Company Registration No. 01108984 (England and Wales)
QUERCIA LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PAGES FOR FILING WITH REGISTRAR
PM+M Solutions for Business LLP
Chartered Accountants
New Century House
Greenbank Technology Park
Challenge Way
Blackburn
Lancashire
BB1 5QB
QUERCIA LIMITED
CONTENTS
Page
Balance sheet
1
Statement of changes in equity
2
Notes to the financial statements
3 - 10
QUERCIA LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
3
3,334,848
4,088,167
Investments
4
2
2
3,334,850
4,088,169
Current assets
Stocks
109,935
126,722
Debtors
5
4,055,055
1,986,870
Cash at bank and in hand
498,030
54,438
4,663,020
2,168,030
Creditors: amounts falling due within one year
6
(4,835,353)
(4,763,355)
Net current liabilities
(172,333)
(2,595,325)
Total assets less current liabilities
3,162,517
1,492,844
Provisions for liabilities
7
(2,415,742)
(2,337,700)
Net assets/(liabilities)
746,775
(844,856)
Capital and reserves
Called up share capital
5,000,100
5,000,100
Revaluation reserve
226,838
226,838
Other reserves
9,808,472
6,810,472
Profit and loss reserves
(14,288,635)
(12,882,266)
Total equity
746,775
(844,856)
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 13 September 2024 and are signed on its behalf by:
T Weston
Director
Company registration number 01108984 (England and Wales)
QUERCIA LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Share capital
Revaluation reserve
Capital reserve
Profit and loss reserves
Total
£
£
£
£
£
Balance at 1 January 2022
5,000,100
236,766
-
(9,579,495)
(4,342,629)
Year ended 31 December 2022:
Loss and total comprehensive income
-
-
-
(3,312,699)
(3,312,699)
Transfers
-
(9,928)
-
9,928
-
Other movements
-
-
6,810,472
-
6,810,472
Balance at 31 December 2022
5,000,100
226,838
6,810,472
(12,882,266)
(844,856)
Year ended 31 December 2023:
Loss and total comprehensive income
-
-
-
(1,406,369)
(1,406,369)
Other movements
-
-
2,998,000
-
2,998,000
Balance at 31 December 2023
5,000,100
226,838
9,808,472
(14,288,635)
746,775
QUERCIA LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
1
Accounting policies
Company information
Quercia Limited is a private company limited by shares incorporated in England and Wales. The registered office is Clayton Hall Sand Quarry, Clayton Hall Quarry, Dawson Lane, Whittle le woods, Lancashire, England, PR6 7DT.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention modified to include the revaluation of freehold properties. The principal accounting policies adopted are set out below.
1.2
Going concern
The directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The company has received a letter of financial support from Opes MRF 2013 Limited, the group's parent company, stating that they will support the company for a period of at least twelve months from the date of signing of these financial statements. Therefore, the directors continue to adopt the going concern basis in preparing the financial statements. Management have seen trade performance significantly improve following the change in ownership and expect this to continue into the coming years.true
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.
Revenue is recognised when the significant risks and rewards of ownership of the goods have passed to the company (usually on disposal of waste to the landfill), 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
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Freehold land and buildings
5 -10 years
Fixtures, fittings, plant & equipment
5 -13 years
Fixtures and fittings
4 years
Motor vehicles
5 years
Future costs of restoration
by reference to volume of waste deposited
Landfill Lining
by reference to volume of waste deposited
Assets in the course of construction
not depreciated until brought into use
QUERCIA LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 4 -
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.5
Fixed asset investments
Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.6
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
1.7
Stocks
Stocks are stated at cost. Stocks are not held for distribution and comprises consumables.
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.
1.8
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 balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
QUERCIA LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 5 -
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.11
Provisions
Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
QUERCIA LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 6 -
Restoration and aftercare provisions
Restoration
Full provision is made for the net present value (NPV) of the Company's minimum unavoidable costs in respect of the restoration liabilities at the landfill site which have been capitalised in tangible fixed assets. The group continues to provide for all after care costs over the life of the landfill site based on the volume of waste deposited in the year
.
Aftercare
Provision for the care and monitoring of the site post closure is made on the Director’s best estimate of future aftercare requirements for the site as a whole for a period of 60 years following the estimated final closure of the landfill as required by the Landfill Directive.
The long term provisions for restoration and aftercare costs are calculated on the NPV of estimated future costs. Current cost estimates are inflated at 3% and discounted at 5% to calculate the NPV. The effect of the unwinding of the discount element is reflected as a finance cost.
Environmental provision
The environmental provision represents the best estimate of future costs in relation to the Environment Agency's ongoing landfill investigation.
Provisions are recognised when the group has a legal or constructive present obligation as a result of a past event, it is probable that the group will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
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
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.
QUERCIA LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
12
22
3
Tangible fixed assets
Freehold land and buildings
Assets under construction
Fixtures, fittings, plant & equipment
Motor vehicles
Future costs of restoration
Landfill Lining
Total
£
£
£
£
£
£
£
Cost or valuation
At 1 January 2023
4,059,036
139,192
7,719,981
20,491
857,184
3,145,101
15,940,985
Additions
15,960
20,335
5,809
42,104
At 31 December 2023
4,074,996
139,192
7,740,316
20,491
857,184
3,150,910
15,983,089
Depreciation and impairment
At 1 January 2023
3,711,805
139,192
6,035,008
19,128
751,420
1,196,265
11,852,818
Depreciation charged in the year
36,713
608,182
998
7,541
141,989
795,423
At 31 December 2023
3,748,518
139,192
6,643,190
20,126
758,961
1,338,254
12,648,241
Carrying amount
At 31 December 2023
326,478
1,097,126
365
98,223
1,812,656
3,334,848
At 31 December 2022
347,231
1,684,973
1,363
105,764
1,948,836
4,088,167
The freehold land and buildings compromising the landfill site were valued at £4,041,595 by the directors on 31 October 1998 on an open market value basis.
QUERCIA LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
3
Tangible fixed assets
(Continued)
- 8 -
land
2023
2022
£
£
Cost
1,128,869
1,128,869
Accumulated depreciation
(1,117,632)
(1,095,055)
Carrying value
11,237
33,814
4
Fixed asset investments
2023
2022
£
£
Shares in group undertakings and participating interests
2
2
5
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
422,409
14,070
Amounts owed by group undertakings
1,859,757
1,859,757
Other debtors
48,114
113,043
2,330,280
1,986,870
Deferred tax asset
1,000,000
3,330,280
1,986,870
2023
2022
Amounts falling due after more than one year:
£
£
Deferred tax asset
724,775
Total debtors
4,055,055
1,986,870
Amounts owed from group undertakings are interest-free and repayable on demand.
QUERCIA LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
6
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
393,222
138,922
Amounts owed to group undertakings
3,508,901
4,528,023
Taxation and social security
788,011
1,660
Other creditors
145,219
94,750
4,835,353
4,763,355
Amounts owed to group undertakings are interest-free and repayable on demand.
7
Provisions for liabilities
2023
2022
£
£
Restoration costs
977,934
918,466
Aftercare costs
1,137,808
1,119,234
Enviromental provision
300,000
300,000
2,415,742
2,337,700
Movements on provisions:
Restoration costs
Aftercare costs
Enviromental provision
Total
£
£
£
£
At 1 January 2023
918,466
1,119,234
300,000
2,337,700
Additional provisions in the year
-
18,574
-
18,574
Utilisation of provision
(5,983)
-
-
(5,983)
Unwinding of discount
65,451
-
-
65,451
At 31 December 2023
977,934
1,137,808
300,000
2,415,742
Restoration costs
The provision for restoration costs represents an estimate of the future costs to restore the landfill site to its original condition. During the year there has been a change in the assumption of the future capping costs by management. As the site comes closer to closure, management has a more accurate view if the costs to complete the capping of landfill which is how the change in assumptions has occurred.
After care costs
Provision for the care and monitoring of the site post closure is made on the Director’s best estimate of future aftercare requirements for the site for a period of 60 years following the estimated final closure of the landfill as required by the Landfill Directive.
QUERCIA LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
7
Provisions for liabilities
(Continued)
- 10 -
Environmental provision
The environmental provision represents the best estimate of future costs in relation to the Environment Agency’s ongoing landfill investigation.
8
Capital reserve
2023
2022
£
£
At the beginning of the year
6,810,472
-
Other movements
2,998,000
6,810,472
At the end of the year
9,808,472
6,810,472
On 10 May 2022, Aalborg Portland A/S waived a financial payable by the company amounting to £6.8m. This was waived as part of settling liabilities of the company based upon facilities held as part of the cash pooling system. This resulted in the creation of a capital reserve to represent the nature of the transaction being equity.
On 8 November 2023, Recydia waived a financial payable amounting to £3.0m. This was waived as part of the sale of the company to new ownership, which resulted in the creation of an additional capital reserve to represent the nature of this transaction.
9
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
Senior Statutory Auditor:
Christopher Johnson FCA
Statutory Auditor:
PM+M Solutions for Business LLP
Date of audit report:
19 September 2024
10
Parent company
The parent company is NWM Holdings Limited. Their registered office is Clayton Hall Sand Quarry Clayton Hall Quarry, Dawson Lane, Whittle-Le-Woods, Lancashire, England, PR6 7DT.
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