Company registration number 00779014 (England and Wales)
SAIT ABRASIVES (UK) LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PAGES FOR FILING WITH REGISTRAR
SAIT ABRASIVES (UK) LIMITED
CONTENTS
Page
Balance sheet
1
Notes to the financial statements
2 - 9
SAIT ABRASIVES (UK) LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
page 1
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
5
1,189,235
1,271,727
Current assets
Stocks
1,071,843
978,542
Debtors
6
997,408
895,364
Cash at bank and in hand
358,524
281,214
2,427,775
2,155,120
Creditors: amounts falling due within one year
7
(2,172,301)
(1,728,729)
Net current assets
255,474
426,391
Total assets less current liabilities
1,444,709
1,698,118
Creditors: amounts falling due after more than one year
8
(2,649)
(188,393)
Provisions for liabilities
(42,162)
(48,641)
Net assets
1,399,898
1,461,084
Capital and reserves
Called up share capital
90,000
90,000
Profit and loss reserves
1,309,898
1,371,084
Total equity
1,399,898
1,461,084
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
The financial statements were approved by the board of directors and authorised for issue on 17 September 2024 and are signed on its behalf by:
C Ingman
Director
Company registration number 00779014 (England and Wales)
SAIT ABRASIVES (UK) LIMITED
BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2023
31 December 2023
page 2
1
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.
2
Accounting policies
Company information
SAIT Abrasives (UK) Limited is a private company limited by shares incorporated in England and Wales. The registered office is Regent House, Meridian East, Meridian Business Park, Leicester, LE19 1WZ.
2.1
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. 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 each category of financial instrument; 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 SAIT Finanziaria SpA. These consolidated financial statements are available from the registrar of Italian companies at www.registroimprese.it/richiedi-subito-document.
SAIT ABRASIVES (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2
Accounting policies
(Continued)
page 3
2.2
Going concern
These financial statements are prepared on the going concern basis. The directors have a reasonable expectation that the company will continue in operational existence for the foreseeable future. The directors have prepared forecasts for a period to 30 June 2023 which indicate that, taking account of severe but plausible downsides, the company will have sufficient funds, through funding from its ultimate parent company, SAIT Finanzaria SpA Limited to meet its liabilities as they fall due for that period.
The current unprecedented economic environment has created uncertainty in relation to the timing of a return to normal operations, the ongoing availability and extent of certain government supports, future consumer behaviour and the associated recovery of volumes and margins. The timing and shape of recovery is uncertain and accordingly, the Company has modelled a number of scenarios, including a severe but plausible downside scenario, taking account of current levels of trading and the consequential impact on cashflows, and indebtedness to the parent company. The downside scenario does not incorporate any further government funding beyond that currently announced. Furthermore, the Company is also reliant on its parent company for the supply of products for resale, which has confirmed that it will continue to extend credit over trading balances to enable the Company to operate with a favourable cash flow throughout this period.
Those forecasts are dependent on SAIT Finanzaria SpA Limited not seeking repayment of the amounts currently due to the group, which at 31 December 2023 amounted to £1,742,190.31, and providing additional financial support during that period. SAIT Finanzaria SpA Limited has indicated its intention to continue to make available such funds as are needed by the company, and that it does not intend to seek repayment of the amounts due at the balance sheet date, for the period covered by the forecast.
As with any company placing reliance on other group entities for financial support, the directors acknowledge that there can be no certainty that this support will continue although, at the date of approval of these financial statements, they have no reason to believe that it will not do so.
2.3
Turnover
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.
2.4
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:
Freehold land and buildings
30 years
Plant and equipment
3 to 10 years
Fixtures and fittings
3 to 20 years
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.
2.5
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.
SAIT ABRASIVES (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
2
Accounting policies
(Continued)
page 4
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.
2.6
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.
2.7
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.
2.8
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.
SAIT ABRASIVES (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
2
Accounting policies
(Continued)
page 5
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 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.
2.9
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.
2.10
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 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 company’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 when the company has 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.
2.11
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.
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.
SAIT ABRASIVES (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
2
Accounting policies
(Continued)
page 6
2.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
2.13
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.
2.14
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.
3
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Sales and marketing
9
7
Production
6
11
Administration
11
10
Total
26
28
4
Interest payable and similar expenses
2023
2022
£
£
Interest payable and similar expenses includes the following:
Interest payable to group undertakings
6,943
17,235
Net foreign exchange losses
8,583
14,914
Total other interest payable and similar charges
15,526
32,149
SAIT ABRASIVES (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
page 7
5
Tangible fixed assets
Land and buildings
Plant and machinery etc
Total
£
£
£
Cost
At 1 January 2023
1,572,408
703,122
2,275,530
Additions
15,873
15,873
At 31 December 2023
1,572,408
718,995
2,291,403
Depreciation and impairment
At 1 January 2023
522,617
481,186
1,003,803
Depreciation charged in the year
52,413
45,952
98,365
At 31 December 2023
575,030
527,138
1,102,168
Carrying amount
At 31 December 2023
997,378
191,857
1,189,235
At 31 December 2022
1,049,791
221,936
1,271,727
6
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
934,384
848,855
Prepayments and accrued income
63,024
46,509
997,408
895,364
7
Creditors: amounts falling due within one year
2023
2022
£
£
Loan due to group undertaking
9
122,534
118,322
Trade creditors
34,035
9,783
Amounts owed to group undertakings
1,742,190
1,259,021
Corporation tax
5,521
36,017
Other taxation and social security
170,114
181,798
Accruals and deferred income
97,907
123,788
2,172,301
1,728,729
The majority of the company's goods for resale are imported from Italy under an agreement with SAIT Abrasivi SpA. The agreement is governed by Italian law which provides that in the event of the liquidation of a company, goods in stock remain the property of the supplier until paid for. A major part of the amount due to SAIT Abrasivi SpA shown above arose from the supply of goods. These amounts are interest free and are repayable on demand.
SAIT ABRASIVES (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
page 8
8
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Loan due to group undertaking
9
2,649
188,393
The amounts owed to group undertakings represents two loans, the first a loan of €123,045 plus accrued interest (2022: €243,045) which is repayable within two years (2022: three years) of the balance sheet date, with an option, at the discretion of the company, to extend this until the company has sufficient cash resources to meet repayments along with normal trading requirements. This loan is unsecured and has accrued interest at a rate of 4% per annum. The second loan is for machinery and has a value of £11,000 plus accrued interest (2022: £65,600), this loan has an interest rate of 2% per annum and is repayable in three years. At the end of the period accrued interest totalled £7,159.
9
Loans and overdrafts
2023
2022
£
£
Loans from group undertakings and related parties
125,183
306,715
Payable within one year
122,534
118,322
Payable after one year
2,649
188,393
A Euro loan from the parent company of €123,045 (2022: €243,045) is translated as £107,024 (2021: £215,523). A machinery loan from the parent company is for a value of £11,000 (2022: £65,600) with an interest cost of £7,159 (2022: £17,235) for both loans. The balances include the value of unpaid interest accrued at the balance sheet date.
Terms and debt repayment schedule
| | | | | |
Loan from parent undertaking | | | | | |
Loan from parent undertaking | | | | | |
| | | | | |
The Euro loan is repayable at a rate of €10,000 per month plus interest at 4% on the outstanding balance. This is in accordance with an agreement dated 26 October 2018. As the loan is denominated in Euros there have been foreign currency losses, in the year, of £8,583 (2022: £14,914).
The second loan is repayable on the day of maturity and interest is payable on the loan at 2% of the outstanding balance. This is in line with an agreement dated 8 March 2019 and is denominated in Sterling.
10
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.
SAIT ABRASIVES (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
10
Audit report information
(Continued)
page 9
Senior Statutory Auditor:
Philip Hayden FCA
Statutory Auditor:
Richard Place Dobson Services Limited
Date of audit report:
24 September 2024
11
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
2023
2022
£
£
129,847
105,072
12
Parent company
The ultimate parent undertaking company is SAIT Finanziaria SpA, a company incorporated in Italy, which is the parent undertaking of the smallest and largest group to consolidate these financial statements. The consolidated financial statements of SAIT Finanziaria SpA are publically available at SAIT Finanziaria SpA, Via Raspini 21, Settimo-Torinese, Torino, Italy or from the website disclosed on page 9. The directors do not consider there to be an ultimate controlling party, as no one person or group of individuals acting in concert has greater than 50% of the equity of the ultimate parent company.
13
Related parties
As the Company was a wholly owned subsidiary of SAIT Finanziaria SpA at 31 December 2023, the Company has taken advantage of the exemption contained in FRS102.33.1A and has therefore not disclosed transactions or balances with wholly owned entities which form part of the Group headed by SAIT Finanziaria SpA.
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