REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
FOR |
PROTECTIVE PACKAGING LIMITED |
REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
FOR |
PROTECTIVE PACKAGING LIMITED |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
CONTENTS OF THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 6 |
Report of the Independent Auditors | 8 |
Income Statement | 12 |
Other Comprehensive Income | 13 |
Balance Sheet | 14 |
Statement of Changes in Equity | 15 |
Notes to the Financial Statements | 16 |
PROTECTIVE PACKAGING LIMITED |
COMPANY INFORMATION |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
DIRECTORS: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Statutory Auditors and Chartered Accountants |
5 Brooklands Place |
Brooklands Road |
Sale |
Cheshire |
M33 3SD |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
The directors present the Strategic Report together with the audited financial statements for the year ended 31 December 2023. |
REVIEW OF BUSINESS |
The principal activities of the company during the year remained that of the manufacture of protective packaging solutions. |
Development of the business |
Fiscal 2023 saw the Company's sales decrease by 6.4% to £13.09m. The associated Gross Profit whilst running at an improved 61.1% versus Fiscal 2022's 59.6%, decreased by 4.1% to £7.99m. Domestic sales accounted for 54% of revenue with export activity contributing 46%. The company achieved sales with 41 export territories which serves to provide continued evidence that the Company's global reach is as strong as ever, supported by a programme of direct sales, sales through strategic distribution channels and an ever-growing on-line presence. The Company continues to exploit its considerable business differentiators in all markets, manufacturing the highest quality packaging, supplied in a timely fashion whilst ensuring adherence to its business ethics. The Company continues to win new business in all markets and to consolidate its position as the UK's leading supplier of climatic packaging solutions and a major force in Europe and further afield. The company continues to review its manufacturing techniques and material and product format mix with a view to achieving sales growth in industry sectors, specific applications and geographical regions that meet the sales strategies of the business. The company will continue to maximise the sales opportunities and associated margin levels for the unique elements of its product range. In every area of the business, we are stronger and more capable than ever due to the continuing success and further development of the Buddy System linked to a more strategic recruitment policy and continued investment in its automated manufacturing capability. |
The Company's results for the year are included within these financial statements. |
Future-outlook |
2024 will see a ramping up of our dedicated sales and marketing initiatives associated with our ability to offer pouches with re-closable zipper profiles. Our zipper-pouch manufacturing capability will allow us to manufacture to both traditional sizes, but also to dimensions previously unavailable commercially anywhere. From our new modern base, and with our new equipment in place, the Directors are planning to be ready to exploit the growing opportunities associated with the global market and maintain and where possible enhance their position, as a worldwide leader in the provision of climatic packaging solutions across all market sectors and geographical locations. The Company's routes to market will continue to be a combination of direct sales and sales via a strategically developed network of exclusive and non-exclusive distributors and business partners, all supported by previous good practice with regard to recruitment and training proactive. The company will continue to work to the disciplines of its unbroken 35-year accreditation to ISO 9001:2015 and exploit the opportunities that will arise as a result. In addition, 2024 will allow the Company to exploit its accredited to the ISO 14001:2015 Standard for Environmental Management which, when coupled with the Company's continuing status as a carbon neutral business as it journeys towards Net Zero, demonstrates an appreciation of its environmental impact. The Company will use its enhanced manufacturing base to continue to engage with its key markets such as the pharmaceutical, diagnostic, healthcare, aerospace, electronics and food sectors. We will extend our global reach and presence by a significant increase in our marketing activity and through further development of our various websites in tandem with our linguistic skill sets. The company's commercial and operational platforms will grow through the further development of management in both areas of the business to further support the fulfilment of the company's Fiscal 2024 growth aspirations. Fiscal 2024 will see a continued emphasis placed upon the Company's significant differentiators as we seek to develop new markets and where necessary, displace the indigenous supply base. Fiscal 2024 will see the continued development of a new, tailored ERP system that will support our business as we develop our operational efficiencies and provide our customers with an enhanced experience. Fiscal 2024 will see the company develop specific mono-polymer materials to meet the requirements where appropriate, of sustainability and recyclability whilst maintaining the fundamentals principles of a barrier to atmospheric degradation of the packaged product and the prolongation of product-life. |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
PRINCIPAL RISKS AND UNCERTAINTIES |
The principal risks and uncertainties that the company faces continue to relate mainly to working within the credit worthiness of our customers, both domestic and overseas. In mitigation, our relationship with our credit limit underwriters is crucial, as we will only extend credit payment terms to companies that we can obtain an insured credit limit with. Immediate payment against pro-forma invoices is the only option when we are doing business with uninsured customers and this can sometimes be a hurdle to us actually doing business. The Company is exposed to fluctuating cost prices for its key raw materials and to currency exchange rates. In mitigation, the Company robustly resists the acceptance of price fluctuation, other than downwards and in respect of the GBP/EURO exchange rate relationship, has the perfect natural hedge of almost parity between the value of EURO purchases and EURO sales. The Company's IT system is fundamentally based on an aged and creaking platform, but F2023/4 will see the full integration across the entire business of a new and bespoke ERP system. The Company has successfully navigated the implementation of the Plastic Packaging Tax (PPT) and the collection of the appropriate amount of tax from the sale of eligible products. However, the challenge remains for the Company to work with its supply chain on the development of laminate materials that contain a minimum 30% recyclate content so that its customers will no longer be exposed to the payment of PPT. This is not an overnight fix, but a medium to long-term aim and one that the Company is engaged in with its key supply partners. On a related theme, a further challenge that the Company faces is the implementation of Extended Producer Responsibility (EPR) and the associated cost of managing and recycling the packaging waste generated. The Company is required to obtain, from all UK customers, an understanding of the sales revenue of those customers, personnel employed by those customers and an appreciation of whether any of the purchased packaging is destined for the domestic waste stream. The collection of this data is a burden on the business.. |
Other potential risks include |
Price risk: Economical, political and market conditions in supplier countries can affect the price we pay for raw materials. This can adversely affect our business but can also benefit the business. |
Credit risk: All our domestic and overseas debt is insured or based on advance payment, to minimise any bad debt exposure within the business. |
Liquidity risk: Due to our financial results during these financial years and our strict credit, we are diligent in managing our cash flows. |
Exchange risk: The uncertainty associated to currency exchange rates is largely obviated by the company's natural hedge mechanism related to an almost equitable split in overseas currency sales and purchases. |
Financial/Cash flow risk: The Company finances its operations through a mixture of cash flows and invoice financing. Daily cash positions are sent to the board for review. The management's objective is to retain sufficient liquid funds to enable it to meet its day to day obligations as they fall due. |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
POST BALANCE SHEET EVENTS |
Events over the last few years such as Covid, the conflict in Ukraine and even shipping issues such as the problem in the Suez Canal have seen a lot of instability regarding pricing of things like energy, aluminium, polymers and freight. Although things have begun to stabilise we still need to be mindful of the ever changing climate that we are currently experiencing. We have seen multiple increases to interest rates, inflation and fluctuating fuel prices which all impacts our supply chain. Due to the nature of our business this has subsequently had an impact on our suppliers pricing which we are diligently monitoring using various market intelligence to ensure we are getting the most competitive prices and staying ahead of the curve. |
We continue to monitor changes within the industry such as Plastic Packaging Tax which came into effect as at the 1st April 2022, as with previous potential significant business changes we were ahead of the curve and fully prepared for its implementation. Over the last 2 years we have seen increases in the amount charged per tonne for Plastic Packaging Tax and have made the necessary adjustments when required. We are also aware of changes in other European countries who begin to implement their own similar regulations and will ensure our processes are updated to reflect this where necessary. |
Extended Producer Responsibility or EPR was introduced in 2023 the idea is to see the full cost of managing household waste shift to producers, in the hope of delivering a more circular economy for packaging where greater quantities of recyclable waste are reprocessed into valuable, high-quality secondary resources. EPR will also change the way in which non-household packaging waste is managed and its reprocessing is financed. Due to the nature of our business, our place in the supply chain and the amount of packaging we handle then this is something that we must conform to. A project team reviewed the published regulations and submitted data in line with our obligation during 2023 and will continue to do so throughout 2024. At this time the cost to the business of EPR is still unclear but full details are due to be published during the 2nd half of 2024. |
As part of the review of our business impact on the environment we have once again partnered with a company to off-set our carbon emissions to become carbon neutral for another year. We also gained the ISO 14001 accreditation early 2023 and undertook the surveillance audit early 2024. We partnered with a specialist company for the installation of solar panels at our facility which were installed early Q2 2024 with significant results. |
During 2022 we engaged with a specialist ERP partner to replace our current dated IT system and also our accounting software. This will help streamline procedures without the need to transfer data between the two different systems and also improve reporting and analysis. This is a substantial project which will be vigorously tested and development of the system will continue throughout 2024 with an expected completion of Q4 2024 or Q1 2025. |
GOING CONCERN |
In preparing these financial statements, the Directors are required to prepare the financial statements on the going concern basis unless it is inappropriate to presume that the |
Company will continue in business. In satisfaction of this responsibility, the Directors have considered the Company's ability to meet its liabilities as they fall due for a period of at least twelve months from the signing date of the financial statements. |
The Company continues to manufacture at its new production facility with no plans to stop production. To date, the Company has not experienced any significant disruption from employee absence, its supply chain or its distribution networks and none is anticipated in the foreseeable future due to the fact that the Company has significant current orders as at the date of signing these accounts as well as holding appropriate levels of stock. |
The Directors have prepared what they consider to be a realistic forecast for the period to the end of December 2025. This indicates that for a period of 16 months from the date of signing these accounts, the Company continues to generate cash. There are various cost saving measures that the Directors could implement if the fall in revenue was worse than this. |
The Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. The Directors therefore believe that it remains appropriate to prepare the financial statements on a going concern basis. The financial statements do not include any adjustments that would result from the basis of preparation being inappropriate. |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
FINANCIAL KEY PERFORMANCE INDICATORS |
Financially we have exercised excellent controls with regard to stock and cash flow with stock turn, debtor days and creditor days all at appropriate levels which are reported to the board for review on a weekly basis. All expense lines remain under control. Our sales visits and issued samples and quotes were all in line with our targets and our customer survey clearly indicates that we are considered an excellent supplier. Quality complaints are in line with our objectives but continue to be reviewed and improvements implemented to ensure these are kept to an absolute minimum. |
RESEARCH AND DEVELOPMENT |
The company will continue to develop new materials, manufacturing techniques and packaging product formats to allow entry into new geographical markets, areas of application and industry sectors and continue to provide specialist product and equipment manufacturers with the climatic packaging solutions that they require. We will endeavour wherever possible to utilise smart features on our packaging to exploit the opportunities for intelligent packaging. The company will build upon its growing reputation as a developer of the most appropriate packaging solutions to meet the specific demands of the customer's needs and that of their products and routes to market. The company will continue to link its excellent technical acumen with that of its key material supply base to achieve this objective. |
ON BEHALF OF THE BOARD: |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
The directors present their report with the financial statements of the company for the year ended 31 December 2023. |
PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of the manufacture of protective packaging solutions. |
DIVIDENDS |
The total distribution of dividends for the year ended 31 December 2023 is £1,000,000 (2022: £1,093,752). The directors do not recommend a final dividend. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 January 2023 to the date of this report. |
DIRECTORS INDEMNITIES |
The company has currently made qualifying third party indemnity provisions for the benefit of its directors, which remain in force at the date of this report. |
MATTERS INCLUDED IN THE STRATEGIC REPORT |
The business review, financial risk assessment, assessment of principal risk and uncertainties, research and development, post balance sheet events and future developments are included within the strategic report. |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Strategic Report, the Report of the Directors 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 company and of the profit or loss of the company for that period. In preparing these 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; |
- | 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 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. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
AUDITORS |
The auditors, Harold Sharp Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
PROTECTIVE PACKAGING LIMITED |
Opinion |
We have audited the financial statements of Protective Packaging Limited (the 'company') for the year ended 31 December 2023 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 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: |
- | give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its profit for the year then ended; |
- | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
- | have been prepared in accordance with the requirements of the Companies Act 2006. |
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 Auditors' 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 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 directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
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. |
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 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 the audit: |
- | the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
PROTECTIVE PACKAGING LIMITED |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors. |
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: |
- | adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of directors' remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page six, 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 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. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
PROTECTIVE PACKAGING LIMITED |
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 a Report of the Auditors 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. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
As part of our planning process: |
- We enquired of management the systems and controls the company has in place, the areas of the financial statements that are mostly susceptible to the risk of irregularities and fraud, and whether there was any known, suspected or alleged fraud. |
- We obtained an understanding of the legal and regulatory frameworks applicable to the company. We determined that the following were most relevant: FRS 102, Companies Act 2006, health and safety, and employment law. |
- We considered the incentives and opportunities that exist in the company, including the extent of management bias, which present a potential for irregularities and fraud to be perpetuated, and tailored our risk assessment accordingly. |
- Using our knowledge of the company, together with the discussions held with the company at the planning stage, we formed a conclusion on the risk of misstatement due to irregularities including fraud and tailored our procedures according to this risk assessment. |
The key procedures we undertook to detect irregularities including fraud during the course of the audit included: |
- Identifying and testing journal entries and the overall accounting records, in particular those that were significant and unusual. |
- Reviewing the financial statement disclosures and determining whether accounting policies have been appropriately applied. |
- Reviewing and challenging the assumptions and judgements used by management in their significant accounting estimates, in particular in relation to accrued costs, and dilapidations provision. |
- Assessing the extent of compliance, or lack of, with the relevant laws and regulations in particular those that are central to the entities ability to continue in operation. |
- Testing key revenue lines, in particular cut-off, for evidence of management bias. |
- Performing a physical verification of key assets , including stock. |
- Obtaining third-party confirmation of material bank balances. |
- Documenting and verifying all significant related party balances and transactions. |
- Reviewing documentation such as the company board minutes, correspondence with solicitors, for discussions of irregularities including fraud. |
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 the directors and management. |
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
PROTECTIVE PACKAGING LIMITED |
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 a Report of the Auditors 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. |
for and on behalf of |
Statutory Auditors and Chartered Accountants |
5 Brooklands Place |
Brooklands Road |
Sale |
Cheshire |
M33 3SD |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
INCOME STATEMENT |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
2023 | 2022 |
Notes | £ | £ |
TURNOVER | 3 |
Cost of sales |
GROSS PROFIT |
Administrative expenses |
OPERATING PROFIT | 5 |
Interest payable and similar expenses | 7 |
PROFIT BEFORE TAXATION |
Tax on profit | 8 |
PROFIT FOR THE FINANCIAL YEAR |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
OTHER COMPREHENSIVE INCOME |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
2023 | 2022 |
Notes | £ | £ |
PROFIT FOR THE YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
BALANCE SHEET |
31 DECEMBER 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 10 |
Tangible assets | 11 |
CURRENT ASSETS |
Stocks | 12 |
Debtors | 13 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 14 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
PROVISIONS FOR LIABILITIES | 17 |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 18 |
Retained earnings | 19 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 January 2022 |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - |
Balance at 31 December 2022 |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - |
Balance at 31 December 2023 |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
NOTES TO THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
1. | STATUTORY INFORMATION |
Protective Packaging Limited is a private company limited by shares and incorporated in England and Wales under the Companies Act 2006. The address of the registered office is Unit 3, Gateway, 1 Opus Close, Carrington, Manchester, M31 4RQ and its registered number is 02312465. The nature of the company's operations and its principal activities are set out in the strategic report. |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
The accounts have been prepared for the company as a single entity. The presentation and functional currency is GBP £. |
Financial Reporting Standard 102 - reduced disclosure exemptions |
The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland": |
• | the requirements of Section 7 Statement of Cash Flows; |
• | the requirement of paragraph 3.17(d); |
• | the requirements of paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c); |
• | the requirements of paragraphs 12.26, 12.27, 12.29(a), 12.29(b) and 12.29A; |
• | the requirement of paragraph 33.7. |
This information is included in the consolidated financial statements of Betronics Limited as at 31 December 2023 and these financial statements may be obtained from Companies House, Crown Way, Cardiff, CF14 3UZ. |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
2. | ACCOUNTING POLICIES - continued |
Critical accounting 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. |
The directors have made no material judgements but have made estimates in preparing these financial statements. 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. |
Accrued costs |
Accrued expenditure is estimated by the directors at each year end, to ensure that all known liabilities are accounted for in the financial statements. |
Provisions |
A provision is recognised in the balance sheet when the entity has a present legal or constructive obligation as a result of a past event, that can be reliably measured and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are recognised at the best estimate of the amount required to settle the obligation at the reporting date. |
Management estimate and make provision for costs that will be incurred in returning a leased property to the condition that it was in at the inception of the lease. The actual costs of work that needs to be completed could vary from the estimates. The amount recognised is the estimated cost of dilapidations and is reassessed each year in accordance with local conditions and requirements. Changes in the estimated timing of dilapidations or dilapidations cost estimates are dealt with prospectively by recording an adjustment to the provision. |
Turnover |
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the company and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. |
Intangible assets |
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. |
Development costs are in respect of the company's new ERP system which was not brought into use at the year end. Once in use the asset will be amortised over its estimated useful life of four years. |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
2. | ACCOUNTING POLICIES - continued |
Tangible fixed assets |
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. |
At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount. |
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on a reducing balance basis. |
Depreciation is provided on the following bases: |
Leasehold property improvements | straight line over term of the lease |
Motor vehicles | 25% reducing balance |
Plant & machinery | 10% reducing balance |
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date. |
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the statement of comprehensive income. |
Assets under construction represent machinery not yet complete. They are subject to depreciation once complete and brought into use. |
Stocks |
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads. |
At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss. |
Stocks are comprised of packaging materials and completed packaging items. |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
2. | ACCOUNTING POLICIES - continued |
Financial instruments |
The company has elected to apply the provisions of Section 11 'Basic Financial Instruments' of FRS 102 to all of its financial instruments. |
Financial instruments are recognised 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, which include trade debtors, other debtors, amounts owed by group undertakings, amounts owed by related parties 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. Financial assets classified as receivable within one year are not amortised. |
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, including trade creditors, other creditors, amounts owed to group undertakings, and amounts owed to related parties, 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 are derecognised when, and only when, the company's contractual obligations are discharged, cancelled, or they expire. |
Derivative financial instruments are recognised at fair value using a valuation technique with any gains or losses being reported in profit or loss. Outstanding derivatives at reporting date are included under the appropriate format heading depending on the nature of the derivative. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
2. | ACCOUNTING POLICIES - continued |
Foreign currencies |
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result. |
Hire purchase and leasing commitments |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
Going concern |
In preparing these financial statements, the Directors are required to prepare the financial statements on the going concern basis unless it is inappropriate to presume that the |
Company will continue in business. In satisfaction of this responsibility, the Directors have considered the Company's ability to meet its liabilities as they fall due for a period of at least twelve months from the signing date of the financial statements. |
The Company continues to manufacture at its new factory production facility with no plans to stop production. To date, the Company has not experienced any significant disruption from employee absence, its supply chain or its distribution networks and none is anticipated in the foreseeable future due to the fact that the Company has significant current orders as at the date of signing these accounts as well as holding appropriate levels of stock. |
The Directors have prepared what they consider to be a realistic forecast for the period to the end of December 2025. This indicates that for a period of 16 months from the date of signing these accounts, the Company continues to generate cash. There are various cost saving measures that the Directors could implement if the fall in revenue was worse than this. |
The Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. The Directors therefore believe that it remains appropriate to prepare the financial statements on a going concern basis. The financial statements do not include any adjustments that would result from the basis of preparation being inappropriate. |
3. | TURNOVER |
The turnover and profit before taxation are attributable to the one principal activity of the company. |
An analysis of turnover by geographical market is given below: |
2023 | 2022 |
£ | £ |
United Kingdom |
Europe |
Rest of the world | 416,873 | 1,884,118 |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
4. | EMPLOYEES AND DIRECTORS |
2023 | 2022 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
2023 | 2022 |
Production staff | 28 | 31 |
Administrative staff | 32 | 28 |
Management staff | 5 | 5 |
Directors are deemed to be key management personnel. |
2023 | 2022 |
£ | £ |
Directors' remuneration |
Directors' pension contributions to money purchase schemes |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes |
Information regarding the highest paid director is as follows: |
2023 | 2022 |
£ | £ |
Emoluments etc |
Amounts paid to third parties in respect of directors services £42,000 (2022: £42,000). |
The value of the company's contributions paid to a defined contribution pension scheme in respect of the highest paid director was £nil (2022: £nil). |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
5. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
2023 | 2022 |
£ | £ |
Hire of plant and machinery |
Other operating leases |
Depreciation - owned assets |
Auditors' remuneration |
Foreign exchange differences | ( |
) |
Services provided by the auditors for non audit services were £1,000 (2022: £1,000). |
6. | EXCEPTIONAL ITEMS |
2023 | 2022 |
£ | £ |
Exceptional items | 175,958 | (52,000 | ) |
Exceptional items relate to the company's dilapidation provision movement in the year. |
7. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2023 | 2022 |
£ | £ |
Other interest received | ( |
) | ( |
) |
Invoice factoring fees |
8. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
2023 | 2022 |
£ | £ |
Current tax: |
UK corporation tax |
Deferred tax |
Tax on profit |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
8. | TAXATION - continued |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
2023 | 2022 |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of |
Effects of: |
Expenses not deductible for tax purposes | ( |
) |
Capital allowances in excess of depreciation | ( |
) | ( |
) |
Deferred tax | 73,332 | 131,135 |
Prior year over provision | (2,411 | ) | (3,180 | ) |
Effect of tax rate change in year | (20,285 | ) | - |
Total tax charge | 393,417 | 487,542 |
9. | DIVIDENDS |
2023 | 2022 |
£ | £ |
Ordinary shares shares of £1 each |
Final |
Dividends are paid on ordinary shares only. |
10. | INTANGIBLE FIXED ASSETS |
Development |
costs |
£ |
COST |
At 1 January 2023 |
Additions |
At 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 December 2022 |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
11. | TANGIBLE FIXED ASSETS |
Improvements | Asset |
to | Plant and | under |
property | machinery | construction | Totals |
£ | £ | £ | £ |
COST |
At 1 January 2023 |
Additions |
Reclassification/transfer | ( |
) |
At 31 December 2023 |
DEPRECIATION |
At 1 January 2023 |
Charge for year |
At 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 December 2022 |
12. | STOCKS |
2023 | 2022 |
£ | £ |
Raw materials |
Finished goods |
No impairment loss has been recognised in cost of sales against stock during the year or in the prior year due to slow-moving and obsolete stock. |
There is no material difference between replacement cost of stocks and the amounts stated above. |
13. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
£ | £ |
Trade debtors |
Amounts owed by group undertakings |
Other debtors |
Amounts owed by related |
parties | 474,585 | 750,362 |
Prepayments and accrued income |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
13. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR - continued |
Trade debtors of £1,483,280 (2022: £1,834,431) were factored at 31 December 2023 and are included above as an outstanding trade balance due from the facility provider as the cash has not been received from them at the year end. Factoring debt is secured by a fixed charge in favour of Close Brothers Limited. |
The impairment loss recognised in the company statement of comprehensive income for the year in respect of bad and doubtful trade debtors was £nil (2022: £nil). |
Amounts owed by group undertakings are interest free and due on demand. |
14. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
£ | £ |
Trade creditors |
Tax |
Social security and other taxes |
Other creditors |
Accruals and deferred income |
15. | LEASING AGREEMENTS |
Minimum lease payments under non-cancellable operating leases fall due as follows: |
2023 | 2022 |
£ | £ |
Within one year |
Between one and five years |
In more than five years |
16. | SECURED DEBTS |
The following secured debts are included within creditors: |
2023 | 2022 |
£ | £ |
Other creditors | - | 146,826 |
Factoring debts are secured by a debenture in favour of Close Brothers Limited. |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
17. | PROVISIONS FOR LIABILITIES |
2023 | 2022 |
£ | £ |
Deferred tax | 335,332 | 261,999 |
Other provisions | 251,204 | 445,246 |
Deferred | Dilapidati |
tax | on |
£ | £ |
Balance at 1 January 2023 |
Provided during year |
Credit to Income Statement during year | ( |
) |
Balance at 31 December 2023 |
The provision for deferred taxation comprises accelerated capital allowances of £400,866 (2022: £371,997), less the short term timing differences of £65,534 (2022: £109,998). |
Provision for dilapidations includes amounts in respect of the company's current premises in addition to the previous premises. |
18. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
value: | £ | £ |
Ordinary shares | £1 | 5,000 | 5,000 |
Ordinary shares have full voting, dividend and capital rights. |
19. | RESERVES |
Retained |
earnings |
£ |
At 1 January 2023 |
Profit for the year |
Dividends | ( |
) |
At 31 December 2023 |
20. | PENSION COMMITMENTS |
The company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the company to the fund and amounted to £61,712 (2022: £61,791). Contributions totalling £917 (2022: £nil) were payable to the fund at 31 December 2023. |
PROTECTIVE PACKAGING LIMITED (REGISTERED NUMBER: 02312465) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2023 |
21. | ULTIMATE PARENT COMPANY |
Betronics Limited is regarded by the directors as being the company's ultimate parent company. |
In the opinion of the directors this is the company's ultimate parent company. |
Betronics Limited is incorporated in England and Wales and the registered office is Unit 3, Gateway, 1 Opus Close, Carrington, Manchester, M31 4RQ. Group accounts are available from Companies House. |
Betronics Limited is ultimately controlled by C G Lewis. |
22. | CAPITAL COMMITMENTS |
The company had capital commitments of £72,310 (2022: £181,172) as at 31 December 2023. |
23. | RELATED PARTY DISCLOSURES |
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |
The company paid consultancy fees of £42,000 (2022: £42,000) to Boxburn Limited, a company in which J H Law is a director. At the year end the balance of £23,000 (2022: £23,000) was due to Boxburn Limited. The amount is included within creditors. |
As at 31 December 2023 the company owed £1,409,375 (2022: £1,529,687) to C G Lewis a director of the company. The amount is included in other creditors. The balance is interest free and repayable on demand. |
The company is also related to 3D Barrier Bags, Inc. a company under common control. During the year the company made sales of £44,213 (2022: £54,974) to 3D Barrier Bags. At the year end £474,585 (2022: £750,362) was owed by 3D Barrier Bags. This is included in debtors amounts owed by related parties. |