REGISTERED NUMBER: |
Strategic Report, Report of the Directors and |
Audited Financial Statements |
for the Year Ended 31 December 2023 |
for |
Ralawise Limited |
REGISTERED NUMBER: |
Strategic Report, Report of the Directors and |
Audited Financial Statements |
for the Year Ended 31 December 2023 |
for |
Ralawise Limited |
Ralawise Limited (Registered number: 01362849) |
Contents of the Financial Statements |
for the year ended 31 December 2023 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 8 |
Report of the Independent Auditors | 10 |
Statement of Comprehensive Income | 13 |
Statement of Financial Position | 14 |
Statement of Changes in Equity | 15 |
Notes to the Financial Statements | 16 |
Ralawise Limited |
Company Information |
for the year ended 31 December 2023 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Chartered Accountants |
and Statutory Auditor |
One St Peter's Square |
Manchester |
M2 3DE |
Ralawise Limited (Registered number: 01362849) |
Strategic Report |
for the year ended 31 December 2023 |
The directors present their strategic report of the company for the year ended 31st December 2023. |
Ralawise Limited ('company') is a family owned and controlled businesses. The principal activity of the company is the B2B distribution of clothing and apparel related products. The company distributes over 100 brands from recognised leisurewear brands, prominent global sports brands, and industry activewear brands including market leading sustainable, recycled and organic products. The company also has a growing selection of private label / own-brands that are created internally and directly sourced, these are either exclusive to the company or distributed more widely via a network of 3rd party distributors. |
The company supplies clothing to the wholesale, retail and e-tail industries and most of the products sold are subject to further value-added processes by our customers before onward sale to businesses, retailers and consumers covers a broad and extensive range of market sectors including; |
- | Sports & activewear |
- | Hospitality |
- | Workwear |
- | Safety clothing |
- | Mass events (including sports & music merchandise) |
- | Leisurewear |
- | High street retail |
- | Fashion |
- | Education |
- | Health & beauty |
- | Medical and healthcare |
Over 85% of the company's revenue is traded via its online platform. The company is the leader in the combined UK and European marketplace, where it has a growing market share through enhanced service levels, strength of inventory and an attractive brand portfolio of world leading industry brands. The company's private label products are developing in the key product areas of hospitality, sports and active wear. The company is planning further strategic investments into product, infrastructure and selling channels. |
REVIEW OF BUSINESS |
During 2023 the recovery from the headwinds of previous years continued but at a more moderate pace as the toll of inflation, spiralling costs, increased wages and the highest interest rates since 2009 dampened demand. Q1 & Q2 of 2023 actually started positively with a major bounce in some key sectors, however Q3 & Q4 saw a dramatic reverse of this as corporate and consumer confidence diminished on the backdrop of a downbeat economic outlook for the months ahead. These poor market conditions and flat demand continued for Q1 of 2024, with the first signs of a return to growth being seen in Q2. Overall the company's turnover increased by 1.2% to £168.6m. |
In 2023 the company experienced product devaluation and moderating prices leading to a 9.8% reduction in the Gross Profit margin to 25.8% down from 28.6%. The product devaluation was brand led and affected the whole industry. Prices fell as inventory excesses in the market were released and competitors chased market share against the backdrop of flat business activity levels. Additionally, during this time the company was processing high cost inventory purchased at peak times of the supply chain crisis and currency weakness. The company is confident that the some of these margin reduction pressures have come to end and that this coupled with a number of margin improvement strategies that have been implemented will enable the Gross Profit margin to be return to historic levels. |
The company's product mix is one of our key strengths and further investments have been made in new brands and product sectors, for example the scrubs healthcare products brand Onna (by Premier Clothing) was recently launched offering customers the opportunity to move into the large, well-established sector of healthcare/wellbeing scrubs. Despite the squeeze on budgets as companies and consumers tighten their belts there has been a positive movement of the company's customers towards the best products and brands, particularly those which are exclusive to the company, with this in mind the company plans further product development and brand collaborations. |
Ralawise Limited (Registered number: 01362849) |
Strategic Report |
for the year ended 31 December 2023 |
The SKU reduction programme which commenced during the year has produced improved efficiencies and cost savings and will continue as the company moves towards its target of a net 20% reduction in SKU numbers by the end of 2024. This inventory realignment will come at a cost as many of these SKUs will have to be sold efficiently and sustainably at discounted prices. The company has actively redeveloped Raladeal, its 'close out' business model, to create a long term outlet for discontinued product. The inventory position which grew substantially to £71.9m at the end 2022 on the back of supply chain disruption stabilised at £69.3m at the end of 2023 as normal supply chain timescales have been restored. Company inventory is set to reduce in 2024 to more efficient levels without impacting service levels to customers. This will have a positive impact on the inflated levels of storage and financial costs that are being incurred and will increase the company's inventory turns going forward into 2024/2025. |
Whilst the company is working hard to overcome the difficulties as best we can, it must be stressed that Brexit still massively impacts the business with respect to duties (inbound and outbound) and an increased administrative burden. Indeed, following Brexit the company is now the only distributor with sizable operations in the UK, Ireland and mainland Europe. This is a gratifying position and one that we and our brand partners see as providing a major competitive advantage over our competitors. |
2023 saw increased investment in people, technology and infrastructure and the kick start of two long term strategic projects that will drive increased capacity, capability and efficiency in the future. |
The Company continued to invest in its web platform www.ralawise.com offering extended and new services for customers while driving efficiency with order processing and customer experience. The platform continues to be the market leader for choice, speed, and usability in UK, Ireland & mainland Europe. More investments are planned to improve our customers' complete end to end shopping experience and business support platform. |
KEY PERFORMANCE INDICATORS |
The key performance indicators are: |
2023 | 2022 |
Revenue | £168.6m | £166.6m |
Gross profit | £43.6m | £47.7m |
Gross profit % | 25.8% | 28.6% |
EBITDA - non adjusted | £7.5m | £14.1m |
Shareholder funds | £70.0m | £66.5m |
Stocks | £69.3m | £71.9m |
A new long term Asset Backed Lending facility (ABL) was agreed with the company's bankers during the year. This provides significantly increased facilities and available liquidity, as evidenced by the |
increase in cash reserves to £7.2m from £1.9m. Significant cash generation from operations is expected during 2024, arising mainly from the regularisation of stocks to more standard levels. |
PRINCIPAL RISKS AND UNCERTAINTIES |
The geopolitical landscape has become even more complex, dangerous and uncertain with the war in Ukraine entering its third year, disputes in the Far East and tragic difficulties in the Middle East. As a consequence, supply chain logistics have again been impacted with longer lead times due to shipping disruption. The coming year will also see a general election which will increase uncertainty in political and economic direction. |
Inflation which peaked at over 10% moderated through the past year and is set to return to more sustainable levels of c.2% by mid-2024, however the full effects of some of the price rises are delayed and have still to filter through to all layers of the business. For example, the company renegotiated its energy supply contracts in October 2023 at prices that were significant increased from the previous 3 year fixed term deal. Energy efficiency measures and active cost reduction plans have been implemented to mitigate the overall financial effect of these price increases. |
Interest rates finished the year at 5.25% base rate, which is inflicting huge funding costs to the company and our customers alike. It is expected that monetary tightening will ease over the coming year and that this will lead to a much more positive environment for all, and a reboot in customer and consumer confidence. The company is actively taking action to reduce its borrowings and interest payment exposure. |
Ralawise Limited (Registered number: 01362849) |
Strategic Report |
for the year ended 31 December 2023 |
The ever increasing costs of employment including apprenticeship levy, statutory wage rises etc. still remains a significant risk, however overall company employee numbers decreased as efficiencies and productivity improvements were found. Labour markets did ease slightly in 2023 as the economy slowed but remain tight and there are still huge gaps in skilled resources meaning competition for employees remains high. |
The increase in the rate of UK corporation tax from 19% to 25% which was implemented in 2023 acts as a break on confidence, although the company's plans for infrastructure investment should help to mitigate this. The key to unlocking efficiency savings is investment and this will continue across all areas of the company's activities. We will appropriate manage the risks and uncertainties associated with such large scale investments. |
Competitor activity is always a risk and is constantly reviewed. The company is confident that its tireless investment in, and dedication to, market leading products and services in all areas of the business should help mitigate the risks. |
The shareholders, Board and senior management constantly review risks and uncertainties and we are fully confident that despite all the headwinds and issues presented that these will be overcome by our effective Risk Management strategies and processes. |
The overall strategy of the company is to provide its stakeholders with a solid and robust platform from which further developments and investments can be made in a sustainable, responsible and profitable manner. |
SECTION 172(1) STATEMENT |
The board of directors of Ralawise Limited, both individually and collectively for the year ended 31 December 2023, consider in good faith, they have acted in the way most likely to promote the success of the company for the benefit of its members as a whole and having regard to the matters set out in s172 (1)(a-f) as below: |
a) The likely consequences of any decision in the long term; |
a) The interests of the company's employees; |
b) The need to foster the company's business relationships with suppliers, customers and others; |
c) The impact of the company's operations on the community and the environment; |
d) The desirability of the company maintaining a reputation for high standards of business conduct; and |
e) The need to act fairly between members of the company and the company. |
The directors make decisions by taking their legal duties into account alongside the priorities and requirements of the stakeholders. |
a) The likely consequences of any decision in the long term |
The directors have regard to the likely consequences of their decisions on the long term objectives and sustainability of the company, its stakeholders and the community including preserving its values and culture. Ralawise is a business built on its standards and reputation and the directors would not make a decision which would have a detrimental impact on this reputation whether in the short term or the long term. |
b) The interests of the company's employees |
Our employees are key, so it is very important that they have the right environment in which to create ideas and set high standards. Further details of engagement with employees are given below. |
c) The need to foster the company's business relationships with suppliers, customers and others. |
We carry out our business with similar-minded people with whom we collaborate and support. We build on this to forge strong and lasting partnerships which are important for our long-term success. Further details of engagement with suppliers, customers and others are given below. |
Ralawise Limited (Registered number: 01362849) |
Strategic Report |
for the year ended 31 December 2023 |
d) The impact of the company's operations on the community and the environment. |
We are proud to be part of the local and wider communities. It is our aim to create opportunities to recruit and develop local people and to understand the issues that are important to the community and what we can do to support it. Most facilities and employees are based on the border of Wales and the Northwest of England and we regularly support local initiatives to improve this region and the lives of the people who work and live there. |
e) The desirability of the company maintaining a reputation for high standards of business conduct |
All new employees receive a New Starter Pack which documents our history, standards, equal opportunities and training program (among other things). All employees have easy access to our Operating Procedures, Code of Conduct and Code of Business Ethics and understand the requirement for them to comply with the company's high standards of conduct at all times. The company also has a Child Labour Remediation Policy which operates throughout the business and our supply chain to show our commitment and responsibility to protect child/young workers. Any issues of non-compliance with any of our policies can be highlighted confidentially following our documented whistleblowing policies. Further details on Corporate Social Responsibility are given below. |
f) The need to act fairly between members of the company and the company. |
The company aims to act with integrity and courtesy in all its business relationships and will consider all members and stakeholders when making decisions for the overall good of the company. |
ENGAGEMENT, HEALTH AND WELL-BEING OF EMPLOYEES |
The Board would like to pay tribute to all our colleagues, as throughout 2023 their determination, loyalty and hardworking was truly outstanding, as it always is. |
Employee engagement remains a major focus to the business and the company continues to communicate and support our teams on the following key matters; |
- | Recruitment |
- | Communication and collaboration |
- | Learning and development |
- | Equality |
- | Diversity and inclusion |
- | Employee relations |
- | Health, safety and well-being |
- | Reward and recognition |
The company has in place a comprehensive network of communication, reporting, liaison, forums with all our colleagues to create a proactive inclusive environment. |
The company prides itself as a responsible, equal opportunity, engaging, caring, employer. We strive to follow best practice in our welfare and renumeration practices. The company actively benchmarks itself on pay and conditions to maintain its position and competitiveness. |
Health and well-being continues to be major initiatives for the company and the Employee Assistance Programme (EAP) is fully operational and integrated with a new Health Heroes 24/7 GP referral scheme implemented in the year. In response to the cost of living pressures, financial well-being is another priority and webinars are held for all colleagues in collaboration with our banking partner, HSBC .These are held on a regular basis and are designed to enhance understanding of all key day to day budgeting and financial topics. |
Flexible and hybrid forms of working schemes were maintained in 2023 as they were appreciated by our employees. However, as 2023 progressed and in line with the general direction of flow of the employment market more and more colleagues were encouraged to come back to the office to enable better employee engagement and team morale. |
Ralawise Limited (Registered number: 01362849) |
Strategic Report |
for the year ended 31 December 2023 |
During the year technology was implemented to support performance, goals and succession, this improves the visibility of our talent pipeline and allows us to create personalised opportunities and development programmes for all. 2023 also saw the successful launch of a graduate programme, which is helping to attract talent form a diverse background. |
Gender pay gap data for Ralawise Limited was reported in April 2023. The pay gap was 4.3% and remained significantly below the UK reported average for 2023 of 14.3%. The company recognises more work is to be done to reduce this gap further (full details of the report is available at www.ralawise.com). |
The company has policies in place to ensure that full and fair consideration is given to applications for employment made by disabled people and to ensure that there is no discrimination or bullying of disabled people in the workplace. |
ENGAGEMENT WITH CUSTOMERS, SUPPLIERS AND OTHERS. |
The company would like to thank all its stakeholders, customers and suppliers for their continued support and collaboration during 2023 and together we look forward to 2024 with optimism. |
As availability of product improved and our operations became more streamlined our customers confidence in Ralawise and the services we provide continued to grow. Significant efforts were made in respect of customer retention and acquisition, and it is pleasing to report that active customer accounts reached record numbers during the year, a trend that has continued into 2024. More diverse and interactive plans with customers are planned which alongside further developments on the company's e-commerce platforms should lead even greater customer engagement. |
The company's relationships with all its suppliers are a cornerstone to its success and further digital and technical enhancements were made. The company is passionate about driving change within its supply base and improving all areas of efficiency, compliance, best practice and corporate governance. |
CORPORATE SOCIAL RESPONSIBILITY |
The company's internal CSR and Sustainability department made extensive progress in 2023 to further develop a comprehensive and fully integrated code of business ethics and CSR. These include the following topics |
- | modern slavery |
- | supply chain mapping |
- | corporate compliance |
- | transparency & traceability |
- | governance |
- | environmental impact |
- | sustainability |
The company works closely with all its strategic supply partners in driving best practices in business ethics, manufacturing standards, social responsibility and in the following of international recognised accreditations and standards. The company is proud to be a member of SEDEX, Amfori and the Better Cotton initiative and is certified for GOTS. All suppliers are required to follow the company code of conduct working closely and in collaboration with our CSR & Sustainability department. Further, they are encouraged to reduce their social and environmental impact including through the use of sustainable materials. |
All areas of the company's activities are being challenged to reduce environmental impact, water usage, energy consumption etc. and we are proud to be 'zero to landfill'. Further the company is pleased to announce that all our electricity supply is from sustainable sources and that though our main logistics partner, DPD, more and more of our parcels are being delivered using electric vehicles. |
The CSR and Sustainability department during the year made continue improvements in training, supply chain mapping, social compliance monitoring, traceability and transparency, and standard certifications. |
The Board are actively involved in driving CSR and sustainability goals and all aspects of the company's operations are under review to ensure a sustainable, recycled and renewable future. |
Ralawise Limited (Registered number: 01362849) |
Strategic Report |
for the year ended 31 December 2023 |
STREAMLINED ENERGY AND CARBON REPORT |
Reporting Period |
This has been based upon the period January 2023 to end December 2023. |
Reasons for change in emissions from previous year |
Emissions have remained relatively the same from 2022 and our specific energy consumption has reduced by around 1%. |
Quantification and reporting methodology. |
We have used the 2023 UK Government conversion factors for company reporting. Some minor transportation data and gas has been estimated amounting to around 3% of our total emissions. |
Organisational Boundary |
This report covers all the company's operations in the UK. |
Operational Scopes |
We have measured our Scope 1 & 2 emissions to include our main energy sources as listed below. |
2023 | 2022 |
Ralawise Ltd | Tonnes Co2e |
Scope 1 Emissions - Emissions from activities for which the company own or control including combustion of fuel & operation of facilities. Emissions from staff mileage and delivery vehicles. |
83 |
84 |
Scope 2 Emissions - Emission from purchase of electricity & heat for own use. | 355 | 352 |
Total Scope 1 & 2 emission tCo2e | 437 | 436 |
Total Energy consumption to calculate above kWh | 2,096,482 | 2,227,888 |
Energy Intensity Ratio to calculate above tCo2e/£M Income | 2.60 | 2.64 |
Energy Efficiency activities |
The ESOS phase 3 report to 5 December 2023 has recently been completed and this identified a number of energy saving opportunities which are currently being evaluated. A longer term project involving a significant investment into solar power is also being progressed. |
ON BEHALF OF THE BOARD: |
6 August 2024 |
Ralawise Limited (Registered number: 01362849) |
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. |
DIVIDENDS |
The total amount of dividends paid in the year was £1,529,340 (2022: £20,831,577). |
FUTURE DEVELOPMENTS |
Detail of future developments are set out in the Strategic Report. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 January 2023 to the date of this report. |
FINANCIAL RISK MANAGEMENT |
The company has exposure in four main areas of financial risk: foreign exchange, liquidity, customer credit and cost price fluctuations. |
Foreign exchange transactional currency exposure |
The company is exposed to currency exchange risk due to a significant proportion of its transactions denominated in non-sterling currencies. The net exposure of each currency is monitored and if necessary managed by the use of various forward foreign exchange products. The company also operates foreign currency bank accounts to offset the exposure on receivables and payables. |
Liquidity and cashflow risk |
The objective of the company in managing liquidity risk is to ensure that it can meet its financial obligations as and when they fall due. The company is in a strong financial position and has in place facilities to allow it to meet its financial obligations. New banking facilities agreed in 2023 have substantially strengthened the company's liquidity position. |
Customer credit exposure |
The company may offer credit terms to its customers which allow payment of the debt after delivery of the goods. The company is at risk to the extent that a customer may be unable to pay the debt on the specified due date. This risk is mitigated by the strong on-going customer relationships and effective credit control procedures. The company has a very large customer base which helps reduce the overall credit risk. |
Cost price fluctuation risk |
Price risk arises because of the variability in supply chain costs and the volatile nature of commodity prices which feed through to the price of the company's products. Such price risk exposure will effect the whole market in which the company operates and over a period of time selling prices and cost prices across the industry worldwide would be expected to come back into alignment. The company's strong financial and stockholding positions enable short term risk in this area to be managed. |
DIRECTORS INDEMNITY INSURANCE |
The company has paid for indemnity insurance cover for all of its directors. |
Ralawise Limited (Registered number: 01362849) |
Report of the Directors |
for the year ended 31 December 2023 |
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), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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; |
- | state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; |
- | 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 or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
AUDITORS |
The auditors, Forvis Mazars LLP, 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 |
Ralawise Limited |
Opinion |
We have audited the financial statements of Ralawise Limited (the 'company') for the year ended 31 December 2023 which comprise The Statement of Comprehensive Income, Statement of Financial Position, 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 FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" (United Kingdom Generally Accepted Accounting Practice). |
In our opinion, the financial statements: |
- | 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 other information comprises the information included in the Strategic report and the Report of Directors, other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. |
Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. |
We have nothing to report in this regard. |
Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of 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 |
Ralawise Limited |
Matters on which we are required to report by exception |
In 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. |
We have nothing to report in respect of the following matters in relation to which 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 nine, 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. |
Auditors' responsibilities for the audit of the financial statements |
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below. |
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. |
Based on our understanding of the company and its industry, we considered that non-compliance with the following laws and regulations might have a material effect on the financial statements: employment regulation, health and safety regulation, anti-money laundering regulation. |
To help us identify instances of non-compliance with these laws and regulations, and in identifying and assessing the risks of material misstatement in respect to non-compliance, our procedures included, but were not limited to: |
- | Inquiring of management and, where appropriate, those charged with governance, as to whether the company is in compliance with laws and regulations, and discussing their policies and procedures regarding compliance with laws and regulations; |
- | Inspecting correspondence, if any, with relevant licensing or regulatory authorities; |
- | Communicating identified laws and regulations to the engagement team and remaining alert to any indications of non-compliance throughout our audit; and |
- | Considering the risk of acts by the company which were contrary to applicable laws and regulations, including fraud. |
We also considered those laws and regulations that have a direct effect on the preparation of the financial statements, such as tax legislation, pension legislation, the Companies Act 2006. |
In addition, we evaluated the directors' and management's incentives and opportunities for fraudulent manipulation of the financial statements, including the risk of management override of controls, and determined that the principal risks related to posting manual journal entries to manipulate financial performance, management bias through judgements and assumptions in significant accounting estimates, revenue recognition (which we pinpointed to the cutoff assertion), and significant one-off or unusual transactions. |
Report of the Independent Auditors to the Members of |
Ralawise Limited |
Our audit procedures in relation to fraud included but were not limited to: |
- | Making enquiries of the directors and management on whether they had knowledge of any actual, suspected or alleged fraud; |
- | Gaining an understanding of the internal controls established to mitigate risks related to fraud; |
- | Discussing amongst the engagement team the risks of fraud; and |
- | Addressing the risks of fraud through management override of controls by performing journal entry testing. |
There are inherent limitations in the audit procedures described above and the primary responsibility for the prevention and detection of irregularities including fraud rests with management. As with any audit, there remained a risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal controls. |
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 auditor's report. |
Use of our report |
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in 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 |
Chartered Accountants |
and Statutory Auditor |
One St Peter's Square |
Manchester |
M2 3DE |
Ralawise Limited (Registered number: 01362849) |
Statement of Comprehensive |
Income |
for the year ended 31 December 2023 |
2023 | 2022 |
Notes | £ | £ |
TURNOVER | 4 |
Cost of sales | ( |
) | ( |
) |
GROSS PROFIT |
Distribution costs | ( |
) | ( |
) |
Administrative expenses | ( |
) | ( |
) |
5,901,384 | 12,036,935 |
Other operating income | 5 |
OPERATING PROFIT | 7 |
Income from fixed asset investments |
Interest receivable and similar income |
7,979,541 | 13,390,809 |
Interest payable and similar expenses | 8 | ( |
) | ( |
) |
PROFIT BEFORE TAXATION |
Tax on profit | 9 | ( |
) | ( |
) |
PROFIT FOR THE FINANCIAL YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
Ralawise Limited (Registered number: 01362849) |
Statement of Financial Position |
31 December 2023 |
2023 | 2022 |
Notes | £ | £ |
FIXED ASSETS |
Intangible assets | 11 |
Tangible assets | 12 |
Investments | 13 |
CURRENT ASSETS |
Stocks | 14 |
Debtors | 15 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 16 | ( |
) | ( |
) |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
PROVISIONS FOR LIABILITIES | 21 | ( |
) | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 22 |
Other reserve | 23 |
Capital redemption reserve | 23 |
Retained earnings | 23 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
Ralawise Limited (Registered number: 01362849) |
Statement of Changes in Equity |
for the year ended 31 December 2023 |
Called up | Capital |
share | Retained | Other | redemption | Total |
capital | earnings | reserve | reserve | 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 |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements |
for the year ended 31 December 2023 |
1. | GENERAL INFORMATION |
Ralawise Limited ('the company') is engaged in the on-line B2B.com distribution of clothing, apparel and related products. |
STATUTORY INFORMATION |
The company is a private company limited by shares and is incorporated in England and Wales with company number 01362849. The address of the registered office and principal place of business is Unit 112, Tenth Avenue Zone 3, Deeside Industrial Park, Deeside, Flintshire, CH5 2UA. |
2. | STATEMENT OF COMPLIANCE |
The financial statements of Ralawise Limited have been prepared in compliance with United Kingdom Accounting Standards, including "The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland" ("FRS 102") and the Companies Act 2006. |
3. | ACCOUNTING POLICIES |
Summary of significant accounting policies |
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented, unless otherwise stated. |
Basis of preparation |
The financial statements have been prepared on the going concern basis under the historical cost convention and comply with United Kingdom Accounting Standards and Companies Act 2006. The Company is exempt by virtue of s401 of the Companies Act 2006 from the requirement to prepare group financial statements. These financial statements present information about the Company as an individual undertaking and not about its group. |
Going concern |
The company meets its day to day working capital requirements through its banking facilities which are agreed at a group level. |
After reviewing the company's forecasts and projections, the directors are satisfied that the company has adequate resources to continue in operational existence for the foreseeable future, including a period of not less than 12 months from the date of signing of these financial statements. The company therefore continues to adopt the going concern basis in preparing its consolidated financial statements. |
Financial Reporting Standard 102 - reduced disclosure exemptions |
The company has taken advantage of the following disclosure exemption 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. |
This information is included in the consolidated financial statements of Ralawise Group Holdings Limited as at 31 December 2023 and these financial statements may be obtained from the Companies House website (https://www.gov.uk/get-information-about-a-company). |
Revenue recognition |
Revenue is measured at the fair value of the consideration received or receivable and represents net invoiced sales of goods, net of returns, discounts and rebates, excluding value added tax. Carriage charges made to customers are included in revenue. Revenue is recognised when the goods are despatched. |
Goodwill |
Goodwill arising on previous acquisitions was amortised over its estimated useful life of ten years and is now fully written off. |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements - continued |
for the year ended 31 December 2023 |
3. | ACCOUNTING POLICIES - continued |
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. |
Website and e-commerce platform are being amortised evenly over their estimated useful life of five years. |
Customer databases are being amortised evenly over their estimated useful life of five years and are now fully written off. |
Trademarks are being amortised evenly over their estimated useful life of ten years. |
Computer software is being amortised evenly over its estimated useful life of two years. |
Assets in the course of construction |
Assets in the course of construction are stated at cost. These assets are not amortised or depreciated until they are available for use. |
Tangible fixed assets |
Tangible fixed assets are stated at historical cost less accumulated depreciation and accumulated impairment losses. Cost includes expenditure directly attributable to making the asset capable of operating as intended. |
Depreciation is provided at the following annual rates so as to write off cost of assets less residual value over their estimated useful economic lives. Assets are also reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. |
Plant and machinery | - straight line over four and ten years |
Fixtures and fittings | - straight line over four, seven and eight years |
Motor vehicles | - straight line over four years |
Office equipment | - straight line over three and four years |
The residual values and useful lives of assets are reviewed and adjusted if appropriate at the end of each reporting period. |
Government grants |
Government grants are recognised on an accruals basis. |
Stocks |
Stocks are stated at cost or if lower selling price including costs to sell. Cost includes all costs of purchase and any other costs incurred in bringing stock to its present location and condition. Cost is calculated using the first-in, first out basis. |
Provision is made for damaged, obsolete and slow-moving stock where appropriate. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, 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 reporting date. |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements - continued |
for the year ended 31 December 2023 |
3. | ACCOUNTING POLICIES - continued |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position 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. |
Foreign currencies |
(i) Functional and presentation currency |
The financial statements are prepared in sterling which is also the functional currency of the company. |
(ii) Transactions and balances |
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the date of the transactions. At each period end foreign currency monetary items are translated using the closing rate. Non monetary items measured at historical cost are translated using the exchange rate at the date of the transaction. |
(iii) Forward currency contracts |
See accounting policies for financial instruments. |
Leases |
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership of the leased asset to the company. All other leases are classified as operating leases. |
Payments made under operating leases are charged to the income statement on a straight line basis over the period of the lease. This policy will spread the benefit of rent free periods over the period of the lease. |
Employee benefits |
The company provides a range of benefits to employees, including annual bonus arrangements, paid holiday arrangements and a defined contribution pension plan. |
(i) Short term benefits |
Short term benefits, including holiday pay and other similar non-monetary benefits, are recognised as an expense in the period in which service is received. |
(ii) Defined contribution pension plans |
The company operates a defined contribution pension plan for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid the company has no further payment obligations. The contributions are recognised as an expense when they are due. Amounts not paid are shown as accruals in the balance sheet. The assets of the plan are held separately from the company in independently administered funds. |
(iii) Annual bonus plan |
The company operates bonus plans for certain employees. An expense is recognised in the income statement when the company has a legal or constructive obligation to make payments under the plans as a result of past events and a reliable estimate of the obligation can be made. |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements - continued |
for the year ended 31 December 2023 |
3. | ACCOUNTING POLICIES - continued |
Trade debtors and other receivables within one year |
Trade debtors and other receivables including amounts owing from group companies, with no stated interest rate are recorded at transaction price less any impairment. |
Cash and cash equivalents |
Cash and cash equivalents include cash on hand, demand and other short-term highly liquid investments with original maturities of three months or less. Bank overdrafts are shown within borrowings in current liabilities on the statement of financial position. |
Trade creditors and other payables |
Trade creditors and other payables are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method. |
Impairment of assets |
Assets not measured at fair value are reviewed for any indications that the asset maybe impaired at each reporting date. If such indications exist the recoverable amount of the asset or the assets cash generating unit is estimated and compared to the carrying amount. Where the carrying amount exceeds its recoverable amount, an impairment loss is recognised in the profit and loss unless the asset is carried at a revalued amount where the impairment loss is a revaluation decrease. |
Related parties |
The company discloses transactions with related parties which are not wholly owned within the same group. Where appropriate, transactions of a similar nature are aggregated unless, in the opinion of the directors, separate disclosure is necessary to understand the effect of the transactions on the financial statements. |
Exceptional items |
The company classifies certain one-off charges or credits that have a material impact on the company's financial results as 'exceptional items'. These are disclosed separately to provide further understanding of the financial performance of the company. There were no exceptional items in the year or the comparative year. |
Financial Instruments |
The company has chosen to adopt Sections 11 and 12 of FRS 102 in respect of financial instruments. |
(i) Financial assets |
Basic financial assets, including trade and other receivables, cash and bank balances and investments are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. |
Such assets are subsequently carried at amortised cost using the effective interest method. |
(ii) Financial liabilities |
Basic financial liabilities, including trade and other payables, bank loans and loans from fellow group companies, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. |
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method. |
Derivatives, including interest rate swaps and foreign exchange contracts, are not basic financial instruments. |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements - continued |
for the year ended 31 December 2023 |
3. | ACCOUNTING POLICIES - continued |
(iii) Derivative instruments |
The company uses various foreign currency products to reduce exposure to foreign exchange rates. Derivatives are initially recognised at fair value on the date a derivative is entered into and are subsequently revalued to fair value at the period end. Changes in the fair value of derivatives are recognised in the income statement under the most appropriate heading. The fair value of the forward foreign currency contracts is calculated by reference to comparable contracts with similar maturity profiles. |
Borrowing costs |
All borrowing costs are recognised in the income statement in the period in which they are incurred. |
Fixed asset investments |
Investments in subsidiary undertakings are held at cost less accumulated impairment losses. |
Volume rebates and prompt payment discounts |
Volume rebates received from suppliers for stock purchases are recognised on an accruals basis only when their receipt can be reasonably expected. These are credited to the income statement through cost of sales. |
Prompt payment discounts received from suppliers are credited to the income statement through cost of sales when taken. |
Provisions for liabilities |
Provisions are recognised when the company has a present obligation (legal or constructive) as a result of a past event, it is probable that the company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. |
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the year end, taking into account the risks and uncertainties surrounding the obligation. |
Significant judgements and estimates |
The preparation of these financial statements requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. Judgements and estimates are continually evaluated based on historical experiences and other factors, including expectations of future events that are believed to be reasonable under the circumstances. |
The estimates that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next year are discussed below: |
(i) Stock valuation provision (shown as an expected reduction in stock and debited to the Income Statement through cost of sales) |
A valuation loss is recognised where the selling price is less than cost. In arriving at this impairment loss, judgements and estimates have been used to assess the anticipated future selling prices of stocks held at the year end, particularly for slow-moving and discontinued stock items. |
(ii) Dilapidation costs (shown as a provision charged to the Income Statement through Administrative Expenses) |
A provision is included in the financial statements to cover the costs of making good property dilapidations where such work is required by the terms of the lease agreement. In arriving at this provision, judgements and estimates have been used to assess the expected level of such costs. |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements - continued |
for the year ended 31 December 2023 |
3. | ACCOUNTING POLICIES - continued |
The main areas of judgement are: |
(i) Impairment of assets |
In assessing whether there have been any indicators of impairment, the directors have considered both external and internal sources of information such as market conditions, counterparty credit ratings and experience of recoverability. |
(ii) Depreciation and amortisation rates |
In assessing depreciation and amortisation rates the directors consider the expected useful life of the specific asset involved. To allow for appropriate rates many fixed asset categories have a range of depreciation rates that can be applied. |
4. | TURNOVER |
The total turnover of the company for the year has been derived from its principal activity. Although trading is mostly undertaken in the UK there are also exports to the rest of Europe and beyond. No further disclosure of exports is given due to it being considered commercially sensitive. |
5. | OTHER OPERATING INCOME |
2023 | 2022 |
£ | £ |
Management recharges received |
Sundry income |
Government grants |
195,069 | 529,171 |
6. | 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 |
Customer services and administration | 158 | 169 |
Directors | 5 | 5 |
Warehouse | 386 | 388 |
The company operates a defined contribution pension scheme for the benefit of employees. The assets of the scheme are administered by an independent pensions provider. Pension payments are recognised as an expense during the year and amounted to £333,450 (2022: £282,888). |
2023 | 2022 |
£ | £ |
Directors' remuneration |
Directors' pension contributions to money purchase schemes |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements - continued |
for the year ended 31 December 2023 |
6. | EMPLOYEES AND DIRECTORS - continued |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes |
The directors remuneration for 2023 was paid by the ultimate holding company Ralawise Group Holdings Limited. Management charges of £960,000 were paid to Ralawise Group Holdings Limited in the year, which includes the provision of directors services. |
7. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
2023 | 2022 |
£ | £ |
Other operating leases | 712,798 | 771,986 |
Depreciation - owned assets | 905,124 | 803,941 |
Profit on disposal of fixed assets | (14,675 | ) | (18,506 | ) |
Website and e-commerce platform amortisation | 358,312 | 337,827 |
Customer database amortisation | - | 41,071 |
Computer software amortisation | 139,776 | 327,146 |
Auditors' remuneration | 43,000 | 40,000 |
Auditors remuneration for non audit work | - | - |
Foreign exchange differences | 136,191 | (545,480 | ) |
Operating leases - rental of land and buildings | 1,489,671 | 1,469,380 |
Government grants | - | (3,131 | ) |
AUDITORS' REMUNERATION |
2023 | 2022 |
£ | £ |
Fees payable to the company's auditor for the audit of the company's annual accounts | 43,000 | 40,000 |
Fees payable to the company's auditor for other services: |
- Advisory | - | - |
- | - |
8. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2023 | 2022 |
£ | £ |
Directors' loan interest |
Bank interest |
Other loan interest |
Other interest |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements - continued |
for the year ended 31 December 2023 |
9. | 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 |
Adjustment relating to earlier years | (12,240 | ) | 6,276 |
Total current tax |
Deferred tax | ( |
) |
Tax on profit |
UK corporation tax has been charged at 23.52% (2022 - 19%). |
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 |
Income not taxable for tax purposes | ( |
) | ( |
) |
Adjustments to tax charge in respect of previous periods | ( |
) |
deductible for tax purposes |
Change in UK corporation tax rate applied to deferred tax | (4,279 | ) | 146,923 |
Enhanced capital allowances | (3,024 | ) | (109,953 | ) |
Total tax charge | 994,112 | 2,310,966 |
The standard rate of corporation tax in the UK increased to 25% from 19% on 1 April 2023. |
10. | DIVIDENDS |
2023 | 2022 |
£ | £ |
In-specie dividend | - | 18,919,808 |
Interim dividends | 1,529,340 | 1,911,769 |
1,529,340 | 20,831,577 |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements - continued |
for the year ended 31 December 2023 |
11. | INTANGIBLE FIXED ASSETS |
Goodwill | Website |
and | and |
customer | e-commerce | Computer |
database | platform | Trademarks | software | Totals |
£ | £ | £ | £ | £ |
COST |
At 1 January 2023 |
Additions |
At 31 December 2023 |
AMORTISATION |
At 1 January 2023 |
Amortisation for year |
At 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 December 2022 |
Included within Computer software are £642,290 of costs, in relation to an asset in the course of construction. These costs have not been amortised to date. |
12. | TANGIBLE FIXED ASSETS |
Office |
Fixtures | and |
Plant and | and | Motor | computer |
machinery | fittings | vehicles | equipment | Totals |
£ | £ | £ | £ | £ |
COST |
At 1 January 2023 |
Additions |
Disposals | ( |
) | ( |
) |
At 31 December 2023 |
DEPRECIATION |
At 1 January 2023 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
At 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 December 2022 |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements - continued |
for the year ended 31 December 2023 |
13. | FIXED ASSET INVESTMENTS |
Shares in |
group |
undertakings |
£ |
COST |
At 1 January 2023 |
and 31 December 2023 |
NET BOOK VALUE |
At 31 December 2023 |
At 31 December 2022 |
The company's investments in Premier Clothing Limited and RalaTeam BV were transferred to the new holding company Ralawise Group Holdings Limited, by way of an in-specie dividend on 6 January 2022. |
The company's investments at the Statement of Financial Position date in the share capital of companies include the following: |
Registered office: Unit 8, Naas Road Business Park, Muirfield Drive, Naas Road, Dublin 12 |
Nature of business: |
% |
Class of shares: | holding |
Registered office: Castroper Hellweg 109 44805 Bochum, Germany |
Nature of business: |
% |
Class of shares: | holding |
Registered office: Unit 112 Tenth Avenue, Deeside Industrial Park, Deeside, Flintshire, United Kingdom, CH5 2UA |
Nature of business: |
% |
Class of shares: | holding |
Registered office: Strandvejen 343, 2930 Klampenborg, Denmark |
Nature of business: |
% |
Class of shares: | holding |
14. | STOCKS |
2023 | 2022 |
£ | £ |
Goods for resale |
The replacement value of stocks is in the region of £75,000,000 (2022: £82,000,000). |
Stocks of £69,313,859 (2022: £nil) are subject to financing arrangements. |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements - continued |
for the year ended 31 December 2023 |
15. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
£ | £ |
Trade debtors |
Amounts owed by group undertakings |
Other debtors |
Gain on financial derivative | 1,621 | - |
Tax |
VAT |
Prepayments and accrued income |
Amounts owed by group undertakings are unsecured, interest free and repayable on demand. |
Trade debtors of £17,713,733 (2022: £17,153,434) are subject to financing arrangements. |
16. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
£ | £ |
Bank loans and overdrafts (see note 17) |
Other loans (see note 17) |
Trade creditors |
Amounts owed to group undertakings |
Tax |
Social security and other taxes |
VAT | 918,065 | - |
Other creditors |
ABL financing | 34,869,257 | 14,299,473 |
Fair value of derivatives | - | 223,704 |
Directors' current accounts | 650,740 | 600,000 |
Accrued expenses |
Amounts owed to group undertakings are unsecured and repayable on demand. |
17. | LOANS |
An analysis of the maturity of loans is given below: |
2023 | 2022 |
£ | £ |
Amounts falling due within one year or on demand: |
Bank loans |
Other loans | 1,512,226 | 2,191,343 |
Loans owed to group |
undertakings | - | 2,000,000 |
Other loans are from related parties and are unsecured, interest bearing and repayable on demand. |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements - continued |
for the year ended 31 December 2023 |
18. | LEASING AGREEMENTS |
2023 | 2022 |
£ | £ |
Within one year | 1,769,740 | 1,954,078 |
Between one and five years | 5,686,446 | 6,138,304 |
In more than five years | 2,366,058 | 3,499,024 |
9,822,244 | 11,591,406 |
19. | SECURED DEBTS |
The following secured debts are included within creditors: |
2023 | 2022 |
£ | £ |
Bank loans |
ABL Financing | 34,869,257 | 14,299,473 |
The bank hold a debenture dated 31 October 2023 including fixed and floating charges over all assets and undertakings both present and future. |
The ABL financing facility is secured against the company's stock and debtors as detailed in note 14 and 15 respectively. |
The ABL facility is interest bearing, with the Invoice Financing and Stock Financing being base rate plus a margin. The facility end date is 31 October 2026. |
20. | FINANCIAL INSTRUMENTS |
The carrying amounts of the company's financial instruments are as follows; |
2023 | 2022 |
£ | £ |
Financial Instruments that are debt instruments measured at amortised cost: |
Cash at bank | 7,213,495 | 1,886,111 |
Trade receivables | 20,416,485 | 20,272,616 |
Other receivables | 2,566,835 | 3,082,506 |
Amounts owed by group undertakings | 11,963,533 | 12,267,339 |
Financial assets measured at fair value through income statement | 1,621 | - |
Financial liabilities measured at amortised cost: |
Trade creditors | (7,233,040 | ) | (11,515,734 | ) |
Other payables | (5,271,382 | ) | (5,476,552 | ) |
Asset finance loan | - | (107,791 | ) |
ABL financing | (34,869,257 | ) | (14,299,473 | ) |
Bank loan | - | (14,340,627 | ) |
Amounts owed to group undertakings | (760,406 | ) | (2,710,348 | ) |
Loans owed to group undertakings | - | (2,000,000 | ) |
Financial debt instruments measured at fair value through the income statement |
- |
(223,704 |
) |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements - continued |
for the year ended 31 December 2023 |
21. | PROVISIONS FOR LIABILITIES |
2023 | 2022 |
£ | £ |
Deferred tax | 551,155 | 623,866 |
Other provisions |
Dilapidations | 2,915,369 | 2,807,692 |
Other provisions | 16,147 | 13,705 |
2,931,516 | 2,821,397 |
Aggregated amounts | 3,482,671 | 3,445,263 |
Deferred Tax | Other provisions |
£ | £ |
Balance at 1 January 2023 | 623,866 | 2,821,397 |
Charge / (credit) to the Income Statement during the year | (72,711 | ) | 151,507 |
Utilised | - | (41,389 | ) |
551,155 | 2,931,515 |
The deferred tax liability of the company consists of the tax effect of the following: |
2023 |
£ |
Timing differences on fixed assets | 681,656 |
Other short term timing differences | (130,501 | ) |
551,155 |
A provision of £2,915,369 (2022: £2,807,692) has been recognised for the future cost of making good dilapidations on leasehold properties. This expenditure is expected to be incurred when the leases expire in 2027, 2030 and 2031. |
The remaining balance of other provisions, is a provision for leave pay. |
22. | CALLED UP SHARE CAPITAL |
Number: | Class: | Nominal | 2023 |
value: | £ |
2,706,673 | Ordinary | £1 | 2,706,673 |
1,147,500 | A Funding | £1 | 1,147,500 |
1,113,750 | B Funding | £1 | 1,113,750 |
1,113,750 | C Funding | £1 | 1,113,750 |
6,081,673 |
All of the called up share capital is held by the ultimate parent company. |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements - continued |
for the year ended 31 December 2023 |
23. | RESERVES |
Retained earnings represent cumulative profits and losses net of dividends and other adjustments. |
Other reserve represents the amount paid on the allotment of shares in excess of nominal value which arose from restructuring relief. |
Capital redemption reserve comprises the nominal value of shares repurchased by the company. |
Dividends and other distributions are recognised as liabilities in the financial statements in the period in which the dividends and other distributions are approved by the shareholders. These amounts are recognised in the Statements of Changes in Equity. |
24. | ULTIMATE PARENT COMPANY |
Ralawise Group Holdings Limited is regarded by the directors as being the company's ultimate parent company. |
The company is controlled by Mrs E V Batson, Mr J P Batson and Mr J P Batson who are directors of and control Ralawise Group Holdings Limited. |
25. | CONTINGENT LIABILITIES |
The company guarantees the bank borrowings of certain group companies amounting to £nil (2022: £488,389) as at 31 December 2023. |
The company has given indemnities to its bankers covering a Letter of Credit facility. The aggregate value of Letters of Credit open at the year end was £nil (2022: £351,240). |
26. | DIRECTORS' INTEREST IN TRANSACTIONS |
An amount of £650,740 (2022: £600,000) owed to Mr J P Batson and Mr J P Batson, is included within creditors: amounts falling due within one year. The loan is unsecured and repayable on demand. Interest payable to Mr J P Batson and Mr J P Batson in the year amounted to £50,740 (2022: £nil) |
RELATED PARTY DISCLOSURES |
The company has taken advantage of the exemption in FRS 33 'Related Parties' not to disclose transactions with other wholly owned group companies within the group headed by Ralawise Group Holdings Limited. Disclosure has been made below of transactions with related parties. |
2023 | 2022 |
£ | £ |
Sales to entities |
Management recharges receivable from entities | 10,000 | 10,000 |
Other income received | 4,800 | 12,665 |
Other charges paid (including rent) | (1,720,076 | ) | (1,851,184 | ) |
Other interest payable | (124,801 | ) | (230,453 | ) |
Amount due from related parties |
Loans due to related parties | ( |
) | ( |
) |
Ralawise Limited (Registered number: 01362849) |
Notes to the Financial Statements - continued |
for the year ended 31 December 2023 |
26. | DIRECTORS' INTEREST IN TRANSACTIONS - continued |
2023 | 2022 |
£ | £ |
Sales to entities |
Purchases from entities | ( |
) | ( |
) |
Other income received | 20,468 | 29,326 |
Other charges paid | (25,116 | ) | (18,709 | ) |
Amount due from related parties |
Amount due to related parties | ( |
) | ( |
) |