Company registration number 07110338 (England and Wales)
THERMATIC LIMITED
Annual Report And Financial Statements
For The Year Ended 31 December 2023
Thermatic Limited
THERMATIC LIMITED
Company Information
Directors
Mr E Wratten
Mr PB Douglas-Fleet
(Appointed 27 June 2024)
Secretary
Mr E Wratten
Company number
07110338
Registered office
Unit 3 Sovereign Enterprise Park
King William Street
Salford
Manchester
England
M50 3UP
Auditor
Chavereys Audit Limited
The Goods Shed
Jubilee Way
Faversham
Kent
England
ME13 8GD
Thermatic Limited
THERMATIC LIMITED
Contents
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Group statement of comprehensive income
7
Group balance sheet
8
Company balance sheet
9
Group statement of changes in equity
10
Company statement of changes in equity
11
Group statement of cash flows
12
Notes to the financial statements
13 - 30
Thermatic Limited
THERMATIC LIMITED
Strategic Report
For The Year Ended 31 December 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Review of the business
The Thermatic Group experienced a slight reduction in turnover in 2023, decreasing from £25,176,746 to £24,149,640. This decline was the result of a strategic decision to exit loss-making contracts and concentrate on our core customer base. Despite this reduction, the gross profit margin increased from 27.2% to 30.4% during the year.
Operating profit for the Group decreased from £656,172 to £397,746, primarily due to bad debt write-offs totalling £222,978 (compared to £16,133 in 2022). This bad debt was attributed to Wilko Limited entering administration.
Thermatic continues to expand its range of services, offering nationwide hard facilities maintenance. This capability was further enhanced by the acquisition of Thermatic Drainage Limited (formerly PDS (NW) Limited) on 31 July 2023. This acquisition enables the Group to offer a comprehensive national drainage solution, covering everything from CCTV surveying and jetting to complex patch lining and no-dig repairs.
Our commitment to excellent customer service is upheld by our highly valued workforce. The average number of employees increased from 201 in 2022 to 225 in 2023.
Principal risks and uncertainties
The directors consider the full range of risks affecting the group on a regular basis, and where appropriate take action to address such risks. The principal risks and uncertainties facing the group are detailed below:
Market Risk
The group operates in a competitive market place, however the strength of the group brands and a focus on developing long-term relationships with its customers is deemed to cover this risk.
Credit Risk
The group's credit risk is primarily attributed to its trade debtors. The group continues to expand its customer base and has no significant concentration of credit risk. The group has a good record of minimising bad debts and takes the necessary steps to ensure the risk is minimised. The credit risk on liquid funds is limited because the counterparties are banks with high credit ratings assigned by credit rating agencies.
Liquidity Risk
The group manages its debt finance in such a way to ensure that it has sufficient funds available for ongoing operations and future developments.
Mr PB Douglas-Fleet
Director
19 September 2024
Thermatic Limited
THERMATIC LIMITED
Directors' Report
For The Year Ended 31 December 2023
- 2 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Principal activities
The group continues to operate with a nationwide network of multi skilled engineers and supervisors, delivering expert advice and solutions across all aspects of hard facilities maintenance, including: mechanical and electrical building services, drainage solutions, specialist ventilation, renewable technologies and energy management services. The principal activity in the year under review is the provision of these services to the commercial, residential, medical, domestic and social housing sectors.
Results and dividends
The results for the year are set out on page 7.
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:
Mr CR Tennent
(Resigned 27 June 2024)
Mr E Wratten
Mr PB Douglas-Fleet
(Appointed 27 June 2024)
Auditor
Chavereys Audit Limited were appointed as auditor to the group and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
Statement of directors' responsibilities
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:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the ;
prepare the on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.
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.
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.
Thermatic Limited
THERMATIC LIMITED
Directors' Report (Continued)
For The Year Ended 31 December 2023
- 3 -
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
On behalf of the board
Mr PB Douglas-Fleet
Director
19 September 2024
Thermatic Limited
THERMATIC LIMITED
Independent Auditor's Report
To The Members Of Thermatic Limited
- 4 -
Opinion
We have audited the financial statements of Thermatic Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023 which comprise 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 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 the parent company's 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.
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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
Thermatic Limited
THERMATIC LIMITED
Independent Auditor's Report (Continued)
To The Members Of Thermatic Limited
- 5 -
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 their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the 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
The objectives of our audit are to identify and assess the risks of material misstatement of the financial statements due to fraud or error; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud or error; and to respond appropriately to those risks. Owing the inherent limitations of an audit, there is an unavoidable risk that material misstatements in in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK).
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedure included the following:
We obtained an understanding of the legal and regulatory frameworks applicable to the Group and Company and the sector in which they operate. We determined that the following laws and regulations were most significant: Companies Act 2006 and UK corporate tax laws, employment law, pensions legislation and health and safety law.
Identifying and assess the design effectiveness of controls management has in place to prevent and detect fraud;
Understanding how those charged with governance considered and addressed the potential override of controls or other inappropriate influence over the financial reporting process;
Challenging assumptions and judgment made by management in its significant accounting estimates;
Identifying and testing journal entries, in particular any journal entries posted for unusual amounts and outside of normal working hours; and
Assessing the extent of compliance with the relevant laws and regulations.
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.
Thermatic Limited
THERMATIC LIMITED
Independent Auditor's Report (Continued)
To The Members Of Thermatic Limited
- 6 -
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
Benjamin Wilkinson BSc FCA (Senior Statutory Auditor)
For and on behalf of Chavereys Audit Limited
20 September 2024
Chartered Accountants
Statutory Auditor
The Goods Shed
Jubilee Way
Faversham
Kent
England
ME13 8GD
Thermatic Limited
THERMATIC LIMITED
Group Statement Of Comprehensive Income
For The Year Ended 31 December 2023
- 7 -
2023
2022
as restated
Notes
£
£
Turnover
24,149,641
25,176,743
Cost of sales
(16,816,524)
(18,321,804)
Gross profit
7,333,117
6,854,939
Distribution costs
67,945
Administrative expenses
(7,003,315)
(6,198,770)
Other operating (expenses)/income
(1)
3
Operating profit
3
397,746
656,172
Interest payable and similar expenses
7
(67,438)
(52,165)
Profit before taxation
330,308
604,007
Tax on profit
8
(354)
(192,333)
Profit for the financial year
22
329,954
411,674
Profit for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.
Thermatic Limited
THERMATIC LIMITED
Group Balance Sheet
As At 31 December 2023
- 8 -
2023
2022
as restated
Notes
£
£
£
£
Fixed assets
Goodwill
9
852,949
374,530
Other intangible assets
9
41,248
4,345
Total intangible assets
894,197
378,875
Tangible assets
10
1,166,832
550,166
2,061,029
929,041
Current assets
Stocks
13
902,734
767,604
Debtors
14
4,938,087
5,838,222
Cash at bank and in hand
923,638
452,287
6,764,459
7,058,113
Creditors: amounts falling due within one year
15
(6,749,927)
(5,453,071)
Net current assets
14,532
1,605,042
Total assets less current liabilities
2,075,561
2,534,083
Creditors: amounts falling due after more than one year
16
(492,058)
(1,296,036)
Provisions for liabilities
Deferred tax liability
19
15,502
(15,502)
-
Net assets
1,568,001
1,238,047
Capital and reserves
Called up share capital
21
10,000
10,000
Profit and loss reserves
22
1,558,001
1,228,047
Total equity
1,568,001
1,238,047
These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.
The financial statements were approved by the board of directors and authorised for issue on 19 September 2024 and are signed on its behalf by:
19 September 2024
Mr PB Douglas-Fleet
Director
Company registration number 07110338 (England and Wales)
Thermatic Limited
THERMATIC LIMITED
Company Balance Sheet
As At 31 December 2023
31 December 2023
- 9 -
2023
2022
as restated
Notes
£
£
£
£
Fixed assets
Intangible assets
9
950
Tangible assets
10
15,464
27,003
Investments
11
2,162,825
947,985
2,179,239
974,988
Current assets
Debtors
14
1,521,890
1,402,326
Cash at bank and in hand
288,040
107,359
1,809,930
1,509,685
Creditors: amounts falling due within one year
15
(3,504,503)
(1,376,587)
Net current (liabilities)/assets
(1,694,573)
133,098
Total assets less current liabilities
484,666
1,108,086
Creditors: amounts falling due after more than one year
16
(412,500)
(1,774,864)
Net assets/(liabilities)
72,166
(666,778)
Capital and reserves
Called up share capital
21
10,000
10,000
Profit and loss reserves
22
62,166
(676,778)
Total equity
72,166
(666,778)
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 £738,944 (2022 - £306,061 loss).
The financial statements were approved by the board of directors and authorised for issue on 19 September 2024 and are signed on its behalf by:
19 September 2024
Mr PB Douglas-Fleet
Director
Company registration number 07110338 (England and Wales)
Thermatic Limited
THERMATIC LIMITED
Group Statement Of Changes In Equity
For The Year Ended 31 December 2023
- 10 -
Share capital
Profit and loss reserves
Total
£
£
£
As restated for the period ended 31 December 2022:
Balance at 1 January 2022
10,000
816,373
826,373
Year ended 31 December 2022:
Profit and total comprehensive income
-
411,674
411,674
Balance at 31 December 2022
10,000
1,228,047
1,238,047
Year ended 31 December 2023:
Profit and total comprehensive income
-
329,954
329,954
Balance at 31 December 2023
10,000
1,558,001
1,568,001
Thermatic Limited
THERMATIC LIMITED
Company Statement Of Changes In Equity
For The Year Ended 31 December 2023
- 11 -
Share capital
Profit and loss reserves
Total
£
£
£
As restated for the period ended 31 December 2022:
Balance at 1 January 2022
10,000
(370,717)
(360,717)
Year ended 31 December 2022:
Loss and total comprehensive income for the year
-
(306,061)
(306,061)
Balance at 31 December 2022
10,000
(676,778)
(666,778)
Year ended 31 December 2023:
Profit and total comprehensive income
-
738,944
738,944
Balance at 31 December 2023
10,000
62,166
72,166
Thermatic Limited
THERMATIC LIMITED
Group Statement Of Cash Flows
For The Year Ended 31 December 2023
- 12 -
2023
2022
as restated
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
27
2,610,214
(143,235)
Interest paid
(67,438)
(52,165)
Income taxes paid
(131,715)
(39,568)
Net cash inflow/(outflow) from operating activities
2,411,061
(234,968)
Investing activities
Acquisition of subsidiary
(413,357)
-
Purchase of intangible assets
(41,778)
-
Purchase of tangible fixed assets
(509,799)
(152,333)
Proceeds from disposal of tangible fixed assets
3,377
14,803
Net cash used in investing activities
(961,557)
(137,530)
Financing activities
Repayment of borrowings
(818,902)
656,384
Repayment of bank loans
(125,833)
(150,000)
Payment of finance leases obligations
(33,418)
(36,409)
Net cash (used in)/generated from financing activities
(978,153)
469,975
Net increase in cash and cash equivalents
471,351
97,477
Cash and cash equivalents at beginning of year
452,287
354,810
Cash and cash equivalents at end of year
923,638
452,287
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements
For The Year Ended 31 December 2023
- 13 -
1
Accounting policies
Company information
Thermatic Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Unit 3 Sovereign Enterprise Park, King William Street, Salford, Manchester, England, M50 3UP.
The group consists of Thermatic 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. 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:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
1.2
Business combinations
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.
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
1
Accounting policies
(Continued)
- 14 -
1.3
Basis of consolidation
The consolidated group financial statements consist of the financial statements of the parent company Thermatic 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.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
1.4
Going concern
At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.5
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
Turnover comprises services provided by the company and it's subsidiaries, and is recognised in the period as to which it relates.
1.6
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 10 years.
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.
1.7
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.
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
1
Accounting policies
(Continued)
- 15 -
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:
Software
25% straight line
1.8
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Leasehold land and buildings
Straight line basis over length of lease
Plant and equipment
25% straight line/25% reducing balance
Fixtures and fittings
25% straight line/15% reducing balance
Motor vehicles
25% straight line/25% reducing balance
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.
1.9
Fixed asset investments
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities 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.
1.10
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.
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
1
Accounting policies
(Continued)
- 16 -
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.
1.11
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.12
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.
1.13
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.
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
1
Accounting policies
(Continued)
- 17 -
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.
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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
1.14
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.
1.15
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.
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
1
Accounting policies
(Continued)
- 18 -
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.
1.16
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.
1.17
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.18
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
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.
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
- 19 -
3
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange gains
(126)
-
Research and development costs
-
(2,390)
Depreciation of owned tangible fixed assets
172,893
157,373
Depreciation of tangible fixed assets held under finance leases
14,393
-
Loss/(profit) on disposal of tangible fixed assets
3,359
(657)
Amortisation of intangible assets
68,180
43,119
Operating lease charges
172,384
103,961
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
43,650
30,750
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
2
2
2
2
Management
12
11
1
1
Other staff
211
188
19
11
Total
225
201
22
14
Their aggregate remuneration comprised:
Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
9,384,794
9,082,426
1,018,367
632,195
Social security costs
989,673
964,909
88,963
52,960
Pension costs
260,080
235,596
36,892
14,378
10,634,547
10,282,931
1,144,222
699,533
Key management includes members of senior management. The compensation paid or payable to key management for employee services was £240,280 (2022: £207,480).
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
- 20 -
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
75,600
76,200
Company pension contributions to defined contribution schemes
7,080
6,480
82,680
82,680
7
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
61,742
52,165
Interest on finance leases and hire purchase contracts
5,696
-
Total finance costs
67,438
52,165
8
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
(2,813)
Adjustments in respect of prior periods
30,708
Total current tax
27,895
Deferred tax
Origination and reversal of timing differences
80,469
192,333
Previously unrecognised tax loss, tax credit or timing difference
(108,010)
Total deferred tax
(27,541)
192,333
Total tax charge
354
192,333
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
8
Taxation
(Continued)
- 21 -
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Profit before taxation
330,308
604,007
Expected tax charge based on the standard rate of corporation tax in the UK of 23.50% (2022: 19.00%)
77,622
114,761
Tax effect of expenses that are not deductible in determining taxable profit
1,998
(482)
Tax effect of income not taxable in determining taxable profit
(46,864)
Tax effect of utilisation of tax losses not previously recognised
(88,481)
(6,678)
Unutilised tax losses carried forward
789
Change in unrecognised deferred tax assets
7,050
93,525
Adjustments in respect of prior years
30,708
Effect of change in corporation tax rate
10,491
(3,531)
Permanent capital allowances in excess of depreciation
(7,842)
(3,820)
Amortisation on assets not qualifying for tax allowances
14,883
8,056
Research and development tax credit
(7,410)
Deferred tax adjustments in respect of prior years
(2,088)
Taxation charge
354
192,333
9
Intangible fixed assets
Group
Goodwill
Software
Total
£
£
£
Cost
At 1 January 2023
423,993
7,200
431,193
Additions
541,724
41,778
583,502
Disposals
(879,041)
(879,041)
At 31 December 2023
86,676
48,978
135,654
Amortisation and impairment
At 1 January 2023
49,463
2,855
52,318
Amortisation charged for the year
63,305
4,875
68,180
Disposals
(879,041)
(879,041)
At 31 December 2023
(766,273)
7,730
(758,543)
Carrying amount
At 31 December 2023
852,949
41,248
894,197
At 31 December 2022
374,530
4,345
378,875
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
9
Intangible fixed assets
(Continued)
- 22 -
Company
Software
£
Cost
At 1 January 2023
Additions
1,200
At 31 December 2023
1,200
Amortisation and impairment
At 1 January 2023
Amortisation charged for the year
250
At 31 December 2023
250
Carrying amount
At 31 December 2023
950
At 31 December 2022
10
Tangible fixed assets
Group
Leasehold land and buildings
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2023
337,899
512,140
16,282
87,000
953,321
Additions
354,116
150,134
4,755
795
509,800
Business combinations
107,723
1,613
191,552
300,888
Disposals
(2,915)
(9,350)
(12,265)
At 31 December 2023
692,015
767,082
22,650
269,997
1,751,744
Depreciation and impairment
At 1 January 2023
84,021
284,228
9,955
24,951
403,155
Depreciation charged in the year
7,129
139,081
3,476
37,600
187,286
Eliminated in respect of disposals
(75)
(5,454)
(5,529)
At 31 December 2023
91,150
423,234
13,431
57,097
584,912
Carrying amount
At 31 December 2023
600,865
343,848
9,219
212,900
1,166,832
At 31 December 2022
253,878
227,912
6,327
62,049
550,166
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
10
Tangible fixed assets
(Continued)
- 23 -
Company
Plant and equipment
£
Cost
At 1 January 2023
61,940
Additions
2,973
At 31 December 2023
64,913
Depreciation and impairment
At 1 January 2023
34,937
Depreciation charged in the year
14,512
At 31 December 2023
49,449
Carrying amount
At 31 December 2023
15,464
At 31 December 2022
27,003
11
Fixed asset investments
Group
Company
2023
2022
2023
2022
£
£
£
£
Unlisted investments
2,162,825
947,985
Movements in fixed asset investments
Company
Investments
£
Cost or valuation
At 1 January 2023
947,985
Additions
1,214,840
At 31 December 2023
2,162,825
Carrying amount
At 31 December 2023
2,162,825
At 31 December 2022
947,985
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
- 24 -
12
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
VTV Solutions Limited
Unit 3 Sovereign Enterprise Park, King William Street, Salford, Manchester M50 3UP
Ventiliation and validation services
Ordinary
100.00
Thermatic Buildings Services Limited
Unit 3 Sovereign Enterprise Park, King William Street, Salford, Manchester M50 3UP
Owns property occupied by the group
Ordinary
100.00
Thermatic Technical FM Limited
Unit 3 Sovereign Enterprise Park, King William Street, Salford, Manchester M50 3UP
Provider of hard FM services to the commercial sector
Ordinary
100.00
Thermatic Homes Limited
Unit 3 Sovereign Enterprise Park, King William Street, Salford, Manchester M50 3UP
National provider of mechanical, electrical and renewable services
Ordinary
100.00
Thermatic Renewables Limited
Unit 3 Sovereign Enterprise Park, King William Street, Salford, Manchester M50 3UP
Dormant
Ordinary
100.00
Thermatic Scotland Limited
272 Bath Street, Glasgow, Scotland G2 4JR
Dormant
Ordinary
100.00
Thermatic Energy Services Limited
Unit 3 Sovereign Enterprise Park, King William Street, Salford, Manchester M50 3UP
Building management consultants focused on building energy use, connecting estates and energy management strategies
Ordinary
100.00
Thermatic Maintenance Limited
Unit 3 Sovereign Enterprise Park, King William Street, Salford, Manchester M50 3UP
Dormant
Ordinary
100.00
Thermatic Drainage Limited
Unit 3 Sovereign Enterprise Park, King William Street, Salford, Manchester M50 3UP
Drainage solutions and surveying services
Ordinary
100.00
13
Stocks
Group
Company
as restated
2023
2022
2023
2022
£
£
£
£
Consumables
11,049
14,316
-
-
Work in progress
891,685
753,288
-
-
902,734
767,604
-
-
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
- 25 -
14
Debtors
Group
Company
as restated
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
3,268,012
5,195,022
Amounts owed by group undertakings
-
-
350,094
475,000
Other debtors
275,739
44,035
Prepayments and accrued income
1,394,336
584,451
313,786
177,326
4,938,087
5,823,508
663,880
652,326
Deferred tax asset (note 19)
14,714
108,010
4,938,087
5,838,222
771,890
652,326
Amounts falling due after more than one year:
Amounts owed by group undertakings
-
-
750,000
750,000
Total debtors
4,938,087
5,838,222
1,521,890
1,402,326
15
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
17
160,000
150,000
150,000
150,000
Obligations under finance leases
18
44,381
23,852
Other borrowings
17
1,315,392
1,205,961
Trade creditors
1,549,592
1,300,821
71,580
64,032
Amounts owed to group undertakings
2,468,014
801,879
Corporation tax payable
38,386
Other taxation and social security
795,790
762,246
144,343
48,006
Other creditors
630,892
493,957
410,961
260,637
Accruals and deferred income
2,215,494
1,516,234
259,605
52,033
6,749,927
5,453,071
3,504,503
1,376,587
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
- 26 -
16
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
17
226,667
362,500
212,500
362,500
Obligations under finance leases
18
65,391
33,536
Other borrowings
17
900,000
900,000
Amounts owed to group undertakings
512,364
Other creditors
200,000
200,000
492,058
1,296,036
412,500
1,774,864
17
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
386,667
512,500
362,500
512,500
Loans from related parties
900,000
900,000
Invoice discounting facility
1,315,392
1,205,961
2,601,741
2,618,461
362,500
1,412,500
Payable within one year
2,375,074
1,355,961
150,000
150,000
Payable after one year
226,667
1,262,500
212,500
1,262,500
Bank loans are secured by a fixed and floating charge over the group's assets.
The invoice discounting facility is secured on the trade debtors ledger in Thermatic Technical FM Limited and VTV Solutions Limited.
18
Finance lease obligations
Group
Company
2023
2022
2023
2022
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
44,380
23,852
In two to five years
65,392
33,536
109,772
57,388
-
-
Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 4 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
- 27 -
19
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
Liabilities
Liabilities
Assets
Assets
2023
2022
2023
2022
Group
£
£
£
£
Accelerated capital allowances
135,122
-
-
(63,662)
Tax losses
(108,010)
-
-
65,940
Other timing differences
(11,610)
-
-
12,436
15,502
-
-
14,714
Liabilities
Liabilities
Assets
Assets
2023
2022
2023
2022
Company
£
£
£
£
Tax losses
-
-
108,010
-
Group
Company
2023
2023
Movements in the year:
£
£
Asset at 1 January 2023
(14,714)
-
Credit to profit or loss
(27,539)
(108,010)
On acquisition
57,755
-
Liability/(Asset) at 31 December 2023
15,502
(108,010)
20
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
260,080
235,596
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.
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
- 28 -
21
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
10,000
10,000
10,000
10,000
22
Profit and loss reserves
Group
Company
2023
2022
2023
2022
as restated
as restated
£
£
£
£
At the beginning of the year
1,228,047
816,373
(676,778)
(370,717)
Profit/(loss) for the year
329,954
411,674
738,944
(306,061)
At the end of the year
1,558,001
1,228,047
62,166
(676,778)
23
Acquisition of a business
On 31 July 2023 the group acquired 100 percent of the issued capital of Thermatic Drainage Limited (formerly PDS (NW) Limited).
Book Value
Adjustments
Fair Value
Net assets acquired
£
£
£
Property, plant and equipment
300,889
-
300,889
Inventories
6,000
-
6,000
Trade and other receivables
423,751
-
423,751
Cash and cash equivalents
401,483
-
401,483
Borrowings
(28,333)
-
(28,333)
Obligations under finance leases
(85,802)
-
(85,802)
Trade and other payables
(144,908)
-
(144,908)
Tax liabilities
(142,208)
-
(142,208)
Deferred tax
(57,755)
-
(57,755)
Total identifiable net assets
673,117
-
673,117
Goodwill
541,723
Total consideration
1,214,840
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
23
Acquisition of a business
(Continued)
- 29 -
The consideration was satisfied by:
£
Cash
814,840
Contingent consideration
400,000
1,214,840
Contingent consideration is payable based on the EBITDA of the company in the years to 31 July 2024 and 31 July 2025. The amount payable is capped at £400,000. The amount recognised in the business combination is based on management’s expectation for the company's performance at the acquisition date.
Contribution by the acquired business for the reporting period included in the group statement of comprehensive income since acquisition:
£
Turnover
878,201
Profit after tax
53,646
24
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
459,211
55,590
-
-
Between two and five years
1,220,556
218,774
-
-
In over five years
193,008
243,358
-
-
1,872,775
517,722
-
-
25
Related party transactions
Transactions with related parties
During the year, interest of £19,044 (2022: £24,784) and management charges of £148,500 (2022: £198,000) were charged by a company under common control. As at 31 December 2023, the balance due to the related party was £nil(2022: £900,000).
During the year, the group received charges of £119,115 (2022: £132,251) from a company connected to the shareholders. At the year end, a balance of £224,100 (£21,600) was due by the group to the related party.
26
Controlling party
During the year, the group was under the control of Dr and Mrs R J Wratten.
Thermatic Limited
THERMATIC LIMITED
Notes To The Group Financial Statements (Continued)
For The Year Ended 31 December 2023
- 30 -
27
Cash generated from/(absorbed by) group operations
2023
2022
£
£
Profit for the year after tax
329,954
411,674
Adjustments for:
Taxation charged
354
192,333
Finance costs
67,438
52,165
Loss/(gain) on disposal of tangible fixed assets
3,359
(657)
Amortisation and impairment of intangible assets
68,180
43,119
Depreciation and impairment of tangible fixed assets
187,286
157,373
Decrease in provisions
(400,000)
-
Movements in working capital:
Increase in stocks
(129,130)
(707,460)
Decrease in debtors
1,309,172
400,671
Increase/(decrease) in creditors
1,173,601
(692,453)
Cash generated from/(absorbed by) operations
2,610,214
(143,235)
28
Analysis of changes in net debt - group
1 January 2023
Cash flows
Acquisitions and disposals
31 December 2023
£
£
£
£
Cash at bank and in hand
452,287
471,351
-
923,638
Borrowings excluding overdrafts
(2,618,461)
944,735
(28,333)
(1,702,059)
Obligations under finance leases
(57,388)
33,418
(85,802)
(109,772)
(2,223,562)
1,449,504
(114,135)
(888,193)
29
Prior period adjustment
The prior period has been restated, adjusting the presentation of unbilled services from debtors to work in progress. There is no impact on the profit and loss of the group.
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