Company registration number 13909607 (England and Wales)
EVOLUTION AQUA GROUP LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
EVOLUTION AQUA GROUP LTD
COMPANY INFORMATION
Directors
Mr N J Jackson
Ms N H Peers
Mr M Widdall
(Appointed 30 January 2024)
Mr P W Capell
(Appointed 30 January 2024)
Company number
13909607
Registered office
Evolution House
Kellett Close
Wigan
WN5 0LP
Auditor
MHA
Richard House
9 Winckley Square
Preston
PR1 3HP
EVOLUTION AQUA GROUP LTD
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Group statement of comprehensive income
8
Group balance sheet
9
Company balance sheet
10
Group statement of changes in equity
11
Company statement of changes in equity
12
Group statement of cash flows
13
Notes to the financial statements
14 - 31
EVOLUTION AQUA GROUP LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023. This report provides an overview of the Group’s performance, strategy, and key objectives for the future.
Principal activities
The Company operates as a holding company and acquired 100% of the issued share capital of Evolution Aqua Limited, OCM Products Limited and Onyx Ling Limited, previously Bermuda Watergardens Limited, (the Group) in March 2022. The Company also holds 50% of the issued share capital of Aqua Bioscience Ltd.
The Company holds debt funding for the Group. As a result, the principal expenses of the Company continue to be amortisation of goodwill and loan interest.
The principal activity of the Group is the manufacturing of bespoke, patented solutions, including filters and filtration media, ultraviolet clarifiers/sterilizers, and live beneficial bacteria. These products are designed for use in various aquatic environments such as ornamental ponds, freshwater and marine aquariums, commercial fish systems, public aquariums, fish farms, swimming pools, process water and wastewater treatment systems. The Company markets these products under the Evolution Aqua and Flocell brands as well as manufacturing for global partners. Its operations are primarily based in the UK, Europe, and the USA.
Performance overview
During the financial year, the Company achieved a revenue of £7,553,310, representing a 23.9% increase compared to the previous year post acquisition results. Gross Profit stood at £3,665,427, reflecting a 19.1% increase. EBITDA for the year was £84,647 excluding exceptional costs. A decrease of £851,817 on the previous year resulting from significant investment in Employment and Research and Development costs to secure future growth.
Key performance indicators based on the full year results for the previous year include:
Revenue growth: -3.8%
Gross profit: 52%
Market Overview
Core market conditions have been challenging. The Aquatics and Swimming Pools markets have experienced a drop in sales following the high demand during the COVID period and additionally, macroeconomic events, including the conflict in Ukraine and the increase in the cost of living. These latter issues impacted consumer confidence and reduced disposable income. Despite these challenges, the Company has maintained its market position and made significant progress in new markets and sectors, exploring growth avenues, and adapting to the changing landscape.
Strategy and Objectives
The Company has invested heavily in talent, as reflected in the overhead changes, to build upon its strategic vision and grow. The core strategy is focussed on leveraging its principal technologies in both existing and new markets as well as expanding its footprint into the environmental sector. Disposal of the Bermuda Watergardens business in 2023 was directly related to focus and ensuring that we manage opportunity cost effectively. To achieve this, our strategy focuses on the following key areas:
1. Product Innovation
Investing in research and development to bring cutting-edge products to both existing and new markets. Over the past year, the Company launched multiple items to support its core business such as Surge Filters and Titanium lined Ultraviolet Clarifiers as well as developing new advance environmental filtration solutions. All of which underpin our core strategy.
2. Market Expansion
Expanding our market reach in both new geographical areas and customer segments form an important part of both protecting our core business and supporting our growth aspirations. As we enter new sectors our focus remains pinned to our strategy of leveraging our core patented technology and local manufacturing skills.
EVOLUTION AQUA GROUP LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Principal risks and uncertainties
The Company faces several risks and uncertainties, including:
1. Economic Conditions
The increase in the cost of living for consumers has created a more challenging trading environment for the Company. To mitigate this impact, the Company has taken several actions, including the constant review and elimination of low-margin products and the disposal of the Bermuda Business.
2. Competitive Landscape
Competitive pressure remains a significant risk for the Company, especially that of manufacturers from the Far East. The Company mitigates this risk by focusing on core technologies that offer unique, patented solutions. Additionally, the Company provides added value services to its customers, championing UK manufacturing, innovating solutions for both new and core customers and maintaining strong relationships that prevent leakage and ensures it is the partner of choice.
3. Ukraine Conflict
The Company has actively managed the risks presented by the Ukraine conflict by increasing inventory purchases to avoid potential delays at the point of importation. Additionally, the Company has been closely liaising with its customers to ensure they have sufficient stock in case of supply chain disruptions.
4. Regulatory Compliance
Adhering to regulatory requirements is essential for our operations, and any changes in regulations could affect our business processes and cost structure. The Company has actively managed this risk by achieving ISO9001 certification in 2024, ensuring that our processes meet the highest standards of quality management.
Future Outlook
The future remains bright as the new talent starts to deliver and the structure of the business adjusts to that focus on growth in both its core markets and new sectors. Long term contracts and partnerships in new sectors are being delivered and the Company is optimistic about its growth prospects.
Conclusion
The Board remains confident in the Company’s ability to deliver sustainable growth and create shareholder value.
We would like to thank our employees, customers, and stakeholders for their continued support.
Mr N J Jackson
Director
20 September 2024
EVOLUTION AQUA GROUP LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Results and dividends
The results for the year are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a further dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr N J Jackson
Ms N H Peers
Mr N P Inskip
(Resigned 30 January 2024)
Mr M Widdall
(Appointed 30 January 2024)
Mr P W Capell
(Appointed 30 January 2024)
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.
On behalf of the board
Mr N J Jackson
Director
20 September 2024
2024-09-24
EVOLUTION AQUA GROUP LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:
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.
EVOLUTION AQUA GROUP LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF EVOLUTION AQUA GROUP LTD
- 5 -
Opinion
We have audited the financial statements of Evolution Aqua Group Ltd (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 loss 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.
EVOLUTION AQUA GROUP LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF EVOLUTION AQUA GROUP LTD
- 6 -
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.
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
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:
Enquiries with management, about any known or suspected instances of non-compliance with laws and regulations and fraud;
Challenging assumptions and judgements made by management in their significant accounting estimates, in particular in relation to debtor recoverability and slow moving/obsolete stock provisions;
An evaluation of the risk of management override of controls and subsequent testing, including through testing journal entries and other adjustments for appropriateness;
An evaluation of the company's internal control environment; and
Reviewing board minutes and resolutions.
EVOLUTION AQUA GROUP LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF EVOLUTION AQUA GROUP LTD
- 7 -
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
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.
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.
Jenny McCabe FCA
Senior Statutory Auditor
For and on behalf of MHA, Statutory Auditor
Preston, United Kingdom
20 September 2024
MHA is the trading name of MacIntyre Hudson LLP, a limited liability partnership in England and Wales (registered number OC312313)
EVOLUTION AQUA GROUP LTD
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
Continuing
Discontinued
31 December
Continuing
Discontinued
31 December
operations
operations
2023
operations
operations
2022
as restated
Notes
£
£
£
£
£
£
Turnover
3
7,352,328
200,982
7,553,310
5,745,844
351,095
6,096,939
Cost of sales
(3,665,427)
-
(3,665,427)
(2,713,366)
-
(2,713,366)
Gross profit
3,686,901
200,982
3,887,883
3,032,478
351,095
3,383,573
Distribution costs
(284,560)
(115)
(284,675)
(251,272)
(151)
(251,423)
Administrative expenses
(6,362,098)
(244,212)
(6,606,310)
(4,185,259)
(410,947)
(4,596,206)
Exceptional item
4
-
(852,668)
(852,668)
-
-
-
Operating loss
5
(2,959,757)
(896,013)
(3,855,770)
(1,404,053)
(60,003)
(1,464,056)
Interest payable and similar expenses
9
(701,050)
(673)
(701,723)
(541,943)
(673)
(542,616)
Loss before taxation
(3,660,807)
(896,686)
(4,557,493)
(1,945,996)
(60,676)
(2,006,672)
Tax on loss
10
-
-
-
79,323
17,256
96,579
Loss for the financial year
(3,660,807)
(896,686)
(4,557,493)
(1,866,673)
(43,420)
(1,910,093)
Loss 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.
EVOLUTION AQUA GROUP LTD
GROUP BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 9 -
2023
2022
as restated
Notes
£
£
£
£
Fixed assets
Goodwill
12
21,244,156
24,545,043
Other intangible assets
12
619,425
686,582
Total intangible assets
21,863,581
25,231,625
Tangible assets
13
1,083,504
1,032,241
Investments
14
1
1
22,947,086
26,263,867
Current assets
Stocks
16
1,659,554
2,145,152
Debtors
17
2,484,108
2,113,316
Cash at bank and in hand
823,484
690,321
4,967,146
4,948,789
Creditors: amounts falling due within one year
18
(2,498,456)
(1,306,074)
Net current assets
2,468,690
3,642,715
Total assets less current liabilities
25,415,776
29,906,582
Creditors: amounts falling due after more than one year
19
(8,312,361)
(8,245,674)
Net assets
17,103,415
21,660,908
Capital and reserves
Called up share capital
21
100,000
100,000
Share premium account
23,471,001
23,471,001
Profit and loss reserves
(6,467,586)
(1,910,093)
Total equity
17,103,415
21,660,908
The financial statements were approved by the board of directors and authorised for issue on 20 September 2024 and are signed on its behalf by:
20 September 2024
Mr N J Jackson
Director
Company registration number 13909607 (England and Wales)
EVOLUTION AQUA GROUP LTD
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
as restated
Notes
£
£
£
£
Fixed assets
Investments
14
29,824,578
30,767,578
Current assets
Debtors
17
2,894,790
3,268,964
Cash at bank and in hand
3,397
4,414
2,898,187
3,273,378
Creditors: amounts falling due within one year
18
(533,269)
(132,488)
Net current assets
2,364,918
3,140,890
Total assets less current liabilities
32,189,496
33,908,468
Creditors: amounts falling due after more than one year
19
(8,200,000)
(8,200,000)
Net assets
23,989,496
25,708,468
Capital and reserves
Called up share capital
21
100,000
100,000
Share premium account
23,471,001
23,471,001
Profit and loss reserves
418,495
2,137,467
Total equity
23,989,496
25,708,468
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s loss for the year was £1,718,972 (2022 - £2,137,467 profit).
These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 20 September 2024 and are signed on its behalf by:
20 September 2024
Mr N J Jackson
Director
Company registration number 13909607 (England and Wales)
EVOLUTION AQUA GROUP LTD
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
As restated for the period ended 31 December 2022:
Balance at 11 February 2022
-
Year ended 31 December 2022:
Loss and total comprehensive income
-
-
(1,910,093)
(1,910,093)
Issue of share capital
21
100,000
23,471,001
-
23,571,001
Balance at 31 December 2022
100,000
23,471,001
(1,910,093)
21,660,908
Year ended 31 December 2023:
Loss and total comprehensive income
-
-
(4,557,493)
(4,557,493)
Balance at 31 December 2023
100,000
23,471,001
(6,467,586)
17,103,415
EVOLUTION AQUA GROUP LTD
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
As restated for the period ended 31 December 2022:
Balance at 11 February 2022
-
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
2,137,467
2,137,467
Issue of share capital
21
100,000
23,471,001
-
23,571,001
Balance at 31 December 2022
100,000
23,471,001
2,137,467
25,708,468
Year ended 31 December 2023:
Profit and total comprehensive income
-
-
(1,718,972)
(1,718,972)
Balance at 31 December 2023
100,000
23,471,001
418,495
23,989,496
EVOLUTION AQUA GROUP LTD
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
2023
2022
as restated
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
22
942,633
(2,094,991)
Interest paid
(701,723)
(542,616)
Income taxes (paid)/refunded
(115)
161,013
Net cash inflow/(outflow) from operating activities
240,795
(2,476,594)
Investing activities
Purchase of intangible assets
(208,231)
(166,531)
Proceeds from disposal of intangibles
235,297
-
Purchase of tangible fixed assets
(249,833)
(205,988)
Proceeds from disposal of tangible fixed assets
45,243
2,300
Net proceeds from shares and investments
-
(4,749,679)
Net cash used in investing activities
(177,524)
(5,119,898)
Financing activities
Repayment of borrowings
-
8,200,000
Payment of finance leases obligations
69,892
86,813
Net cash generated from financing activities
69,892
8,286,813
Net increase in cash and cash equivalents
133,163
690,321
Cash and cash equivalents at beginning of year
690,321
Cash and cash equivalents at end of year
823,484
690,321
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
1
Accounting policies
Company information
Evolution Aqua Group Ltd (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Evolution House, Kellett Close, Wigan, WN5 0LP.
The group consists of Evolution Aqua Group Ltd 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.
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.
1.3
Basis of consolidation
The consolidated group financial statements consist of the financial statements of the parent company Evolution Aqua Group Ltd 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.
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.
Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.
If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.
Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.
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.
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.
1.6
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.
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
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.
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:
Patents & licences
20 years 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 improvements
4 years straight line
Plant and equipment
15 years straight line
Motor vehicles
4 years straight line
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.
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.
Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.
In the parent company financial statements, investments in associates are accounted for at cost less impairment.
Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
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.
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.
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -
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.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 19 -
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.
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 20 -
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
1.14
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.
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.
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 21 -
1.16
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.17
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.
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Continued operations
7,352,328
5,745,844
Discontinued operations
200,982
351,095
7,553,310
6,096,939
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
3
Turnover and other revenue
(Continued)
- 22 -
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
5,868,330
6,096,939
Rest of World
1,684,980
-
7,553,310
6,096,939
2023
2022
£
£
Other revenue
Royalty income
-
61,753
4
Exceptional item
2023
2022
£
£
Expenditure
Investment write off
852,668
-
852,668
-
5
Operating loss
2023
2022
£
£
Operating loss for the year is stated after charging/(crediting):
Exchange losses/(gains)
47,369
(5,893)
Depreciation of owned tangible fixed assets
153,765
162,492
(Profit)/loss on disposal of tangible fixed assets
(438)
4,548
Amortisation of intangible assets
2,615,140
2,051,468
Impairment of intangible assets
725,838
Operating lease charges
211,237
203,960
6
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
8,702
51,194
Audit of the financial statements of the company's subsidiaries
24,304
4,150
33,006
55,344
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
7
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
62
48
4
4
Their aggregate remuneration comprised:
Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
2,648,548
2,348,344
28,003
29,178
8
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
28,003
29,178
9
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
683,626
531,546
Other finance costs:
Interest on finance leases and hire purchase contracts
18,097
11,070
Total finance costs
701,723
542,616
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
(96,579)
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
10
Taxation
(Continued)
- 24 -
The actual charge/(credit) 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
(4,557,493)
(2,006,672)
Expected tax credit based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
(1,071,922)
(381,268)
Tax effect of expenses that are not deductible in determining taxable profit
844,013
284,689
Tax effect of income not taxable in determining taxable profit
(135)
Adjustments in respect of prior years
96,770
Effect of change in corporation tax rate
22,369
-
Deferred tax not recognised
108,905
Taxation charge/(credit)
-
(96,579)
11
Impairments
Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:
2023
2022
Notes
£
£
In respect of:
Goodwill
12
725,838
-
Recognised in:
Administrative expenses
725,838
-
Amounts recognised in other comprehensive income in respect of impairment losses on previously revalued assets.
943,000
-
The impairment losses in respect of financial assets are recognised in other gains and losses in the profit and loss account.
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 25 -
12
Intangible fixed assets
Group
Goodwill
Patents & licences
Total
£
£
£
Cost
At 1 January 2023
26,535,182
988,285
27,523,467
Additions
496,884
496,884
Disposals
(649,645)
(649,645)
At 31 December 2023
26,535,182
835,524
27,370,706
Amortisation and impairment
At 1 January 2023
1,990,139
301,703
2,291,842
Amortisation charged for the year
2,575,049
40,091
2,615,140
Impairment losses
725,838
725,838
Disposals
(125,695)
(125,695)
At 31 December 2023
5,291,026
216,099
5,507,125
Carrying amount
At 31 December 2023
21,244,156
619,425
21,863,581
At 31 December 2022
24,545,043
686,582
25,231,625
The company had no intangible fixed assets at 31 December 2023 or 31 December 2022.
More information on impairment movements in the year is given in note 11.
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 26 -
13
Tangible fixed assets
Group
Leasehold improvements
Plant and equipment
Motor vehicles
Total
£
£
£
£
Cost
At 1 January 2023
22,328
2,306,688
101,933
2,430,949
Additions
156,595
169,176
325,771
Disposals
(195,978)
(82,301)
(278,279)
At 31 December 2023
22,328
2,267,305
188,808
2,478,441
Depreciation and impairment
At 1 January 2023
11,489
1,325,148
62,071
1,398,708
Depreciation charged in the year
5,089
117,055
31,621
153,765
Eliminated in respect of disposals
(98,514)
(59,022)
(157,536)
At 31 December 2023
16,578
1,343,689
34,670
1,394,937
Carrying amount
At 31 December 2023
5,750
923,616
154,138
1,083,504
At 31 December 2022
10,839
981,540
39,862
1,032,241
The company had no tangible fixed assets at 31 December 2023 or 31 December 2022.
14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
15
29,824,577
30,767,577
Investments in joint ventures
1
1
1
1
1
1
29,824,578
30,767,578
Movements in fixed asset investments
Group
Shares in joint ventures
£
Cost or valuation
At 1 January 2023 and 31 December 2023
1
Carrying amount
At 31 December 2023
1
At 31 December 2022
1
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
14
Fixed asset investments
(Continued)
- 27 -
Movements in fixed asset investments
Company
Shares in subsidiaries and joint ventures
£
Cost or valuation
At 1 January 2023
30,767,578
Disposals
(943,000)
At 31 December 2023
29,824,578
Carrying amount
At 31 December 2023
29,824,578
At 31 December 2022
30,767,578
15
Subsidiaries
Details of the company's subsidiaries at 31 December 2023 are as follows:
Name of undertaking
Principal activity
Class of
% Held
shares held
Direct
Indirect
Evolution Aqua Limited
Manufacture, design, development and sale of filtration systems
Ordinary
100.00
-
OCM Products Ltd (formerly Flocell Ltd)
Manufacture of swimming pool filter media
Ordinary
95.00
5.00
Onyx Ling Ltd (formerly Bermuda Watergardens Limited)
Provision of water gardening accessories
Ordinary
100.00
-
16
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Work in progress
-
7,590
-
-
Finished goods and goods for resale
1,659,554
2,137,562
1,659,554
2,145,152
-
-
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 28 -
17
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
1,657,896
1,414,312
Amounts owed by group undertakings
-
-
2,879,340
3,240,551
Amounts owed by undertakings in which the company has a participating interest
659,145
252,458
-
-
Other debtors
57,588
245,552
18,413
Prepayments and accrued income
109,479
200,994
15,450
10,000
2,484,108
2,113,316
2,894,790
3,268,964
18
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Obligations under finance leases
20
44,344
41,139
Trade creditors
1,595,965
448,264
154,946
Corporation tax payable
64,319
64,434
62,325
62,325
Other taxation and social security
382,616
199,609
196,262
-
Other creditors
125,487
454
Accruals and deferred income
285,725
552,174
119,736
70,163
2,498,456
1,306,074
533,269
132,488
19
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Obligations under finance leases
20
112,361
45,674
Other borrowings
8,200,000
8,200,000
8,200,000
8,200,000
8,312,361
8,245,674
8,200,000
8,200,000
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 29 -
20
Finance lease obligations
Group
Company
2023
2022
2023
2022
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
44,344
41,139
In two to five years
112,361
45,674
156,705
86,813
-
-
21
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100,000
100,000
100,000
100,000
22
Cash generated from/(absorbed by) group operations
2023
2022
£
£
Loss for the year after tax
(4,557,493)
(1,910,093)
Adjustments for:
Taxation charged/(credited)
(96,579)
Finance costs
701,723
542,616
(Gain)/loss on disposal of tangible fixed assets
(438)
4,548
Amortisation and impairment of intangible assets
3,340,978
2,051,468
Depreciation and impairment of tangible fixed assets
153,765
162,492
Movements in working capital:
Decrease/(increase) in stocks
485,598
(2,145,152)
Increase in debtors
(370,792)
(1,904,792)
Increase in creditors
1,189,292
1,200,501
Cash generated from/(absorbed by) operations
942,633
(2,094,991)
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 30 -
23
Analysis of changes in net debt - group
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
690,321
133,163
823,484
Borrowings excluding overdrafts
(8,200,000)
-
(8,200,000)
Obligations under finance leases
(86,813)
(69,892)
(156,705)
(7,596,492)
63,271
(7,533,221)
24
Prior period adjustment
The directors have identified subsidiary acquisition costs totalling £650,870 which were included in the profit and loss account in the year ended 31 December 2022. A prior year adjustment has been included to reallocate these costs to form part of the investment value in the parent company balance sheet. In the consolidated accounts this adjustment has led to a corresponding increase in the goodwill value in the previous year.
Reconciliation of changes in equity - group
1 January
31 December
2022
2022
£
£
Adjustments to prior year
Capitalisation of acquisition costs
-
650,870
Equity as previously reported
-
21,010,038
Equity as adjusted
-
21,660,908
Analysis of the effect upon equity
Profit and loss reserves
-
650,870
Reconciliation of changes in loss for the previous financial period
2022
£
Adjustments to prior year
Capitalisation of acquisition costs
650,870
Loss as previously reported
(2,560,963)
Loss as adjusted
(1,910,093)
EVOLUTION AQUA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
24
Prior period adjustment
(Continued)
- 31 -
Reconciliation of changes in equity - company
1 January
31 December
2022
2022
£
£
Adjustments to prior year
Capitalisation of acquisition costs
-
650,870
Equity as previously reported
-
25,057,598
Equity as adjusted
-
25,708,468
Analysis of the effect upon equity
Profit and loss reserves
-
650,870
Reconciliation of changes in profit for the previous financial period
2022
£
Adjustments to prior year
Capitalisation of acquisition costs
650,870
Profit as previously reported
1,486,597
Profit as adjusted
2,137,467
2023-12-312023-01-01falseCCH SoftwareCCH Accounts Production 2024.200Mr N J JacksonMs N H PeersMr N P InskipMr M WiddallMr P W 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