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Registration number: 01314060

Slemcka (DMS) Limited

Annual Report and Consolidated Financial Statements

for the Year Ended 31 December 2023

 

Slemcka (DMS) Limited

Contents

Company Information

1

Strategic Report

2 to 4

Directors' Report

5

Statement of Directors' Responsibilities

6

Independent Auditor's Report

7 to 10

Consolidated Profit and Loss Account

11

Consolidated Statement of Comprehensive Income

12

Consolidated Balance Sheet

13

Balance Sheet

14

Consolidated Statement of Changes in Equity

15

Statement of Changes in Equity

16

Consolidated Statement of Cash Flows

17

Notes to the Financial Statements

18 to 35

 

Slemcka (DMS) Limited

Company Information

Directors

K. J. Bates

M. K. Bates

C. M. Bates

L. D. Goodfellow

S. E. Laronde

Registered office

Elan House
Park Lane
Castle Vale
Birmingham
B35 6LJ

Auditors

Robert Whowell & Partners LLP
Chartered Accountants
Westwood House
78 Loughborough Road
Quorn
Loughborough
Leicestershire
LE12 8DX

 

Slemcka (DMS) Limited

Strategic Report for the Year Ended 31 December 2023

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

Principal activity

The principal activity of the group is that of manufacture, import and distribution of housewares, including bathroom and living products. The principal activity of the parent company is that of a holding company.

Review of the business

The group experienced weaker trading results during the year from Lloyd Pascal & Company Limited and it’s Hong Kong subsidiary, Lloyd Pascal Limited. The consolidated revenue and results of the group which incorporates the Hong Kong subsidiary are disclosed in the statutory financial statements.

The impact on the economy of higher inflation and reduced consumer spending have impacted on sales and profitability. Retailers have changed business models with a significant increase in marketplace channels, with consumers more price sensitive the group has promoted heavily during the year to reduce stocks from £2,750,641 to £1,678,537. The impact of this resulted in revenues increasing by 3.9% to £13.3 million (2022: £12.8 million), gross profit margin has increased to 29.8% (2022: 26.1%), however increased distribution costs and administrative expenses resulted in a net operating loss of £371,020 (2022: profit of £196,559) before unrealised gains on the revaluation of investments.

Overall, the group traded profitability reporting profit before tax of £194,188 (2022: £238,682). The group’s net assets increased by £224,478 (1.7%) from 2022 after dividends for the year of £200,000 (2022: £200,000).

The directors are pleased to report unrealised gains on investment properties of £460,000 (2022: £nil) and operating warehouses of £320,000 (2022: £315,000) following the assets being revalued at the year end, against which the deferred tax provision being increased by £219,940 (2022: £78,750).

As a consequence of the above, and the changing needs of certain shareholders, the directors commenced a strategic review of the business during the year which is now largely complete.

The group's key financial and other performance indicators during the year were as follows:

Financial KPIs

Unit

2023

2022

Gross profit margin

%

29.80

26.14

Net profit margin

%

1.72

1.49

Working capital ratio

6.92

7.16

Debtor days

72.00

89.00

Creditor days

28.00

23.00

Stock turnover

3.47

3.24

 

Slemcka (DMS) Limited

Strategic Report for the Year Ended 31 December 2023

Research and development

The group has invested heavily in R&D in order to adapt to consumer trends. Extensive research has been undertaken to include the use of third party trend forecasting and future consumer insights, and the addition of external design agencies and product designer to develop robust new concepts for customer new product development strategies. All products designed under the Lloyd Pascal and tertiary brands, remain the intellectual property of Lloyd Pascal & Co Limited and fully comply with required parameters and relevant safety and industry standards.

Principal risks and uncertainties

Management continually monitor the key risks facing the group together with assessing the controls used for managing these risks. The board of directors formally reviews and documents the principal risks facing the business at least annually. The principal risks and uncertainties facing the group are volatility in ongoing market conditions and UK consumer confidence. Price pressure from both customers and suppliers and ongoing disruptions to the supply chain.

Future developments

The business of the group has comprised three main activities for many years:

• The supply of housewares, including bathroom and living products from stock (“the Lloyd Pascal division” of Lloyd Pascal & Co. Limited)
• The supply of garden and outdoor living products from stock (“the Slemcka division” of Lloyd Pascal & Co. Limited)
• The direct supply of housewares, including bathroom and living products from suppliers based predominantly in the Far East (“the Hong Kong business”)

The strategic review of the business has highlighted the differing needs of the family shareholders as well as the relative profitability of the activities carried out by the group.

As a consequence, the board have taken the following actions in the current year:

To effect the wind down of the domestic retail division that supplies houseware product, including bathroom and living products in order to stem the losses being incurred, and formulated a plan for the restructure of the current group by way of a demerger and sale of certain properties to facilitate the exit of some of the shareholders from the trading activities.

This has resulted in:
• redundancies being necessary which will be concluded by 30 September 2024 incurring an expected cost to the business of £301,790.
• additional provisions being made against the value of stocks held at 31 December 2023 meaning a total stock provision held of £357,338 (2022: £262,654), and
• the disposal of all group properties that will not be required to facilitate the successful continuing operations of the group, which is expected to be concluded by the end of September 2024.

 

Slemcka (DMS) Limited

Strategic Report for the Year Ended 31 December 2023

Under the terms of the planned demerger certain shareholders intend to exit and are expected to resign from the board at that time leaving a reduced, but substantial trading business that will continue in the future with the Slemcka division and Hong Kong business continuing.

Those shareholders choosing to exit expect to receive full consideration for their shares, funded through a mixture of property, existing cash resources, and proceeds from the sale of certain properties that completed in 2024.

After the proposed reorganisation, the group will be under the control of a new holding company owned by two of the current shareholders. The continuing group is expected to retain a net asset value in excess of £3 million with sufficient cash available to meet the ongoing working capital needs of the ongoing business.

The Slemcka division will continue to operate through existing warehousing premises and infrastructure in the UK, and forecasts demonstrate sufficient cash and available headroom to fund anticipated growth in 2025.

The Hong Kong business will continue to operate via the wholly owned trading subsidiary, and the prospects to the end of 2025 are very encouraging in terms of turnover and profitability.

Approved and authorised by the Board on 25 September 2024 and signed on its behalf by:
 

.........................................
M. K. Bates
Director

 

Slemcka (DMS) Limited

Directors' Report for the Year Ended 31 December 2023

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

Directors of the group

The directors who held office during the year were as follows:

K. J. Bates

M. K. Bates

C. M. Bates

L. D. Goodfellow

S. E. Laronde

Information included in the Strategic Report

As permitted by Paragraph 1A of Schedule 7 to the Large and medium-sized Companies and Groups (Accounts and reports) Regulations 2008 certain matters which are required to be disclosed in the director's report have been omitted as they are included in the strategic report on pages 2 and 4.

Financial instruments

The group currently has no requirement for an overdraft or other facilities in order to trade.

Risks

Liquidity risk
The group's exposure to liquidity risk is not considered to be material.

Foreign currency risk
The group's foreign currency transactions are mainly in US dollars and holds sufficient dollar reserves for trading purposes.

Credit risk
Investment of cash surpluses are made on bank deposits only. All customers who wish to trade on credit terms are subject to credit verification procedures. Receivable balances are closely monitored and provision is made for any doubtful debts. The group has arranged credit insurance cover, further reducing this risk exposure.

Disclosure of information to the auditor

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditor is unaware.

Approved and authorised by the Board on 25 September 2024 and signed on its behalf by:

.........................................
M. K. Bates
Director

 

Slemcka (DMS) Limited

Statement of Directors' Responsibilities

The directors acknowledge their responsibilities 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 group and the company and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

select suitable accounting policies and 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; and

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group's and the company's transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

 

Slemcka (DMS) Limited

Independent Auditor's Report to the Members of Slemcka (DMS) Limited

Opinion

We have audited the financial statements of Slemcka (DMS) Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023, which comprise the Consolidated Profit and Loss Account, Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Balance Sheet, Consolidated Statement of Changes in Equity, Statement of Changes in Equity, Consolidated Statement of Cash Flows, and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including 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 group's and the parent company's affairs as at 31 December 2023 and of the group's profit for the year then ended;

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor responsibilities for the audit of the financial statements section of our report. We are independent of the group 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 group's ability to continue as a going concern for a period of at least twelve months from when the financial statements were authorised.

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 directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.

 

Slemcka (DMS) Limited

Independent Auditor's Report to the Members of Slemcka (DMS) Limited

In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.

Opinion on other matters prescribed by the Companies Act 2006

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

the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of our 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 and the Directors' Report.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

adequate accounting records have not been kept by the parent company or its subsidiaries, or returns adequate for our audit have not been received from branches not visited by us; or

the parent company financial statements are not in agreement with the accounting records and returns; or

certain disclosures of directors' remuneration specified by law are not made; or

we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page 6, 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.

 

Slemcka (DMS) Limited

Independent Auditor's Report to the Members of Slemcka (DMS) Limited

Auditor 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:

enquiring of management, including obtaining and reviewing supporting documentation, concerning the group's policies and procedures relating to: identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance; detecting and responding to the risks of fraud and whether they had knowledge of any actual, suspected or alleged fraud; and the internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations.

we obtained an understanding of the legal and regulatory frameworks applicable to the group based on our understanding of the group, sector experience and discussions with management. The most significant considerations for the group are the Companies Act 2006, Corporate and VAT legislation, Employment Taxes, Health and Safety and the Bribery Act 2010.

discussing amongst the engagement team, who also undertook the audit testing on significant components, to assess how and where fraud might occur in the financial statements and any potential indicators of fraud. As part of this discussion, we identified potential for fraud in the following areas: management override of controls; and revenue recognition, specifically the manipulation of revenue using fraudulent journals.

we tested the appropriateness of accounting journals and other adjustments made in the preparation of the financial statements.

we reviewed the group's accounting policies for non-compliance with relevant standards. Our work also included considering significant accounting estimates for evidence of misstatement or possible bias and testing any significant transactions that appeared to be outside the normal course of business.

 

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from events and transactions reflected in the financial statements, the less likely we are to become aware of it.

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

 

Slemcka (DMS) Limited

Independent Auditor's Report to the Members of Slemcka (DMS) Limited

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in 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.

.................................................................................
Paul Johnson FCA (Senior Statutory Auditor)
For and on behalf of Robert Whowell & Partners LLP, Statutory Auditor

Westwood House
78 Loughborough Road
Quorn
Loughborough
Leicestershire
LE12 8DX

26 September 2024

 

Slemcka (DMS) Limited

Consolidated Profit and Loss Account for the Year Ended 31 December 2023

Note

2023
£

2022
£

Turnover

3

13,336,026

12,838,759

Cost of sales

 

(9,361,758)

(9,483,332)

Gross profit

 

3,974,268

3,355,427

Distribution costs

 

(740,510)

(402,109)

Administrative expenses

 

(3,781,226)

(2,900,404)

Other operating income

4

176,448

143,645

Gains on revaluation of investments

 

488,055

31,533

Operating profit

5

117,035

228,092

Other interest receivable and similar income

6

77,153

10,642

Interest payable and similar expenses

7

-

(52)

   

77,153

10,590

Profit before tax

 

194,188

238,682

Tax on profit

11

35,112

(47,793)

Profit for the financial year

 

229,300

190,889

Profit/(loss) attributable to:

 

Owners of the company

 

229,300

190,889

 

Slemcka (DMS) Limited

Consolidated Statement of Comprehensive Income for the Year Ended 31 December 2023

Note

2023
£

2022
£

Profit for the year

 

229,300

190,889

Unrealised surplus arising on property revaluation

11, 13

320,000

315,000

Deferred tax effect

11, 13

(124,822)

(78,750)

 

195,178

236,250

Total comprehensive income for the year

 

424,478

427,139

Total comprehensive income attributable to:

 

Owners of the company

 

424,478

427,139

 

Slemcka (DMS) Limited

(Registration number: 01314060)
Consolidated Balance Sheet as at 31 December 2023

Note

2023
£

2022
£

Fixed assets

 

Intangible assets

12

1

1

Tangible assets

13

5,633,006

5,345,827

Investment property

14

1,860,000

1,400,000

Other financial assets

16

84,361

56,306

 

7,577,368

6,802,134

Current assets

 

Stocks

17

1,678,537

2,750,641

Debtors

18

3,252,735

4,045,241

Cash at bank and in hand

19

3,324,539

1,970,191

 

8,255,811

8,766,073

Creditors: Amounts falling due within one year

20

(1,193,427)

(1,223,978)

Net current assets

 

7,062,384

7,542,095

Total assets less current liabilities

 

14,639,752

14,344,229

Provisions for liabilities

21

(1,068,849)

(997,804)

Net assets

 

13,570,903

13,346,425

Capital and reserves

 

Called up share capital

23

11,000

11,000

Revaluation reserve

24

2,361,460

2,166,282

Other reserves

24

951,074

586,192

Retained earnings

24

10,247,369

10,582,951

Equity attributable to owners of the company

 

13,570,903

13,346,425

Shareholders' funds

 

13,570,903

13,346,425

Approved and authorised by the Board on 25 September 2024 and signed on its behalf by:
 

.........................................
M. K. Bates
Director

 

Slemcka (DMS) Limited

(Registration number: 01314060)
Balance Sheet as at 31 December 2023

Note

2023
£

2022
£

Fixed assets

 

Investments

15

47,250

47,250

Other financial assets

16

117

117

 

47,367

47,367

Current assets

 

Debtors

18

305,271

305,271

Cash at bank and in hand

19

1,923

2,021

 

307,194

307,292

Net assets

 

354,561

354,659

Capital and reserves

 

Called up share capital

23

11,000

11,000

Retained earnings

343,561

343,659

Shareholders' funds

 

354,561

354,659

The company made a profit after tax for the financial year of £199,902 (2022 - profit of £35,899).

Approved and authorised by the Board on 25 September 2024 and signed on its behalf by:
 

.........................................
M. K. Bates
Director

 

Slemcka (DMS) Limited

Consolidated Statement of Changes in Equity for the Year Ended 31 December 2023
Equity attributable to the parent company

Share capital
£

Revaluation reserve
£

Non-distributable reserve
£

Retained earnings
£

Total equity
£

At 1 January 2023

11,000

2,166,282

586,192

10,582,951

13,346,425

Profit for the year

-

-

-

229,300

229,300

Other comprehensive income

-

195,178

364,882

(364,882)

195,178

Total comprehensive income

-

195,178

364,882

(135,582)

424,478

Dividends

-

-

-

(200,000)

(200,000)

At 31 December 2023

11,000

2,361,460

951,074

10,247,369

13,570,903

Share capital
£

Revaluation reserve
£

Non-distributable reserve
£

Retained earnings
£

Total equity
£

At 1 January 2022

11,000

1,930,032

586,192

10,592,062

13,119,286

Profit for the year

-

-

-

190,889

190,889

Other comprehensive income

-

236,250

-

-

236,250

Total comprehensive income

-

236,250

-

190,889

427,139

Dividends

-

-

-

(200,000)

(200,000)

At 31 December 2022

11,000

2,166,282

586,192

10,582,951

13,346,425

 

Slemcka (DMS) Limited

Statement of Changes in Equity for the Year Ended 31 December 2023

Share capital
£

Retained earnings
£

Total
£

At 1 January 2023

11,000

343,659

354,659

Profit for the year

-

199,902

199,902

Dividends

-

(200,000)

(200,000)

At 31 December 2023

11,000

343,561

354,561

Share capital
£

Retained earnings
£

Total
£

At 1 January 2022

11,000

507,760

518,760

Profit for the year

-

35,899

35,899

Dividends

-

(200,000)

(200,000)

At 31 December 2022

11,000

343,659

354,659

 

Slemcka (DMS) Limited

Consolidated Statement of Cash Flows for the Year Ended 31 December 2023

Note

2023
£

2022
£

Cash flows from operating activities

Profit for the year

 

229,300

190,889

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

5

53,384

50,195

Changes in fair value of investments

 

(488,055)

(31,533)

Finance income

6

(77,153)

(10,642)

Finance costs

7

-

52

Income tax (credit)/expense

11

(35,112)

47,793

 

(317,636)

246,754

Working capital adjustments

 

Decrease/(increase) in stocks

17

1,072,104

(28,094)

Decrease in debtors

18

792,506

361,318

Increase/(decrease) in creditors

20

1,680

(423,212)

Cash generated from operations

 

1,548,654

156,766

Income taxes paid

11

(50,896)

(71,257)

Net cash flow from operating activities

 

1,497,758

85,509

Cash flows from investing activities

 

Interest received

6

76,439

10,005

Acquisitions of tangible assets

13

(20,563)

(30,768)

Dividend income from financial assets

6

714

637

Net cash flows from investing activities

 

56,590

(20,126)

Cash flows from financing activities

 

Interest paid

7

-

(52)

Dividends paid

(200,000)

(200,000)

Net cash flows from financing activities

 

(200,000)

(200,052)

Net increase/(decrease) in cash and cash equivalents

 

1,354,348

(134,669)

Cash and cash equivalents at 1 January 2023

 

1,970,191

2,104,860

Cash and cash equivalents at 31 December 2023

19

3,324,539

1,970,191

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

1

General information

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office is:
Elan House
Park Lane
Castle Vale
Birmingham
B35 6LJ

These financial statements were authorised for issue by the Board on 25 September 2024.

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.

Basis of preparation

These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.

The Group's functional and presentational currency is GBP.

Summary of disclosure exemptions

The company is a qualifying entity for the purposes of FRS 102 and has elected to take the exemption under paragraph 1.12(b) of FRS 102 not to present the company statement of cash flows.

Basis of consolidation

The consolidated financial statements present the results of group and its own subsidiaries ("the group") as if they formed a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.

The consolidated financial statements incorporate the results of business combinations using the purchase method. In the statement of financial position, the acquiriee's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquiried operations are included in the consolidated statements of profit and loss and comprehensive income from the date on which control is obtained. They are deconsolidated from the date control ceases.

No profit and loss account is presented for the company as permitted by section 408 of the Companies Act 2006. The company made a profit after tax for the financial year of £199,902 (2022 - £35,899).

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Judgements

The critical judgements that the directors have made in the process of applying the group's accounting policies that have the most significant effect on the amounts recognised in the statutory financial statements are discussed below:

(i) Assessing indicators of impairment

In assessing whether there have been any indicators of impairment of assets, the directors have considered both external and internal sources of information such as market conditions, counterparty credit ratings and experience of recoverability. There have been no indicators of impairment identified during the current financial year.

Key sources of estimation uncertainty

The key assumptions concerning the future, and other key sources of estimation uncertainty, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

(i) Valuation of freehold land and buildings and investment property - determine the fair value of land and buildings and investment property based on the last valuation reviewed and local market conditions.

(ii) Stock provisions - The group establishes a provision for stock that is slow-moving, obsolete, or damaged. The group has identified which stock items should be provided for given its knowledge of the relevant inventory lines.

Revenue recognition

Turnover is recognised to the extent that it is probable that the economic benefits will flow to the group and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebaes, value added tax and other sales taxes. The following criteria must also be met before turnover is recognised:

Sale of goods
- the group has transferred the significant risks and rewards of ownership to the buyer;
- the group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
- the amount of turnover can be measured reliably;
- it is probable that the group will receive the consideration due under the transaction; and
- the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Rent receivable
Rental income is credited to the profit and loss account on the accruals basis.

Tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in the profit and loss account, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the group operates and generates taxable income.

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the consolidated financial statements.

Unrelieved tax losses and other deferred tax assets are recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference, except for revalued land and investment property where the future tax rate that is expected to apply to the sale of the asset is used.

Tangible assets

Tangible fixed assets under the cost model are stated at historical cost less acummulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Individual freehold properties are carried at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent impairment losses. Revaluations are undertaken with sufficient regularity to ensure the carrying amount does not differ materially from that which would be determined using fair value at the statement of financial position date.

Fair values are determined from market based evidence normally undertaken by professionally qualified valuers.

Revaluation gains and losses are recognised in the consolidated statement of comprehensive income.

Depreciation

Land is not depreciated. Depreciation on other assets is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight line method.

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the consolidated profit and loss account.

Depreciation is provided on the following basis:

Asset class

Depreciation method and rate

Freehold property (excluding land)

2% over remaining useful life

Furniture, fittings and equipment

25% straight line

Motor vehicles

25% straight line

Plant and machinery

10% straight line

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Investment property

Investment property is carried at fair value determined annually by external valuers and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in the consolidated profit and loss account.

Goodwill

Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is held in the currency of the acquired entity and revalued to the closing rate at each reporting period date. Goodwill is amortised over its useful life, which shall not exceed ten years if a reliable estimate of the useful life cannot be made.

Investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Investments in listed company shares are remeasured to market value at each statement of financial position date. Gains and losses on remeasurement are recognised in the consolidated profit and loss account.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Trade debtors

Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at transaction value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is determined using the first in, first out (FIFO) method.

At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in the consolidated profit and loss account.

Creditors

Short term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at transaction value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to the consolidated profit and loss account on a straight-line basis over the period of the lease.

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Foreign currency transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are recognised using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the consolidated profit and loss account.

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders.

Defined contribution pension obligation

The group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the group pays fixed contributions into a seperate entity. Once the contributions have been paid the group has no further payment obligations.

The contributions are recognised as an expense in the consolidated profit and loss account when they fall due. Amounts not paid are shown in creditors as a liability in the statement of financial position. The assets of the plan are held seperately from the group in independently administered funds.

Research and development

In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight line basis over their useful economic lives, which range from three to six years.

If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

3

Turnover

The analysis of the group's turnover for the year by market is as follows:

2023
£

2022
£

UK

13,023,818

12,383,155

Rest of world

312,208

455,604

13,336,026

12,838,759

4

Other operating income

The analysis of the group's other operating income for the year is as follows:

2023
£

2022
£

Government grants

12,000

12,000

Rents

164,448

131,645

176,448

143,645

5

Operating (loss)/profit

Arrived at after charging/(crediting):

2023
£

2022
£

Depreciation

53,384

50,195

Foreign exchange losses/(gains)

99,609

(165,074)

Operating lease - property

100,839

151,970

6

Other interest receivable and similar income

2023
£

2022
£

Interest income on bank deposits

76,439

10,005

Dividend income from financial assets

714

637

77,153

10,642

7

Interest payable and similar expenses

2023
£

2022
£

Interest on bank overdrafts and borrowings

-

52

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

8

Staff costs

The aggregate payroll costs (including directors' remuneration) were as follows:

2023
£

2022
£

Wages and salaries

1,896,597

1,771,128

Social security costs

205,503

192,048

Pension costs, defined contribution scheme

88,081

74,420

Redundancy costs

2,308

-

2,192,489

2,037,596

The average number of persons employed by the group (including directors) during the year, analysed by category was as follows:

2023
No.

2022
No.

Distribution

16

16

Administration and support

33

31

Management

8

8

57

55

9

Directors' remuneration

The directors' remuneration for the year was as follows:

2023
£

2022
£

Remuneration

298,678

273,960

Group contributions to defined contribution pension schemes

3,000

3,000

301,678

276,960

During the year the number of directors who were receiving benefits was as follows:

2023
No.

2022
No.

Accruing benefits under money purchase pension scheme

3

3

In respect of the highest paid director:

2023
£

2022
£

Remuneration

107,892

111,819

The value of the company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £Nil (2022 - £Nil).

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

10

Auditors' remuneration

2023
£

2022
£

Audit of these financial statements

27,500

20,000

Other fees to auditors

Accounting and taxation services

7,500

6,500

35,000

26,500


 

11

Taxation

Tax charged/(credited) in the consolidated profit and loss account

2023
£

2022
£

Current taxation

UK corporation tax

19,106

50,679

UK corporation tax adjustment to prior periods

(441)

(1,435)

18,665

49,244

Deferred taxation

Arising from origination and reversal of timing differences

(53,777)

(2,886)

Arising from changes in tax rates and laws

-

1,435

Total deferred taxation

(53,777)

(1,451)

Tax (receipt)/expense in the income statement

(35,112)

47,793

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

The tax on profit before tax for the year is lower than the standard rate of corporation tax in the UK (2022 - higher than the standard rate of corporation tax in the UK) of 19% (2022 - 19%).

The differences are reconciled below:

2023
£

2022
£

Profit before tax

194,188

238,682

Corporation tax at standard rate

36,896

45,350

Effect of revenues exempt from taxation

(92,866)

(6,112)

Effect of expense not deductible in determining taxable profit

5,227

13,788

Effect of tax losses

16,888

-

Deferred tax credit

(53,777)

(1,451)

Tax increase/(decrease) from effect of capital allowances and depreciation

1,998

(2,347)

Tax decrease from other short-term timing differences

(443)

(1,435)

Other tax effects for reconciliation between accounting profit and tax expense (income)

50,965

-

Total tax (credit)/charge

(35,112)

47,793

Deferred tax

Group

Deferred tax assets and liabilities

2023

Asset
£

Liability
£

Accelerated capital allowances

-

18,025

Capital gains

-

1,050,824

-

1,068,849

2022

Asset
£

Liability
£

Accelerated capital allowances

-

166,920

Capital gains

-

830,884

-

997,804

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Tax relating to items recognised in other comprehensive income or equity - group

2023
£

2022
£

Deferred tax related to items recognised as other comprehensive income

124,822

78,750

12

Intangible assets

Group

Goodwill
 £

Total
£

Cost or valuation

At 1 January 2023

1

1

At 31 December 2023

1

1

Amortisation

At 1 January 2023

-

-

At 31 December 2023

-

-

Carrying amount

At 31 December 2023

1

1

At 31 December 2022

1

1

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

13

Tangible assets

Group

Freehold land and buildings
£

Furniture, fittings and equipment
 £

Motor vehicles
 £

Plant and machinery
£

Total
£

Cost or valuation

At 1 January 2023

5,240,000

499,581

42,032

218,810

6,000,423

Revaluations

320,000

-

-

-

320,000

Additions

-

16,263

-

4,300

20,563

Disposals

-

-

-

(4,399)

(4,399)

At 31 December 2023

5,560,000

515,844

42,032

218,711

6,336,587

Depreciation

At 1 January 2023

-

421,709

42,032

190,855

654,596

Charge for the year

-

50,746

-

2,638

53,384

Eliminated on disposal

-

-

-

(4,399)

(4,399)

At 31 December 2023

-

472,455

42,032

189,094

703,581

Carrying amount

At 31 December 2023

5,560,000

43,389

-

29,617

5,633,006

At 31 December 2022

5,240,000

77,872

-

27,955

5,345,827

Included within the net book value of land and buildings above is £5,560,000 (2022 - £5,240,000) in respect of freehold land and buildings.
 

Revaluation

The fair value of the group's buildings was revalued as at 31 December 2023 by an independent valuer. The valuation is at an open market value and was valued by Holt Commercial.
Had this class of asset been measured on a historical cost basis, the carrying amount would have been £1,841,186 (2022 - £1,880,336). The historical cost would have been £2,325,282 (2022 - £2,325,282) and accumulated depreciation £484,096 (2022 - £444,946).
 

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

14

Investment properties

Group

2023
£

At 1 January 2023

1,400,000

Fair value adjustments

460,000

At 31 December 2023

1,860,000


The investment property was valued by Holt Commercial, Chartered Surveyors as at 31 March 2024, and is stated on the basis of open market value. The historical cost and net book value of the investment property amounts to £731,559 (2022 - £731,559).

15

Investments

Group

Details of undertakings

Details of the investments (including principal place of business) in which the group holds 20% or more of the nominal value of any class of share capital are as follows:

Undertaking

Registered office

Holding

Proportion of voting rights and shares held

     

2023

2022

Subsidiary undertakings

Lloyd Pascal & Co. Limited*

Elan House, Park Lane, Castle Vale, Birmingham, B35 6LJ

Ordinary and deferred

100%

100%

 

     

Lloyd Pascal (Hong Kong) Limited

42nd Floor, Central Plaza, 18 Harbour Road, Wanchai, Hong Kong

Ordinary

100%

100%

 

     

House and Homestyle Limited

Elan House, Park Lane, Castle Vale, Birmingham, B35 6LJ

Ordinary

100%

100%

 

     

* indicates direct investment of the company

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

Subsidiary undertakings

Lloyd Pascal & Co. Limited

The principal activity of Lloyd Pascal & Co. Limited is the manufacture, import and distribution of housewares, including bathroom and living products.

Lloyd Pascal (Hong Kong) Limited

The principal activity of Lloyd Pascal (Hong Kong) Limited is the design, import and distribution of bathroom fittings and accessories, and other household articles.

House and Homestyle Limited

The principal activity of House and Homestyle Limited is a dormant company.

Company

2023
£

2022
£

Investments in subsidiaries

47,250

47,250

Subsidiaries

£

Cost or valuation

At 1 January 2023

47,250

Carrying amount

At 31 December 2023

47,250

At 31 December 2022

47,250

16

Other financial assets

 

Group

Company

2023
£

2022
£

2023
£

2022
£

Non-current financial assets

Investments in listed shares

84,361

56,306

117

117

84,361

56,306

117

117

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

17

Stocks

 

Group

Company

2023
£

2022
£

2023
£

2022
£

Finished goods and goods for resale

1,242,408

2,351,414

-

-

Goods in transit

436,129

399,227

-

-

1,678,537

2,750,641

-

-

18

Debtors

 

Group

Company

Current

2023
£

2022
£

2023
£

2022
£

Trade debtors

2,639,398

3,127,352

-

-

Other debtors

502,402

822,549

305,271

305,271

Prepayments

110,935

95,340

-

-

 

3,252,735

4,045,241

305,271

305,271

19

Cash and cash equivalents

 

Group

Company

2023
£

2022
£

2023
£

2022
£

Cash on hand

649

750

-

-

Cash at bank

1,203,053

957,115

1,923

2,021

Short-term deposits

2,120,837

1,012,326

-

-

3,324,539

1,970,191

1,923

2,021

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

20

Creditors

 

Group

Company

2023
£

2022
£

2023
£

2022
£

Due within one year

Trade creditors

605,476

561,903

-

-

Social security and other taxes

389,719

383,645

-

-

Outstanding defined contribution pension costs

23,032

19,587

-

-

Accruals

156,094

207,506

-

-

Income tax liability

19,106

51,337

-

-

1,193,427

1,223,978

-

-

21

Provisions for liabilities

Group

Deferred tax
£

Total
£

At 1 January 2023

997,804

997,804

Increase in existing provisions

71,045

71,045

At 31 December 2023

1,068,849

1,068,849

22

Pension and other schemes

Defined contribution pension scheme

The group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the group to the scheme and amounted to £88,081 (2022 - £74,420).

Contributions totalling £23,032 (2022 - £19,587) were payable to the scheme at the end of the year and are included in creditors.

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

23

Share capital

Allotted, called up and fully paid shares

 

2023

2022

 

No.

£

No.

£

Ordinary of £1 each

11,000

11,000

11,000

11,000

         


The ordinary shares carry voting rights but no fixed right to income.

24

Reserves

Group

Capital redemption reserve

The capital redemption reserve represents the nominal value of shares bought back by the company from third parties.

Revaluation reserve

The revaluation reserve represents the cumulative increase in fair value of land and buildings used within the business.

Non-distributable reserve

The non-distributable reserve represents the cumulative increase in fair value of investment property.

Retained earnings

Retained earnings represents cumulative profits and losses retained in current and previous periods.

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

25

Analysis of changes in net debt

Group

At 1 January 2023
£

Financing cash flows
£

Foreign exchange movements
£

At 31 December 2023
£

Cash and cash equivalents

Cash

1,970,191

1,453,957

(99,609)

3,324,539

 

1,970,191

1,453,957

(99,609)

3,324,539

26

Related party transactions

Group

During the year, amounts totalling £5,753 (2022 - £7,062) were paid to a close family member of a director in respect of administrative duties. Total net expenses of £56,685 had been claimed by directors and close family members. At 31st December 2023, expenses were owed to directors and close family members of £796.

During the year gross salary and pension amounting to £254,777 (2022 - £243,831) were paid to close family members of the directors.

The group has taken advantage of the exemption permitted by Section 33 Related Party Disclosures not to provide disclosures of transactions enetered into with other wholly owned members of the group.

Company

Amounts due from directors

2023

At 1 January 2023
£

At 31 December 2023
£

C. M. Bates

Directors' loan

181,241

181,241

     
   

K. J. Bates

Directors' loan

57,186

57,186

     
   

 

 

Slemcka (DMS) Limited

Notes to the Financial Statements for the Year Ended 31 December 2023

2022

At 1 January 2022
£

At 31 December 2022
£

C. M. Bates

Directors' loan

181,241

181,241

     
   

K. J. Bates

Directors' loan

57,186

57,186

     
   

 

Other transactions with directors

Dividends totalling £200,000 (2022: £200,000) were paid to the directors in the year.

27

Financial instruments

Group

Categorisation of financial instruments

2023
 £

2022
 £

Financial assets measured at fair value through the profit and loss account comprise of cash and cash equivalents and listed investments.

3,408,900

2,026,497

Financial assets that are debt instruments measured at amortised cost comprise trade debtors and other debtors.

3,141,800

3,949,901

Financial liabilities measured at amortised cost comprise trade creditors, other creditors and accruals.

(784,602)

(788,996)

Company

Categorisation of financial instruments

2023
 £

2022
 £

Financial assets measured at fair value through the profit and loss account comprise of cash and cash equivalents.

1,923

2,021

Financial assets that are debt instruments measured at amortised cost comprise trade debtors, other debtors and amounts owed by group undertakings.

305,271

305,271

28

Ultimate controlling party

The directors consider there to be no individual ultimate controlling party.