Company registration number 14897633 (England and Wales)
CIVIC EARTH LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2024
PAGES FOR FILING WITH REGISTRAR
Tree Accountancy Limited
Chartered Certified Accountants & Registered Auditors
3rd Floor
Eastgate
Castle Street
Castlefield
Manchester
M3 4LZ
CIVIC EARTH LIMITED
CONTENTS
Page
Strategic report
1 - 2
Balance sheet
3
Notes to the financial statements
4 - 8
CIVIC EARTH LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 28 FEBRUARY 2024
- 1 -
The directors present the strategic report for the year ended 28 February 2024.
Business performance
Civic Earth Limited began trading in July 2023, supported by Civic Engineers' established infrastructure. In its first eight months (to 28th February 2024), it generated £210,000 in revenue with three full-time fee earning employees.
Shared clients and projects with Civic Engineers have provided a strong start. The upcoming year promises significant growth, with a projected revenue of c. £1 million and a target EBITDA in excess of £125,000. Over the first eight months, Civic Earth received 100+ new work enquiries valued at £1.82 million. The bid success rate was 45%, winning £689,770 in fees, with a bid capture rate of 34%.
Strategic management
In the year to 29th February 2024 the Civic group of companies, led by the parent company Civic Plus Limited, expanded by incorporating two new subsidiaries that complement Civic Engineers. These additions enhance the group's value and resilience. Civic Earth Limited began operations in July 2023 and is a specialised ground engineering consultancy. It is led by experienced director Dan Matthews and collaborates with Civic Engineers on various projects for mutual clients. Civic Engineers also established as a limited company based in Dublin, fully owned by Civic Plus Limited. It offers the same core engineering disciplines as its UK counterpart: civil, structural, and transport engineering, serving projects in the Republic of Ireland.
The group's strategic objective, under the rebranded name CIVIC, is to embrace market opportunities in the built environment sector, especially those driven by ESG considerations amid the global climate emergency and the regeneration of towns and cities in the UK and Ireland. Our core disciplines remain focussed on structural, civil, and transport engineering services, while we expand consultancy services in environmental sustainability and ground engineering, particularly in the Republic of Ireland. In the UK, we have grown teams of professionals in Edinburgh and Liverpool to support our core studios in Glasgow, London and Manchester, leveraging market opportunities and local engineering talent.
We are in the second year of our five-year plan to create a group with an EBITDA of circa £5 Million. Last year, group fee income increased by 9% and profit margins improved to 8%, with further improvement opportunities expected next year.
Growth over the next financial year will be delivered through a combination of organic revenue growth as Civic Engineers and Civic Earth expand their market share, along with strategic acquisitions and the incorporation a new complimentary sustainability consultancy. This last year has seen investment in our business processes and systems, and we have introduced a staff bonus scheme to incentivise all of our teams to reach for greater commercial success.
Business environment
External market conditions continued to remain sluggish in the year to February 2024 due to sustained high interest rates and persistent inflation in the UK. Interest rates are expected to remain relatively high, potentially continuing the trend of reduced investment in commercial and residential properties. However, given the recent change in government we expect to see positive shifts in market sentiment, impacting our work pipeline.
Our group's work pipeline is strong, but we remain cautious and are tightly controlling business costs. The most significant risk is a slowdown in the pipeline due to external market conditions, such as project instructions being put on hold. Nevertheless, we maintain good control over our talent pipeline, with a stable, experienced team and low employee turnover.
CIVIC EARTH LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2024
- 2 -
Mr J Broster
Director
23 September 2024
CIVIC EARTH LIMITED
BALANCE SHEET
AS AT 28 FEBRUARY 2024
28 February 2024
- 3 -
2024
Notes
£
£
Fixed assets
Tangible assets
3
1,036
Current assets
Stocks
1,850
Debtors
4
104,172
Cash at bank and in hand
2,722
108,744
Creditors: amounts falling due within one year
5
(134,680)
Net current liabilities
(25,936)
Net liabilities
(24,900)
Capital and reserves
Called up share capital
1,000
Profit and loss reserves
(25,900)
Total equity
(24,900)
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
These financial statements have been prepared and delivered 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 23 September 2024 and are signed on its behalf by:
Mr J Broster
Director
Company registration number 14897633 (England and Wales)
CIVIC EARTH LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2024
- 4 -
1
Accounting policies
Company information
Civic Earth Limited is a private company limited by shares incorporated in England and Wales. The registered office is Carvers Warehouse, 77 Dale Street, Manchester, Greater Manchester, M1 2HG.
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 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
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 the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value]. The principal accounting policies adopted are set out below.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of Civic Plus Limited. These consolidated financial statements are available from its registered office, Carver's Warehouse, 77 Dale Street, Manchester, United Kingdom, M1 2HG.
1.2
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.
CIVIC EARTH LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2024
1
Accounting policies
(Continued)
- 5 -
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
1.3
Research and development expenditure
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
1.4
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:
Fixtures and fittings
20% 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 credited or charged to profit or loss.
1.5
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible 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, 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.
CIVIC EARTH LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2024
1
Accounting policies
(Continued)
- 6 -
1.6
Work in progress
Stocks and work in progress are stated at their estimated selling price less costs to complete. Costs comprises direct materials and the relevant proportion of direct labour costs and overheads that have been incurred up to the appropriate stage of completion.
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.
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 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.
1.8
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 balance sheet 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 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.
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, 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.
CIVIC EARTH LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2024
1
Accounting policies
(Continued)
- 7 -
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
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.
1.11
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
2
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
Number
Total
3
3
Tangible fixed assets
Plant and machinery etc
£
Cost
At 26 May 2023
Additions
1,165
At 28 February 2024
1,165
Depreciation and impairment
At 26 May 2023
Depreciation charged in the year
129
At 28 February 2024
129
Carrying amount
At 28 February 2024
1,036
CIVIC EARTH LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2024
- 8 -
4
Debtors
2024
Amounts falling due within one year:
£
Trade debtors
98,926
Other debtors
5,246
104,172
5
Creditors: amounts falling due within one year
2024
£
Trade creditors
63,107
Taxation and social security
20,625
Other creditors
50,948
134,680
6
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
Senior Statutory Auditor:
Nicholas Ian Hynes FCCA
Statutory Auditor:
Tree Accountancy Limited
Date of audit report:
24 September 2024
7
Ultimate controlling party
The company's ultimate controlling party is Civic Plus Limited.