified and considered these assumptions, and after taking into consideration potential mitigating actions that the directors could take, including right sizing the cost base to reflect the potential trading downturn and the deferral of non-contractual payments, the directors have concluded that such a scenario is not plausible.

For these reasons, the directors continue to believe that it is appropriate to continue to adopt a going concern basis for the preparation of the financial statements.

1.4
Turnover

Turnover represents net invoiced sales of goods and services, excluding value added tax and other sales taxes, adjusted for accrued revenue calculated by reference to the fair value of services performed up to the balance sheet date but not invoiced.

Service income is recognised over the period of the service contract in accordance with generally accepted accounting principles.

ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
1.5
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 5 years.

 

If there are indicators of a significant movement in the useful life or residual value of goodwill, amortisation is revised prospectively to reflect this.

 

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

1.6
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

 

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

 

Development costs are recognised as an intangible asset when all of the following criteria are met:

 

All other research and development expenditure is written off as incurred.

Amortisation 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:

Computer software
50% on cost
1.7
Tangible fixed assets

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

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:

Short leasehold
Straight line over the life of the lease
Plant and machinery
Between 25% and 33% on cost
Fixtures and fittings
Between 25% and 33% on cost
Computer equipment
Between 20% and 33% on cost
Motor vehicles
25% on cost
ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -

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

1.8
Fixed asset investments

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

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

1.9
Impairment of fixed assets

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

 

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

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

 

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

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

1.10
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined on a first-in, first-out basis after making due allowance for obsolete and slow moving items.

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

1.11
Cash and cash equivalents

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

ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 19 -
1.12
Financial instruments

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

 

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

 

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

Basic financial assets

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

Other financial assets

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

Impairment of financial assets

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

 

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

 

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

Derecognition of financial assets

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

Classification of financial liabilities

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

ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 20 -
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.

Derecognition of financial liabilities

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

1.13
Equity instruments

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

1.14
Taxation

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

Current tax

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

ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 21 -
Deferred tax

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

 

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

1.15
Provisions

Provisions are recognised when the group has a legal or constructive present obligation as a result of a past event, it is probable that the group will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

 

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

1.16
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.

1.17
Retirement benefits

The group operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the group in an independently administered fund. The amount charged to the consolidated statement of comprehensive income represents the contributions payable to the scheme in respect of the accounting period.

1.18
Leases

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 leased asset are consumed.

1.19
Foreign exchange

Each entity in the group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency. The assets and liabilities of overseas subsidiary undertakings are translated into the presentational currency at the rate of exchange ruling at the balance sheet date. Income and expenses for each statement of comprehensive income are translated at exchange rates at the dates of transaction. All resulting exchange differences are recognised in other comprehensive income.

ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
2
Judgements and key sources of estimation uncertainty

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

 

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

 

 

 

3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
28,194,293
22,212,783
Europe
814,368
745,380
Rest of the World
299,167
3,206,849
29,307,828
26,165,012
2023
2022
£
£
Other revenue
Interest income
40,534
2,090
4
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
10,500
7,280
Audit of the financial statements of the company's subsidiaries
31,000
30,520
41,500
37,800
For other services
All other non-audit services
20,950
21,400
ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
5
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Directors
3
2
-
-
Management
5
4
-
-
Sales
13
14
-
-
Finance and Admin
5
9
-
-
Professional Services
15
17
-
-
Systems and Development
3
5
-
-
Marketing
8
4
-
-
Service and Support
85
82
-
-
4
-
-
-
Total
141
137
-
0
-
0

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
5,983,040
5,675,706
-
0
-
0
Social security costs
423,316
434,039
-
-
Pension costs
368,751
279,105
-
0
-
0
6,775,107
6,388,850
-
0
-
0
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
269,874
255,744
Company pension contributions to defined contribution schemes
25,500
22,830
295,374
278,574
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
202,092
184,051
Company pension contributions to defined contribution schemes
25,500
22,830
ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
6
Directors' remuneration
(Continued)
- 24 -

The number of directors to whom retirement benefits were accruing under money purchase schemes was 1 (2022 - 1).

7
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange differences apart from those arising on financial instruments measured at fair value through profit or loss
72,842
115,237
Depreciation of owned tangible fixed assets
111,189
104,586
Profit on disposal of tangible fixed assets
-
(3,133)
Amortisation of intangible assets
602,536
1,497,881
Loss on disposal of intangible assets
2,231
-
Operating lease charges
284,282
433,710
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
40,534
2,090
9
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
1,425,710
1,271,959
Other interest on financial liabilities
725
2,482
Other interest
54,693
57,255
Total finance costs
1,481,128
1,331,696
10
Taxation
2023
2022
£
£
Current tax
Adjustments in respect of prior periods
-
0
1,785
Deferred tax
Origination and reversal of timing differences
-
0
(457,650)
Total tax charge/(credit)
-
0
(455,865)
ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
10
Taxation
(Continued)
- 25 -

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

2023
2022
£
£
(Loss)/profit before taxation
(481,773)
877,654
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 23.50% (2022: 19.00%)
(113,217)
166,754
Tax effect of expenses that are not deductible in determining taxable profit
371,525
257,824
Tax effect of income not taxable in determining taxable profit
(10,127)
(595)
Tax effect of utilisation of tax losses not previously recognised
(374,163)
(727,007)
Unutilised tax losses carried forward
(1,204)
16,383
Adjustments in respect of prior years
-
0
1,785
Permanent capital allowances in excess of depreciation
(9,855)
8,734
Amortisation on assets not qualifying for tax allowances
137,041
277,760
Loans irrecoverable
-
0
21
Deferred tax on losses
-
0
(457,524)
Taxation charge/(credit)
-
(455,865)

Factors that affect tax charges

As part of Budget 2021 on 3 March 2021, it was announced that the UK corporation tax rate will increase to 25% from 1 April 2023. This change was substantively enacted on 24 May 2021. Prior to this change, the corporation tax rate was 19%. The effect on the company and the group of this change has been reflected in the financial statements in the financial year as appropriate.

11
Intangible fixed assets
Group
Goodwill
Computer software
Total
£
£
£
Cost
At 1 January 2023
13,065,905
276,786
13,342,691
Additions
-
0
93,938
93,938
Disposals
-
0
(5,355)
(5,355)
At 31 December 2023
13,065,905
365,369
13,431,274
Amortisation and impairment
At 1 January 2023
12,532,243
188,513
12,720,756
Amortisation charged for the year
533,662
68,874
602,536
Disposals
-
0
(3,124)
(3,124)
At 31 December 2023
13,065,905
254,263
13,320,168
ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
11
Intangible fixed assets
(Continued)
- 26 -
Carrying amount
At 31 December 2023
-
0
111,106
111,106
At 31 December 2022
533,662
88,273
621,935
The company had no intangible fixed assets at 31 December 2023 or 31 December 2022.
12
Tangible fixed assets
Group
Short leasehold
Plant and machinery
Fixtures and fittings
Computer equipment
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 January 2023
68,637
7,626
108,456
481,305
33,156
699,180
Additions
-
0
-
0
6,207
87,197
-
0
93,404
At 31 December 2023
68,637
7,626
114,663
568,502
33,156
792,584
Depreciation and impairment
At 1 January 2023
51,076
4,286
81,038
368,241
33,156
537,797
Depreciation charged in the year
5,529
-
0
10,935
94,725
-
0
111,189
At 31 December 2023
56,605
4,286
91,973
462,966
33,156
648,986
Carrying amount
At 31 December 2023
12,032
3,340
22,690
105,536
-
0
143,598
At 31 December 2022
17,561
3,340
27,418
113,064
-
0
161,383
The company had no tangible fixed assets at 31 December 2023 or 31 December 2022.
13
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
14
-
0
-
0
1,058
1,058
ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
13
Fixed asset investments
(Continued)
- 27 -
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 January 2023 and 31 December 2023
1,058
Carrying amount
At 31 December 2023
1,058
At 31 December 2022
1,058
ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 28 -
14
Subsidiaries

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

Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Indirect
AlwaysON Group Limited
UK
Dormant
A Ordinary £0.02 shares
-
100.00
AA Ordinary £0.01 shares
-
100.00
B Ordinary £0.01 shares
-
100.00
C Ordinary £0.01 shares
-
100.00
D1 Ordinary £0.01 shares
-
100.00
D2 Ordinary £0.01 shares
-
100.00
D3 Ordinary £0.01 shares
-
100.00
E Ordinary £0.01 shares
-
100.00
F Ordinary £0.01 shares
-
100.00
O1 Ordinary £0.01 shares
-
100.00
Ordinary A £0.01 shares
-
100.00
Ordinary AA £0.01 shares
-
100.00
Ordinary B £0.01 shares
-
100.00
Preferred £0.01 shares
-
100.00
Ordinary £0.20 shares
-
100.00
AlwaysON Limited
UK
Dormant
Ordinary £1 shares
-
100.00
Data Continuity Group Limited
UK
Dormant
Ordinary £0.01 shares
-
100.00
iHotDesk Holdings Limited
UK
Dormant
Ordinary £0.01 shares
-
100.00
iHotDesk Limited
UK
Dormant
Ordinary A £0.01 shares
-
100.00
On Direct Business Services Limited
UK
Professional data management services
Ordinary £0.01 shares
100.00
-
Redblade Limited
UK
Dormant
Ordinary £1 shares
-
100.00
Unit IT (Pty) Limited
South Africa
Professional data management services
Ordinary ZAR1 shares
-
100.00
Unit IT Limited
UK
Professional data management services
Ordinary £1 shares
-
100.00
Ezis Limited
UK
Dormant
Ordinary £1 shares
-
100.00
S3 Consulting Limited
UK
Dormant
Ordinary £1 shares
-
100.00
Ordinary A £1 shares
-
100.00
Ordinary B £1 shares
-
100.00
Ordinary C £1 shares
-
100.00
ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
14
Subsidiaries
(Continued)
- 29 -

Unit IT Limited - Audit Exemption

The directors have taken advantage of exemption available under section 479A of the Companies Act 2006 and have not had the financial statements of Unit IT Limited for the year ended 31 December 2023 audited. Unit IT Limited is a 100% subsidiary of the group, registered in England and Wales with company number 07984253.

15
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Finished goods and goods for resale
45,619
11,166
-
0
-
0
16
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
3,101,485
3,704,182
-
0
-
0
Amounts owed by group undertakings
-
-
5,979,305
5,979,305
Other debtors
929,551
588,504
-
0
-
0
Prepayments and accrued income
2,673,034
1,764,334
-
0
-
0
6,704,070
6,057,020
5,979,305
5,979,305
Amounts falling due after more than one year:
Deferred tax asset (note 20)
2,268,576
2,268,450
-
0
-
0
Total debtors
8,972,646
8,325,470
5,979,305
5,979,305
17
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
£
£
£
£
Trade creditors
5,267,061
3,853,399
-
0
-
0
Corporation tax payable
12,799
12,799
-
0
-
0
Other taxation and social security
674,006
438,993
-
-
Other creditors
671,934
829,146
-
0
-
0
Accruals and deferred income
1,818,326
1,437,563
-
0
-
0
8,444,126
6,571,900
-
0
-
0
ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 30 -
18
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Debenture loans
19
14,413,174
14,413,174
-
0
-
0
19
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Debenture loans
14,413,174
14,413,174
-
0
-
0
Payable after one year
14,413,174
14,413,174
-
0
-
0

Secured debts

The group is party to an omnibus guarantee and set-off agreement given to Santander UK plc in respect of group overdraft facilities, dated 21 May 2014. The total level of indebtedness at the year end amounted to £Nil.

 

The group has registered fixed and floating charges over its assets with Roger Guy, dated 1 June 2018, 21 September 2021 and 7 August 2023.

20
Deferred taxation

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

Assets
Assets
2023
2022
Group
£
£
Accelerated capital allowances
126
-
Tax losses
2,268,450
2,259,018
Other timing differences
-
9,432
2,268,576
2,268,450
The company has no deferred tax assets or liabilities.
ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
20
Deferred taxation
(Continued)
- 31 -
Group
Company
2023
2023
Movements in the year:
£
£
Asset at 1 January 2023
(2,268,450)
-
Credit to profit or loss
(126)
-
Asset at 31 December 2023
(2,268,576)
-

Deferred tax on losses represent tax losses that are expected to unwind against the company's future trading profits on ordinary activities. The directors have considered the likelihood of these losses being reversed and conclude that the company will be profitable in future years to utilise these losses.

21
Provisions for liabilities
Group
Company
2023
2022
2023
2022
£
£
£
£
Dilapidations
8
1,810
-
-
Movements on provisions:
Dilapidations
Group
£
Dilapidations
8

Other provisions represent a provision for dilapidation costs in respect of premises rented by the group. The lease to which the provision relates is due to expire within the next 12 months.

22
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
368,751
279,105

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund. Contributions amounting to £42,393 (2022: £24,583) were payable to the scheme as at the year end.

ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 32 -
23
Share-based payment transactions

In November 2020, the company had granted 10,500 options over Ordinary shares of the company under a share option plan to eight employees. No share options were exercised during the year ended 31 December 2023. There is an expectation of these options being exercised in future periods with the exception of the 3 employee options which have now lapsed totalling 1,500 shares.

 

The details of the scheme are as follows:

 

Class of shares: Ordinary

Number of employees granted 500 shares: 3 (lapsed)

Number of employees granted 1,500 shares: 4

Number of employees granted 3,000 shares: 1

Grant date: November 2020

Option granted: October 2030

Subscription price: £38.07 per option share

 

No share options were exercised during the year ended 31 December 2023.

 

All share-based payments previously in place within the group's subsidiaries have now lapsed.

24
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of 1p each
191,662
191,662
1,917
1,917

Called up share capital represents the nominal value of shares that have been issued. Each Ordinary share carries one vote, an equal right to dividends and capital (including on a winding up) and is not redeemable.

25
Reserves
Share premium

This reserve records the amount above the nominal value received for shares issued, less transaction costs.

Profit and loss reserves

This reserve records all current period retained earnings.

ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 33 -
26
Operating lease commitments
Lessee

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

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
293,594
165,964
-
-
Between two and five years
1,089,041
484,106
-
-
In over five years
-
22,342
-
-
1,382,635
672,412
-
-
27
Related party transactions

Key management are considered to be the directors of the company.

Transactions with related parties

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.

Purchases
Purchases
2023
2022
£
£
Group
Crayon Group AS
460
207,590
Service charges receivable
2023
2022
£
£
Group
Crayon Group AS
-
660,363
28
Directors' transactions
Description
% Rate
Opening balance
Closing balance
£
£
B Raynes - Advances
-
9,980
9,980
9,980
9,980
ON DIRECT GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 34 -
29
Controlling party

It is the opinion of the directors that there is no ultimate controlling party; no individual shareholding held in the company constitutes a holding that would confer significant control to that individual.

30
Cash generated from group operations
2023
2022
£
£
(Loss)/profit for the year after tax
(481,773)
1,333,519
Adjustments for:
Taxation charged/(credited)
-
0
(455,865)
Finance costs
1,481,128
1,331,696
Investment income
(40,534)
(2,090)
Gain on disposal of tangible fixed assets
-
(3,133)
Loss on disposal of intangible assets
2,231
-
Amortisation and impairment of intangible assets
602,536
1,497,881
Depreciation and impairment of tangible fixed assets
111,189
104,586
Decrease in provisions
(1,802)
(1,623)
Movements in working capital:
(Increase)/decrease in stocks
(34,453)
4,217
Increase in debtors
(647,050)
(1,397,669)
Increase/(decrease) in creditors
2,022,226
(351,438)
Cash generated from operations
3,013,698
2,060,081
31
Analysis of changes in net debt - group
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
1,653,998
1,235,636
2,889,634
Borrowings excluding overdrafts
(14,413,174)
-
(14,413,174)
(12,759,176)
1,235,636
(11,523,540)
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