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UC BUILD LIMITED |
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STRATEGIC REPORT |
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FOR YEAR ENDED 31 DECEMBER 2023 |
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The directors present their strategic report for the year ended 31 December 2023. |
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UC Build Limited is a construction company operating across the UK in various sectors including Retail, Living Space, Hospitality, Commercial and Distribution and are specialist in Construction Management, Design and Build and Traditional Contracting. |
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REVIEW OF THE BUSINESS |
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The business saw a small reduction in turnover from 2022 of 0.97% to £22,327,534 with an overall operating profit of £942,605 representing 4.2% (2022 - 7.1%), as a result of an increase in tendered opportunities and working with new clients which provided lower margins and also a reduction in Construction Management projects to more Design and Build. Going forward the plan is to work on more Design and Build and increase the client based. The forecast turnover for 2024 is £42M and similar for 2025 with a marginal increase in the Gross Profit from the fixed element of the business salaries covered by a increased turnover. Investment has been made over the last two years to put the company into a position to substantially increase turnover. The directors took advantage of the higher interest rates and deposited funds into term deposit accounts paying interest rates of 4% which generated interest of £90,578 in the year. This resulted in an overall profit before tax of £1,033,183 and a profit after tax of £783,131. The directors proposed dividends of £510,000 being 66% of the profit after tax to retain 34% within the business.
The Balance Sheet has increased in value by £273,131 (2022 £ 579,594) and it has been the Directors policy to retain at least 25% of the retained profits each year to support the continued growth planned in the company and to remove any requirement for external funding. The Directors plans are to run the projects with a positive cash flow which has been maintained except for a couple of projects where the Employers agents/PQS were slow to deal with applications but on the whole this has been maintained. This did not affect cash flow though as there are always significant reserves to cover and late approvals or applications/invoices along with higher terms than normal from new clients.
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PRINCIPAL RISKS AND UNCERTAINTIES |
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Margin Erosion :- As the market hardens the directors are expending a slight improvement in margins for 2024 from the increased turnover and economies of scale. The increased business coming from working with new clients and larger projects generally with the reduction in smaller works. Resources : the company has maintained and supported staff and marginally increased numbers and additionally made use of contract staff to fill the busy periods when there are more projects on but these are in an operational basis rather than managerial or supervisory. This is expected to continue and recruit additional staff as the preference is to utilise full time staff employed by the company rather than appoint contractors for short term periods but this does depend on the trend of the work over the year. With the change in client basis it has been important to maintain staff with the skills required for those clients so there has been some change in the staff with some of them moving away and being replaced with staff capable to support the new projects.
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ON BEHALF OF THE BOARD: |
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Mr R Carpenter |
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Financial Director |
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Date: 24 September 2024 |
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UC BUILD LIMITED |
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DIRECTORS' REPORT |
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FOR THE YEAR ENDED 31 DECEMBER 2023 |
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The directors present their report and the audited financial statements of the company for the year ended 31 December 2023. |
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PRINCIPAL ACTIVITIES |
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The principal activities of the company is project management and construction of buildings. |
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FUTRUE DEVELOPMENTS |
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The Company continues to main a good position within the industry as a contractor with strong relationships with their customers and the ability to bring on new customers. The Directors expect the Company turnover to grow from 2023 to £40M+ in 2024 and marginally increase margins from economies of scale. |
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FINANCIAL INSTRUMENT RISK |
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The Company has no risk or exposure under Financial Instruments in respect of currency, credit, interest rate risk and liquidity risk. |
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RESULTS AND DIVIDENDS |
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Dividends paid during the year amounted to £510,000 (2022: £575,000). No final dividends are proposed. |
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2023 |
2022 |
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£ |
£ |
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Profit after tax for the year |
783,131 |
1,305,167 |
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Interim dividends |
510,000 |
575,000 |
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DIRECTORS |
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The directors who served during the year were as follows: |
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Mr R Carpenter |
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Mr D Underwood |
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Mr R Gott |
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Mr A Turner |
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FINANCIAL INSTRUMENTS |
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The Company has no risk or exposure under Financial Instruments in respect of currency, credit, interest rate risk and liquidity risk. |
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POST BALANCE SHEET EVENTS |
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There were no Post Balance Sheet events that affect the understanding of these financial statements. |
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EMPLOYEES |
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The Company has a recruitment policy to ensure that all applications for employment, including those made by disabled persons, are given full and fair consideration in light of the applicants' aptitudes and abilities. There is also an equal opportunities policy to ensure that all employees are treated equally in terms of employment, training, career development and promotion. Where employees develop a disability during their employment, every effort is made to continue their employment and arrange for appropriate training as far as is reasonably practicable |
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STATEMENT OF DIRECTORS RESPONSIBILITY |
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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 on a going concen basis. 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 FRS 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 and profit or loss of the Company for that period. In preparing these financial statements, the directors are required to:
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The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company 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. |
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The directors are responsible for the maintenance and integrity of the corporate and financial information included on the company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. |
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DISCLOSURE OF INFORMATION TO AUDITOR |
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The directors of the company who held office on the date of approval of the annual report confirm that:
a) so far as each director is aware, there is no relevant audit information ( information needed by the company's auditors in connection with preparing their report) of which the Company's are unaware, and b) they have taken all the steps that they ought to have taken as directors in order to make themselves aware of any relevant audit information and to establish that the Company's auditors are aware of that information.
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AUDITOR |
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The auditor A4G Audit Limited, was removed as auditor and the auditors Magee Gammon were appointed in accordance with section 485 of the Companies Act 2006. |
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Opinion |
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We have audited the financial statements of UC Build Limited (the 'company') for the year ended 31st December 2023 which comprise the Statement of Income, the Statement of Financial Activities, the Statement of Cash Flows, the Statement of Changes in Total 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 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 31st 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.
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Basis for opinion |
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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.
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Conclusions relating to going concern |
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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.
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Other information |
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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.
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Opinions on other matters prescribed by the Companies Act 2006 |
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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.
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Matters on which we are required to report by exception |
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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.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
- adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or - the financial statements are not in agreement with the accounting records and returns; or - certain disclosures of directors' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit.
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Responsibilities of directors |
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As explained more fully in the Directors' Responsibilities Statement set out on page 5, 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 is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
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Auditors' responsibilities for the audit of the financial statements |
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Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a 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.
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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: |
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Capability of the audit in detecting irregularities including fraud |
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Based on our understanding of the company, we have considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006. We evaluated management incentives and opportunities for fraudulent manipulation of the financial statements including management override, and considered that the principal risk was related to the posting of inappropriate journal entries to improve the result before tax for the year.
We designed audit procedures to respond to the risk, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion.
Procedures performed by the audit team included:
-Discussions with management regarding known or suspected instances of non compliance with laws and -regulations; -Evaluation of controls designed to prevent and detect irregularities; and -Assessing journal entries as part of our planned audit approach.
There are inherent limitations in the audit procedures described above, and the further removed non compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. As in all of our audits we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to 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.
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Use of our report |
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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.
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Joshua Conlon FCCA ( Senior Statutory Auditor) |
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for and on behalf of Magee Gammon Corporate Limited |
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Chartered Accountants Statutory Auditors Henwood House Henwood Ashford Kent TN24 8DH |
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24 September 2024 |
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UC BUILD LIMITED |
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Company registered number: 10382117 |
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STATEMENT OF FINANCIAL POSITION AT 31 December 2023 |
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Note |
2023 |
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2022 |
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£ |
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FIXED ASSETS |
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Property, plant and equipment |
7 |
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44,430 |
15,649 |
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CURRENT ASSETS |
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Debtors |
8 |
3,784,882 |
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3,136,836 |
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Cash at bank and in hand |
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5,914,947 |
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7,063,789 |
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9,699,829 |
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10,200,625 |
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CREDITORS: Amounts falling due within one year |
9 |
5,651,789 |
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6,405,070 |
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NET CURRENT ASSETS |
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4,048,040 |
3,795,555 |
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TOTAL ASSETS LESS CURRENT LIABILITIES |
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4,092,470 |
3,811,204 |
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PROVISIONS FOR LIABILITIES |
11 |
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(11,110) |
(2,975) |
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NET ASSETS |
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£4,081,360 |
£3,808,229 |
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CAPITAL AND RESERVES |
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Called up share capital |
12 |
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1,000 |
1,000 |
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Retained earnings |
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4,080,360 |
3,807,229 |
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SHAREHOLDERS' FUNDS |
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£4,081,360 |
£3,808,229 |
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The directors acknowledge their responsibilities for: |
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1) ensuring that the company keeps accounting records which comply with Sections 386 and 386 of the Companies Act 2006, and |
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2) preparing financial statements that give a true and fair view of the state of affairs of the company at the end of each financial year and of its profit or loss for the financial year in accordance with the requirements of Sections 394 and 395 and which otherwise comply with the requirements of the Companies Act 2006 relating to the financial statements, so far as they are applicable to the company. |
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UC BUILD LIMITED |
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STATEMENT OF CASH FLOWS |
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FOR THE YEAR ENDED 31 DECEMBER 2023 |
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2023 |
2022 |
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£ |
£ |
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Cash flows from operating activities |
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Profit before taxation |
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1,033,183 |
1,623,523 |
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Adjusted for: |
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Depreciation and amortisation |
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6,677 |
15,750 |
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Loss on sale of property, plant and equipment |
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4,483 |
- |
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Investment income |
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(90,578) |
- |
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(Increase)/Decrease in trade and other receivables |
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(648,046) |
8,268,008 |
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Decrease in trade and other payables |
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(681,776) |
(4,359,538) |
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Cash generated from operations |
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(376,057) |
5,547,743 |
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Income taxes paid |
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(313,422) |
(183,952) |
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Net cash generated from operating activities |
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(689,479) |
5,363,791 |
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Cash flows from investing activities |
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Interest received |
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90,578 |
- |
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Purchase of property, plant and equipment |
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(43,941) |
- |
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Sale of property, plant and equipment |
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4,000 |
- |
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Net cash from investing activities |
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50,637 |
- |
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Cash flows from financing activities |
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Dividends paid |
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(510,000) |
(575,000) |
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Net cash used in financing activities |
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(510,000) |
(575,000) |
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Net (decrease)/increase in cash and cash equivalents |
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(1,148,842) |
4,788,791 |
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Cash and cash equivalents at the beginning of the year |
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7,063,789 |
2,274,998 |
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Cash and cash equivalents at the end of the year |
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5,914,947 |
7,063,789 |
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1b. |
Basis of accounting |
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These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. |
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The financial statements have been prepared under the historical cost convention. The presentation currency is £ sterling. |
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1c. |
Basic financial assets |
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Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised. |
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1d. |
Basic financial liabilities |
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Basic financial liabilities, including creditors 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 payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised. |
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4. |
DIRECTORS AND EMPLOYEES |
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Employee costs during the year amounted to: |
2023 |
2022 |
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£ |
£ |
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Wages and salaries |
1,345,109 |
1,016,921 |
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Pension costs |
127,784 |
104,032 |
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£1,472,893 |
£1,120,953 |
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The average weekly number of employees during the year were as follows: |
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2023 |
2022 |
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No. |
No. |
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Management and administration |
25 |
23 |
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Directors' remuneration: |
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2023 |
2022 |
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£ |
£ |
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Remuneration |
373,988 |
335,196 |
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Employees |
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The Company operates a defined contribution pension scheme for the benefit of the employees and directors. The assets of the scheme are administered by an independent pensions provider. Pension payments recognised as an expense during the year amount to £127,784 (2022 - £104,032). |
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The Average number of employees including directors during the year was as follows;- |
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'2023 |
'2022 |
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Construction |
16 |
14 |
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Administration |
9 |
9 |
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Total |
25 |
23 |
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Directors Remuneration |
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The aggregate remuneration of the directors was £373,988 (2022: £335,196). The Company paid £30,000 (2022: £17,000) into defined contribution pension. During the year retirement benefits accrued to two directors (2022: two) in respect of defined contribution pension. The Highest paid director received remuneration of £143,158 (2022 : £124,043).
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6. |
TAX ON PROFIT ON ORDINARY ACTIVITIES |
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2023 |
2022 |
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£ |
£ |
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UK Corporation tax |
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Current tax on profits for the year |
242,798 |
308,469 |
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Impact of adjustments |
7,172 |
12,878 |
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Deferred tax |
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Origination and reversal of timing differences |
7,198 |
(2,991) |
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Changes to tax rates |
937 |
- |
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258,105 |
318,356 |
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Adjustment of current taxation in respect of prior years |
(8,053) |
- |
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£250,052 |
£318,356 |
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Factors that may affect future tax charges |
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In the 2021 Spring Budget, the Government announced that from 1 April 2023 the corporation tax rate will increase to 25%. This was substantively enacted in 2021 and is therefore used to measure UK deferred taxes in both 2021 and 2022, to the extent the related timing differences are expected to reverse in 2023 or later. |
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UK corporation tax has been charged at 23.5% |
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17. |
RELATED PARTY TRANSACTIONS |
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During the year the company made sales of £84,788 (2022 £173,930) and received fees of £ 111,134 (paid fees of £ 851,423) and was charged costs of £ 50,785 to/from UC Build (North) Limited, a company in which the four directors have a controlling interest. |
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These transactions were carried out at arms length and the balance outstanding to the company at the year end amounted to £ 16,807 (2022 £ 423,517). |
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During the year two advances were made to one of the directors Adam Turner for £ 50,000 on 16th March 2023 and a further £ 11,000 on 21st June 2023. The interest charged was 2.75% and represented a short term loan. This was repaid, with the interest on 29th July 2024. |
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CONTROLLING PARTY |
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No individual shareholder holds a majority of voting rights. Therefore, there is no parent entity or ultimate controlling party by virtue of shareholdings. |