Company Registration No. 02834292 (England and Wales)
PHILIP KINGSLEY PRODUCTS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PHILIP KINGSLEY PRODUCTS LIMITED
COMPANY INFORMATION
Directors
J Kingsley
A Kingsley
K Kingsley
Secretary
J Kingsley
Company number
02834292
Registered office
54 Green Street
London
W1K 6RU
United Kingdom
Auditor
HW Fisher LLP
Acre House
11-15 William Road
London
NW1 3ER
United Kingdom
PHILIP KINGSLEY PRODUCTS LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Group statement of comprehensive income
7
Group balance sheet
8
Company balance sheet
9
Group statement of changes in equity
10
Company statement of changes in equity
11
Group statement of cash flows
12
Notes to the financial statements
13 - 26
PHILIP KINGSLEY PRODUCTS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -

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

Fair review of the business

In the year 2023, the company managed to grow while remaining profitable. The company focused on cost control in a difficult economic environment characterised by continued high inflation.

 

The company seeks to diversify its sales channels and income streams in order to avoid concentration risk. This is particularly relevant as the retail landscape in the UK continues to change because of changing consumer preferences.

Principal risks and uncertainties

Liquidity is always the greatest risk in the view of the directors. It is mitigated by a conservative balance sheet and prudent cash flow planning.

 

The health of the economy and inflation are posing a risk to the demand side as general consumer sentiment is likely to be affected negatively. The Group continues ensure that its product offering is desirable in this trading environment. The Group is mitigating potential cost increases and supplier risk by having multiple sources of supply.

 

Currency risk is minimal, expenses are incurred in the same currency as sales.

 

The Group has no external loans, continues to grow organically and is not seeking any external loans in the foreseeable future.

Development and performance

Analysis of development performance

 

The Group continues to be active in the research, development and testing of new products for the hair and scalp while prioritising profit over growth.

 

Key performance indicators

The Group uses a range of financial key performance indicators to drive performance and monitor and manage the business effectively. These are reported companywide on a daily, weekly, and monthly basis against targets. The key financial performance indicators for the year were as follows:

 

 

 

 

 

 

2023

2022

 

 

 

 

 

£

£

Revenue

 

 

 

 

14,351,081

13,578,888

Gross profit margin

 

 

 

68%

65%

EBITDA

 

 

 

 

-298,654

42,534

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

On behalf of the board

J Kingsley
Director
24 September 2024
PHILIP KINGSLEY PRODUCTS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -

The directors present their annual report and financial statements for the year ended 31 December 2023.

Principal activities

The principal activity of the company and group continued to be that of marketing and sale of up-market haircare products and treatments.

Results and dividends

The results for the year are set out on page 7.

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

Directors

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

J Kingsley
A Kingsley
K Kingsley
Auditor

The auditor, HW Fisher LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

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
J Kingsley
Director
24 September 2024
PHILIP KINGSLEY PRODUCTS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -

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

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the 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:

 

 

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.

PHILIP KINGSLEY PRODUCTS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PHILIP KINGSLEY PRODUCTS LIMITED
- 4 -
Opinion

We have audited the financial statements of Philip Kingsley Products Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

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

Conclusions relating to going concern

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

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the 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.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

PHILIP KINGSLEY PRODUCTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PHILIP KINGSLEY PRODUCTS LIMITED
- 5 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report and the directors' report.

 

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

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, 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 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 extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

As part of our planning process:

 

The key procedures we undertook to detect irregularities including fraud during the course of the audit included:

PHILIP KINGSLEY PRODUCTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PHILIP KINGSLEY PRODUCTS LIMITED
- 6 -

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements even though we have properly planned and performed our audit in accordance with auditing standards. The primary responsibility for the prevention and detection of irregularities and fraud rests with those charged with the directors of the group.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

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

Simon Mott-Cowan (Senior Statutory Auditor)
For and on behalf of HW Fisher LLP
Chartered Accountants
Statutory Auditor
Acre House
11-15 William Road
London
NW1 3ER
United Kingdom
24 September 2024
PHILIP KINGSLEY PRODUCTS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
14,351,081
13,578,888
Cost of sales
(4,629,606)
(4,802,090)
Gross profit
9,721,475
8,776,798
Distribution costs
(1,124,196)
(1,200,191)
Administrative expenses
(8,932,344)
(7,563,320)
Operating (loss)/profit
4
(335,065)
13,287
Interest receivable and similar income
8
19,958
2,122
(Loss)/profit before taxation
(315,107)
15,409
Tax on (loss)/profit
9
(69,255)
31,897
(Loss)/profit for the financial year
(384,362)
47,306
(Loss)/profit for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.
PHILIP KINGSLEY PRODUCTS LIMITED
GROUP BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
10
300,897
282,578
Tangible assets
11
34,191
30,846
335,088
313,424
Current assets
Stocks
13
2,216,528
1,910,738
Debtors
14
2,433,096
2,360,331
Cash at bank and in hand
5,367,543
5,773,527
10,017,167
10,044,596
Creditors: amounts falling due within one year
15
(2,372,138)
(1,994,661)
Net current assets
7,645,029
8,049,935
Total assets less current liabilities
7,980,117
8,363,359
Provisions for liabilities
Deferred tax liability
16
5,945
4,825
(5,945)
(4,825)
Net assets
7,974,172
8,358,534
Capital and reserves
Called up share capital
18
97
97
Capital redemption reserve
5
5
Profit and loss reserves
7,974,070
8,358,432
Total equity
7,974,172
8,358,534
The financial statements were approved by the board of directors and authorised for issue on 24 September 2024 and are signed on its behalf by:
J Kingsley
Director
PHILIP KINGSLEY PRODUCTS LIMITED
COMPANY BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
10
300,897
282,578
Tangible assets
11
34,191
30,846
335,088
313,424
Current assets
Stocks
13
2,058,057
1,611,817
Debtors
14
2,333,744
2,195,134
Cash at bank and in hand
4,619,770
5,375,695
9,011,571
9,182,646
Creditors: amounts falling due within one year
15
(2,316,011)
(1,957,584)
Net current assets
6,695,560
7,225,062
Total assets less current liabilities
7,030,648
7,538,486
Provisions for liabilities
Deferred tax liability
16
5,945
4,825
(5,945)
(4,825)
Net assets
7,024,703
7,533,661
Capital and reserves
Called up share capital
18
97
97
Capital redemption reserve
5
5
Profit and loss reserves
7,024,601
7,533,559
Total equity
7,024,703
7,533,661

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 £508,958 (2022 - £251,434 loss).

The financial statements were approved by the board of directors and authorised for issue on 24 September 2024 and are signed on its behalf by:
J Kingsley
Director
Company Registration No. 02834292
PHILIP KINGSLEY PRODUCTS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
Share capital
Capital redemption reserve
Profit and loss reserves
Total
£
£
£
£
Balance at 1 January 2022
97
5
8,311,126
8,311,228
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
47,306
47,306
Balance at 31 December 2022
97
5
8,358,432
8,358,534
Year ended 31 December 2023:
Loss and total comprehensive income for the year
-
-
(384,362)
(384,362)
Balance at 31 December 2023
97
5
7,974,070
7,974,172
PHILIP KINGSLEY PRODUCTS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Capital redemption reserve
Profit and loss reserves
Total
£
£
£
£
Balance at 1 January 2022
97
5
7,784,993
7,785,095
Year ended 31 December 2022:
Loss and total comprehensive income for the year
-
-
(251,434)
(251,434)
Balance at 31 December 2022
97
5
7,533,559
7,533,661
Year ended 31 December 2023:
Loss and total comprehensive income for the year
-
-
(508,958)
(508,958)
Balance at 31 December 2023
97
5
7,024,601
7,024,703
PHILIP KINGSLEY PRODUCTS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
21
204,595
1,797,495
Income taxes paid
(647,811)
(2,278)
Net cash (outflow)/inflow from operating activities
(443,216)
1,795,217
Investing activities
Purchase of intangible assets
(49,554)
(161,286)
Purchase of tangible fixed assets
(8,521)
(10,925)
Interest received
19,958
2,122
Net cash used in investing activities
(38,117)
(170,089)
Net (decrease)/increase in cash and cash equivalents
(481,333)
1,625,128
Cash and cash equivalents at beginning of year
5,773,527
4,148,399
Effect of foreign exchange rates
75,349
-
0
Cash and cash equivalents at end of year
5,367,543
5,773,527
PHILIP KINGSLEY PRODUCTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
1
Accounting policies
Company information

Philip Kingsley Products Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 54 Green Street, London, W1K 6RU, United Kingdom.

 

The group consists of Philip Kingsley Products Limited and all of its subsidiaries.

1.1
Accounting convention

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

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

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

 

 

1.2
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Philip Kingsley Products Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 31 December 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

1.3
Going concern

The directors have considered the relevant business and financial risks and the ability of the group to continue in operational existence for the foreseeable future. Recent global events have created significant financial pressures on the global economy, individuals and for companies in general. Having considered the contingency plans in place and having reviewed updated cashflow forecasts, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future and hence consider the adoption of the going concern basis in preparing these financial statements is appropriate.

1.4
Turnover

Turnover represents amounts receivable for the sale of hair products net of VAT and trade discounts.

PHILIP KINGSLEY PRODUCTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -

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.

1.5
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.

1.6
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:

Computer software
33% straight line
Development costs
33% straight line
1.7
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:

Plant and equipment
3 years straight line
Computer equitpment
3 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.

1.8
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.

PHILIP KINGSLEY PRODUCTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -

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.

1.9
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 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.

1.10
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.

1.11
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.

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.

PHILIP KINGSLEY PRODUCTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
Basic financial liabilities

Basic financial liabilities, including creditors, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

1.12
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.

1.13
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.

1.14
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.

1.15
Retirement benefits

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

PHILIP KINGSLEY PRODUCTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
1.16
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 leased asset are consumed.

1.17
Foreign exchange

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

2
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.

Key sources of estimation uncertainty

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

Stock provision

The obsolete, slow moving stock items and expiry dates on each product were reviewed on a line by line basis and provided for.

Capitalisation of website development costs

The website development costs are capitalised under intangible fixed assets, which are based on the directors' best estimate of time attributable to projects meeting the recognition criteria.

Amortisation of website development costs

The amortisation on the website is calculated based on the project end dates, which are the best estimates, based on the project managers' day to day experience and knowledge of the projects activities and the completion date for each project.

3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
QVC
1,494,024
1,391,017
Salons
463,560
335,515
Retailers
3,157,695
3,238,640
E-tailers
6,374,781
5,034,930
International
2,097,488
2,839,071
E-Commerce
763,533
739,715
14,351,081
13,578,888
PHILIP KINGSLEY PRODUCTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
3
Turnover and other revenue
(Continued)
- 18 -
2023
2022
£
£
Other significant revenue
Interest income
19,958
2,122
2023
2022
£
£
Turnover analysed by geographical market
UK
12,253,594
10,739,817
International
2,097,487
2,839,071
14,351,081
13,578,888
4
Operating (loss)/profit
2023
2022
£
£
Operating (loss)/profit for the year is stated after charging/(crediting):
Exchange differences apart from those arising on financial instruments measured at fair value through profit or loss
33,572
(72,733)
Research and development costs
59,522
138,986
Depreciation of owned tangible fixed assets
5,176
4,668
(Profit)/loss on disposal of tangible fixed assets
-
9,472
Amortisation of intangible assets
31,235
24,579
Operating lease charges
290,962
251,524
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
39,849
24,081
Audit of the financial statements of the company's subsidiaries
20,082
12,500
59,931
36,581
6
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
Administrative
43
43
43
43
PHILIP KINGSLEY PRODUCTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
6
Employees
(Continued)
- 19 -

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
2,327,949
2,364,711
2,312,825
2,129,659
Social security costs
217,581
212,504
217,581
212,504
Pension costs
115,088
150,593
115,088
150,593
2,660,618
2,727,808
2,645,494
2,492,756
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
64,175
77,012
Company pension contributions to defined contribution schemes
983
1,003
65,158
78,015

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2022 - 1).

8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
19,958
2,122
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
69,255
9,286
Deferred tax
Origination and reversal of timing differences
-
0
(41,183)
Total tax charge/(credit)
69,255
(31,897)
PHILIP KINGSLEY PRODUCTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
9
Taxation
(Continued)
- 20 -

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

2023
2022
£
£
(Loss)/profit before taxation
(315,107)
15,409
Expected tax charge based on the standard rate of corporation tax in the UK of 0% (2022: 19.00%)
-
2,928
Tax effect of expenses that are not deductible in determining taxable profit
313,493
162,790
Adjustments in respect of prior years
(103,900)
-
0
Permanent capital allowances in excess of depreciation
(13,740)
-
0
Depreciation on assets not qualifying for tax allowances
13,836
-
0
Research and development tax credit
-
0
(98,020)
Tax at marginal rate
(98,300)
-
0
Capital allowances
(13,740)
(5,581)
Capital items
377
285
Deferred tax - timing difference
-
0
(41,183)
Fixed assets profit on disposals
-
0
1,800
Sundry expenses
871
-
Pension accruals
(3,448)
-
Tax effect of LLC profit
(26,194)
(54,916)
Taxation charge/(credit)
69,255
(31,897)
PHILIP KINGSLEY PRODUCTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
10
Intangible fixed assets
Group
Computer software
Development costs
Total
£
£
£
Cost
At 1 January 2023
98,997
259,719
358,716
Additions
-
0
49,554
49,554
At 31 December 2023
98,997
309,273
408,270
Amortisation and impairment
At 1 January 2023
51,481
24,657
76,138
Amortisation charged for the year
4,751
26,484
31,235
At 31 December 2023
56,232
51,141
107,373
Carrying amount
At 31 December 2023
42,765
258,132
300,897
At 31 December 2022
47,516
235,062
282,578
Company
Computer software
Development costs
Total
£
£
£
Cost
At 1 January 2023
98,997
259,719
358,716
Additions
-
0
49,554
49,554
At 31 December 2023
98,997
309,273
408,270
Amortisation and impairment
At 1 January 2023
51,481
24,657
76,138
Amortisation charged for the year
4,751
26,484
31,235
At 31 December 2023
56,232
51,141
107,373
Carrying amount
At 31 December 2023
42,765
258,132
300,897
At 31 December 2022
47,516
235,062
282,578
PHILIP KINGSLEY PRODUCTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
11
Tangible fixed assets
Group
Plant and equipment
Computer equitpment
Total
£
£
£
Cost
At 1 January 2023
49,892
280,675
330,567
Additions
8,521
-
0
8,521
At 31 December 2023
58,413
280,675
339,088
Depreciation and impairment
At 1 January 2023
19,046
280,675
299,721
Depreciation charged in the year
5,176
-
0
5,176
At 31 December 2023
24,222
280,675
304,897
Carrying amount
At 31 December 2023
34,191
-
0
34,191
At 31 December 2022
30,846
-
0
30,846
Company
Plant and equipment
Computer equitpment
Total
£
£
£
Cost
At 1 January 2023
49,892
280,675
330,567
Additions
8,521
-
0
8,521
At 31 December 2023
58,413
280,675
339,088
Depreciation and impairment
At 1 January 2023
19,046
280,675
299,721
Depreciation charged in the year
5,176
-
0
5,176
At 31 December 2023
24,222
280,675
304,897
Carrying amount
At 31 December 2023
34,191
-
0
34,191
At 31 December 2022
30,846
-
0
30,846
PHILIP KINGSLEY PRODUCTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
12
Subsidiaries

Details of the company's subsidiaries at 31 December 2023 are as follows:

Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Philip Kingsley Products LLC
100 Sunnyside Blvd, Ste 200 Woodbury NY 11797, USA.
Sale of up - market haircare products treatments
N/A
100.00
13
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Finished goods and goods for resale
2,216,528
1,910,738
2,058,057
1,611,817
14
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
1,842,093
1,855,389
1,778,351
1,740,798
Corporation tax recoverable
297,001
-
0
297,001
-
0
Other debtors
137,051
356,666
113,731
307,032
Prepayments and accrued income
156,951
148,276
144,661
147,304
2,433,096
2,360,331
2,333,744
2,195,134
15
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
£
£
£
£
Trade creditors
1,482,655
1,118,517
1,482,023
1,117,847
Corporation tax payable
-
0
282,675
-
0
282,675
Other taxation and social security
122,301
193,840
122,301
191,441
Other creditors
140,950
113,530
140,950
113,530
Accruals and deferred income
626,232
286,099
570,737
252,091
2,372,138
1,994,661
2,316,011
1,957,584
PHILIP KINGSLEY PRODUCTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
16
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

Liabilities
Liabilities
2023
2022
Group
£
£
Accelerated capital allowances
5,945
4,825
Liabilities
Liabilities
2023
2022
Company
£
£
Accelerated capital allowances
5,945
4,825
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 January 2023
4,825
4,825
Charge to profit or loss
1,120
1,120
Liability at 31 December 2023
5,945
5,945

The deferred tax liability set out above is expected to reverse within 12 months and relates to accelerated capital allowances that are expected to mature within the same period.

17
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
115,088
150,593

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

18
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary Shares of 1p each
9,700
9,700
97
97
PHILIP KINGSLEY PRODUCTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 25 -
19
Operating lease commitments
Lessee

At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
66,550
-
66,550
-
66,550
-
66,550
-
20
Related party transactions

During the year, the Group was charged a management fee of £861,381 (2022: £94,453) from Philip Kingsley Trichological Centre of New York LTD and charged £108,234 (2022: £nil) to The Trichological Clinic Limited for the directors' services rendered in the year.

 

At the year end, the balances of £486,367 (2022: £199,991) due from Philip Kingsley Trichological Centre of New York LTD were recognised as bad debts.

 

At the year end, the group owes an amount of £140,950 (2022: £113,530) to The Philip Kingsley Will Trust in which the beneficiaries are the directors of Philip Kingsley Products Limited.

 

At the year end, included in trade and other debtors are £547,884 (2022: £404,009 ) and £nil (2022: £264,959) due from The Trichological Clinic Limited and Philip Kingsley Trichological Centre of New York LTD respectively, the entities in which the shareholders are the same shareholders of Philip Kingsley Products Limited.

21
Cash generated from group operations
2023
2022
£
£
(Loss)/profit for the year after tax
(384,362)
47,306
Adjustments for:
Taxation charged/(credited)
69,255
(31,897)
Investment income
(19,958)
(2,122)
(Gain)/loss on disposal of tangible fixed assets
-
9,472
Amortisation and impairment of intangible assets
31,235
24,579
Depreciation and impairment of tangible fixed assets
5,176
4,668
Movements in working capital:
(Increase)/decrease in stocks
(354,615)
688,899
Decrease in debtors
205,120
2,016,525
Increase/(decrease) in creditors
652,744
(959,935)
Cash generated from operations
204,595
1,797,495
PHILIP KINGSLEY PRODUCTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 26 -
22
Analysis of changes in net funds - group
1 January 2023
Cash flows
Exchange rate movements
31 December 2023
£
£
£
£
Cash at bank and in hand
5,773,527
(481,333)
75,349
5,367,543
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