Company registration number 02778086 (England and Wales)
PADLEY & VENABLES LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PADLEY & VENABLES LIMITED
COMPANY INFORMATION
Director
F M Brunner
Company number
02778086
Registered office
Callywhite Lane
Dronfield
S18 2XT
Auditor
BHP LLP
2 Rutland Park
Sheffield
S10 2PD
Business address
Callywhite Lane
Dronfield
S18 2XT
Bankers
National Westminster Bank plc
42 High Street
Sheffield
S1 2GE
PADLEY & VENABLES LIMITED
CONTENTS
Page
Strategic report
1
Director's report
2 - 3
Independent auditor's report
4 - 6
Profit and loss account
7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 28
PADLEY & VENABLES LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The director presents the strategic report for the year ended 31 December 2023.
Review of the business
Our objective is to present a balanced and practical review of the development and performance of our business during the year and its position at the year-end. Our review is intended to reflect the size and nature of our business and is written in the context of the risks and uncertainties we face.
The company is a manufacturer of specialised Bar Steels and Consumable Accessories for use in the Mining and Construction Industries throughout the World. The Company’s activities are organised into two manufacturing divisions – Padley & Venables and Bedford Steels. In summary, the activities of the two divisions can be summarised as follows:-
Bedford Steels
Bedford Steels is a steel re-rolling facility, manufacturing a range of specialised Hollow and Solid Bar Sections for the Mining, Construction and General Engineering Industries. These products are supplied to manufacturers of consumable tools throughout the world.
Padley & Venables
Padley & Venables manufactures consumable tools for the Mining, Quarrying and Construction Industries. These products are divided into three main groups, Rock Drilling Accessories, Tools for boom mounted Breakers and Tools for hand held pneumatic/hydraulic Breakers. These products are marketed throughout the world, under two brand names, "P&V" and "Thomas Turton/Crossbow".
Principal risks and uncertainties
This year has seen a number of challenges and risks to the business. A significant increase in energy cost has needed a fundamental change to standard production hours in the production facilities. Fortunately, the workforce has accepted this as we strive to improve our energy efficiency.
A global downturn in mining and construction activity has resulted in fewer sales and orders. Many mine operators and construction companies have taken this opportunity to run down existing stock levels to improve cash flow. High inflation has continued to cause unease in the workforce as salaries have been under pressure to stay in line, while the April minimum wage increase of 9.8% will add pressure across all industries.
The reduction in raw material and finished stock has improved available cash, which leaves us well positioned for any sudden upturn in Mining and construction sectors.
The company continues to pursue its strategy of continual investment in its employees, product development and plant and equipment in order to keep itself well positioned and ready to react positively to an ever changing environment.
Key performance indicators
We consider that our key financial performance indicators are those that convey the financial performance and strength of the company as a whole, these being turnover, gross margin and return on capital employed.
Turnover decreased to £23.8m (2022: £27.5m), gross profit fell to £2.8m (2022: £5.4m). Return on capital employed reduced by 7% (2022: 4%).
F M Brunner
Director
11 July 2024
PADLEY & VENABLES LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
The director presents his annual report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company is the manufacture of drilling equipment, demolition tools and rolled steel products.
Results and dividends
The results for the year are set out on page 7.
No ordinary dividends were paid. The director does not recommend payment of a final dividend.
Director
The director who held office during the year and up to the date of signature of the financial statements was as follows:
F M Brunner
Auditor
The auditor, BHP LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of director's responsibilities
The director is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The director is 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. He is 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 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.
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
PADLEY & VENABLES LIMITED
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
On behalf of the board
F M Brunner
Director
11 July 2024
PADLEY & VENABLES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PADLEY & VENABLES LIMITED
- 4 -
Opinion
We have audited the financial statements of Padley & Venables Limited (the 'company') for the year ended 31 December 2023 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows 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:
give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its loss 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.
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 director's 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 director with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The director is 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 our audit:
the information given in the strategic report and the director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the director's report have been prepared in accordance with applicable legal requirements.
PADLEY & VENABLES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PADLEY & VENABLES LIMITED (CONTINUED)
- 5 -
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 director's 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 remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of director
As explained more fully in the director's responsibilities statement, the director is 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 director determines 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 director is 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 director either intends to liquidate the company or to cease operations, or has 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.
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
we identified the laws and regulations applicable to the Company through discussions with directors and other management, and from our commercial knowledge and experience of the trade;
we focused on specific laws and regulations which we considered may have a direct material effect on the
financial statements or the operations of the Company;
we assessed the extent of compliance with the laws and regulations considered above through making enquiries of management and inspecting legal correspondence; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
PADLEY & VENABLES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PADLEY & VENABLES LIMITED (CONTINUED)
- 6 -
We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by;
knowledge of actual, suspected and alleged fraud; and
regulations.
To address the risks of fraud through management bias and override controls, we:
performed analytical procedures to identify any unusual or unexpected relationships;
tested journal entries to identify unusual transactions;
assessed whether judgements and assumptions made in determining the accounting estimates were
indicative of potential bias; and
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
agreeing financial statement disclosures to underlying supporting documentation;
reading the minutes of meetings of those charged with governance;
enquiring of management as to actual and potential litigation and claims; and
discussions with senior management regarding relevant regulations and reviewing the company’s legal and
professional fees.
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the director’s and other management and the inspection of regulatory and legal correspondence.
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.
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an 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 members as a body, for our audit work, for this report, or for the opinions we have formed.
Terri Pierpoint
Senior Statutory Auditor
For and on behalf of BHP LLP
12 September 2024
Chartered Accountants
Statutory Auditor
2 Rutland Park
Sheffield
S10 2PD
PADLEY & VENABLES LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
23,816,817
27,526,689
Cost of sales
(20,973,388)
(22,137,225)
Gross profit
2,843,429
5,389,464
Distribution costs
(1,932,184)
(2,451,457)
Administrative expenses
(1,711,289)
(1,879,534)
Operating (loss)/profit
4
(800,044)
1,058,473
Interest receivable and similar income
7
95,405
58,117
Interest payable and similar expenses
8
(25,405)
(Loss)/profit before taxation
(704,639)
1,091,185
Tax on (loss)/profit
9
144,552
(178,512)
(Loss)/profit for the financial year
(560,087)
912,673
The profit and loss account has been prepared on the basis that all operations are continuing operations.
PADLEY & VENABLES LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
2023
2022
£
£
(Loss)/profit for the year
(560,087)
912,673
Other comprehensive income
Revaluation of tangible fixed assets
140,000
Actuarial gain/(loss) on defined benefit pension schemes
8,000
(1,452,000)
Tax relating to other comprehensive income
(2,000)
363,000
Total other comprehensive income for the year
6,000
(949,000)
Total comprehensive income for the year
(554,087)
(36,327)
PADLEY & VENABLES LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
4,076,965
4,890,586
Investment property
12
434,418
434,418
Investments
13
8
8
4,511,391
5,325,012
Current assets
Stocks
14
15,122,304
17,238,137
Debtors
15
5,452,556
8,406,833
Cash at bank and in hand
3,325,009
1,558,115
23,899,869
27,203,085
Creditors: amounts falling due within one year
16
(1,825,449)
(5,281,699)
Net current assets
22,074,420
21,921,386
Total assets less current liabilities
26,585,811
27,246,398
Provisions for liabilities
Deferred tax liability
17
504,000
660,000
(504,000)
(660,000)
Net assets excluding pension surplus
26,081,811
26,586,398
Defined benefit pension surplus
20
1,008,000
1,057,500
Net assets
27,089,811
27,643,898
Capital and reserves
Called up share capital
18
1,600,002
1,600,002
Revaluation reserve
19
140,000
140,000
Profit and loss reserves
25,349,809
25,903,896
Total equity
27,089,811
27,643,898
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
The financial statements were approved and signed by the director and authorised for issue on 11 September 2024
F M Brunner
Director
Company registration number 02778086 (England and Wales)
PADLEY & VENABLES LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
Share capital
Revaluation reserve
Profit and loss reserves
Total
£
£
£
£
Balance at 1 January 2022
1,600,002
26,080,223
27,680,225
Year ended 31 December 2022:
Profit
-
-
912,673
912,673
Other comprehensive income:
Revaluation of tangible fixed assets
-
140,000
-
140,000
Actuarial gains on defined benefit plans
-
-
(1,452,000)
(1,452,000)
Tax relating to other comprehensive income
-
363,000
363,000
Total comprehensive income
-
140,000
(176,327)
(36,327)
Balance at 31 December 2022
1,600,002
140,000
25,903,896
27,643,898
Year ended 31 December 2023:
Loss
-
-
(560,087)
(560,087)
Other comprehensive income:
Actuarial gains on defined benefit plans
-
-
8,000
8,000
Tax relating to other comprehensive income
-
(2,000)
(2,000)
Total comprehensive income
-
-
(554,087)
(554,087)
Balance at 31 December 2023
1,600,002
140,000
25,349,809
27,089,811
PADLEY & VENABLES LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
25
1,758,671
(286,825)
Interest paid
(25,405)
Income taxes refunded/(paid)
13,224
(195,152)
Net cash inflow/(outflow) from operating activities
1,771,895
(507,382)
Investing activities
Purchase of tangible fixed assets
(63,179)
(350,430)
Proceeds from disposal of tangible fixed assets
32,773
15,649
Interest received
25,405
1,117
Net cash used in investing activities
(5,001)
(333,664)
Net increase/(decrease) in cash and cash equivalents
1,766,894
(841,046)
Cash and cash equivalents at beginning of year
1,558,115
2,399,161
Cash and cash equivalents at end of year
3,325,009
1,558,115
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
1
Accounting policies
Company information
Padley & Venables Limited is a private company limited by shares incorporated in England and Wales. The registered office is Callywhite Lane, Dronfield, S18 2XT.
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 on the historical cost convention, modified to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
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.
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.
1.4
Intangible fixed assets - goodwill
Acquired goodwill is written off in equal annual instalments over its estimated useful economic life.
1.5
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:
Freehold land and buildings
2.5% straight line
Land and buildings Leasehold
2.5% straight line
Plant and machinery
5% - 16.6% straight line
Fixtures & fittings
16.6% straight line
Motor vehicles
25% straight line
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.
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
1.6
Investment property
Investment property, which is property held to earn rentals and/or for capital appreciation, is measured using the fair value model and stated at its fair value as the reporting end date. The surplus or deficit on revaluation is recognised in the profit and loss account.
1.7
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.8
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.
1.9
Stocks
Stocks are stated at the lower of cost and net realisable value. Cost is based on standard costing principle with costs reviewed annually with reference to current cost and includes expenditure incurred in acquiring the stocks, production or conversion costs and other costs in bringing them to their existing location and condition. In the case of manufactured stocks and work in progress, cost includes an appropriate share of overheads based on normal operating capacity.
1.10
Cash and cash equivalents
Cash at bank and in hand are basic financial assets and include cash in hand and deposits held at call with banks.
1.11
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.
Basic financial assets
Basic financial assets, which include trade and other receivables 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.
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.
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
Impairment of financial assets
Financial assets 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. The impairment loss 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, 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.
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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.12
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.
1.13
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.
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Deferred tax
Deferred taxation is provided at appropriate rates on all timing differences using the liability method only to the extent that, in the opinion of the director, there is a reasonable probability that a liability or asset will crystallise in the foreseeable future.
1.14
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.
1.15
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
The cost of providing benefits under defined benefit plans is determined separately for each plan using the projected unit credit method, and is based on actuarial advice.
The change in the net defined benefit liability arising from employee service during the year is recognised as an employee cost. The cost of plan introductions, benefit changes, settlements and curtailments are recognised as an expense in measuring profit or loss in the period in which they arise.
The net interest element is determined by multiplying the net defined benefit liability by the discount rate, taking into account any changes in the net defined benefit liability during the period as a result of contribution and benefit payments. The net interest is recognised in profit or loss as other finance revenue or cost.
Remeasurement changes comprise actuarial gains and losses, the effect of the asset ceiling and the return on the net defined benefit liability excluding amounts included in net interest. These are recognised immediately in other comprehensive income in the period in which they occur and are not reclassified to profit and loss in subsequent periods.
The net defined benefit pension asset or liability in the balance sheet comprises the total for each plan of the present value of the defined benefit obligation (using a discount rate based on high quality corporate bonds), less the fair value of plan assets out of which the obligations are to be settled directly. Fair value is based on market price information, and in the case of quoted securities is the published bid price. The value of a net pension benefit asset is limited to the amount that may be recovered either through reduced contributions or agreed refunds from the scheme.
1.16
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to income on a straight line basis over the term of the relevant lease.
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the director is 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
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Stock valuation
In accordance with accounting policy 1.9, stock is based on standard costing. Management apply an uplift to stock valuation on the average stock holding period to account for the surcharges on stock purchased. Due to the economic environment management used a 24 month average to calculate the surcharge uplift as opposed to a 12 month average in the prior period.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by class of business
Sales
23,816,817
27,526,689
2023
2022
£
£
Other revenue
Interest income
95,405
58,117
In the opinion of the directors the disclosure of the geographical analysis of turnover would be seriously prejudicial to the interests of the company. This information has therefore not been disclosed.
4
Operating (loss)/profit
2023
2022
Operating (loss)/profit for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
(196,580)
(403,556)
Fees payable to the company's auditor for the audit of the company's financial statements
34,000
32,880
Depreciation of owned tangible fixed assets
849,030
863,977
Profit on disposal of tangible fixed assets
(5,003)
(15,649)
Operating lease charges
36,221
36,109
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Production
118
128
Selling and administration
61
68
Total
179
196
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
5,983,093
6,669,517
Social security costs
554,484
648,644
Pension costs
137,009
149,218
6,674,586
7,467,379
6
Director's remuneration
2023
2022
£
£
Remuneration for qualifying services
164,974
157,902
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Other interest income
95,405
58,117
8
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
-
25,405
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
254,360
Adjustments in respect of prior periods
(2,092)
Total UK current tax
(2,092)
254,360
Foreign current tax on profits for the current period
31,540
45,152
Total current tax
29,448
299,512
Deferred tax
Origination and reversal of timing differences
(156,000)
(41,000)
Other adjustments
(18,000)
(80,000)
Total deferred tax
(174,000)
(121,000)
Total tax (credit)/charge
(144,552)
178,512
The actual (credit)/charge for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
(Loss)/profit before taxation
(704,639)
1,091,185
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
(165,731)
207,325
Adjustments in respect of prior years
(2,092)
Double tax relief
(45,152)
Other permanent differences
(5,541)
(4,763)
Other tax adjustments
1,001
Foreign tax
31,540
45,152
Effect of change in deferred tax rates
(10,036)
(25,051)
Movements in deferred tax not recognised
(2,408)
Deferred tax charged directly to STRGL
(2,000)
Fixed assets differences
11,716
Taxation (credit)/charge for the year
(144,552)
178,512
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
9
Taxation
(Continued)
- 19 -
In addition to the amount (credited)/charged to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:
2023
2022
£
£
Deferred tax arising on:
Actuarial differences recognised as other comprehensive income
2,000
(363,000)
10
Intangible fixed assets
Goodwill
£
Cost
At 1 January 2023
379,109
Disposals
(379,109)
At 31 December 2023
Amortisation and impairment
At 1 January 2023
379,109
Disposals
(379,109)
At 31 December 2023
Carrying amount
At 31 December 2023
At 31 December 2022
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
11
Tangible fixed assets
Freehold land and buildings
Land and buildings Leasehold
Plant and machinery
Fixtures & fittings
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 January 2023
1,624,744
356,304
13,775,334
1,377,927
375,450
17,509,759
Additions
9,668
22,570
30,941
63,179
Disposals
(56,291)
(56,291)
At 31 December 2023
1,624,744
356,304
13,785,002
1,400,497
350,100
17,516,647
Depreciation and impairment
At 1 January 2023
979,494
198,877
10,302,574
824,892
313,336
12,619,173
Depreciation charged in the year
40,620
8,904
746,911
20,468
32,127
849,030
Eliminated in respect of disposals
(28,521)
(28,521)
At 31 December 2023
1,020,114
207,781
11,049,485
845,360
316,942
13,439,682
Carrying amount
At 31 December 2023
604,630
148,523
2,735,517
555,137
33,158
4,076,965
At 31 December 2022
645,250
157,427
3,472,760
553,035
62,114
4,890,586
12
Investment property
2023
£
Fair value
At 1 January 2023 and 31 December 2023
434,418
Investment property totalling £294,418 was purchased on 11 June 2007. The director believes that the value represents the current market value of the properties at 31 December 2023.
13
Fixed asset investments
2023
2022
Notes
£
£
Investments in subsidiaries
23
8
8
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
14
Stocks
2023
2022
£
£
Raw materials and consumables
7,025,441
8,989,431
Work in progress
2,335,094
2,453,377
Finished goods and goods for resale
5,761,769
5,795,329
15,122,304
17,238,137
15
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
3,502,496
5,178,127
Corporation tax recoverable
54,574
351,606
Amounts owed by group undertakings
1,630,095
2,396,445
Other debtors
109,546
250,688
Prepayments and accrued income
155,845
229,967
5,452,556
8,406,833
16
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
985,960
2,746,488
Amounts owed to group undertakings
1,175,904
Corporation tax
254,360
Other taxation and social security
193,889
209,779
Other creditors
214,850
375,749
Accruals and deferred income
430,750
519,419
1,825,449
5,281,699
17
Deferred taxation
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
2023
2022
Balances:
£
£
ACAs
494,000
650,000
Revaluations
10,000
10,000
504,000
660,000
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
17
Deferred taxation
(Continued)
- 22 -
2023
Movements in the year:
£
Liability at 1 January 2023
660,000
Credit to profit or loss
(156,000)
Liability at 31 December 2023
504,000
18
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
1,600,002
1,600,002
1,600,002
1,600,002
19
Revaluation reserve
2023
2022
£
£
At the beginning of the year
140,000
Revaluation surplus arising in the year
140,000
At the end of the year
140,000
140,000
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
20
Retirement benefits
The group operates a defined benefit pension scheme the assets of which are held in a separate trustee administered fund. A full actuarial valuation of the scheme was carried out as at 5 April 2022.
The valuation used for FRS 102 disclosures has been based on a full assessment of the assets of the scheme as at 31 December 2023.
Amounts recognised in the balance sheet
2023
2022
£000
£000
Fair value of scheme assets
56,980
55,762
Present value of scheme liabilities
(34,740)
(37,088)
Surplus in the scheme
22,240
18,674
Effect of asset ceiling
(20,896)
(17,264)
1,344
1,410
Related deferred tax liability
(336)
(352)
Net pension surplus
1,008
1,058
Amounts recognised in the profit and loss account
2023
2022
£000
£000
Current service cost
180
389
Net interest cost
(70)
(57)
Administrative costs
(36)
(12)
Net pension cost recognised in the profit and loss account
74
320
Amounts recognised in other comprehensive income
2023
2022
£000
£000
Actuarial (gains) losses
(2,088)
(18,549)
Return on scheme assets (excluding interest income)
(689)
16,851
Changes in asset ceiling (excluding interest income)
2,769
3,150
Net (gain)/loss recognised in other comprehensive income
(8)
1,452
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
20
Retirement benefits
(Continued)
- 24 -
Change in scheme assets
2023
2022
£000
£000
Fair value of scheme assets at 1 January
55,762
73,871
Return on scheme assets (excluding interest income)
689
(16,851)
Insurance premiums for risk benefits
(7)
(8)
Member contributions
25
30
Benefits paid
(2,257)
(2,599)
Administrative costs
36
12
Interest income
2,732
1,307
Fair value of scheme assets at 31 December
56,980
55,762
Total return on scheme assets
3,421
(15,544)
Change in scheme liabilities
2023
2022
£000
£000
Scheme liabilities at 1 January
37,088
56,825
Current service cost
180
389
Loss on curtailment/changes/introductions
-
-
Interest cost
1,799
1,000
Member contributions
25
30
Benefits paid
(2,257)
(2,599)
Insurance premiums for risk benefits
(7)
(8)
Actuarial gains
(2,088)
(18,549)
Scheme liabilities at 31 December
34,740
37,088
Principal weighted average actuarial assumptions
Assumptions used to determine the scheme liabilities:
%
%
Discount rate
4.80%
1.80%
Rate of salary increases
3.40%
3.70%
Rate of RPI price inflation
3.40%
3.70%
Rate of CPI price inflation
3.03%
3.31%
Assumptions used to determine the net pension cost:
Discount rate
5.00%
1.45%
Rate of salary increases
3.40%
3.15%
Rate of RPI price inflation
3.40%
3.15%
Rate of CPI price inflation
3.01%
2.15%
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
20
Retirement benefits
(Continued)
- 25 -
Life expectancy assumptions on the post retirement mortality table used to determine benefit obligations:
2023
2022
Years
Years
Member age 65 (current life expectancy)
22.40
22.80
Member age 45 (life expectancy at age 65)
23.90
24.30
2023
2022
Balance sheet reconciliation
£000
£000
Surplus in the scheme at 1 January
1,637
3,409
Recognised in the profit and loss account
(74)
(320)
Amounts recognised in other comprehensive income
8
(1,452)
Surplus in the scheme at 31 December
1,571
1,637
Defined contribution scheme
The company also operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. Employee and employer contributions totalling £Nil (2022: £2,646) were payable to the fund at the year end and are included in creditors.
2023
2022
£000
£000
Charged to profit and loss account
117
140
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 26 -
21
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel is as follows.
2023
2022
£
£
Aggregate compensation
558,235
525,206
2023
2022
£
£
Aggregate sales made to group companies:
Brunner & Lay Inc.
1,868,422
1,944,151
Brunner Canada Inc.
-
1,899
Brunner & Lay Australia Pty
4,723,300
4,209,927
6,591,722
6,205,977
Aggregate purchases from group companies:
Brunner & Lay Inc.
151,021
163,052
Freight recharges:
Brunner & Lay Australia Pty
32,199
49,070
The amounts owed by/ to other group companies at the year end are as follows:
Amounts owed to Padley & Venables Limited by:
2023
2022
£
£
Brunner & Lay Inc.
1,453,034
1,795,539
Brunner & Lay Australia Pty
177,061
600,906
1,630,095
2,396,445
Amounts owed by Padley & Venables Limited to:
2023
2022
£
£
Brunner & Lay Inc.
-
1,173,061
Brunner & Lay Australia Pty
-
2,843
-
1,175,904
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
21
Related party transactions
(Continued)
- 27 -
The company is owed £Nil (2022: £35,404) by the Padley & Venables Pension Fund as at the year end.
In the prior year the company also received a loan from Brunner and Lay Canada for £1,000,000 which was fully repaid in the current year.
22
Ultimate controlling party
The company's ultimate parent undertaking is Brunner & Lay International Limited, a company incorporated in the USA. This is the only group to incorporate the results of the company.
23
Subsidiaries
The company has four subsidiaries at a total cost of investment of £8. The companies, which are registered in England and Wales, are as follows:-
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Indirect
Bedford Rock Drill Components Limited
UK
Ordinary
-
100.00
Crossbow Demolition Tools Limited
UK
Ordinary
-
100.00
Crossbow Rock Drills Limited
UK
Ordinary
-
100.00
Thomas Turton Limited
UK
Ordinary
-
100.00
There is a 100% direct shareholding in each subsidiary listed above.
24
Analysis of changes in net funds
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
1,558,115
1,766,894
3,325,009
PADLEY & VENABLES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 28 -
25
Cash generated from/(absorbed by) operations
2023
2022
£
£
(Loss)/profit for the year after tax
(560,087)
912,673
Adjustments for:
Taxation (credited)/charged
(144,552)
178,512
Finance costs
25,405
Investment income
(25,405)
(1,117)
Gain on disposal of tangible fixed assets
(5,003)
(15,649)
Depreciation and impairment of tangible fixed assets
849,030
863,977
Pension scheme non-cash movement
74,000
320,000
Movements in working capital:
Decrease/(increase) in stocks
2,115,833
(4,309,904)
Decrease/(increase) in debtors
2,657,245
(106,225)
(Decrease)/increase in creditors
(3,202,390)
1,845,503
Cash generated from/(absorbed by) operations
1,758,671
(286,825)
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