Company registration number SC355707 (Scotland)
Robert Cullen Limited
Annual report and financial statements
for the year ended 31 December 2023
Robert Cullen Limited
Company information
Directors
A Maitland
D R MacDonald
R A Kelly
Secretary
D R MacDonald
Company number
SC355707
Registered office
10 Dawsholm Avenue
Dawsholm Industrial Estate
Glasgow
G20 0TS
Auditor
Henderson Loggie LLP
The Vision Building
20 Greenmarket
Dundee
DD1 4QB
Bankers
HSBC
2 Buchanan Street
Glasgow
G1 3LB
Robert Cullen Limited
Contents
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 25
Robert Cullen Limited
Strategic Report
for the year ended 31 December 2023
- 1 -

The directors present the strategic report for the year ended 31 December 2023.

 

The principal activity of the company in the year under review is the manufacture of cardboard boxes, cartons and moulded fibre products.

Review of the business

Robert Cullen Limited (t/a Cullen Sustainable Packaging) is one of the world's leading, innovative, conceptual design and packaging manufacturers. We produce a large range of products for the NHS, Industry, and leading Supermarket chains using both corrugate and moulded fibre. The moulded fibre products are made from 100% recycled paper, are 100% biodegradable, 100% compostable, and produced to the highest standard in a new state-of-the-art plant in Glasgow. Cullen is the only company in the UK that can offer both internal and external packaging manufactured from the same facility.

 

Financial review

The directors are satisfied that the company's trading performance for the year has met expectations. Turnover has remained similar to the prior year at £29.25m in comparison to £29.24m in 2022. The company's gross margin is in line with management expectations.

 

Overall, the company achieved an operating profit of £5.89m (2022 - £5.39m).

 

The company's net profit for the year after taxation was £4.58m (2022 - £4.06m).

 

Financial Key Performance Indicators (KPIs)

The directors use KPIs of gross and net profit margins to review the company's performance during the year. KPIs were in line with expectations.

Principal risks and uncertainties

 

Financial Risk Management

Trading activities and major capital expenditure are financed through a mix of cash reserves, hire purchase and finance leasing together with bank borrowings and related party loans. The company strictly monitors working capital.

 

Competitive Risk Assessment

The company operates in a competitive environment; however the directors believe that the company, through its continued investment in new products and technology is well placed to continue developing its market share.

 

Environmental Risk Assessment

The directors recognise the company's environmental responsibilities and increasing legislation in this area.

 

The company complies with relevant legislation and also strives to ensure that environmental best practices are adopted. Our mission is to produce the most efficient eco-friendly packaging possible, maximising the natural resources we have available. Global manufacturers see moulded fibre, made from 100% recycled paper, as the most environmentally responsible method of achieving this. Our innovative approach to building our business has seen Cullen patent several new technological processes and designs including recycling the heat and water we use to reduce our effect on the environment and recycling the waste from our corrugated box production to produce recyclable moulded fibre articles ensuring nothing is wasted.

 

Robert Cullen Limited was the first packaging company in the UK to have the EU compostability certificate EN13432.

Robert Cullen Limited
Strategic Report (continued)
for the year ended 31 December 2023
- 2 -
Development and performance

The inevitable increase in costs in all areas of the business coupled with the continued uncertainty in the global economy has brought new challenges and the company appreciates the need to be flexible to meet these challenges.

 

The main uncertainties facing the company are the extent to which competitors can gain market share from the company's target markets together with the future costs of paper, labour, energy and fuel.

 

We have seen strong performance in packaging solutions for products that have experienced increased demand from an environmental sustainability perspective and we have had further success in adapting the product range to meet market demands.

On behalf of the board

D R MacDonald
Director
25 September 2024
Robert Cullen Limited
Directors' report
for the year ended 31 December 2023
- 3 -

The directors present their annual report and financial statements for the year ended 31 December 2023.

Principal activities

The principal activity of the company continued to be that of the manufacture of cardboard boxes, cartons and moulded fibre products.

Results and dividends

The results for the year are set out on page 9.

Ordinary dividends were paid amounting to £2,000,000. The directors do not recommend payment of a further dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

A Maitland
D R MacDonald
R A Kelly
Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

Strategic report

Included within the strategic report is an indication of the principal risks and uncertainties including the risks associated with the market conditions, competition and legislative and compliance risks.

On behalf of the board
D R MacDonald
Director
25 September 2024
Robert Cullen Limited
Directors' responsibilities statement
for the year ended 31 December 2023
- 4 -

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

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.

Robert Cullen Limited
Independent auditor's report
to the member of Robert Cullen Limited
- 5 -
Opinion

We have audited the financial statements of Robert Cullen Limited (the 'company') for the year ended 31 December 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including 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:

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 Auditor's 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 annual report 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.

Robert Cullen Limited
Independent auditor's report (continued)
to the member of Robert Cullen Limited
- 6 -

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the 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:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, 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.

Auditor's 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 these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud, are detailed below.

Robert Cullen Limited
Independent auditor's report (continued)
to the member of Robert Cullen Limited
- 7 -

As part of our planning process:

 

The key procedures we undertook to detect irregularities including fraud during the course of the audit included:

 

Owing to the inherent limitations of an audit, there is an unavoidable risk that some material misstatements in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK). For instance, the further removed non-compliance is from the events and transactions reflected in the financial statements, the less likely the auditor is to become aware of it or to recognise the non-compliance.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

 

 

 

 

 

 

 

 

 

 

 

 

Robert Cullen Limited
Independent auditor's report (continued)
to the member of Robert Cullen Limited
- 8 -

Use of our report

This report is made solely to the company's member 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 member those matters we are required to state to the member in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's member, for our audit work, for this report, or for the opinions we have formed.

Gavin Black
Senior Statutory Auditor
For and on behalf of Henderson Loggie LLP
25 September 2024
Chartered Accountants
Statutory Auditor
The Vision Building
20 Greenmarket
Dundee
DD1 4QB
Robert Cullen Limited
Statement of comprehensive income
for the year ended 31 December 2023
- 9 -
2023
2022
Notes
£
£
Turnover
3
29,250,022
29,236,464
Cost of sales
(19,102,182)
(19,720,165)
Gross profit
10,147,840
9,516,299
Administrative expenses
(4,262,839)
(4,126,655)
Operating profit
4
5,885,001
5,389,644
Interest receivable and similar income
7
155,684
-
0
Interest payable and similar expenses
8
(277,936)
(202,178)
Profit before taxation
5,762,749
5,187,466
Tax on profit
9
(1,180,780)
(1,124,338)
Profit for the financial year
4,581,969
4,063,128

The profit and loss account has been prepared on the basis that all operations are continuing operations.

Robert Cullen Limited
Balance sheet
as at 31 December 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
11
7,300
11,965
Tangible assets
12
7,914,497
7,266,893
7,921,797
7,278,858
Current assets
Stocks
13
942,449
1,019,924
Debtors
14
6,274,496
6,301,216
Cash at bank and in hand
6,452,134
3,322,298
13,669,079
10,643,438
Creditors: amounts falling due within one year
15
(5,626,002)
(4,557,051)
Net current assets
8,043,077
6,086,387
Total assets less current liabilities
15,964,874
13,365,245
Creditors: amounts falling due after more than one year
16
(3,020,321)
(3,294,170)
Provisions for liabilities
Deferred tax liability
19
(1,025,055)
(733,546)
(1,025,055)
(733,546)
Net assets
11,919,498
9,337,529
Capital and reserves
Called up share capital
21
2
2
Profit and loss reserves
22
11,919,496
9,337,527
Total equity
11,919,498
9,337,529
The financial statements were approved by the board of directors and authorised for issue on 25 September 2024 and are signed on its behalf by:
D R MacDonald
Director
Company Registration No. SC355707
Robert Cullen Limited
Statement of changes in equity
for the year ended 31 December 2023
- 11 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 January 2022
2
5,274,399
5,274,401
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
4,063,128
4,063,128
Balance at 31 December 2022
2
9,337,527
9,337,529
Year ended 31 December 2023:
Profit and total comprehensive income for the year
-
4,581,969
4,581,969
Dividends
10
-
(2,000,000)
(2,000,000)
Balance at 31 December 2023
2
11,919,496
11,919,498
Robert Cullen Limited
Notes to the financial statements
for the year ended 31 December 2023
- 12 -
1
Accounting policies
Company information

Robert Cullen Limited is a private company limited by shares incorporated in Scotland. The registered office is 10 Dawsholm Avenue, Dawsholm Industrial Estate, Glasgow, G20 0TS.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

 

 

The financial statements of the company are consolidated in the financial statements of Robert Cullen Holdings Limited. These consolidated financial statements are available from its registered office.

1.2
Going concern

At the time of approving the financial statements, the directors have not identified any material uncertainty in respect of going concern and therefore have a reasonable expectation that the company has adequate resources to continue in operational existence for at least 12 months from the date of approval of the financial statements. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.true

1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Robert Cullen Limited
Notes to the financial statements (continued)
for the year ended 31 December 2023
1
Accounting policies (continued)
- 13 -
1.4
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and has been fully amortised in prior periods.

1.5
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

 

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Patents & licences
10% on a straight line basis
1.6
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Heritable property
2-10% on a straight line basis
Plant and equipment
10-25% on a straight line basis
Motor vehicles
25% on a reducing balance basis
Fibre moulds
25% on a straight line basis

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

1.7
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Robert Cullen Limited
Notes to the financial statements (continued)
for the year ended 31 December 2023
1
Accounting policies (continued)
- 14 -

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.8
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.9
Cash and cash equivalents

Cash at bank and in hand are basic financial assets and include cash in hand, deposits held at call with banks, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.10
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Robert Cullen Limited
Notes to the financial statements (continued)
for the year ended 31 December 2023
1
Accounting policies (continued)
- 15 -
Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors and bank loans, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Robert Cullen Limited
Notes to the financial statements (continued)
for the year ended 31 December 2023
1
Accounting policies (continued)
- 16 -
Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.11
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

1.12
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.13
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.14
Retirement benefits

The company operates a defined contribution scheme for the benefit of its employees. The assets of the scheme are held separately from those of the company in an independently administered fund. Contributions payable are charged to the profit and loss account in the year they are payable.

Robert Cullen Limited
Notes to the financial statements (continued)
for the year ended 31 December 2023
1
Accounting policies (continued)
- 17 -
1.15
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

1.16
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Critical judgements
Stock

In arriving at the valuation of stock it may be necessary for management to make an assessment over the carrying value of stock items and, where applicable, apply a provision to amend this carrying value to a more accurate level. These provisions are arrived at using management's knowledge and understanding of the business and the industry in which it operates and focuses on potentially obsolete or old items for which the full value may no longer be recoverable.

Robert Cullen Limited
Notes to the financial statements (continued)
for the year ended 31 December 2023
- 18 -
3
Turnover and other revenue
2023
2022
£
£
Other significant revenue
Interest income
155,684
-
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
26,516,602
26,139,512
Europe
2,489,820
2,712,153
RoW
243,600
384,799
29,250,022
29,236,464

The turnover and profit before taxation are attributable to the one principal activity of the company.

4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
60
(8,076)
Fees payable to the company's auditor for the audit of the company's financial statements
17,375
16,550
Depreciation of owned tangible fixed assets
711,346
800,755
Depreciation of tangible fixed assets held under finance leases
174,324
174,324
Amortisation of intangible assets
4,665
4,665
Operating lease charges
91,597
79,629
5
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2023
2022
Number
Number
Total
164
158
Robert Cullen Limited
Notes to the financial statements (continued)
for the year ended 31 December 2023
5
Employees (continued)
- 19 -

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
5,576,317
4,982,457
Social security costs
562,429
516,104
Pension costs
190,170
226,843
6,328,916
5,725,404
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
162,794
141,066
Company pension contributions to defined contribution schemes
76,000
76,000
238,794
217,066

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2022 - 3).

The directors are deemed to be key management personnel.

7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
155,684
-
0
8
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
173,853
94,340
Interest on finance leases and hire purchase contracts
22,567
22,787
Other interest
81,516
85,051
277,936
202,178
Robert Cullen Limited
Notes to the financial statements (continued)
for the year ended 31 December 2023
- 20 -
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
1,197,822
965,726
Adjustments in respect of prior periods
(308,552)
(75,439)
Total current tax
889,270
890,287
Deferred tax
Origination and reversal of timing differences
334,700
247,963
Adjustment in respect of prior periods
(43,190)
(13,912)
Total deferred tax
291,510
234,051
Total tax charge
1,180,780
1,124,338

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Profit before taxation
5,762,749
5,187,466
Expected tax charge based on the standard rate of corporation tax in the UK of 24% (2022: 19%)
1,355,399
985,619
Tax effect of expenses that are not deductible in determining taxable profit
27,354
8,231
Depreciation on assets not qualifying for tax allowances
11,727
171,366
Deferred tax adjustments in respect of prior years
(43,190)
(10,573)
Finance lease depreciation credits
(9,390)
(11,038)
Effect of change in deferred tax rate
5,887
56,172
R&D tax credits
(167,007)
(75,439)
Taxation charge for the year
1,180,780
1,124,338
10
Dividends
2023
2022
£
£
Final paid
2,000,000
-
0
Robert Cullen Limited
Notes to the financial statements (continued)
for the year ended 31 December 2023
- 21 -
11
Intangible fixed assets
Goodwill
Patents & licences
Total
£
£
£
Cost
At 1 January 2023 and 31 December 2023
1
56,414
56,415
Amortisation and impairment
At 1 January 2023
1
44,449
44,450
Amortisation charged for the year
-
0
4,665
4,665
At 31 December 2023
1
49,114
49,115
Carrying amount
At 31 December 2023
-
0
7,300
7,300
At 31 December 2022
-
0
11,965
11,965
12
Tangible fixed assets
Heritable property
Assets under construction
Plant and equipment
Motor vehicles
Fibre moulds
Total
£
£
£
£
£
£
Cost
At 1 January 2023
2,391,387
2,299,453
11,688,399
35,774
302,818
16,717,831
Additions
-
0
822,317
519,573
-
0
191,384
1,533,274
At 31 December 2023
2,391,387
3,121,770
12,207,972
35,774
494,202
18,251,105
Depreciation and impairment
At 1 January 2023
717,683
-
0
8,603,441
2,236
127,578
9,450,938
Depreciation charged in the year
49,857
-
0
765,789
8,384
61,640
885,670
At 31 December 2023
767,540
-
0
9,369,230
10,620
189,218
10,336,608
Carrying amount
At 31 December 2023
1,623,847
3,121,770
2,838,742
25,154
304,984
7,914,497
At 31 December 2022
1,673,704
2,299,453
3,084,958
33,538
175,240
7,266,893

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

2023
2022
£
£
Plant and equipment
1,092,114
1,266,437
Robert Cullen Limited
Notes to the financial statements (continued)
for the year ended 31 December 2023
- 22 -
13
Stocks
2023
2022
£
£
Raw materials and consumables
250,352
435,871
Work in progress
107,931
96,202
Finished goods and goods for resale
584,166
487,851
942,449
1,019,924
14
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
5,101,303
5,724,481
Amounts owed by group undertakings
43,332
43,332
Prepayments and accrued income
1,129,861
533,403
6,274,496
6,301,216
15
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans
17
158,504
164,775
Obligations under finance leases
18
347,786
373,779
Trade creditors
1,729,437
1,668,922
Corporation tax
1,031,515
890,288
Other taxation and social security
722,384
480,879
Other creditors
1,305,891
840,971
Accruals and deferred income
330,485
137,437
5,626,002
4,557,051
16
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
17
2,208,787
2,348,709
Obligations under finance leases
18
211,534
345,461
Other creditors
600,000
600,000
3,020,321
3,294,170
Robert Cullen Limited
Notes to the financial statements (continued)
for the year ended 31 December 2023
16
Creditors: amounts falling due after more than one year (continued)
- 23 -
Amounts included above which fall due after five years are as follows:
Payable by instalments
1,505,846
1,580,902
17
Loans and overdrafts
2023
2022
£
£
Bank loans
2,367,291
2,513,484
Payable within one year
158,504
164,775
Payable after one year
2,208,787
2,348,709

The bank term loans and overdraft facility are secured by a bond and floating charge over the company's assets and undertakings and by a standard security over the company's heritable property.

 

The company is also a party to a cross-guarantee with Robert Cullen Holdings Limited.

The bank term loan amounted to £2,367,291 (2022 - £2,513,484) at year end. £2,200,000 was advanced in 2018 and is repayable over 15 years. The loan is repayable on a monthly capital and interest basis with the final repayment due to be made in February 2033. Interest is charged at 2.7% above bank base rate. A new £900,000 loan was advanced in 2022 and is repayable over 12 years. The loan is repayable on a monthly capital and interest basis with the final repayment due to be made in March 2034. Interest is charged at 2.2% above bank base rate.

Other loans amounted to £1,905,891 (2022 - £1,440,971) at the year end, being amounts owed to a related party. Interest is charged on this loan at 4.25%. There are no set repayment terms for the loan advanced, however £600,000 is deemed to be due in more than one year with the balance remaining due in less than one year.

18
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
347,786
373,779
In two to five years
211,534
345,461
559,320
719,240

Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 4.5 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

 

The leases are secured against the assets concerned.

Robert Cullen Limited
Notes to the financial statements (continued)
for the year ended 31 December 2023
- 24 -
19
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
1,069,285
748,396
Other
(44,230)
(14,850)
1,025,055
733,546
2023
Movements in the year:
£
Liability at 1 January 2023
733,546
Charge to profit or loss
291,509
Liability at 31 December 2023
1,025,055
20
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
190,170
226,843

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

21
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
2
2
2
2

The ordinary shares carry full ownership, voting and dividend rights.

22
Profit and loss reserves

Profit and loss reserves include all current and prior period retained profits and losses.

Robert Cullen Limited
Notes to the financial statements (continued)
for the year ended 31 December 2023
- 25 -
23
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2023
2022
£
£
Within one year
90,806
86,630
Between two and five years
132,334
202,563
223,140
289,193
24
Capital commitments

Amounts contracted for but not provided in the financial statements:

2023
2022
£
£
Acquisition of tangible fixed assets
693,000
750,499
25
Related party transactions
Transactions with related parties

During the year the company entered into the following transactions with related parties:

Advertising
2023
2022
£
£
Other related parties
-
50,000

The following amounts were outstanding at the reporting end date:

2023
2022
Amounts due to related parties
£
£
Loan balance
1,905,891
1,440,971
Interest accrued on loan
176,920
95,404
26
Ultimate controlling party

The company is a wholly owned subsidiary of Robert Cullen Holdings Limited. The ultimate controlling party of Robert Cullen Holdings Limited is D R MacDonald.

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