REGISTERED NUMBER: 02251430 (England and Wales) |
GROUP STRATEGIC REPORT, |
REPORT OF THE DIRECTORS AND |
AUDITED |
CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
FOR |
UPPER CANADA UK LIMITED |
REGISTERED NUMBER: 02251430 (England and Wales) |
GROUP STRATEGIC REPORT, |
REPORT OF THE DIRECTORS AND |
AUDITED |
CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
FOR |
UPPER CANADA UK LIMITED |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
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 |
Report of the Independent Auditors | 5 |
Consolidated Income Statement | 8 |
Consolidated Other Comprehensive Income | 9 |
Consolidated Balance Sheet | 10 |
Company Balance Sheet | 11 |
Consolidated Statement of Changes in Equity | 12 |
Company Statement of Changes in Equity | 13 |
Consolidated Cash Flow Statement | 14 |
Notes to the Consolidated Financial Statements | 15 |
UPPER CANADA UK LIMITED |
COMPANY INFORMATION |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
DIRECTORS: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
SENIOR STATUTORY AUDITOR: | Andrew Green LLB FCA |
AUDITORS: |
Chartered Accountants |
and Statutory Auditors |
34-40 High Street |
Wanstead |
London |
E11 2RJ |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
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 pleased to report that the following the successful integration of the Vintage Cosmetic Company trade into the business following its purchase in 2022, the enlarged group is able to report revenue of £18,782,441, operating profits of £2,338,635 and a profit before tax of £2,170,465. |
The comparative profit and loss figures include 2 months of the full group results following the acquisition in October 2022 and are not comparable. |
2023 shows a positive position of the business with growth in all territories over the previous year. The acquisition of The Vintage Cosmetic company in Q3 2022 meant 2023 provided us a full year of business and the brand showed incremental growth, mainly through US and UK markets. |
We continue to focus on a split strategy of both volume and margin accretive growth in the business, this will be vitally important to maintain to ensure long term success and the ongoing sustainability of the business. |
Our US business was very positive, driven by the introduction of the Vintage brand, this is all through direct retailer relationships that were transitioned over successfully as part of the acquisition. |
Our UK business performed well, once again showing growth through our Danielle brand, this did offset some decline in our other brands as we see the UK high street continuing to be a challenge through the cost-of-living crisis. |
Through the set up on our Dutch subsidiary, to help with EU trading post Brexit, our European business is in growth through direct retailer relationships, distributors and independents, we fully expect this to continue to grow and accelerate moving forward. |
We are pleased with the growth in both sales and profit, whilst continuing to at least maintain, if not grow, gross margin year on year. |
The Group's key performance indicators are as follows: |
2023 | 2022 |
Turnover | £18,782,441 | £10,111,277 |
Gross Profit Margin | 34.08% | 30.79% |
Operating profit | £2,338,635 | £371,809 |
The net assets of the group were £7,420,175 (2022: £5,816,855) at the balance sheet date, reflecting its solid position from a solvency and liquidity point of view. |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
GROUP STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
PRINCIPAL RISKS AND UNCERTAINTIES |
The management of the business and the nature of the group's strategy are subject to a number of risks. |
The Directors have set out below the principal risks facing the business. |
The Directors are of the opinion that a thorough risk management process is adopted which involves a formal review of all risks identified below. Where possible, processes are in place to mitigate such risks. |
Economic downturn |
A key factor in the success of the business is consumer spending. In response to this continuous risk, senior management aim to keep abreast of economic conditions. In cases of severe economic downturn, marketing and pricing strategies will be modified to reflect the new market conditions. |
Inflation and the cost of living crisis |
Global inflationary pressures that have arisen following the outbreak of the war in Ukraine continue to represent the largest risk to the business. These pressures are seen most clearly in relation to: |
Price inflation |
The Group assesses the risks that costs inflation may bring with the aim to mitigate future threats this may have on the business. |
Wage cost inflation |
The Group is affected by wage cost inflation and pressures within the labour market. The Group monitors the market to ensure complete compliance with labour market regulations, and maintains employment policies, remuneration and benefits packages that are designed to be competitive with other companies, as well as providing employees with fulfilling career opportunities. |
Supply Chain and Freight Costs |
Delays in the delivery of products and increases in freight costs, however caused, can have a detrimental impact on the costs of goods and can negatively impact on margins. The Directors monitor this key cost and to find ways to where possible, to mitigate any significant increases. |
Competition |
The market in which the Group operates is highly competitive. As a result, the Group is subject to a high level of price sensitivities in its consumer-led market. Policies of assessing our pricing strategy and ongoing market research are in place to mitigate such risks. |
Brexit |
The main area where Brexit impacted the group relate to added costs and administration of the import of goods for resale. The group has mitigated part of this risk by incorporating an entity in Holland in order to receive goods direct from China to service European customers. |
ON BEHALF OF THE BOARD: |
18 September 2024 |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
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. |
PRINCIPAL ACTIVITY |
The principal activity of the group in the year under review was that of importers and wholesalers of toiletries, travel accessories and gifts. |
On 14 October 2022 the company purchased the entire issued share capital of The Vintage Cosmetic Company Limited for a total consideration of £5,612,012 (including fees and deferred consideration). |
On 1 January 2023 the trade and assets of The Vintage Cosmetic Company Limited were hived up into the Company. |
DIVIDENDS |
There were no dividends paid during the current or preceding year. |
FUTURE DEVELOPMENTS |
The Directors are confident that continued focus on the key management policies will strengthen the financial position of the Group during the ensuing period and enable it to capitalise on opportunities as they arise. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 January 2023 to the date of this report. |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
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. |
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 ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information. |
AUDITORS |
The auditors, THP Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
UPPER CANADA UK LIMITED |
Opinion |
We have audited the financial statements of Upper Canada UK Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023 which comprise the Consolidated Income Statement, 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 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 and the Report of the Directors, 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. |
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. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
UPPER CANADA UK LIMITED |
Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page four, 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. |
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 the audit was considered capable of detecting irregularities including fraud |
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows: |
- the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations; |
- we identified the laws and regulations applicable to the group through discussions with directors and other management, and from our commercial knowledge and experience of the sector in which the group operates; |
- we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the group, including the Companies Act 2006, taxation legislation and data protection, anti-bribery, employment, environmental, goods import and health and safety legislation; |
- we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and |
- identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit. |
We assessed the susceptibility of the group's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by: |
- making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and |
- considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. |
To address the risk of fraud through management bias and override of controls, we: |
- performed analytical procedures to identify any unusual or unexpected relationships; |
- tested journal entries to identify unusual transactions; |
- assessed whether judgements and assumptions made in determining the accounting estimates set out in note 2 were indicative of potential bias; and |
- investigated the rationale behind significant or unusual transactions. |
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to: |
- agreeing financial statement disclosures to underlying supporting documentation; |
- enquiring of management as to actual and potential litigation and claims; and |
- reviewing correspondence with HMRC and any other relevant regulators as required. |
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any. |
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion. |
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
UPPER CANADA UK 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. |
for and on behalf of |
Chartered Accountants |
and Statutory Auditors |
34-40 High Street |
Wanstead |
London |
E11 2RJ |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
CONSOLIDATED INCOME STATEMENT |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
TURNOVER | 3 | 18,782,441 | 10,111,277 |
Cost of sales | 12,380,699 | 6,998,395 |
GROSS PROFIT | 6,401,742 | 3,112,882 |
Distribution costs | 546,607 | 441,961 |
Administrative expenses | 3,516,500 | 2,299,112 |
4,063,107 | 2,741,073 |
OPERATING PROFIT | 5 | 2,338,635 | 371,809 |
Exceptional (losses)/gains on foreign currency |
6 |
(168,170 |
) |
235,053 |
2,170,465 | 606,862 |
Interest payable and similar expenses | 7 | 4,789 | 127 |
PROFIT BEFORE TAXATION | 2,165,676 | 606,735 |
Tax on profit | 8 | 518,884 | 121,823 |
PROFIT FOR THE FINANCIAL YEAR |
Profit attributable to: |
Owners of the parent | 1,646,792 | 484,912 |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
CONSOLIDATED OTHER COMPREHENSIVE INCOME |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
2023 | 2022 |
Notes | £ | £ |
PROFIT FOR THE YEAR | 1,646,792 | 484,912 |
OTHER COMPREHENSIVE INCOME |
Exchange difference | (43,472 | ) | - |
Income tax relating to other comprehensive income |
- |
- |
OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX |
(43,472 |
) |
- |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
1,603,320 |
484,912 |
Total comprehensive income attributable to: |
Owners of the parent | 1,603,320 | 484,912 |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
CONSOLIDATED BALANCE SHEET |
31 DECEMBER 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 10 | 4,533,823 | 4,806,690 |
Tangible assets | 11 | 12,471 | 16,172 |
Investments | 12 | - | - |
4,546,294 | 4,822,862 |
CURRENT ASSETS |
Stocks | 13 | 1,864,473 | 2,941,644 |
Debtors | 14 | 5,019,230 | 3,747,507 |
Cash at bank | 2,021,820 | 3,135,335 |
8,905,523 | 9,824,486 |
CREDITORS |
Amounts falling due within one year | 15 | 4,646,352 | 6,708,106 |
NET CURRENT ASSETS | 4,259,171 | 3,116,380 |
TOTAL ASSETS LESS CURRENT LIABILITIES |
8,805,465 |
7,939,242 |
CREDITORS |
Amounts falling due after more than one year |
16 |
1,385,290 |
2,122,387 |
NET ASSETS | 7,420,175 | 5,816,855 |
CAPITAL AND RESERVES |
Called up share capital | 19 | 350,938 | 350,938 |
Other reserves | 20 | (43,472 | ) | - |
Retained earnings | 20 | 7,112,709 | 5,465,917 |
SHAREHOLDERS' FUNDS | 7,420,175 | 5,816,855 |
The financial statements were approved by the Board of Directors and authorised for issue on 18 September 2024 and were signed on its behalf by: |
S G Flatt - Director |
B P Andrews - Director |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
COMPANY BALANCE SHEET |
31 DECEMBER 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 10 |
Tangible assets | 11 |
Investments | 12 |
CURRENT ASSETS |
Stocks | 13 |
Debtors | 14 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 15 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year |
16 |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 19 |
Retained earnings | 20 |
SHAREHOLDERS' FUNDS |
Company's profit for the financial year | 1,375,235 | 385,112 |
The financial statements were approved by the Board of Directors and authorised for issue on |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
Called up |
share | Retained | Other | Total |
capital | earnings | reserves | equity |
£ | £ | £ | £ |
Balance at 1 January 2022 | 350,938 | 4,981,005 | - | 5,331,943 |
Changes in equity |
Total comprehensive income | - | 484,912 | - | 484,912 |
Balance at 31 December 2022 | 350,938 | 5,465,917 | - | 5,816,855 |
Changes in equity |
Total comprehensive income | - | 1,646,792 | (43,472 | ) | 1,603,320 |
Balance at 31 December 2023 | 350,938 | 7,112,709 | (43,472 | ) | 7,420,175 |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
COMPANY STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 January 2022 |
Changes in equity |
Total comprehensive income | - |
Balance at 31 December 2022 |
Changes in equity |
Total comprehensive income | - |
Balance at 31 December 2023 |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
CONSOLIDATED CASH FLOW STATEMENT |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
2023 | 2022 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 23 | 114,792 | 311,851 |
Interest paid | (4,789 | ) | (127 | ) |
Movement in FX reserve | (43,472 | ) | - |
Tax paid | (535,533 | ) | (156,123 | ) |
Net cash from operating activities | (469,002 | ) | 155,601 |
Cash flows from investing activities |
Purchase of intangible fixed assets | - | (2,100 | ) |
Purchase of tangible fixed assets | (10,355 | ) | (10,372 | ) |
Sale of intangible fixed assets | 2,939 | - |
Purchase of subsidiary - deferred | (637,097 | ) | (1,572,071 | ) |
Net cash from investing activities | (644,513 | ) | (1,584,543 | ) |
Decrease in cash and cash equivalents | (1,113,515 | ) | (1,428,942 | ) |
Cash and cash equivalents at beginning of year |
24 |
3,135,335 |
4,564,277 |
Cash and cash equivalents at end of year |
24 |
2,021,820 |
3,135,335 |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
1. | STATUTORY INFORMATION |
Upper Canada UK Limited is a |
The presentation currency of the financial statements is the Pound Sterling (£). |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Basis of consolidation |
The Group consolidated financial statements include the financial statements of the Company and its subsidiaries, all of whom are 100% owned, made up to the same period end date. All accounting policies as detailed below are applied consistently across the Group. |
The parent company has taken the exemption under FRS102 from presenting its own cash flow statement. |
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. |
Turnover |
Revenue is measured at the fair value of the consideration received or receivable and represents the amount receivable for goods supplied, net of returns, discounts and value added taxes. |
Revenue is recognised when the significant risks and rewards of the goods have passed to the customer, which on deliveries is typically the point where goods are delivered to and accepted by the customer. |
Goodwill |
Business combinations, other than group reconstructions, are accounted for by applying the purchase method. A business combination is defined as the bringing together of separate entities or businesses into one reporting entity. |
The cost of a business combination is the fair value of the consideration given and liabilities incurred plus directly attributable costs. Goodwill, recognised at the point of purchase, represents the excess of the fair value of the consideration given over the fair values of the Group's interest in the identifiable net assets, liabilities and contingent liabilities acquired. |
Goodwill on the acquisition of a businesses in 2017 and 2022 is being amortised over its estimated useful life of twenty years. |
Goodwill on the acquisition of brands in 2020 is being amortised over its estimated useful life of ten years. |
Trademarks |
Amortisation is calculated so as to write off the cost of an asset, less estimated residual value, over the useful economic life of that asset as follows: |
Trademarks - 5% per annum |
Tangible fixed assets |
Improvements to property | - |
Plant and machinery | - |
Office Equipment | - |
Investments in subsidiaries |
Investments in subsidiary undertakings are recognised at cost. |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
2. | ACCOUNTING POLICIES - continued |
Stocks |
Stock is stated at the lower of cost and selling price less costs to complete and sell, after making due allowance for obsolete and slow moving items. Stocks are recognized as an expense in the period in which the related revenue is recognized. |
Cost is determined on an average cost basis. Cost includes the purchase price, including taxes and duties, transport and all other costs directly attributable to bringing the stock to its present location and condition. |
At the year end, the basis on which provision is made for stock was changed from a stock category method to a provision based on ageing. This resulted in a reduction in the provision of £245,251. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
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. |
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. |
Foreign currencies |
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result. |
Hire purchase and leasing commitments |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The group operates a defined contribution pension scheme. Contributions payable to the group's pension scheme are charged to profit or loss in the period to which they relate. |
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: |
2023 | 2022 |
£ | £ |
United Kingdom | 8,459,867 | 4,554,257 |
Europe | 751,115 | 404,353 |
United States of America | 8,508,174 | 4,580,262 |
Rest of world | 1,063,285 | 572,405 |
18,782,441 | 10,111,277 |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
4. | EMPLOYEES AND DIRECTORS |
2023 | 2022 |
£ | £ |
Wages and salaries | 2,014,162 | 1,957,301 |
Social security costs | 244,749 | 241,700 |
Other pension costs | 51,112 | 72,537 |
2,310,023 | 2,271,538 |
The average number of employees during the year was as follows: |
2023 | 2022 |
Sales | 11 | 14 |
Product development | 17 | 21 |
Operations and finance | 12 | 10 |
The average number of employees by undertakings that were proportionately consolidated during the year was 40 (2022 - 45 ) . |
2023 | 2022 |
£ | £ |
Directors' remuneration | 257,400 | 242,200 |
Directors' pension contributions to money purchase schemes | 7,875 | 7,313 |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes | 1 | 1 |
Information regarding the highest paid director is as follows: |
2023 | 2022 |
£ | £ |
Emoluments etc | 257,400 | 213,200 |
Pension contributions to money purchase schemes | 7,875 | 7,313 |
The Directors are considered to be the key management for the purposes of disclosure under FRS102. |
5. | OPERATING PROFIT |
The operating profit is stated after charging: |
2023 | 2022 |
£ | £ |
Other operating leases | 155,374 | 164,289 |
Depreciation - owned assets | 14,055 | 22,576 |
Goodwill amortisation | 269,228 | 75,870 |
Trademarks amortisation | 700 | 1,051 |
Auditors' remuneration | 23,500 | 19,500 |
Foreign exchange differences | 97,666 | 51,709 |
6. | EXCEPTIONAL ITEMS |
2023 | 2022 |
£ | £ |
Exceptional (losses)/gains on foreign currency | (168,170 | ) | 235,053 |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
7. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2023 | 2022 |
£ | £ |
Bank loan interest | - | 127 |
Inland Revenue interest | 4,789 | - |
4,789 | 127 |
8. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
2023 | 2022 |
£ | £ |
Current tax: |
UK corporation tax | 518,884 | 121,823 |
Tax on profit | 518,884 | 121,823 |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
2023 | 2022 |
£ | £ |
Profit before tax | 2,165,676 | 606,735 |
Profit multiplied by the standard rate of corporation tax in the UK of 23.500 % (2022 - 19 %) |
508,934 |
115,280 |
Effects of: |
Depreciation in excess of capital allowances | 63,946 | 6,543 |
Tax rate | 443 | - |
Other timing differences | (54,439 | ) | - |
Total tax charge | 518,884 | 121,823 |
Tax effects relating to effects of other comprehensive income |
2023 |
Gross | Tax | Net |
£ | £ | £ |
Exchange difference | (43,472 | ) | - | (43,472 | ) |
9. | INDIVIDUAL INCOME STATEMENT |
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. |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
10. | INTANGIBLE FIXED ASSETS |
Group |
Goodwill | Trademarks | Totals |
£ | £ | £ |
COST |
At 1 January 2023 | 5,181,562 | 143,075 | 5,324,637 |
Disposals | (2,939 | ) | - | (2,939 | ) |
At 31 December 2023 | 5,178,623 | 143,075 | 5,321,698 |
AMORTISATION |
At 1 January 2023 | 376,272 | 141,675 | 517,947 |
Amortisation for year | 269,228 | 700 | 269,928 |
At 31 December 2023 | 645,500 | 142,375 | 787,875 |
NET BOOK VALUE |
At 31 December 2023 | 4,533,123 | 700 | 4,533,823 |
At 31 December 2022 | 4,805,290 | 1,400 | 4,806,690 |
Company |
Goodwill | Trademarks | Totals |
£ | £ | £ |
COST |
At 1 January 2023 |
Acquired on hive up |
At 31 December 2023 |
AMORTISATION |
At 1 January 2023 |
Amortisation for year |
At 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 December 2022 |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
11. | TANGIBLE FIXED ASSETS |
Group |
Improvements | Fixtures |
to | Plant and | and | Office |
property | machinery | fittings | Equipment | Totals |
£ | £ | £ | £ | £ |
COST |
At 1 January 2023 | 6,092 | 21,636 | 9,530 | 67,378 | 104,636 |
Additions | - | - | - | 10,355 | 10,355 |
Disposals | - | (6,705 | ) | - | - | (6,705 | ) |
Transfer | - | (6,093 | ) | - | 6,092 | (1 | ) |
At 31 December 2023 | 6,092 | 8,838 | 9,530 | 83,825 | 108,285 |
DEPRECIATION |
At 1 January 2023 | 6,092 | 15,543 | 9,530 | 57,299 | 88,464 |
Charge for year | - | - | - | 14,055 | 14,055 |
Eliminated on disposal | - | (6,705 | ) | - | - | (6,705 | ) |
At 31 December 2023 | 6,092 | 8,838 | 9,530 | 71,354 | 95,814 |
NET BOOK VALUE |
At 31 December 2023 | - | - | - | 12,471 | 12,471 |
At 31 December 2022 | - | 6,093 | - | 10,079 | 16,172 |
Company |
Fixtures |
Plant and | and | Office |
machinery | fittings | Equipment | Totals |
£ | £ | £ | £ |
COST |
At 1 January 2023 |
Additions |
Disposals | ( |
) | ( |
) |
Transfer |
At 31 December 2023 |
DEPRECIATION |
At 1 January 2023 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
At 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 December 2022 |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
12. | FIXED ASSET INVESTMENTS |
Company |
Shares in |
group |
undertakings |
£ |
COST |
At 1 January 2023 |
Additions |
Disposals | ( |
) |
Hive up | ( |
) |
At 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 December 2022 |
The group or the company's investments at the Balance Sheet date in the share capital of companies include the following: |
Subsidiaries |
Registered office: Unit 10.1.1, The Leathermarket, Weston Street, London, SE1 3ER |
Nature of business: |
% |
Class of shares: | holding |
This company was dissolved on 23 January 2024. |
Registered office: Unit 10.1.1, The Leathermarket, Weston Street, London, SE1 3ER |
Nature of business: |
% |
Class of shares: | holding |
The trade and assets of The Vintage Cosmetic Company Limited were hived up into the parent company on 1 January 2023 and it was dormant from that date. |
Registered office: To advise |
Nature of business: |
% |
Class of shares: | holding |
13. | STOCKS |
Group | Company |
2023 | 2022 | 2023 | 2022 |
£ | £ | £ | £ |
Stocks | 1,864,473 | 2,941,644 |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
14. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
2023 | 2022 | 2023 | 2022 |
£ | £ | £ | £ |
Trade debtors | 4,201,868 | 3,354,664 |
Amounts owed by group undertakings | - | - |
Prepayments and accrued income | 817,362 | 392,843 |
5,019,230 | 3,747,507 |
15. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
2023 | 2022 | 2023 | 2022 |
£ | £ | £ | £ |
Trade creditors | 1,133,217 | 589,111 |
Amounts owed to group undertakings | 1,481,939 | 4,108,616 |
Corporation tax | 149,200 | 165,849 |
Social security and other taxes | 57,145 | 61,280 |
VAT | 183,572 | 285,481 | 183,572 | 260,226 |
Other creditors | 1,199,638 | 1,110,023 |
Accruals and deferred income | 441,641 | 387,746 |
4,646,352 | 6,708,106 |
Included within other creditors is an amount of £2,585,890 (2022 : ££3,222,387) in respect of the deferred |
consideration due on the purchase of The Vintage Cosmetic Company Limited. £1,200,000 (2022 : |
£1,100,000) of this balance is shown within creditors due in less than one year and the balance is shown |
within creditors due after one year. |
16. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
Group | Company |
2023 | 2022 | 2023 | 2022 |
£ | £ | £ | £ |
Other creditors | 1,385,290 | 2,122,387 |
17. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Group |
Non-cancellable operating | leases |
2023 | 2022 |
£ | £ |
Within one year | 116,320 | 508,581 |
Between one and five years | 247,398 | - |
363,718 | 508,581 |
The above commitments relate to the office premises in London. In the prior year, the figures included 3rd party warehouses premises previously rented by The Vintage Cosmetic Company Limited. |
Company |
Non-cancellable operating | leases |
2023 | 2022 |
£ | £ |
Within one year |
Between one and five years |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
18. | SECURED DEBTS |
The Group's principal bankers hold a fixed and floating charge over all of the assets of the Company in |
respect of any obligations the Group has to the bank. At the year end there were no such obligations. |
19. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
value: | £ | £ |
Ordinary shares | 1 | 350,938 | 350,938 |
20. | RESERVES |
Group |
Retained | Other |
earnings | reserves | Totals |
£ | £ | £ |
At 1 January 2023 | 5,465,917 | - | 5,465,917 |
Profit for the year | 1,646,792 | 1,646,792 |
Exchange difference arising on |
consolidation | - | (43,472 | ) | (43,472 | ) |
At 31 December 2023 | 7,112,709 | (43,472 | ) | 7,069,237 |
Company |
Retained |
earnings |
£ |
At 1 January 2023 |
Profit for the year |
At 31 December 2023 |
21. | RELATED PARTY DISCLOSURES |
During the year the group re-charged its parent company costs of £nil (2022: £449,720) in relation to |
operating expenses incurred on its behalf. |
At the balance sheet date the company had the followed balances with related parties: |
Upper Canada Soap & Candle Makers Incorporated (parent company) Creditor £1,481,939 (2022: |
£4,108,616). |
22. | ULTIMATE CONTROLLING PARTY |
The immediate parent company is Upper Canada Soap & Candle Makers Incorporated (incorporated in Canada and registered office at 5875 Chedworth Way Mississauga, ON L5R 3L9). The ultimate parent company is CVI Canada Incorporated, who are also incorporated in Canada and registered at the same address. |
The immediate and ultimate parent companies are not required to prepare consolidated accounts. |
The ultimate controlling party is S G Flatt. |
UPPER CANADA UK LIMITED (REGISTERED NUMBER: 02251430) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
23. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
2023 | 2022 |
£ | £ |
Profit before taxation | 2,165,676 | 606,735 |
Depreciation charges | 283,983 | 99,497 |
Finance costs | 4,789 | 127 |
2,454,448 | 706,359 |
Decrease/(increase) in stocks | 1,077,170 | (665,230 | ) |
(Increase)/decrease in trade and other debtors | (1,271,723 | ) | 33,157 |
(Decrease)/increase in trade and other creditors | (2,145,103 | ) | 237,565 |
Cash generated from operations | 114,792 | 311,851 |
24. | 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 | 2,021,820 | 3,135,335 |
Year ended 31 December 2022 |
31.12.22 | 1.1.22 |
£ | £ |
Cash and cash equivalents | 3,135,335 | 4,564,277 |
25. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1.1.23 | Cash flow | At 31.12.23 |
£ | £ | £ |
Net cash |
Cash at bank | 3,135,335 | (1,113,515 | ) | 2,021,820 |
3,135,335 | (1,113,515 | ) | 2,021,820 |
Total | 3,135,335 | (1,113,515 | ) | 2,021,820 |