Registered number:
FOR THE YEAR ENDED 31 DECEMBER 2023
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
COMPANY INFORMATION
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
CONTENTS
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
Founded in 2018 by Yeoh Kai Shen and Sam Ong, AIRSCREAM UK has quickly risen as a dynamic force in the vaping industry. With a vision to become a leading consumer-based company, AIRSCREAM strategically chose vape products as the cornerstone of its journey. This decision was driven by a commitment to innovation and a dedication to offering high-quality, user-friendly vaping solutions.
Central to AIRSCREAM's success is its talented team of passionate professionals, who are empowered to shape the company's future and drive its mission forward. This collaborative and forward-thinking approach has enabled AIRSCREAM to expand its footprint significantly. As of the end of 2023, AIRSCREAM's flagship product line, "AirsPops," is distributed and resold in over 80 markets worldwide. The brand's exceptional performance is particularly notable in the African and Oceanic regions, where "AirsPops" ranks among the top three vaping brands. Over the past five years, AIRSCREAM has garnered prestigious accolades, including two reddot Design Awards and one French Design Award, underscoring its commitment to excellence in design and product quality. These achievements highlight AIRSCREAM's dedication to creating products that not only meet consumer needs but also set new standards in the industry.
2023 has been a challenging year for AIRSCREAM Group, marked by significant obstacles that impeded our planned growth. Regulatory and tax changes in key markets have been particularly impactful, presenting hurdles that required substantial strategic adjustments.
One of the most significant setbacks occurred in Taiwan, where the government implemented a total ban on vape products. This regulatory change resulted in a loss of nearly USD 1 million in sales for AIRSCREAM, with no viable alternative to offset this substantial decrease. In New Zealand, the introduction of new vape product legislation in October 2023 led to considerable market confusion. The unclear implementation details caused uncertainty among retailers regarding the types of products that would remain legal. Consequently, many took the opportunity to deplete existing stock while awaiting clearer guidance from authorities. This uncertainty disrupted our sales and market positioning in the region. Despite these challenges, we achieved a 14% growth in South Africa compared to FY22. Maintaining our leadership position in this market required relentless effort to ensure our products remained competitive and affordable, especially in light of increased taxation on nicotine vape liquids. This involved margin adjustments across the entire supply chain to absorb the additional costs. Moreover, delays in recruiting key team members also impacted our revenue growth in 2023. These delays hindered our ability to execute strategic initiatives and fully capitalize on market opportunities. In summary, while 2023 posed significant challenges, AIRSCREAM Group remains committed to navigating these obstacles and leveraging our strengths to achieve long-term success.
Page 1
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Industry Risks and Uncertainties for AIRSCREAM UK Limited
1. Introduction AIRSCREAM UK Limited operates in a dynamic and complex global market, spanning multiple jurisdictions with unique regulatory, economic, and socio-political environments. Under such circumstances, it does not come risk-free for our business operations. This part outlines the primary industry risks and uncertainties we may face in the various markets we operate in, including economic fluctuations, regulatory changes, market competition, and geopolitical instability. 2. Regulatory Environment 2.1 Compliance and Regulatory Changes In every market, AIRSCREAM must navigate a complex web of local, national, and international regulations. These regulations encompass product safety, marketing practices, environmental standards, and consumer protection laws. The regulatory landscape is continuously evolving, and failure to comply with new or existing regulations could result in significant penalties and reputational damage. 2.2 Country-Specific Regulatory Risks • European Union (Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden): The EU has stringent regulations concerning product safety, consumer rights, and environmental impact. We must stay abreast of changes to the EU Tobacco Products Directive (TPD). • United States: The US Food and Drug Administration (FDA) regulates tobacco products under the Family Smoking Prevention and Tobacco Control Act. The FDA's Premarket Tobacco Application (PMTA) process is critical for market entry and continued sales. • Canada: Health Canada enforces the Tobacco and Vaping Products Act (TVPA), which regulates the manufacture, sale, labelling, and promotion of tobacco and vaping products. • Asia (Indonesia, Japan, Korea, Malaysia, Philippines, Thailand, Vietnam, Hong Kong, Cambodia): Diverse regulatory frameworks require localized strategies for compliance. For instance, Japan regulates e-cigarettes containing nicotine as pharmaceuticals, while Indonesia and Malaysia have stringent advertising restrictions. • Middle East and North Africa (Egypt, Jordan, Libya, Morocco, North Africa): Countries in these regions often have restrictive import regulations and varying enforcement levels, making compliance challenging. For example, Egypt has strict regulations on tobacco product sales and imports, despite that, AIRSCREAM is the first and only brand that is officially approved by the government of Egypt for sales and imports of our products in the market. It is important to note that despite the risks mentioned above, our strategy is to exercise flexibility for the nicotine contents in our e-liquids to ensure relevant compliances are fully met under different market regulations or circumstances.
Page 2
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
3. Market Risks
3.1 Economic Fluctuations Economic conditions can greatly influence consumer spending behaviour. In times of economic downturns, discretionary spending on products like e-cigarettes may decrease, affecting sales and profitability across the industry and various other sectors. 3.2 Currency Exchange Rates Given AIRSCREAM’s global presence, currency exchange rate fluctuations can impact financial performance. We are able to manage these risks through effective hedging strategies and financial planning. 3.3 Geopolitical Risks Geopolitical instability can disrupt supply chains, affect consumer confidence, and lead to sudden regulatory changes. Markets in regions such as the Middle East, North Africa, and Eastern Europe (e.g., Ukraine) are particularly vulnerable to such risks. 4. Competition and Market Dynamics 4.1 Intense Competition The e-cigarette market is highly competitive, with numerous players ranging from large multinational corporations to small local manufacturers. Maintaining market share requires continuous innovation, competitive pricing, and effective marketing strategies. 4.2 Market Saturation In mature markets like the USA, UK, and parts of the EU, market saturation presents a challenge. Growth in these markets depends on capturing market share from competitors, high investments required on education to consumers regarding the illicit trade and convincing traditional tobacco users to switch to e-cigarettes. 4.3 The Illicit Trade Besides a competitive landscape, the industry is constantly battling against the illicit trade in different markets, which thrives among consumers on a global scale, for example in Southeast Asia, the US, UK, Australia and more. This issue is much harder to control or restrict in countries that do not exercise or enforce effective illicit trade monitoring. Please see examples below. 1. United States: The US has seen a substantial increase in the illegal import and sale of e-cigarettes, particularly flavoured disposable ones. Despite regulatory efforts by the FDA and other agencies, thousands of new products continue to enter the market from countries like China. The FDA has created a multi-agency task force to combat this issue, but the influx of illegal e-cigarettes remains a significant challenge (FDA) (Health News Florida). 2. United Kingdom: The UK also faces issues with illicit e-cigarettes, with reports indicating that a notable portion of the e-cigarette market consists of products that do not comply with UK regulations. The Trading Standards Institute has been actively involved in seizing non-compliant products and raising awareness about the dangers of unregulated e-cigarettes. 3. Australia: In Australia, the sale of nicotine-containing e-cigarettes is illegal without a prescription, yet there is a thriving black market for these products. The Australian Border Force and state health departments frequently intercept shipments of illegal e-cigarettes, but the problem persists due to high demand.
Page 3
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
4. Europe: Several European countries, including France and Germany, have reported issues with illegal e-cigarettes. The European Union's Tobacco Products Directive regulates the sale of e-cigarettes, but enforcement varies across member states, leading to a patchwork of compliance and enforcement efforts. 4.4 Emerging Markets While emerging markets (e.g., Indonesia, Pakistan, Vietnam) offer growth potential, they also present unique challenges, including lower consumer purchasing power, limited market infrastructure, and higher operational risks. 5. Technological Risks 5.1 Technological Advancements The e-cigarette industry is characterized by rapid technological advancements. AIRSCREAM’s investment in R&D aims to stay ahead of technological trends and consumer preferences. 5.2 Cybersecurity As a company that likely relies on digital platforms for sales, marketing, and operations, cybersecurity risks are significant. Data breaches could lead to financial losses, legal repercussions, and reputational damage, which is why we invest in appropriate measures to combat such risks. 6. Environmental and Health Risks 6.1 Environmental Regulations Environmental regulations concerning manufacturing processes, packaging, and disposal of e-cigarettes and related products are becoming stricter globally. Compliance requires significant investment in sustainable practices. For example, the EU's Waste Electrical and Electronic Equipment (WEEE) Directive. 6.2 Health Concerns Public health debates about the safety of e-cigarettes continue to evolve. Negative perceptions and potential health risks associated with vaping could impact consumer demand and lead to stricter regulations. For instance, the World Health Organization (WHO), American Heart Association (AHA), American Lung Association (ALA) and more have raised concerns about the unknown health impacts of e-cigarettes.
In the fiscal year ending 2023, our company demonstrated robust financial health and consistent growth across key performance metrics. Revenue increased by 15.6% from £19.1 million to £22.1 million. This growth was attributed to the company’s ability to increase its market share in key markets.
The cash and bank balance of the company increased by 22%, from £5.8 million to £7.1 million. This increase aligns with the revenue growth of £2.9 million and reflects improved management in cash flow planning and fund utilization. Operating profit decreased by 4.4%, from £5.4 million to £5.2 million. This slight decline was due to an increase in remote support team costs, as the group underwent extensive recruitment in 2023 to support business growth.
Page 4
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Significantly, in 2023, the company made strategic investments to penetrate new markets, opening sales routes and introducing our products to 11 new markets. This expansion underlines our commitment to growth and positions us for continued success in the future.
This report was approved by the board and signed on its behalf.
Page 5
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors present their report and the financial statements for the year ended 31 December 2023.
The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 101 ‘Reduced Disclosure Framework’. 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 judgments 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 profit for the year, after taxation, amounted to £4,133,581 (2022 - £4,405,679).
The directors who served during the year were:
Page 6
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1. Introduction of INKLORDS:
AIRSCREAM will be launching a secondary vape device brand, "INKLORDS," to address gaps in our current product portfolio. By the end of 2026, INKLORDS is projected to contribute 20% of all vape sales, providing a significant boost to our market presence and product diversity. 2. Launch of M13 Nicotine Pouches: The upcoming launch of nicotine pouches under the brand M13 presents a significant growth opportunity as a new Nicotine Replacement Therapy (NRT) product. We aim to secure these products at optimal price levels to maximize their market potential. M13 will enable us to penetrate the saturated UK vape market and address restrictions in the US market due to PMTA requirements. By the end of 2027, M13 is expected to contribute at least 30% of our total revenue. 3. Opening of Czech Warehouse and Liquid Factory: In Q4 2024, AIRSCREAM will open a new warehouse and liquid factory in the Czech Republic. This facility will enhance our speed to market in the EU, addressing current growth limitations. Additionally, it will offer new revenue sources through OEM production for other brands. We estimate incremental sales contributions of USD 2 million in 2025, USD 4 million in 2026, and USD 8 million by 2027 from the Czech facilities. 4. Egypt Market Entry: We have secured the first legal permit to import our vape products into Egypt in early 2024. This milestone will allow AIRSCREAM to engage key accounts in the market, tapping into the estimated USD 0.4 billion illicit vape market in Egypt. 5. Strategic Investments in F&B Startups: As part of our strategic plan to become a leading lifestyle consumer company, AIRSCREAM will fund two F&B startups based in Malaysia and China. These investments will provide additional revenue streams and diversify our business operations. These strategic initiatives are designed to propel AIRSCREAM into new markets and product categories, ensuring sustained growth and innovation in the coming years.
Page 7
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Acquisition of Shenzhen AIRSCREAM Tech Co., Ltd
Shenzhen AIRSCREAM Tech Co., Ltd. has been integrated into the group's structure. The group restructuring exercise, which began in Q2 2022, was completed on June 26, 2024, with Shenzhen AIRSCREAM now being transferred to and reported under AIRSCREAM UK Limited. Shenzhen AIRSCREAM is 100% owned by AIRSCREAM UK Limited.
The auditors, Harris & Trotter LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
Page 8
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF AIRSCREAM UK LIMITED
We have audited the financial statements of AIRSCREAM UK LIMITED (the 'Company') for the year ended 31 December 2023, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity and the related notes, 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 101 ‘Reduced Disclosure Framework’ (United Kingdom Generally Accepted Accounting Practice).
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 United Kingdom, including the Financial Reporting Council'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.
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.
Page 9
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF AIRSCREAM UK LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
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 Directors' Report.
Page 10
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF AIRSCREAM UK LIMITED (CONTINUED)
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:
The objectives of our audit are to identify and assess the risks of material misstatement of the financial statements due to fraud or error; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud or error; and to respond appropriately to those risks. Owing to the inherent limitations of an audit, there is an unavoidable risk that material misstatements in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK). In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and noncompliance with laws and regulations, our procedures included the following: • We obtained an understanding of the legal and regulatory frameworks applicable to the Company and the industry in which it operates. We determined that the following laws and regulations were most significant: FRS 101 and the Companies Act 2006. • We obtained an understanding of how the Company is complying with those legal and regulatory frameworks by making enquiries of management. • We challenged assumptions and judgments made by management in its significant accounting estimates; We did not identify any key audit matters relating to irregularities, including fraud.
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 Auditors' Report.
As this is the first time the Company has required an audit, the corresponding figures and comparative financial statements are unaudited.
Page 11
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF AIRSCREAM UK LIMITED (CONTINUED)
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants and Statutory Auditors
101 New Cavendish Street
1st Floor South
W1W 6XH
Page 12
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
Page 13
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
REGISTERED NUMBER: 11368960
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023
Page 14
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
REGISTERED NUMBER: 11368960
STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 DECEMBER 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 17 to 39 form part of these financial statements.
Page 15
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
Page 16
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
AIRSCREAM UK Limited is a private company limited by shares incorporated in England and Wales. The registered office is Ashville Park, Short Way, Thornbury, Bristol, BS35 3UU.
2.Accounting policies
Information on the impact of first-time adoption of FRS 101 is given in note 26.
The preparation of financial statements in compliance with FRS 101 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).
First time application of FRS 100 and FRS 101
The following principal accounting policies have been applied:
The Company has taken advantage of the following disclosure exemptions under FRS 101:
∙the requirements of IFRS 7 Financial Instruments: Disclosures
∙the requirements of IAS 7 Statement of Cash Flows
∙the requirements in IAS 24 Related Party Disclosures to disclose related party transactions entered into between two or more members of a group, provided that any subsidiary which is a party to the transaction is wholly owned by such a member
This information is included in the consolidated financial statements of AIRSCREAM 313 Holdings Limited as at 31 December 2023 and these financial statements may be obtained from Companies House.
The company meets its day-to-day working capital requirements through its cash reserves. The current economic conditions continue to create uncertainty and the company’s forecasts and projections, taking account of reasonably possible changes in trading performance, show that the company should be able to operate within the level of its current cash reserves. After making enquiries, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The company therefore continues to adopt the going concern basis in preparing its financial statements.
Page 17
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
There are no amendments to accounting standards, or IFRIC interpretations that are effective for the year ended 31 December 2023 that have a material impact on the company’s financial statements.
Functional and presentation currency
Transactions and balances
Page 18
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Page 19
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.
Page 20
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Page 21
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
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 profit or loss.
Page 22
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
Page 23
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
The Company recognises financial instruments when it becomes a party to the contractual arrangements of the instrument. Financial instruments are de-recognised when they are discharged or when the contractual terms expire. The Company's accounting policies in respect of financial instruments transactions are explained below:
Financial assets and financial liabilities are initially measured at fair value.
Financial assets
All recognised financial assets are subsequently measured in their entirety at either fair value or amortised cost, depending on the classification of the financial assets.
Fair value through profit or loss
Impairment of financial assets
Financial liabilities
Fair value through profit or loss
At amortised cost
Page 24
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
The following are the judgements made by management in applying the accounting policies of the Company that have the most significant effect on these financial statements: Recognition of deferred tax assets The extent to which deferred tax assets can be recognised is based on an assessment of the probability that future taxable income will be available against which the deductible temporary differences and tax loss carry-forwards can be utilised. In addition, significant judgement is required in assessing the impact of any legal or economic limits or uncertainties in various tax jurisdictions. Useful lives and residual values of depreciable assets Management reviews its estimate of the useful lives and residual values of depreciable assets at each reporting date, based on the expected utility of the assets. Uncertainties in these estimates relate to technological obsolescence that may change the utility of certain software and IT equipment and environmental regulations that can make polluting assets to be depreciated more quickly. Inventories Management estimates the net realisable values of inventories, taking into account the most reliable evidence available at each reporting date. The future realisation of these inventories may be effected by future technology or other market-driven changes that may reduce future selling prices. Leases – determination of the appropriate discount rate to measure lease liabilities The Company enters into leases with third-party landlords and as a consequence the rate implicit in the lease is not readily determinable. The Company uses its incremental borrowing rate as the discount rate for determining its lease liabilities at the lease commencement date. The incremental borrowing rate is the rate of interest that the Company would have to pay to borrow over similar terms which requires estimations when no observable rates are available.
Page 25
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Analysis of turnover by country of destination:
Page 26
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Page 27
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Page 28
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
There were no factors that may affect future tax charges.
Page 29
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Page 30
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Page 31
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
13.Tangible fixed assets (continued)
Page 32
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Page 33
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Page 34
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Page 35
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AIRSCREAM UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Profit and loss account
The Company operates a defined contribution scheme. The pension cost charge for the period represents contributions payable by the Company to the scheme and amounted to £2,785 (2022: £1,396).
Page 36
|