Company registration number 03360713 (England and Wales)
T I MIDWOOD & CO LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
T I MIDWOOD & CO LIMITED
COMPANY INFORMATION
Directors
Mr JO Sandberg
Mr EK O Lundén EKO
(Appointed 14 April 2023)
Mr CA Varey
(Appointed 16 January 2023)
Secretary
Oakwood Corporate Secretary Limited
Company number
03360713
Registered office
C/O UHY Hacker Young
St Johns Chambers
Love Street
Chester
CH1 1QN
Independent auditors
PricewaterhouseCoopers LLP
One Chamberlain Square
Birmingham
B3 3AX
T I MIDWOOD & CO LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' responsibilities statement
4
Directors' report
5 - 6
Independent auditor's report
7 - 10
Statement of comprehensive income
11
Statement of changes in equity
12
Statement of financial position
14
Statement of cash flows
13
Notes to the financial statements
15 - 30
T I MIDWOOD & CO LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report together with the audited financial statements for the year ended 31 December 2023.
Business review
The results of the company for the year, as set out on page 11, show turnover increasing by 1% to £70.3m (2022 - £69.6m) and a profit before taxation of £8.2m (2022 - £2.2m). Net assets increased to £36m (2022 - £28m).
During 2023, the market was impacted by the downturn in the UK economy and the construction industry. In these challenging market conditions, the company was pleased to be able to grow sales by 1%. An easing of inflationary pressure relating to the products allowed Gross Margins to reverse the decline seen in 2022 and return to higher levels, combined with savings achieved in administrative costs resulted in improved profitability during the year.
The directors are confident that the performance of the company will remain steady in 2024.
Principal risks and uncertainties
The management of the business and the nature of the company's business are subject to a number of risks, as outlined by directors below.
Currency risk
The company purchases from overseas suppliers in currencies other than Sterling with no corresponding income to naturally offset the currency risk. The company monitors daily exchange rate movements and from time-to-time uses forward currency contracts to reduce its exposure to currency risk.
Credit risk
The company has a large, diverse customer base with the majority of sales under credit terms. Steps are in place to mitigate this risk such as credit checks on all new customers and the monitoring of aged debts to prevent issuing credit to customers whose payments are already overdue.
Customer trust and brand reputation
Customer confidence and trust with our company and products is critical to our business and we always try to please our customers if we possibly can.
There is always a risk that a customer may get a bad experience, sometimes because of circumstances beyond our control. For example a lost or delayed delivery of an urgently required product, or a faulty product. However, a bad experience can lead to bad reviews and we know that reading existing reviews are usually high on a potential customers list when seeking to purchase products.
We seek to mitigate this risk in the following ways:
We are passionate about customer care. We have a wealth of knowledge, expertise and experience to ensure we provide service excellence to exceed expectations. We are very much a people business, while at the same time we have made significant investment to ensure that we are at the cutting edge of technology. Our new computer system is customer focused, which means that behind the scenes you are totally supported by a robust, state of the art, professional back office operation providing maximum effectiveness.
Our dedicated customer care team can sort out easily problems with delivery, wrong or faulty products being received etc and will do their best to ensure the customer is happy with the outcome.
We also undertake vigorous testing on all new products before adding them to our catalogue to mitigate any problems with a faulty product.
We create reliable products you can have complete confidence in. We wouldn’t put our name to anything less.
T I MIDWOOD & CO LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Principal risks and uncertainties (continued)
Competition
There is always a risk with competition, particularly with cheaper, inferior products on the market.
We mitigate this risk by actively monitoring competitors’ prices and ensuring that our marketing information clearly shows the quality of our products so these can be compared with inferior brands on the market.
Workforce
Keeping the best staff or losing them to a competitor is always a risk to a business. We aim to mitigate this by rewarding staff via salary and good working conditions and other motivational incentives. We have HR support for any member of staff who has a problem at work in any area.
Stock Shortages
Stock shortages can be a real business risk in our industry as this can mean a customer may go to a competitor and we could potentially lose them for future business.
In order to mitigate this, we hold a significant amount of stock which has held us in good stead in the past when other suppliers have struggled with supply issues.
Data and cyber security
Security of customer, commercial and colleague data poses a reputational as well as a financial risk to all businesses.
In order to mitigate this, we have a team of IT experts constantly monitoring and securing our IT systems.
Price
In recent years, the price of steel and other raw materials has fluctuated significantly and sudden increases remain a financial risk to the business when ordering products. However, this will be the same for all suppliers in our industry and our high level of stock helps to mitigate sudden price rises to customers. We also believe that our customers prefer to pay for a good quality product rather than a cheaper one that may not do the job as well.
Liquidity and cashflow
Liquidity and cashflow are obviously something that every business needs to control well and a problem in this area can have a knock-on effect to all areas of the business.
The company has access to the Bufab Group credit facilities when it comes to the need for any borrowing. The company is also meticulous in monitoring its debtors ledger and chasing any overdue debts on a regular basis.
Future growth and developments
The weaker global economy, high inflation and reducing consumer confidence are expected to lead to weaker market demand in the UK construction industry during 2024. Despite this more challenging environment, the directors are confident that due to a well-diversified customer base and continued investment in regional sales and customer service, that demand for the company’s products will remain strong.
The company has continued to provide award-winning service levels and find new, innovative ways to support its customers. The company has maintained support for its recently launched ranges including hand tools, painting and decorating and workwear.
Strategy
The company's main objective is to increase long term value to its shareholders. This is achieved through a continued focus on great service and great products whilst staying true to its values: supportive, knowledgeable, committed and independently-minded.
Historic growth is attributed to the continued introduction of new product ranges and the efforts of the sales team in promoting those products.
T I MIDWOOD & CO LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
Financial key performance indicators
The directors monitor the performance of the company using the following key performance indicators (KPI's):
Turnover £70.3m (2022 - £69.6m) - Goods supplied during the year exclusive of Value Added Tax, trade discounts and rebates
Gross Margin 33.6% (2022 - 27.7%) - Gross Profit as a percentage of Turnover. This represented a reversal of the 2022 decline and return to higher values.
Statement of the directors' duties in performance of S172(1) Companies Act 2006
The board of directors of T I Midwood & Co Limited consider that both individually and together for the year ended 31 December 2023 they have acted in the way they consider, in good faith, would be the most likely to promote the success of the company for the benefit of its members as a whole and having regard to the matters set out in s172(1) (a-f) as below:
a) the likely consequences of any decision in the long term;
b) the interests of the company's employees;
c) the need to foster the company's business relationships with suppliers, customers and others;
d) the impact of the company's operations on the community and the environment;
e) the desirability of the company maintaining a reputation for high standards of business conduct; and
f) the need to act fairly between members of the company.
The directors make decisions by taking their legal duty into account and also the priorities and requirements of the stakeholders by considering the following:
a) The likely consequences of any decision in the long term
The directors understand the business and the evolving environment in which it operates. The directors are mindful that strategic decisions can have long term implications for the business and its stakeholders, and these implications are carefully assessed.
b) The interests of the company's employees
The directors recognise that the strength of the business is built on the hard work, loyalty, dedication and abilities of our people. The success of the business depends on attracting, retaining and motivating employees. We aim to be a responsible employer in our approach, from pay and benefits to our health, safety and workplace environment.
c) The need to foster the company's business relationships with suppliers, customers and others
Delivering our strategy requires strong mutually beneficial relationships with suppliers, customers and others. The directors review and approve the company's approach to suppliers which is set out in the company's policies. The directors continuously assess the priorities related to customers and those with whom we do business.
d) The impact of the company's operations on the community and the environment
The company is aware of its social responsibilities to the communities where it operates. The company recognises the importance of its environmental responsibilities and complies with all legislation with respect to the transportation, storage and use of its products. Further information is contained within the Streamlined Energy and Carbon Report in the Directors' Report.
e) The desirability of the company maintaining a reputation for high standards of business conduct
The directors are committed to high standards of business conduct.
All new starters undertake a full induction process and are provided with a copy of the company's Employee Handbook which documents key topics including conduct and standards.
f) The need to act fairly between members of the company
The company aims to act with integrity and courtesy in all of its business relationships and will consider all members and stakeholders when making decisions for the overall good of the company.
Mr CA Varey
Director
16 September 2024
T I MIDWOOD & CO LIMITED
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 prepared the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards comprising FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland", and applicable law).
Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing the 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 United Kingdom Accounting Standards, comprising FRS 102 have been followed, subject to any material departures disclosed and explained in the financial statements; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
They are also responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006.
Directors’ confirmations
In the case of each director in office at the date the directors’ report is approved:
so far as the director is aware, there is no relevant audit information of which the company’s auditors are unaware; and
they have taken all the steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company’s auditors are aware of that information.
T I MIDWOOD & CO LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 5 -
The directors present their annual report and audited financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company is the supply of essential products that trade professionals rely on every day.
Results and dividends
The results for the year are set out on page 11.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
An interim dividend in respect of the year ended 31 December 2024 of £12,000,000 was paid to the holding company, Bufab UK Holdings Ltd, on 26 June 2024.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr SI Midwood
(Resigned 16 January 2023)
Mr M Söderberg M
(Resigned 14 April 2023)
Mr JO Sandberg
Mr EK O Lundén EKO
(Appointed 14 April 2023)
Mr CA Varey
(Appointed 16 January 2023)
Qualifying third party indemnity provisions
The company has made qualifying third party indemnity provisions for the benefit of its directors during the year. These provisions remain in force at the reporting date.
Streamlined energy and carbon report
2023
2022
Energy consumption
kWh
kWh
Aggregate of energy consumption in the year
1,012,010
1,191,296
2023
2022
Emissions of CO2 equivalent
metric tonnes
metric tonnes
Scope 1 - direct emissions
- Gas combustion
-
-
- Fuel consumed for owned transport
208.00
176.00
208.00
176.00
Scope 2 - indirect emissions
- Electricity purchased
20.00
70.00
Total gross emissions
228.00
246.00
Intensity ratio
Tonnes Co2 per £1m of turnover
3.24
3.53
T I MIDWOOD & CO LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 6 -
Quantification and reporting methodology
We have followed the 2019 HM Government Environmental Reporting Guidelines. We have also used the GHG Reporting Protocol – Corporate Standard and have used the 2020 UK Government’s Conversion Factors for Company Reporting.
Intensity measurement
The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per £1m of turnover, the recommended ratio for the sector.
Measures taken to improve energy efficiency
The company is committed to reducing carbon emissions produced from its operations. To achieve this the company:
recycles packaging and used ink cartridges;
has replaced light bulbs with more energy efficient LED lighting;
diesel cars have been replaced with petrol hybrids on lease renewal;
promotes video conferencing as a means of reducing travel;
The electricity supply has been moved to 100% green electricity from April 2023
Our top 10 suppliers have commenced the Bufab Supplier Engagement Programme
New packaging is being developed to replace plastic where possible. Where it is necessary to use plastic, we will endeavour to use 30% recycled content and recyclable plastic.
minimises waste and encourages an active waste management system; and
promotes environmental awareness and responsibility amongst employees and suppliers.
Disclosure of information in the strategic report
In accordance with section 414C(11) of the Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013 the directors have included a separate Strategic Report which can be found on pages 1 to 3. This report includes information that would have previously been included in the business review and consequently no business review is required in the directors' report.
Auditor's liability
The directors have agreed with the group's auditors that the auditor's liability to damages for breach of duty in relation to the audit of the company's financial statements for the year to 31 December 2023 should be limited to the greater of £5m or 5 times the auditor's fees, and that in any event the auditor's liability for damages should be limited to that part of any loss suffered by the company as is just and equitable having regard to the extent to which the auditor, the company and any third parties are responsible for the loss in question. The shareholders approved this limited liability agreement, as required by the Companies Act 2006, by a resolution dated 6 February 2024.
On behalf of the board
Mr CA Varey
Director
16 September 2024
T I MIDWOOD & CO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF T I MIDWOOD & CO LIMITED
- 7 -
Report on the audit of the financial statements
Opinion
In our opinion, T I Midwood & Co Ltd’s financial statements:
give a true and fair view of the state of the company’s affairs as at 31 December 2023 and of its profit and cash flows for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”, and applicable law); and
have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements, included within the Annual Report, which comprise: Statement of financial position as at 31 December 2023; Statement of comprehensive income, the Statement of changes in equity and the Statement of cash flows for the year then ended; and the notes to the financial statements, which include a description of the significant accounting policies.
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities under ISAs (UK) are further described in the Auditors’ responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We remained independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, which includes the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements.
Conclusions relating to going concern
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
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.
However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the company's ability to continue as a going concern.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
T I MIDWOOD & CO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF T I MIDWOOD & CO LIMITED (CONTINUED)
- 8 -
Reporting on other information
The other information comprises all of the information in the Annual Report other than the financial statements and our auditors’ report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly stated in this report, any form of assurance thereon.
In connection with our audit of the financial statements, 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 audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement of the financial statements or a material misstatement of the other information. 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 based on these responsibilities.
With respect to the Strategic report and Directors' Report, we also considered whether the disclosures required by the UK Companies Act 2006 have been included.
Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain opinions and matters as described below.
Strategic report and Directors' Report
In our opinion, based on the work undertaken in the course of the audit, the information given in the Strategic report and Directors' Report for the year ended 31 December 2023 is consistent with the financial statements and has been prepared in accordance with applicable legal requirements.
In light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we did not identify any material misstatements in the Strategic report and Directors' Report.
T I MIDWOOD & CO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF T I MIDWOOD & CO LIMITED (CONTINUED)
- 9 -
Responsibilities for the financial statements and the audit
Responsibilities of the directors for the financial statements
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements in accordance with the applicable framework and for being satisfied that they give a true and fair view. The directors are also responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditors’ 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 auditors’ 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.
Based on our understanding of the company and industry, we identified that the principal risks of non-compliance with laws and regulations related to the Companies Act 2006 and relevant tax legislation, and we considered the extent to which non-compliance might have a material effect on the financial statements. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting of inappropriate journal entries and management bias in accounting estimates. Audit procedures performed by the engagement team included:
Discussions with management, including considerations of know or suspected instances of non-compliance with laws and regulations
Reviewing of board minutes for any instances of non-compliance with laws and regulations
Challenging assumptions and judgements made by management on significant accounting estimates
Identifying and testing journal entries, in particular journal entries posted with unexpected account combinations and
incorporating unpredictability into the nature, timing and/or extent of our testing
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors’ report.
Use of this report
This report, including the opinions, has been prepared for and only for the company’s members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
T I MIDWOOD & CO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF T I MIDWOOD & CO LIMITED (CONTINUED)
- 10 -
Companies Act 2006 exception reporting
Under the Companies Act 2006 we are required to report to you if, in our opinion:
we have not obtained all the information and explanations we require for our audit; or
adequate accounting records have not been kept by the company, or returns adequate for our audit have not been received from branches not visited by us; or
certain disclosures of directors’ remuneration specified by law are not made; or
the financial statements are not in agreement with the accounting records and returns.
We have no exceptions to report arising from this responsibility.
Mark Kingsbury (Senior Statutory Auditor)
For and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
Birmingham
16 September 2024
T I MIDWOOD & CO LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
2023
2022
Notes
£
£
Turnover
3
70,308,269
69,597,018
Cost of sales
(46,716,434)
(50,319,317)
Gross profit
23,591,835
19,277,701
Distribution costs
(4,125,305)
(4,165,446)
Administrative expenses
(11,057,347)
(12,506,603)
Operating profit
4
8,409,183
2,605,652
Interest receivable and similar income
8
27,548
3,491
Interest payable and similar expenses
9
(249,462)
(386,698)
Profit before taxation
8,187,269
2,222,445
Tax on profit
10
(712,307)
(489,539)
Profit for the financial year
7,474,962
1,732,906
The income statement has been prepared on the basis that all operations are continuing operations.
T I MIDWOOD & CO LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
Called up share capital
Share premium account
Profit and loss account
Total equity
£
£
£
£
Balance at 1 January 2022
103
238,197
26,335,858
26,574,158
Year ended 31 December 2022:
Profit and total comprehensive income
-
-
1,732,906
1,732,906
Balance at 31 December 2022
103
238,197
28,068,764
28,307,064
Year ended 31 December 2023:
Profit and total comprehensive income
-
-
7,474,962
7,474,962
Balance at 31 December 2023
103
238,197
35,543,726
35,782,026
T I MIDWOOD & CO LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
29
18,861,406
(13,147,883)
Interest paid
(249,462)
(386,698)
Income taxes paid
(1,354,107)
(901,273)
Net cash inflow/(outflow) from operating activities
17,257,837
(14,435,854)
Investing activities
Purchase of tangible fixed assets
(222,404)
(455,206)
Proceeds from disposal of tangible fixed assets
83,489
8,766,000
Repayment of loans
29,043
352,751
Interest received
27,548
3,491
Net cash (used in)/generated from investing activities
(82,324)
8,667,036
Financing activities
Repayment of bank loans
(3,416,134)
Payment of finance leases obligations
(108,828)
(131,496)
Net cash used in financing activities
(108,828)
(3,547,630)
Net increase/(decrease) in cash and cash equivalents
17,066,685
(9,316,448)
Cash and cash equivalents at beginning of year
(11,451,300)
(2,134,852)
Cash and cash equivalents at end of year
5,615,385
(11,451,300)
Relating to:
Cash at bank and in hand
5,615,575
621,351
Bank overdrafts included in creditors payable within one year
(190)
(12,072,651)
T I MIDWOOD & CO LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2023
31 December 2023
- 14 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
12
1,223,565
1,390,481
Current assets
Stocks
13
24,898,354
37,277,891
Debtors
14
10,549,837
11,130,062
Cash at bank and in hand
5,615,575
621,351
41,063,766
49,029,304
Creditors: amounts falling due within one year
15
(6,177,162)
(21,530,352)
Net current assets
34,886,604
27,498,952
Total assets less current liabilities
36,110,169
28,889,433
Creditors: amounts falling due after more than one year
16
(114,073)
(222,901)
Provisions for liabilities
Deferred tax liability
19
214,070
359,468
(214,070)
(359,468)
Net assets
35,782,026
28,307,064
Capital and reserves
Called up share capital
21
103
103
Share premium account
238,197
238,197
Profit and loss reserves
35,543,726
28,068,764
Total equity
35,782,026
28,307,064
The financial statements on pages 11 to 30 were authorised for issue by the board of directors on
16 September 2024
16 September 2024
and are signed on its behalf by:
Mr CA Varey
Director
Company Registration No. 03360713
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 15 -
1
Accounting policies
Company information
T I Midwood & Co Limited is a private company limited by shares incorporated in England and Wales. The registered office is C/O UHY Hacker Young, St Johns Chambers, Love Street, Chester, CH1 1QN.
The trading address is Green Lane, Wardle, Nantwich, Cheshire CW5 6BJ.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies which are adopted and applied consistently are set out below.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
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.
1.4
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:
Brand name
25% straight line
1.5
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.
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
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
10% straight line
Plant and equipment
10% straight line
Computer equipment
33.33% straight line
Motor vehicles
20% straight line
Equipment
20% straight line
Assets in process
Not depreciated until complete
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.
1.6
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, 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.
1.7
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.
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
1.8
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.
1.9
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors 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.
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 company 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.
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -
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.
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 company’s contractual obligations expire or are discharged or cancelled.
1.10
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.
1.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 19 -
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 income statement, 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.
1.12
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.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
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 statement of financial position 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 leases asset are consumed.
1.15
Foreign exchange
Foreign currency transactions are initially recorded in the functional currency, by applying the spot exchange rate as at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate ruling at the reporting date, with any gains or losses being taken to the profit and loss account.
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
2
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.
Management consider however that there are no key judgements in the application of accounting policies, nor any key sources estimation uncertainty of such significance that they need to record it in the financial statements.
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Sale of goods
70,308,269
69,597,018
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
66,481,223
65,367,450
Overseas sales
3,827,046
4,229,568
70,308,269
69,597,018
2023
2022
£
£
Other revenue
Interest income
27,548
3,491
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
36,176
(134,830)
Depreciation of owned tangible fixed assets
286,060
568,768
Depreciation of tangible fixed assets held under finance leases
59,225
58,925
Profit on disposal of tangible fixed assets
(39,454)
(7,918)
Operating lease charges
1,276,217
1,031,388
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
5
Auditors' remuneration
2023
2022
Fees payable to the company's auditors and associates:
£
£
For audit services
Audit of the financial statements of the company
75,000
75,000
There were no non-audit fees payable to the auditors.
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
228,143
1,503,163
Company pension contributions to defined contribution schemes
25,043
15,098
253,186
1,518,261
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2022 - 1).
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
228,143
573,674
Company pension contributions to defined contribution schemes
25,043
1,712
The highest paid director did not exercise any share options during the year.
The highest paid director was not entitled to receive shares under a long term incentive scheme during the year.
7
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Administrative staff
88
89
Warehouse staff
107
111
Total
195
200
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
7
Employees
(Continued)
- 22 -
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
7,406,081
8,744,475
Social security costs
672,920
605,854
Other pension costs
216,018
159,445
8,295,019
9,509,774
Wages and salaries includes agency costs of £4,308 (2022: £35,364). The average number of employees above does not include the number of agency workers as they are not employees of the company.
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
1,582
Other interest income
25,966
3,491
Total income
27,548
3,491
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
1,582
9
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
-
274,158
Interest on invoice finance arrangements
39,684
Interest payable to group undertakings
201,882
100,824
241,566
374,982
Other finance costs:
Interest on finance leases and hire purchase contracts
7,896
11,716
249,462
386,698
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current year
1,152,102
522,513
Adjustments in respect of prior years
(294,397)
16,811
Total current tax
857,705
539,324
Deferred tax
Origination and reversal of timing differences
(145,398)
(49,785)
Total tax charge
712,307
489,539
On 1st April 2023 the standard rate of corporation tax in the UK increased from 19% to 25%. This has given an actual tax rate for the year ended 31 December 2023 of 23.521%.
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Profit before taxation
8,187,269
2,222,445
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
1,925,646
422,265
Tax effect of expenses that are not deductible in determining taxable profit
10,315
50,463
Adjustments in respect of prior years
(294,397)
16,811
Group relief
(790,207)
Depreciation on assets not qualifying for tax allowances
4,022
Deferred tax adjustments in respect of prior years
(142,306)
Superdeduction excess
(766)
Taxation charge for the year
712,307
489,539
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
11
Intangible fixed assets
Brand name
£
Cost
At 1 January 2023 and 31 December 2023
20,000
Amortisation and impairment
At 1 January 2023 and 31 December 2023
20,000
Carrying amount
At 31 December 2023
At 31 December 2022
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 25 -
12
Tangible fixed assets
Leasehold improvements
Plant and equipment
Computer equipment
Motor vehicles
Equipment
Assets in process
Total
£
£
£
£
£
£
£
Cost
At 1 January 2023
171,009
1,509,702
956,776
199,743
785,503
76,697
3,699,430
Additions
7,701
109,348
105,355
222,404
Disposals
(136,721)
(136,721)
Transfers
63,701
(63,701)
At 31 December 2023
171,009
1,517,403
1,129,825
168,377
785,503
12,996
3,785,113
Depreciation and impairment
At 1 January 2023
11,739
628,274
815,606
103,884
749,446
2,308,949
Depreciation charged in the year
17,101
144,191
142,506
24,239
17,248
345,285
Eliminated in respect of disposals
(92,686)
(92,686)
At 31 December 2023
28,840
772,465
958,112
35,437
766,694
2,561,548
Carrying amount
At 31 December 2023
142,169
744,938
171,713
132,940
18,809
12,996
1,223,565
At 31 December 2022
159,270
881,428
141,170
95,859
36,057
76,697
1,390,481
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
12
Tangible fixed assets
(Continued)
- 26 -
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2023
2022
£
£
Plant and equipment
335,833
394,759
13
Stocks
2023
2022
£
£
Finished goods and goods for resale
24,898,354
37,277,891
The current replacement cost, or most recent purchase price, or production cost is not materially different from the amount at which the stocks are stated in the accounts.
An impairment loss of £900,723 (2022 - £261,393) was recognised in cost of sales against stock during the year due to movement in obsolete stock provision.
14
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
9,433,006
10,635,401
Corporation tax recoverable
510,019
13,617
Other debtors
95,116
43,565
Prepayments and accrued income
511,696
437,479
10,549,837
11,130,062
Trade debtors are stated after provisions for impairment of £41,048 (2022 - £36,345).
15
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans and overdrafts
17
190
12,072,651
Obligations under finance leases
18
108,306
108,306
Trade creditors
3,232,692
5,937,188
Taxation and social security
1,690,480
2,425,508
Accruals and deferred income
1,145,494
986,699
6,177,162
21,530,352
The HSBC bank loans and overdraft due in less than one year totalling £nil (2022 - £5,064,998) were secured by a fixed and floating charge over the assets of the company.
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 27 -
16
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Obligations under finance leases
18
114,073
222,901
17
Loans and overdrafts
2023
2022
£
£
Bank overdrafts
190
12,072,651
Payable within one year
190
12,072,651
18
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
108,306
108,306
In two to five years
114,073
222,901
222,379
331,207
Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
19
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
214,070
359,468
2023
Movements in the year:
£
Liability at 1 January 2023
359,468
Credit to profit or loss
(145,398)
Liability at 31 December 2023
214,070
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
19
Deferred taxation
(Continued)
- 28 -
The deferred tax liability set out above is expected to reverse in the future and relates to accelerated capital allowances that are expected to mature at a later date.
20
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
216,018
159,445
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
21
Called up share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary A shares of 1p each
9,097
9,097
91
91
Ordinary B share of 10p each
10
10
1
1
Ordinary C shares of 10p each
10
10
1
1
Ordinary D shares of 10p each
10
10
1
1
Ordinary E shares of £1 each
6
6
6
6
Ordinary F shares of 1p each
3
3
-
-
Ordinary G shares of 1p each
300
300
3
3
9,436
9,436
103
103
Shares rank pari passu in all respects save that different levels of dividend may be voted on each class.
22
Financial commitments, guarantees and contingent liabilities
Although the company no longer have any debt due to HSBC, at the balance sheet date HSBC UK Bank Plc continued to hold a fixed charge over all present and future freehold and leasehold property, a first fixed charge over book and other debts, goodwill etc both present and future and a first floating charge over all assets and undertakings both present and future. These charges are security for bank overdrafts which at 31 December 2023 stood at £nil (2022- £5,064,998). These charges were satisfied after the balance sheet date. Assets acquired on HP or finance lease with a liability of £222,380 (2022 - £331,207) are secured on the assets concerned.
23
Capital commitments
At the reporting date the company had not contracted for any material expenditure which is not accrued (2022 - £nil) .
24
Events after the reporting date
A dividend of £12,000,000 was paid to the holding company Bufab UK Holdings Ltd on 26 June 2024.
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 29 -
25
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
1,283,199
1,264,801
Between two and five years
4,171,247
4,148,339
In over five years
2,544,921
3,820,860
7,999,367
9,234,000
26
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel is as follows.
2023
2022
£
£
Aggregate compensation
1,218,770
2,783,300
Transactions with related parties
During the year the company entered into the following transactions with related parties:
During the year the company paid management fees and charges totalling £695,154 to Bufab International AB being a group company. The company also paid £61,149 in respect of a joint insurance policy to Bufab (UK) Limited, also a group company.
Trade sales have been made to other group companies as follows:
Bufab (UK) Limited - £253,136
Bufab Sweden - £2,946
Bufab international AB - £3,751
Bufab Ireland - £1,070
27
Ultimate controlling party
The ultimate holding company of T I Midwood & Co Limited is Bufab AB. The registered office of the ultimate holding company is Box 2266 SE-331 02 Värnamo, Sweden and the principal place of business is Green Lane, Wardle, Nantwich, Cheshire CW5 6BJ.
T I MIDWOOD & CO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 30 -
28
Analysis of changes in net funds/(debt)
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
621,351
4,994,224
5,615,575
Bank overdrafts
(12,072,651)
12,072,461
(190)
(11,451,300)
17,066,685
5,615,385
Obligations under finance leases
(331,207)
108,828
(222,379)
(11,782,507)
17,175,513
5,393,006
29
Cash generated from/(absorbed by) operations
2023
2022
£
£
Profit for the year after tax
7,474,962
1,732,906
Adjustments for:
Taxation charged
712,307
489,539
Finance costs
249,462
386,698
Investment income
(27,548)
(3,491)
Gain on disposal of tangible fixed assets
(39,454)
(7,918)
Depreciation of tangible fixed assets
345,285
627,693
Movements in working capital:
Decrease/(increase) in stocks
12,379,537
(21,993,163)
Decrease in debtors
1,047,584
2,209,742
(Decrease)/increase in creditors
(3,280,729)
3,410,111
Cash generated from/(absorbed by) operations
18,861,406
(13,147,883)
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