Company Registration No. 02859663 (England and Wales)
Petrow Food Industries Limited
Annual report and financial statements
for the year ended 31 December 2023
Petrow Food Industries Limited
Company information
Directors
Ian Tatchell
John Petrow
Company number
02859663
Registered office
71 Queen Victoria Street
London
EC4V 4BE
Independent auditor
Saffery LLP
Torridon House
Beechwood Park
Inverness
IV2 3BW
Business address
Spitalfields House
Phoenix Road
Haverhill
Suffolk
CB9 7AE
Bankers
Barclays Bank plc
72 The Friary
Guildford
GU1 4YT
Petrow Food Industries Limited
Contents
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Statement of comprehensive income
7
Statement of financial position
8
Statement of changes in equity
9
Statement of cash flows
10
Notes to the financial statements
11 - 21
Petrow Food Industries Limited
Strategic report
For the year ended 31 December 2023
1

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

Fair review of the business

The company trades and processes a range of dried fruits and coconut for sale to food manufacturers. Revenue has decreased slightly in the year, and losses continue to be incurred.

Principal risks and uncertainties

The company's business exposes it to a variety of risks that include the effects of fluctuating commodity prices, currencies and ongoing availability of finance. These risks are managed as follows:

 

The company tries to minimise commodity risk by limiting as much as possible the procurement of materials to supply customers who have a contract to purchase material and to meet anticipated forward demand.

 

The company has in place a risk management programme that seeks to limit the adverse impact of foreign exchange rates on the financial performance of the company. International business is hedged through the purchase and sale of forward contracts for foreign currency purchases and sales.

 

The bank facilities that are available to the company are part of an overall facility made to connected businesses. These facilities are not subject to an annual review but are constantly monitored by the lender. The directors remain confident that these facilities will continue to be available for the foreseeable future. An allocation of these facilities is set aside for the company which is considered sufficient to support current levels of business. There are reviews and controls in place to ensure that funds are continually available to all the connected businesses.

On behalf of the board

John Petrow
Director
19 September 2024
Petrow Food Industries 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 principal activity of the company is the processing of dried fruits and coconut for sale to food manufacturers.

Directors

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

Ian Tatchell
John Petrow
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 final dividend.

Future developments

The director's consider the outlook for next year to continue to be challenging, although the directors believe recent investment in 'value added' production lines will open up more opportunities.

Financial risks
Details of financial risks and how they are managed are provided in the Strategic Report on page 1.
Auditor

Saffery LLP have expressed their willingness to continue in office.

Statement of disclosure to auditor

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

On behalf of the board
John Petrow
Director
19 September 2024
Petrow Food Industries Limited
Directors' responsibilities statement
For the year ended 31 December 2023
3

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

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law).

 

Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

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

Petrow Food Industries Limited
Independent auditor's report
To the members of Petrow Food Industries Limited
4
Opinion

We have audited the financial statements of Petrow Food Industries Limited (the 'company') for the year ended 31 December 2023 which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity, the Statement of Cash Flows 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 FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

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

Conclusions relating to going concern

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

 

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

 

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

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

 

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Petrow Food Industries Limited
Independent auditor's report (continued)
To the members of Petrow Food Industries Limited
5

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.

 

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

 

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, set out on page 3, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

 

In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

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

 

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud are detailed below.

 

Identifying and assessing risks related to irregularities:

We assessed the susceptibility of the company’s financial statements to material misstatement and how fraud might occur, including through discussions with the directors, discussions within our audit team planning meeting, updating our record of internal controls and ensuring these controls operated as intended. We evaluated possible incentives and opportunities for fraudulent manipulation of the financial statements. We identified laws and regulations that are of significance in the context of the company by discussions with directors and by updating our understanding of the sector in which the company operates.

Petrow Food Industries Limited
Independent auditor's report (continued)
To the members of Petrow Food Industries Limited
6

Laws and regulations of direct significance in the context of the company include The Companies Act 2006, UK Tax legislation and regulations issued by the Food Standards Agency.

 

Audit response to risks identified

We considered the extent of compliance with these laws and regulations as part of our audit procedures on the related financial statement items including a review of financial statement disclosures. We reviewed the company's correspondence with relevant authorities to identify potential material misstatements arising. We discussed the company's policies and procedures for compliance with laws and regulations with members of management responsible for compliance.

During the planning meeting with the audit team, the engagement partner drew attention to the key areas which might involve non-compliance with laws and regulations or fraud. We enquired of management whether they were aware of any instances of non-compliance with laws and regulations or knowledge of any actual, suspected or alleged fraud. We addressed the risk of fraud through management override of controls by testing the appropriateness of journal entries and identifying any significant transactions that were unusual or outside the normal course of business. We assessed whether judgements made in making accounting estimates gave rise to a possible indication of management bias. At the completion stage of the audit, the engagement partner’s review included ensuring that the team had approached their work with appropriate professional scepticism and thus the capacity to identify non-compliance with laws and regulations and fraud.

 

There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.

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.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Eunice McAdam (Senior Statutory Auditor)
For and on behalf of Saffery LLP
19 September 2024
Statutory Auditors
Torridon House
Beechwood Park
Inverness
IV2 3BW
Petrow Food Industries Limited
Statement of comprehensive income
For the year ended 31 December 2023
7
2023
2022
Notes
£
£
Turnover
3
3,339,479
3,354,383
Cost of sales
(3,953,488)
(3,573,705)
Gross loss
(614,009)
(219,322)
Administrative expenses
(2,463,262)
(1,742,047)
Other operating income
1,183,049
838,229
Operating loss
4
(1,894,222)
(1,123,140)
Interest receivable and similar income
7
1,340
313
Interest payable and similar expenses
8
(587,296)
(441,840)
Loss before taxation
(2,480,178)
(1,564,667)
Tax on loss
9
-
0
(65,150)
Loss for the financial year
(2,480,178)
(1,629,817)

The statement of comprehensive income has been prepared on the basis that all operations are continuing operations. There were no items of other comprehensive income in the current or preceding year.

Petrow Food Industries Limited
Statement of financial position
As at 31 December 2023
8
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
5,318,250
2,787,478
Current assets
Stocks
12
1,227,060
1,153,018
Debtors
13
640,150
1,083,807
Cash at bank and in hand
40,447
147,042
1,907,657
2,383,867
Creditors: amounts falling due within one year
14
(21,068,282)
(16,533,542)
Net current liabilities
(19,160,625)
(14,149,675)
Net liabilities
(13,842,375)
(11,362,197)
Capital and reserves
Called up share capital
16
1,000
1,000
Profit and loss reserves
(13,843,375)
(11,363,197)
Total equity
(13,842,375)
(11,362,197)
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:
John Petrow
Director
Company Registration No. 02859663
Petrow Food Industries Limited
Statement of changes in equity
For the year ended 31 December 2023
9
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2022
1,000
(9,733,380)
(9,732,380)
Year ended 31 December 2022:
Loss and total comprehensive income
-
(1,629,817)
(1,629,817)
Balance at 31 December 2022
1,000
(11,363,197)
(11,362,197)
Year ended 31 December 2023:
Loss and total comprehensive income
-
(2,480,178)
(2,480,178)
Balance at 31 December 2023
1,000
(13,843,375)
(13,842,375)
Petrow Food Industries Limited
Statement of cash flows
For the year ended 31 December 2023
10
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
20
1,827,420
439,173
Income taxes (paid)/refunded
(65,150)
65,198
Net cash inflow from operating activities
1,762,270
504,371
Investing activities
Purchase of tangible fixed assets
(2,720,205)
(547,511)
Interest received
1,340
313
Net cash used in investing activities
(2,718,865)
(547,198)
Financing activities
Proceeds from borrowings
850,000
-
0
Net cash generated from/(used in) financing activities
850,000
-
Net decrease in cash and cash equivalents
(106,595)
(42,827)
Cash and cash equivalents at beginning of year
147,042
189,869
Cash and cash equivalents at end of year
40,447
147,042
Petrow Food Industries Limited
Notes to the financial statements
For the year ended 31 December 2023
11
1
Accounting policies
Company information

Petrow Food Industries Limited is a private company limited by shares incorporated in England and Wales. The registered office is 71 Queen Victoria Street, London, EC4V 4BE.

1.1
Accounting convention

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

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

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

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

 

Ongoing support is provided by C J Petrow International Limited, a company in which John Petrow and Ian Tatchell are directors, and Idolwood Limited, the parent company. The appropriateness of the going concern basis is dependent on this support being continued.

1.3
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.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.4
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost 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:

Freehold property
2-10% per annum straight line basis
Plant and machinery
5-20% per annum straight line basis
Fixtures, fittings and equipment
10-50% per annum straight line basis

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

Petrow Food Industries Limited
Notes to the financial statements (continued)
For the year ended 31 December 2023
1
Accounting policies (continued)
12
1.5
Impairment of fixed assets

At each reporting period end date, the company 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.

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.

1.6
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to sell, which is equivalent to net realisable value. 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.

Cost is calculated on first in first out basis.

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.

1.7
Cash and cash equivalents

Cash at bank and in hand are basic financial assets and include cash in hand and deposits held at call with banks. Bank overdrafts are shown within borrowings in current liabilities.

1.8
Financial instruments

The company 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 company's statement of financial position when the company becomes party to the contractual provisions of the instrument.

 

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

Basic financial assets

Basic financial assets, which include debtors, 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.

Petrow Food Industries Limited
Notes to the financial statements (continued)
For the year ended 31 December 2023
1
Accounting policies (continued)
13
Other financial assets

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

 

Interest is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial. The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating the interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the debt instrument to the net carrying amount on initial recognition.

Classification of financial liabilities

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

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, and loans from fellow group companies, 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.

1.9
Equity instruments

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

1.10
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 income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Petrow Food Industries Limited
Notes to the financial statements (continued)
For the year ended 31 December 2023
1
Accounting policies (continued)
14
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. Where items recognised in other comprehensive income or equity are chargeable to or deductible for tax purposes, the resulting current or deferred tax expense or income is presented in the same component of comprehensive income or equity as the transaction or other event that resulted in the tax expense or income.

1.11
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.

1.12
Retirement benefits

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

1.13
Leases

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

1.14
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

2
Critical accounting judgements and key sources of estimation uncertainty

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

 

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

Critical judgements

The directors do not consider there to be any critical judgements which have had a significant effect on amounts recognised in the financial statements.

Petrow Food Industries Limited
Notes to the financial statements (continued)
For the year ended 31 December 2023
2
Critical accounting judgements and key sources of estimation uncertainty (continued)
15
Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows:

Stocks

Stocks are valued at the lower of cost and net realisable value. Net realisable value includes, where necessary, provisions for slow moving and obsolete stocks. Calculation of these provisions requires judgements to be made which include forecast demand, the competitive and economic environment and inventory loss trends.

3
Turnover and other revenue

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

2023
2022
£
£
Turnover analysed by class of business
Sale of goods
3,339,479
3,354,383
2023
2022
£
£
Other revenue
Interest income
1,340
313
4
Operating loss
2023
2022
Operating loss for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
1,092
(806)
Depreciation of owned tangible fixed assets
173,858
171,260
Operating lease charges
342,300
132,300
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
12,285
11,700
Petrow Food Industries Limited
Notes to the financial statements (continued)
For the year ended 31 December 2023
16
6
Employees

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

2023
2022
Number
Number
73
67

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
2,237,348
1,769,263
Social security costs
203,993
165,516
Pension costs
54,854
46,699
2,496,195
1,981,478
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
1,340
313
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
1,340
313
8
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest payable to group undertakings
587,296
441,840
9
Taxation
2023
2022
£
£
Current tax
Adjustments in respect of prior periods
-
0
65,150
Petrow Food Industries Limited
Notes to the financial statements (continued)
For the year ended 31 December 2023
9
Taxation (continued)
17

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

2023
2022
£
£
Loss before taxation
(2,480,178)
(1,564,667)
Expected tax credit based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
(583,338)
(297,287)
Tax effect of expenses that are not deductible in determining taxable profit
58
234
Adjustments in respect of prior years
-
0
65,150
Fixed asset differences
(6,418)
(15,046)
Remeasurement of deferred tax for changes in tax rates
(37,106)
(98,561)
Movement in deferred tax not recognised
626,804
410,660
Taxation charge for the year
-
65,150

The company has estimated tax losses of £13,901,821 (2022 - £9,786,792) available for carry forward against future trading profits.

The adjustments in respect of prior years relate to R&D tax credits repayable to HMRC.

10
Intangible fixed assets
Goodwill
£
Cost
At 1 January 2023 and 31 December 2023
100,000
Amortisation
At 1 January 2023 and 31 December 2023
100,000
Carrying amount
At 31 December 2023
-
0
At 31 December 2022
-
0
Petrow Food Industries Limited
Notes to the financial statements (continued)
For the year ended 31 December 2023
18
11
Tangible fixed assets
Freehold property
Plant and machinery
Fixtures, fittings and equipment
Total
£
£
£
£
Cost
At 1 January 2023
1,072,652
3,163,832
436,406
4,672,890
Additions
-
0
2,691,112
29,093
2,720,205
Disposals
-
0
(15,575)
-
0
(15,575)
At 31 December 2023
1,072,652
5,839,369
465,499
7,377,520
Depreciation
At 1 January 2023
274,156
1,211,066
400,190
1,885,412
Depreciation charged in the year
24,986
132,996
15,876
173,858
At 31 December 2023
299,142
1,344,062
416,066
2,059,270
Carrying amount
At 31 December 2023
773,510
4,495,307
49,433
5,318,250
At 31 December 2022
798,496
1,952,766
36,216
2,787,478

Included within plant and machinery are assets with a cost of £3,277,522 (2022 - £612,818) that have not yet been commissioned and have therefore not been depreciated.                                                 

12
Stocks
2023
2022
£
£
Raw materials and consumables
946,656
929,348
Work in progress
19,483
1,953
Finished goods and goods for resale
260,921
221,717
1,227,060
1,153,018
13
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
517,464
475,565
Amounts owed by group undertakings
-
0
434,947
Other debtors
13,880
70,206
Prepayments and accrued income
108,806
103,089
640,150
1,083,807
Petrow Food Industries Limited
Notes to the financial statements (continued)
For the year ended 31 December 2023
19
14
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
338,657
450,802
Amounts owed to group undertakings
20,081,470
15,917,017
Corporation tax
48
65,198
Other taxation and social security
57,795
48,489
Other creditors
304,401
-
0
Accruals and deferred income
285,911
52,036
21,068,282
16,533,542
15
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
54,854
46,699

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

16
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
1,000
1,000
1,000
1,000
17
Financial commitments, guarantees and contingent liabilities

At the year end the company had committed to purchase raw materials of £1,107,834 (2022 - £379,826).

18
Ultimate controlling party

The parent company is Idolwood Limited, a company registered in the British Virgin Islands.

19
Related party transactions
Transactions with related parties
Sales
Purchases
2023
2022
2023
2022
£
£
£
£
Fellow subsidiaries of Idolwood Limited
40,650
-
5,332
-
Petrow Food Industries Limited
Notes to the financial statements (continued)
For the year ended 31 December 2023
19
Related party transactions (continued)
20
Management charges, rent and interest paid
Management charges received
2023
2022
2023
2022
£
£
£
£
Entities with control, joint control or significant influence over the company
10,999
-
-
-
Fellow subsidiaries of Idolwood Limited
696,434
556,243
1,183,049
838,229
Key management personnel
4,401
-
-
-
Other related parties
132,300
132,300
-
-

The following amounts were outstanding at the reporting end date:

2023
2022
Amounts due to related parties
£
£
Entities with control, joint control or significant influence over the company
560,999
-
Fellow subsidiaries of Idolwood Limited
19,520,471
15,917,017
Key management personnel
304,401
-

 

The following amounts were outstanding at the reporting end date:

2023
2022
Amounts due from related parties
£
£
Fellow subsidiaries of Idolwood Limited
-
434,947
Other information

Sales of goods to, and purchases of goods from, related parties were made at market price.

 

The balances due to/from related parties are unsecured, will be settled in cash, and there are no fixed terms of repayment.

 

Amounts repayable to related parties carry interest of 2.20% per annum (2022 - 2.20%) charged on the outstanding balance. The amount of interest charged for the year was £587,296 (2022 - £441,840).

 

C J Petrow International Limited, a subsidiary of Idolwood Limited, has guaranteed to continue to support Petrow Food Industries Limited for the foreseeable future.

Petrow Food Industries Limited
Notes to the financial statements (continued)
For the year ended 31 December 2023
21
20
Cash generated from operations
2023
2022
£
£
Loss for the year after tax
(2,480,178)
(1,629,817)
Adjustments for:
Taxation charged
-
0
65,150
Finance costs
587,296
441,840
Investment income
(1,340)
(313)
Depreciation and impairment of tangible fixed assets
173,858
171,260
Movements in working capital:
Increase in stocks
(74,042)
(118,211)
Decrease/(increase) in debtors
459,232
(397,123)
Increase in creditors
3,162,594
1,906,387
Cash generated from operations
1,827,420
439,173
21
Analysis of changes in net funds
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
147,042
(106,595)
40,447
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