Company registration number 06005766 (England and Wales)
PET FOOD BRANDS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PET FOOD BRANDS LIMITED
COMPANY INFORMATION
Directors
Hans-Jurgen Deuerer
Anthony Raeburn
Company number
06005766
Registered office
Brentwood House
Lower Philips Road
Whitebirk Industrial Estate
Blackburn
Lancashire
BB1 5UD
Auditor
Taylor Viney & Marlow Limited
46-54 High Street
Ingatestone
Essex
CM4 9DW
PET FOOD BRANDS LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Statement of income and retained earnings
7
Balance sheet
8 - 9
Notes to the financial statements
10 - 21
PET FOOD BRANDS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Review of the business
Pet Food Brands Limited is an intermediate holding company. Its' direct subsidiary, Pets Choice Limited, manufactures and distributes a wide range of pet foods and related products. Pet Food Brands Limited owns land and buildings and intangible assets used in the business of Pets Choice Limited for which it receives a management charge and royalties.
The key financial performance indicators of the company were as follows;
The principal risks and uncertainties facing the business include:
- Regional market fluctuations in values of commercial property. The properties are located in Blackburn, a region experiencing ongoing investment and improved transport links have brought the city of Manchester closer which should mean properties hold their value in the long term.
- Sustainability and climate change. The land and buildings added during the year have been constructed with the Green revolution in mind.
- Access to tenants. The land and buildings are used in the business of Pets Choice Limited which has traded successfully for a number of years.
- Brand reputation. The intangibles owned by the company are used in the business of Pets Choice Limited which manufactures and sells various branded products. There is the risk that despite the group's implementation of procedures to ensure it meets necessary guidelines and regulations covering manufacture there is a risk of an adverse event that damages brand image.
- Access to credit. The continued growth and expansion of the group's operations increases demand for credit. The group's financial position remains sufficiently strong and key personnel within the group continue to focus on working capital management.
Anthony Raeburn
Director
16 August 2024
PET FOOD BRANDS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
The directors present their report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company continued to be that of a holding company.
Results and dividends
The results for the year are set out on page 7.
Interim dividends were paid amounting to £500,130. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Hans-Jurgen Deuerer
Anthony Raeburn
Auditor
The auditor, Taylor Viney & Marlow Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Energy and carbon report
As the company has not consumed more than 40,000 kWh of energy in this reporting period, it qualifies as a low energy user under these regulations and is not required to report on its emissions, energy consumption or energy efficiency activities. The company's subsidiary, Pets Choice Ltd, has made the relevant report.
Statement of directors' responsibilities
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:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
PET FOOD BRANDS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
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.
On behalf of the board
Anthony Raeburn
Director
16 August 2024
PET FOOD BRANDS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF PET FOOD BRANDS LIMITED
- 4 -
Opinion
We have audited the financial statements of Pet Food Brands Limited (the 'company') for the year ended 31 December 2023 which comprise the statement of income and retained earnings, the balance sheet 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 profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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.
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.
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 directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
PET FOOD BRANDS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF PET FOOD BRANDS 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 directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the 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 extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
We gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates, and considered the risk of acts by the company that were contrary to applicable laws and regulations, including fraud. We designed audit procedures to respond to the risk, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. Audit staff with sufficient knowledge and expertise to identify non-compliance with laws and regulations were deployed on the audit.
Our tests included agreeing the financial statement disclosures to underlying supporting documentation and enquiries with management. We did not identify any key audit matters relating to irregularities, including fraud.
We focussed on laws and regulations which could give rise to a material misstatement in the financial statements, including, but not limited to, the Companies Act 2006 and UK tax legislation. Our tests included agreeing the financial statement disclosures to underlying supporting documentation and enquiries with management. There are inherent limitations in the audit procedures described above and, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. We did not identify any key audit matters relating to irregularities, including fraud. As in all our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.
A further description of our responsibilities 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.
PET FOOD BRANDS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF PET FOOD BRANDS LIMITED (CONTINUED)
- 6 -
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.
David J. Stevens
Senior Statutory Auditor
For and on behalf of Taylor Viney & Marlow Limited
16 August 2024
Chartered Accountants
Statutory Auditor
46-54 High Street
Ingatestone
Essex
CM4 9DW
PET FOOD BRANDS LIMITED
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
-
-
Administrative expenses
(419,131)
(106,294)
Other operating income
1,245,276
761,800
Operating profit
4
826,145
655,506
Interest receivable and similar income
8
510,389
510,389
Interest payable and similar expenses
9
(840,647)
(330,040)
Profit before taxation
495,887
835,855
Tax on profit
10
(10,100)
(70,504)
Profit for the financial year
485,787
765,351
Retained earnings brought forward
972,989
707,768
Dividends
11
(500,130)
(500,130)
Retained earnings carried forward
958,646
972,989
The profit and loss account has been prepared on the basis that all operations are continuing operations.
PET FOOD BRANDS LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Negative goodwill
12
(613,404)
(626,760)
Other intangible assets
12
3,858,329
Total intangible assets
3,244,925
(626,760)
Tangible assets
13
9,124,974
9,240,558
Investments
14
994,749
994,749
13,364,648
9,608,547
Current assets
Debtors
16
4,241,250
4,947,828
Cash at bank and in hand
17,234
14,679
4,258,484
4,962,507
Creditors: amounts falling due within one year
Loans and overdrafts
19
600,377
800,503
Taxation and social security
16,896
81,262
Other creditors
1,396,649
1,775,087
Accruals and deferred income
92,468
49,823
2,106,390
2,706,675
Net current assets
2,152,094
2,255,832
Total assets less current liabilities
15,516,742
11,864,379
Creditors: amounts falling due after more than one year
Loans and overdrafts
19
12,154,188
10,006,630
Other creditors
1,529,682
(13,683,870)
(10,006,630)
Provisions for liabilities
Deferred tax liability
20
156,303
166,837
(156,303)
(166,837)
Net assets
1,676,569
1,690,912
Capital and reserves
Called up share capital
21
162
162
Share premium account
717,761
717,761
Profit and loss reserves
958,646
972,989
Total equity
1,676,569
1,690,912
PET FOOD BRANDS LIMITED
BALANCE SHEET (CONTINUED)
AS AT
31 DECEMBER 2023
31 December 2023
- 9 -
The financial statements were approved by the board of directors and authorised for issue on 16 August 2024 and are signed on its behalf by:
Anthony Raeburn
Director
Company registration number 06005766 (England and Wales)
PET FOOD BRANDS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
1
Accounting policies
Company information
Pet Food Brands Limited is a private company limited by shares incorporated in England and Wales. The registered office and main trading address is Brentwood House, Lower Philips Road, Whitebirk Industrial Estate, Blackburn, Lancashire, BB1 5UD.
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:
- Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
- Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’: Interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
- Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
- Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The company has taken advantage of the exemption under section 401 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.
Pet Food Brands Limited is a subsidiary of P.F.I. Vitakraft GmbH and the results of Pet Food Brands Limited are included in the consolidated financial statements of P.F.I. Vitakraft GmbH which are available from the German company register.
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
Intangible fixed assets - goodwill
Negative goodwill arises where the price paid for an acquisition is less than the fair value of the net assets acquired. Negative goodwill is amortised over the period expected to benefit from the non-monetary assets it attaches to which in this case is deemed to be 50 years. The excess of the fair value over the price paid is recognised within non current assets.
PET FOOD BRANDS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 11 -
1.4
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:
Trademarks
10 years straight line
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 & buildings
2% Straight Line
Freehold land is not depreciated.
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.
1.6
Fixed asset investments
Interests in subsidiaries is 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.
1.7
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.
1.8
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
PET FOOD BRANDS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 12 -
1.9
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 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 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.
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.
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 bank loans and loans from fellow group companies are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future 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.
PET FOOD BRANDS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.10
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.
1.11
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.
1.12
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.
PET FOOD BRANDS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
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.
3
Revenue
2023
2022
£
£
Royalty income
483,476
Dividends received
510,389
510,389
Management fees receivable
761,800
761,800
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Depreciation of owned tangible fixed assets
115,584
115,584
Amortisation of intangible assets
299,482
(13,356)
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
1,000
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
7
Directors' remuneration
Directors are remunerated by the company's subsidiary, Pets Choice Ltd. Remuneration for the year ended 31 December 2023 was £103,226 (2022: £102,832).
PET FOOD BRANDS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 15 -
8
Interest receivable and similar income
2023
2022
£
£
Income from fixed asset investments
Income from shares in group undertakings
510,389
510,389
9
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
718,026
330,040
Unwinding of discount on provisions
122,621
-
840,647
330,040
PET FOOD BRANDS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
20,634
81,262
Deferred tax
Origination and reversal of timing differences
(10,534)
(10,758)
Total tax charge
10,100
70,504
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
495,887
835,855
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
116,635
158,812
Depreciation on assets not qualifying for tax allowances
27,186
21,961
Amortisation on assets not qualifying for tax allowances
(3,141)
(2,537)
Deferred tax adjustments in respect of prior years
(10,534)
(10,759)
Dividend income
(120,046)
(96,973)
Taxation charge for the year
10,100
70,504
11
Dividends
2023
2022
£
£
Interim paid
500,130
500,130
PET FOOD BRANDS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
12
Intangible fixed assets
Negative goodwill
Trademarks
Total
£
£
£
Cost
At 1 January 2023
(667,941)
(667,941)
Additions
4,171,167
4,171,167
At 31 December 2023
(667,941)
4,171,167
3,503,226
Amortisation and impairment
At 1 January 2023
(41,181)
(41,181)
Amortisation charged for the year
(13,356)
312,838
299,482
At 31 December 2023
(54,537)
312,838
258,301
Carrying amount
At 31 December 2023
(613,404)
3,858,329
3,244,925
At 31 December 2022
(626,760)
(626,760)
The negative goodwill arose upon the purchase of the trade and certain assets of Bob Martin (UK) Ltd by the group. The trade now operates in Pets Choice Limited whilst certain assets were acquired by Pets Choice Limited and Pet Food Brands Limited. The amortisation charge is included within administrative expenses.
13
Tangible fixed assets
Freehold land & buildings
£
Cost
At 1 January 2023 and 31 December 2023
9,663,303
Depreciation and impairment
At 1 January 2023
422,745
Depreciation charged in the year
115,584
At 31 December 2023
538,329
Carrying amount
At 31 December 2023
9,124,974
At 31 December 2022
9,240,558
14
Fixed asset investments
2023
2022
Notes
£
£
Investments in subsidiaries
15
994,749
994,749
PET FOOD BRANDS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
15
Subsidiaries
These financial statements are separate company financial statements for Pet Food Brands Ltd.
Separate company financial statements are required to be prepared by law. Consolidated financial statements for the group are prepared and publicly available.
Details of the company's subsidiaries at 31 December 2023 are as follows:
Name of undertaking
Address
Class of
% Held
shares held
Direct
Indirect
Pets Choice Ltd
1
Ordinary
100.00
-
Pets Choice Healthcare Ltd
2
Ordinary
0
100.00
Registered office addresses (all UK unless otherwise indicated):
1, 3
Brentwood House Lower Philips Road, Whitebirk Industrial Estate, Blackburn, England, BB1 5UD
2
38 Main Street, Swords, CO Dublin 650010
The investments in subsidiaries are all stated at cost.
16
Debtors
2023
2022
Amounts falling due within one year:
£
£
Amounts owed by group undertakings
4,160,356
4,890,486
Other debtors
4,875
7,356
Prepayments and accrued income
76,019
49,986
4,241,250
4,947,828
17
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans
19
600,377
800,503
Amounts owed to group undertakings
1,696,277
Corporation tax
16,896
81,262
Other creditors
1,396,649
78,810
Accruals and deferred income
92,468
49,823
2,106,390
2,706,675
PET FOOD BRANDS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
18
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
19
10,206,416
10,006,630
Other borrowings
19
1,947,772
Other creditors
1,529,682
13,683,870
10,006,630
19
Loans and overdrafts
2023
2022
£
£
Bank loans
10,806,793
10,807,133
Loans from group undertakings
1,947,772
12,754,565
10,807,133
Payable within one year
600,377
800,503
Payable after one year
12,154,188
10,006,630
The bank loan is secured by a legal charge over land and buildings at Whitebirk Industrial Estate, Blackburn and at Wemberham Lane, Yatton, Bristol and an unlimited debenture over the assets of Pet Food Brands Limited, Pet Food Brands (Holdings) Limited and Pets Choice Ltd. Pets Choice Ltd has provided an unlimited guarantee whilst a guarantee for £4,380,000 has been provided by Pet Food Brands Limited and Pet Food Brands (Holdings) Limited.
The loan matures in May 2025 and is repayable by 4 instalments of £200,126 and a final repayment of £10,006,290. Interest is charged on the loan at 1.75% above LIBOR base rate.
After the end of the financial year a capital repayment of £3,000,000 was made by the company and the bank agreed to a loan amendment whereby the loan will be repaid in May 2025 with an instalment of an amount sufficient to repay the Loan and any interest due, in full.
PET FOOD BRANDS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
20
Deferred taxation
Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated Capital Allowances
156,303
166,837
2023
Movements in the year:
£
Liability at 1 January 2023
166,837
Credit to profit or loss
(10,534)
Liability at 31 December 2023
156,303
21
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of 1p each
16,238
16,238
162
162
22
Related party transactions
Transactions with related parties
During the year the company entered into the following transactions with related parties:
Management charges receivable from Pets Choice Ltd for the year were £761,800 (2022: £761,800).
Royalties received from Pets Choice Ltd were £483,476 (2022: £NIL). At the year end the amount due from Pets Choice Ltd, its wholly owned subsidiary, was £4,160,356 (2022: £4,890,486). The loan is repayable on demand.
At the year end the company owed £1,947.771 (2022: £1,696,277) to its immediate parent company Pet Food Brands (Holdings) Ltd. The loan is repayable on demand.
At the balance sheet date Pets Choice Ltd had guaranteed a an amount of £3,000,000 owed by the company.
No guarantees have been given.
23
Ultimate controlling party
The immediate parent company is Pet Food Brands (Holdings) Ltd whose registered office is Brentwood House, Lower Philips Road, Whitebirk Industrial Estate, Blackburn, Lancashire BB1 5UD.
The ultimate parent undertaking is P.F.I. Vitakraft GmbH, a company incorporated in Germany. The registered office address of P.F.I. Vitakraft GmbH is at Mahndorfer Heerstr. 928307 Bremen.
PET FOOD BRANDS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
23
Ultimate controlling party
(Continued)
- 21 -
The following are the parents of the largest and smallest groups in which this company's results are consolidated:
Largest group
P.F.I. Vitakraft GmbH
Smallest group
P.F.I. Vitakraft GmbH
The consolidated financial statements are available from the German company register.
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