IRIS Accounts Production v24.2.0.383 00721312 Board of Directors Board of Directors 31.12.23 1.1.23 31.12.23 31.12.23 true true false true true false false true false Fair value model iso4217:GBPiso4217:USDiso4217:EURxbrli:sharesxbrli:pureutr:tonnesutr:kWh007213122022-12-31007213122023-12-31007213122023-01-012023-12-31007213122021-12-31007213122022-01-012022-12-31007213122022-12-3100721312ns15:EnglandWales2023-01-012023-12-3100721312ns14:PoundSterling2023-01-012023-12-3100721312ns10:Director12023-01-012023-12-3100721312ns10:Director22023-01-012023-12-3100721312ns10:CompanySecretary12023-01-012023-12-3100721312ns10:Consolidated2023-12-3100721312ns10:ConsolidatedGroupCompanyAccounts2023-01-012023-12-3100721312ns10:PrivateLimitedCompanyLtd2023-01-012023-12-3100721312ns10:Consolidatedns10:FRS1022023-01-012023-12-3100721312ns10:Consolidatedns10:Audited2023-01-012023-12-3100721312ns10:LargeMedium-sizedCompaniesRegimeForDirectorsReport2023-01-012023-12-3100721312ns10:LargeMedium-sizedCompaniesRegimeForAccounts2023-01-012023-12-3100721312ns10:Consolidatedns10:LargeMedium-sizedCompaniesRegimeForDirectorsReport2023-01-012023-12-3100721312ns10:LargeMedium-sizedCompaniesRegimeForAccountsns10:Consolidated2023-01-012023-12-3100721312ns10:FullAccounts2023-01-012023-12-3100721312ns10:Consolidated2023-01-012023-12-3100721312ns10:Director32023-01-012023-12-3100721312ns10:Director42023-01-012023-12-3100721312ns10:RegisteredOffice2023-01-012023-12-3100721312ns10:Consolidated2022-01-012022-12-3100721312ns5:CurrentFinancialInstruments2023-12-3100721312ns5:CurrentFinancialInstruments2022-12-3100721312ns5:ShareCapital2023-12-3100721312ns5:ShareCapital2022-12-3100721312ns5:CapitalRedemptionReserve2023-12-3100721312ns5:CapitalRedemptionReserve2022-12-3100721312ns5:RetainedEarningsAccumulatedLosses2023-12-3100721312ns5:RetainedEarningsAccumulatedLosses2022-12-3100721312ns5:ShareCapital2021-12-3100721312ns5:RetainedEarningsAccumulatedLosses2021-12-3100721312ns5:CapitalRedemptionReserve2021-12-3100721312ns5:RetainedEarningsAccumulatedLosses2022-01-012022-12-3100721312ns5:CapitalRedemptionReserve2022-01-012022-12-3100721312ns5:RetainedEarningsAccumulatedLosses2023-01-012023-12-3100721312ns5:CapitalRedemptionReserve2023-01-012023-12-3100721312ns5:LandBuildings2022-12-3100721312ns5:ShortLeaseholdAssetsns5:LandBuildings2022-12-3100721312ns5:LeaseholdImprovements2022-12-3100721312ns5:LandBuildings2023-01-012023-12-3100721312ns5:ShortLeaseholdAssetsns5:LandBuildings2023-01-012023-12-3100721312ns5:LeaseholdImprovements2023-01-012023-12-3100721312ns5:LandBuildings2023-12-3100721312ns5:ShortLeaseholdAssetsns5:LandBuildings2023-12-3100721312ns5:LeaseholdImprovements2023-12-3100721312ns5:LandBuildings2022-12-3100721312ns5:ShortLeaseholdAssetsns5:LandBuildings2022-12-3100721312ns5:LeaseholdImprovements2022-12-3100721312ns5:UnlistedNon-exchangeTradedns5:CostValuation2022-12-3100721312ns5:UnlistedNon-exchangeTraded2023-12-3100721312ns5:UnlistedNon-exchangeTraded2022-12-3100721312ns5:CurrentFinancialInstrumentsns5:WithinOneYear2023-12-3100721312ns5:CurrentFinancialInstrumentsns5:WithinOneYear2022-12-3100721312ns5:WithinOneYear2023-12-3100721312ns5:WithinOneYear2022-12-3100721312ns5:BetweenOneFiveYears2023-12-3100721312ns5:BetweenOneFiveYears2022-12-3100721312ns5:AllPeriods2023-12-3100721312ns5:AllPeriods2022-12-3100721312ns5:DeferredTaxation2022-12-3100721312ns5:DeferredTaxation2023-01-012023-12-3100721312ns5:DeferredTaxation2023-12-3100721312ns5:RetainedEarningsAccumulatedLosses2022-12-3100721312ns5:CapitalRedemptionReserve2022-12-31
REGISTERED NUMBER: 00721312 (England and Wales)



















Group Strategic Report,

Report of the Directors and

Consolidated Financial Statements

for the Year Ended 31 December 2023

for

Pentagon Investments Limited

Pentagon Investments Limited (Registered number: 00721312)






Contents of the Consolidated Financial Statements
for the Year Ended 31 December 2023




Page

Company Information 1

Group Strategic Report 2

Report of the Directors 4

Report of the Independent Auditors 6

Consolidated Profit and Loss Account 9

Consolidated Balance Sheet 10

Company Balance Sheet 11

Consolidated Statement of Changes in Equity 12

Company Statement of Changes in Equity 13

Consolidated Cash Flow Statement 14

Notes to the Consolidated Financial Statements 15


Pentagon Investments Limited

Company Information
for the Year Ended 31 December 2023







DIRECTORS: Mrs H Marshall
I E Marshall
M E Marshall
G R Robson



SECRETARY: Mrs S A Robson



REGISTERED OFFICE: 12 Chequers Road
West Meadows Industrial Estate
Derby
DE21 6EN



REGISTERED NUMBER: 00721312 (England and Wales)



AUDITORS: Bates Weston Audit Ltd
Statutory Auditors
Chartered Accountants
The Mills
Canal Street
Derby
DE1 2RJ



BANKERS: Bank of Scotland
33 Old Broad Street
London
BX2 1LB



SOLICITORS: Browne Jacobson LLP
Castle Meadow Road
Nottingham
NG2 1BJ

Pentagon Investments Limited (Registered number: 00721312)

Group Strategic Report
for the Year Ended 31 December 2023

The group comprises the holding company, Pentagon Investments Limited, and the four trading subsidiaries, Mertrux Limited, Lawrence Vehicles Limited, Pentagon Vehicle Rentals Limited, and Meadow Group Services Limited.

Financial Overview
Profit on ordinary activities before taxation was £10.9m (2022: £8.6m). The group has seen an increase in turnover of £76.0m, which was to be expected following a good year of trade with back orders being fulfilled. Mertrux Limited saw an increase in turnover of £33.2m, and Lawrence saw an increase of £43.8m.

Financial Performance
Staff costs have increased by 13% due to an increase in salaries and the number of employees. Overall, the group plans to expand.

Pentagon Investments Limited owns certain properties occupied by its subsidiaries. Third party rental income remains consistent year on year.

Mertrux Limited operates a truck, van and used car retailing business with its associated trades. It holds four Mercedes Benz and Mitsubishi points of representation in the East Midlands. The main business activity remains the sale of commercial vehicles to national and local businesses. Truck and van sales in terms of units have increased by 2% for trucks and 58% for vans. The overall result for the company is an increase in turnover of £33.2m. Gross profit margin has slightly decreased in this competitive market by 0.8% to 6.9%.

Lawrence Vehicles Limited retails heavy trucks with its associated activities via a DAF franchise. The company has two main branches, one in Lancashire and the other based in Lothian. The company also has one parts depot. Turnover in the year increased by 20.0%. Gross profit has marginally increased by 0.7% to 4.8%. This company remains a key performer in the group.

Pentagon Vehicle Rentals Limited is a vehicle rental company focusing on the light van and commercial vehicle market. Turnover increased in the year by 73.8% the gross profit margin has increased by 35.5% to 51.7%.

Meadow Group Services Limited provides the central management and support services for the group. The majority of turnover relates to management fees for work performed for group companies. The company also offers financing and insured warranty products for its customers as an agent and is registered with the Financial Conduct Authority.

Principal Risks and Uncertainties
The management of the business and the nature of the group's strategy are subject to a number of risks.

The directors feel that the principal risk is that of not achieving turnover and the group closely monitors this. There is also the risk of gross profit reduction and cost increases against anticipated performance. The group operates within an industry where margins are low and therefore to be profitable, high volume sales need to occur. This again is closely monitored by the directors with any necessary action undertaken.

SECTION 172(1) STATEMENT
The directors consider, both individually and together, that they have acted in a way they consider, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole (having regard to the stakeholders and matters set out in s172(1)(a-f) of the Companies Act 2006) in the decisions taken during the year ended 31 December 2023.

ENGAGEMENT WITH EMPLOYEES
Within the bounds of confidentiality, staff at all levels are kept fully informed of matters that affect the progress of the company and group and are of interest to them as employees.

Disabled persons are given full and fair consideration for all types of vacancy. If an existing employee becomes disabled, such steps as are practical and reasonable are taken to retain him/her in employment. Where appropriate, assistance with rehabilitation and suitable training are given. Disabled persons have equal opportunities for training, career development and promotion, except insofar as such opportunities are constrained by the practical limitations of their disability.


Pentagon Investments Limited (Registered number: 00721312)

Group Strategic Report
for the Year Ended 31 December 2023

ENGAGEMENT WITH SUPPLIERS, CUSTOMERS AND OTHERS
The directors have had regard to the need to foster the company's business relationships with suppliers,
customers and others.

ON BEHALF OF THE BOARD:





I E Marshall - Director


6 September 2024

Pentagon Investments Limited (Registered number: 00721312)

Report of the Directors
for the Year Ended 31 December 2023

The directors present their report with the financial statements of the company and the group for the year ended 31 December 2023.

PRINCIPAL ACTIVITIES
The principal activities of the group in the year under review were those of retail truck, van and car dealers and their allied trades.

The holding company is responsible for the co-ordination of the activities of the group, its overall financial control and its future development.

DIVIDENDS
Interim dividends per share were paid during the year as follows:
Ordinary £1 - £98.5627 - 31 December 2023
Ordinary B1 £1 - £793.3333 - 31 December 2023
Ordinary B2 £1 - £804.5686 - 31 December 2023
Ordinary B3 £1 - £813.7255 - 31 December 2023
Ordinary B4 £1 - £809.8039 - 31 December 2023

The total distribution of dividends for the year ended 31 December 2023 will be £ 6,168,930 .

DIRECTORS
The directors shown below have held office during the whole of the period from 1 January 2023 to the date of this report.

Mrs H Marshall
I E Marshall
M E Marshall
G R Robson

FINANCIAL INSTRUMENTS AND RISK MANAGEMENT
The group’s financial assets and liabilities consist of trade debtors and creditors, cash balances, bank loans and overdrafts and stocking loans.

The directors manage the group’s exposure to financial risk by researching the credit worthiness of customers and by seeking advice from the group’s providers of finance and its other external financial advisers.

The group does not trade in foreign currencies.

The group does not trade speculatively in derivatives or similar instruments.

STREAMLINED ENERGY AND CARBON REPORTING
This section includes our mandatory reporting of energy and greenhouse gas emissions for the period 1 January 2023 to 31 December 2023, pursuant to the Companies (Directors' Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018, implementing the government's Streamlined Energy and Carbon Reporting (SECR) policy.

Our methodology to calculate our greenhouse gas emissions is based on the 'Environmental Reporting Guidelines January 2019, using the appropriate factors from the UK Government GHG Conversion Factors for Company Reporting (2023).

We report using a financial control approach to define our organisational boundary. We have reported all material emission sources required by the regulations for which we deem ourselves to be responsible and have maintained records of all source data and calculations.

During the reporting period, the steady increase in the number of electric and hybrid vehicles on fleet has continued where operational needs allow. A substantial increase in the use of Biodiesel as a proportion of the total diesel usage has resulted in a significant drop in the emissions resulting from this Scope. The table below includes total energy consumption (reported as kWh) and greenhouse gas emissions for the sources required by the regulations, along with our intensity ratio.

Pentagon Investments Limited (Registered number: 00721312)

Report of the Directors
for the Year Ended 31 December 2023



01/01/2023
-
31/12/2023
01/01/2022
-
31/12/2022
Total Energy Consumption - Used for Emissions Calculation (kWh) 8,636,058 7,743,415
Gas Combustion Emissions, Scope 1 (tCO2e) 535.64 483.99
Propane Emissions, Scope 1 (tCO2e) 2.8 1.1
Purchased Electricity Emissions, Scope 2 (tCO2e) 257.76 233.98
Vehicle Fuel Combustion Emissions, Scope 1 (tCO2e) 708.87 764.84
Vehicle Fuel Combustion Emissions, Scope 3 (tCO2e) 0 0
Total Gross Reported Emissions (tCO2e) 1,505.07 1,483.91
Turnover (£m) 392.78 316.77
Intensity Ratio: Turnover (tCO2e / £m) 3.83 4.68

There are no specific energy efficiency measures planned for the next financial year although the increase in electric/hybrid vehicles will continue as this sector of the market continues to evolve.

DISCLOSURE IN THE STRATEGIC REPORT
The matters required to be disclosed under SI (2008) 410 Sch 7 relating to employees are contained within the Group Strategic Report as applicable in accordance with s414C(11) of the Companies Act 2006.

STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Group Strategic Report, the Report of the Directors 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 the group 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 then apply them consistently;
- make judgements and accounting estimates that are reasonable and prudent;
- state whether applicable 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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

ON BEHALF OF THE BOARD:



Mrs S A Robson - Secretary


6 September 2024

Report of the Independent Auditors to the Members of
Pentagon Investments Limited

Opinion
We have audited the financial statements of Pentagon Investments 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 Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement 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 of the parent company 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 Auditors' 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 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 group's and the parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information
The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors 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.

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 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 the audit:
- the information given in the Group Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Group Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Report of the Independent Auditors to the Members of
Pentagon Investments Limited


Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Directors.

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 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 five, 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 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 group's and the parent 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 group or the parent company or to cease operations, or have no realistic alternative but to do so.

Auditors' 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 a Report of the Auditors 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.

Based on our understanding of the Group and industry in which it operates, we identified that the principal risks of non-compliance with laws and regulations related to the motor trade industry and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006. Audit procedures performed by the engagement team included:

- Enquiry of management around actual and potential litigation and claims;
- Reviewing financial statement disclosures and testing to supporting documentation to assess
compliance with applicable laws and regulations;
- Reviewing minutes of meetings of those charged with governance;
- Performing audit work over the risk of management override of controls, including testing of journal
entries and other adjustments for appropriateness, evaluating the business rationale of significant
transactions outside the normal course of business and reviewing accounting estimates for bias.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Report of the Independent Auditors to the Members of
Pentagon Investments 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 a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.




Ian Neal FCA CTA (Senior Statutory Auditor)
for and on behalf of Bates Weston Audit Ltd
Statutory Auditors
Chartered Accountants
The Mills
Canal Street
Derby
DE1 2RJ

24 September 2024

Pentagon Investments Limited (Registered number: 00721312)

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

2023 2022
as restated
Notes £'000 £'000

TURNOVER 3 392,775 316,769

Cost of sales 368,129 300,003
GROSS PROFIT 24,646 16,766

Administrative expenses 11,059 7,715
13,587 9,051

Other operating income 255 525
OPERATING PROFIT 5 13,842 9,576

Interest receivable and similar income 6 310 76
14,152 9,652

Interest payable and similar expenses 7 3,242 1,048
PROFIT BEFORE TAXATION 10,910 8,604

Tax on profit 8 2,851 1,644
PROFIT FOR THE FINANCIAL YEAR 8,059 6,960

OTHER COMPREHENSIVE INCOME - -
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR

8,059

6,960
Prior year adjustment 11 (675 )
TOTAL COMPREHENSIVE INCOME
SINCE LAST ANNUAL REPORT

7,384

Profit attributable to:
Owners of the parent 8,059 6,960

Total comprehensive income attributable to:
Owners of the parent 7,384 6,960

Pentagon Investments Limited (Registered number: 00721312)

Consolidated Balance Sheet
31 December 2023

2023 2022
as restated
Notes £'000 £'000 £'000 £'000
FIXED ASSETS
Tangible assets 12 25,453 23,508
Investments 13 - -
25,453 23,508

CURRENT ASSETS
Stocks 14 114,243 107,918
Debtors 15 21,811 42,297
Cash at bank and in hand 18,827 10,184
154,881 160,399
CREDITORS
Amounts falling due within one year 16 130,628 136,285
NET CURRENT ASSETS 24,253 24,114
TOTAL ASSETS LESS CURRENT
LIABILITIES

49,706

47,622

CREDITORS
Amounts falling due after more than one
year

17

(1,321

)

(1,190

)

PROVISIONS FOR LIABILITIES 20 (468 ) (405 )
NET ASSETS 47,917 46,027

CAPITAL AND RESERVES
Called up share capital 21 51 51
Capital redemption reserve 22 111 111
Retained earnings 22 47,755 45,865
SHAREHOLDERS' FUNDS 47,917 46,027

The financial statements were approved by the Board of Directors and authorised for issue on 6 September 2024 and were signed on its behalf by:




Mrs H Marshall - Director



I E Marshall - Director


Pentagon Investments Limited (Registered number: 00721312)

Company Balance Sheet
31 December 2023

2023 2022
as restated
Notes £'000 £'000 £'000 £'000
FIXED ASSETS
Tangible assets 12 13,538 13,785
Investments 13 350 350
13,888 14,135

CURRENT ASSETS
Debtors 15 7,881 7,703
Cash at bank 1,595 1,163
9,476 8,866
CREDITORS
Amounts falling due within one year 16 12,764 6,851
NET CURRENT (LIABILITIES)/ASSETS (3,288 ) 2,015
TOTAL ASSETS LESS CURRENT
LIABILITIES

10,600

16,150

PROVISIONS FOR LIABILITIES 20 - 12
NET ASSETS 10,600 16,138

CAPITAL AND RESERVES
Called up share capital 21 51 51
Capital redemption reserve 22 111 111
Retained earnings 22 10,438 15,976
SHAREHOLDERS' FUNDS 10,600 16,138

Company's profit/(loss) for the financial
year

631

(168

)

The financial statements were approved by the Board of Directors and authorised for issue on 6 September 2024 and were signed on its behalf by:




Mrs H Marshall - Director



I E Marshall - Director


Pentagon Investments Limited (Registered number: 00721312)

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

Called up Capital
share Retained redemption Total
capital earnings reserve equity
£'000 £'000 £'000 £'000
Balance at 1 January 2022 51 41,546 111 41,708

Changes in equity
Dividends - (2,641 ) - (2,641 )
Total comprehensive income - 7,635 - 7,635
Balance at 31 December 2022 51 46,540 111 46,702
Prior year adjustment - (675 ) - (675 )
As restated 51 45,865 111 46,027

Changes in equity
Dividends - (6,169 ) - (6,169 )
Total comprehensive income - 8,059 - 8,059
Balance at 31 December 2023 51 47,755 111 47,917

Pentagon Investments Limited (Registered number: 00721312)

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

Called up Capital
share Retained redemption Total
capital earnings reserve equity
£'000 £'000 £'000 £'000
Balance at 1 January 2022 51 18,785 111 18,947

Changes in equity
Dividends - (2,641 ) - (2,641 )
Total comprehensive income - (168 ) - (168 )
Balance at 31 December 2022 51 15,976 111 16,138

Changes in equity
Dividends - (6,169 ) - (6,169 )
Total comprehensive income - 631 - 631
Balance at 31 December 2023 51 10,438 111 10,600

Pentagon Investments Limited (Registered number: 00721312)

Consolidated Cash Flow Statement
for the Year Ended 31 December 2023

2023 2022
as restated
Notes £'000 £'000
Cash flows from operating activities
Cash generated from operations 27 24,131 417
Interest paid (3,183 ) (988 )
Interest element of hire purchase
payments paid

(59

)

(60

)
Tax paid (1,979 ) (1,447 )
Net cash from operating activities 18,910 (2,078 )

Cash flows from investing activities
Purchase of tangible fixed assets (6,404 ) (3,250 )
Sale of tangible fixed assets 1,371 1,030
Sale of investment property - 444
Interest received 310 76
Net cash from investing activities (4,723 ) (1,700 )

Cash flows from financing activities
New loans in year 1,223 -
Capital repayments in year (598 ) (1,054 )
Equity dividends paid (6,169 ) (2,641 )
Net cash from financing activities (5,544 ) (3,695 )

Increase/(decrease) in cash and cash equivalents 8,643 (7,473 )
Cash and cash equivalents at
beginning of year

28

10,184

17,657

Cash and cash equivalents at end of
year

28

18,827

10,184

Pentagon Investments Limited (Registered number: 00721312)

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

1. STATUTORY INFORMATION

Pentagon Investments Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the General Information page.

2. ACCOUNTING POLICIES

Basis of preparing the financial statements
These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.

Consolidation
The consolidated accounts incorporate the accounts of Pentagon Investments Limited and all of its subsidiary undertakings. The acquisition method of accounting has been adopted.

Goodwill arising on consolidation was written off against reserves on acquisition. This will be charged to the profit and loss account on disposal of the business to which it relates.

In the company's financial statements, investments in subsidiary undertakings are stated at cost less amounts written off.

Turnover
Turnover represents the amounts (excluding value added tax) derived from the provision of goods and services to third party and group customers during the year. Turnover is recognised when the group has transferred the significant risks and rewards of ownership to the buyer and it is probable that the group will receive the agreed upon payment.

Tangible fixed assets
Tangible fixed assets are stated at historical cost less accumulated depreciation and any accumulated impairment loss. 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.

Depreciation is provided on all fixed assets, with the exception of loose tools, to write off the cost less the estimated residual value in annual instalments over their estimated useful lives as follows :-

Assets in the course of construction- not provided
Freehold property- 2% straight line on cost or revaluation
Short leasehold- over the period of the lease
Plant and machinery- 15% on cost
Fixtures, fittings, tools and equipment- 10% to 20% on cost
Motor vehicles and equipment- 15% to 50% on cost
Computer equipment- 25% on cost

Vehicles are written off systematically on a straight line basis by reference to their estimated residual value at proposed date of disposal over a range of 2 to 8 years. Loose tools are accounted for on a renewals basis.

Freehold land is not depreciated.

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 within 'cost of sales' and 'administrative expenses' in the profit and loss account.

Pentagon Investments Limited (Registered number: 00721312)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

2. ACCOUNTING POLICIES - continued

Investment property
Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss.

Stocks
Stocks are valued at the lower of cost and net realisable value, after making due allowance for slow moving and obsolete items. In the case of work in progress, cost includes direct labour. Cost represents the invoiced cost of materials, parts and vehicles on an average cost basis.

At each reporting date, stock is assessed for impairment. If impaired, the carrying amount is reduced and the impairment loss is recognised immediately in the profit and loss account.

Vehicles held on consignment are included within stocks in the Balance Sheet when the terms of the consignment agreement and normal commercial practice indicate that the group enjoys the principal benefit equivalent to owning the stock, being the ability to sell it, and carries the principal risks of ownership which are the cost of stockholding, safekeeping and some risks of obsolescence. When these criteria are not met, consignment stocks are not accounted for in the Balance Sheet but disclosed in the notes to the financial statements.

Deferred tax
Deferred tax arises from timing differences that are differences between taxable total profits and total comprehensive income as stated in the financial statements. These timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in the financial statements.

A deferred tax asset is recognised only when it is more likely than not that there will be suitable taxable profits from which the future reversal of underlying timing differences and losses can be deducted.

Provision is made at current rates for taxation deferred in respect of all material timing differences.

Fixed asset investments
Fixed asset investments are valued at cost less provisions for permanent diminution in valuations.

Hire purchase and leasing commitments payable
Assets obtained under hire purchase contracts are capitalised in the Balance Sheet and are depreciated over their estimated useful lives.

The interest element of these obligations is charged to the profit and loss account on a basis which gives a constant periodic rate of interest, on the outstanding hire purchase liability. The capital element of the future payments is treated as a liability.

Rentals paid under operating leases are charged to the profit and loss account as incurred.

Pension costs and other post-retirement benefits
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 separate entity. Once the contributions have been paid the group has no further payment obligations. The contributions are recognised as an expense when they fall due. Amounts not paid are shown in accruals in the Balance Sheet. The assets of the plan are held separately from the group in independently administered funds.

Hire purchase and finance lease receivables
The net investment in assets held by third parties under hire purchase contracts and finance leases in which a residual interest is retained, is accounted for as a current asset within Debtors. Revenue is recognised on a straight line basis over the term of the contract and is included within Turnover.

Pentagon Investments Limited (Registered number: 00721312)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

2. ACCOUNTING POLICIES - continued

Operating lease receivables
Where the company or its subsidiaries enters into a lease as lessor which entails taking substantially all the risks and rewards of ownership of an asset, the lease is treated as an operating lease. The asset is recorded in the Balance Sheet as a tangible fixed asset and is depreciated over its estimated useful life or the term of the lease, whichever is shorter. Revenue is recognised on a straight line basis over the term of the contract and is included within Turnover.

Judgements in applying accounting policies and key sources of estimation
In the application of the group's accounting policies the directors are required to make judgement estimates and assumptions about the carrying amounts of the group's assets and liabilities. These are based on historical experience and other factors that are considered relevant and are reviewed on a regular basis and recognised in the period in which the estimate is revised. Actual results may differ from these estimates.

The following are the critical judgements and where relevant the key sources of estimation uncertainty:

Tangible fixed assets are depreciated over their useful economic lives taking in to account their residual values where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing the asset lives, factors such as technological innovation, product life cycles and maintenance programmes are taken in to account. Residual values consider such things as future market conditions, the remaining life of the asset and projected disposal values.

The recoverability of debtors is assessed on the likelihood and circumstances of the particular cost.

The value of stock is assessed for impairment. In re-assessing the stock value, factors such as slow movement and obsolescence are taken in to account.

As regards to the fair value of the properties held for investment purposes, the directors have considered the portfolio on an aggregate basis given the tenants, rental including any receivable, and capital growth potential in the foreseeable future.

3. TURNOVER

Turnover is wholly attributable to the principal activities of the group and is generated principally within the United Kingdom.

4. EMPLOYEES AND DIRECTORS
2023 2022
as restated
£'000 £'000
Wages and salaries 17,824 15,556
Social security costs 1,838 1,781
Other pension costs 1,045 984
20,707 18,321

Pentagon Investments Limited (Registered number: 00721312)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

4. EMPLOYEES AND DIRECTORS - continued

The average number of employees during the year was as follows:
2023 2022
as restated

Staff and office 139 138
Production and sales 240 224
379 362

2023 2022
as restated
£    £   
Directors' remuneration 892,913 786,353
Directors' pension contributions to money purchase schemes 50,162 49,691

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes 3 3

Information regarding the highest paid director is as follows:
2023 2022
as restated
£    £   
Emoluments etc 722,972 620,147

5. OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2023 2022
as restated
£'000 £'000
Depreciation - owned assets 2,668 2,218
Depreciation - assets on hire purchase contracts 634 881
Profit on disposal of fixed assets (214 ) (175 )
Auditors' remuneration 100 130
Auditors' remuneration - accountancy and taxation compliance 13 13
Auditors' remuneration - other 7 7
Rentals received from vehicle operating leases (6,593 ) (3,780 )
Rents received - other (1,042 ) (892 )
Operating lease rentals 912 912

Pentagon Investments Limited (Registered number: 00721312)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

6. INTEREST RECEIVABLE AND SIMILAR INCOME
2023 2022
as restated
£'000 £'000
Interest on deposits and loans 242 71
Interest received 68 5
310 76

7. INTEREST PAYABLE AND SIMILAR EXPENSES
2023 2022
as restated
£'000 £'000
Interest on taxation 11 -
Stocking loan interest 3,172 988
Hire purchase 59 60
3,242 1,048

8. TAXATION

Analysis of the tax charge
The tax charge on the profit for the year was as follows:
2023 2022
as restated
£'000 £'000
Current tax:
UK corporation tax 2,412 1,371
Adjustment re prior year 376 -
Total current tax 2,788 1,371

Deferred tax 63 273
Tax on profit 2,851 1,644

Pentagon Investments Limited (Registered number: 00721312)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

8. TAXATION - continued

Reconciliation of total tax charge included in profit and loss
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

2023 2022
as restated
£'000 £'000
Profit before tax 10,910 8,604
Profit multiplied by the standard rate of corporation tax in the UK of
23.520 % (2022 - 19 %)

2,566

1,635

Effects of:
Expenses not deductible for tax purposes 53 87
Capital allowances in excess of depreciation (236 ) (386 )
Prior year adjustment 376 -
Short term timing differences 29 35
Deferred tax adjustment 63 273
Total tax charge 2,851 1,644

9. INDIVIDUAL PROFIT AND LOSS ACCOUNT

As permitted by Section 408 of the Companies Act 2006, the Profit and Loss Account of the parent company is not presented as part of these financial statements.


10. DIVIDENDS
2023 2022
as restated
£'000 £'000
Ordinary shares of £1 each
Interim 4,526 2,641
Ordinary B1 shares of £1 each
Interim 405 -
Ordinary B2 shares of £1 each
Interim 410 -
Ordinary B3 shares of £1 each
Interim 415 -
Ordinary B4 shares of £1 each
Interim 413 -
6,169 2,641

11. PRIOR YEAR ADJUSTMENT

Turnover in the subsidiary, Lawrence Vehicles Limited, has previously been recognised upon invoice of vehicles. Further to a review of sales terms and conditions, it was identified that turnover should be recognised upon delivery of vehicles. In the year to 31 December 2022, an adjustment has been made to decrease turnover by £11.0m, increase closing stock by £21.6m, increase opening stock by £10.8m, increase deferred income by £25.1m and increase accrued income by £2.8m. Opening retained earnings at 01 January 2022 have been amended by £425,000.

Pentagon Investments Limited (Registered number: 00721312)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

12. TANGIBLE FIXED ASSETS

Group
Assets in
the
Freehold Short course of
property leasehold construction
£'000 £'000 £'000
COST OR VALUATION
At 1 January 2023 16,444 10 18
Additions - - -
Disposals - - -
At 31 December 2023 16,444 10 18
DEPRECIATION
At 1 January 2023 2,687 - -
Charge for year 247 - -
Eliminated on disposal - - -
At 31 December 2023 2,934 - -
NET BOOK VALUE
At 31 December 2023 13,510 10 18
At 31 December 2022 13,757 10 18

Fixtures
and Motor Computer
fittings vehicles equipment Totals
£'000 £'000 £'000 £'000
COST OR VALUATION
At 1 January 2023 2,398 19,183 23 38,076
Additions 14 6,390 - 6,404
Disposals - (4,313 ) - (4,313 )
At 31 December 2023 2,412 21,260 23 40,167
DEPRECIATION
At 1 January 2023 1,703 10,166 12 14,568
Charge for year 152 2,897 6 3,302
Eliminated on disposal - (3,156 ) - (3,156 )
At 31 December 2023 1,855 9,907 18 14,714
NET BOOK VALUE
At 31 December 2023 557 11,353 5 25,453
At 31 December 2022 695 9,017 11 23,508

Motor vehicles with a cost of £16,276,517 (2022 - £14,936,813) and accumulated depreciation of £6,823,778 (2022 - £6,969,831) are utilised by a subsidiary for leasing activities. Depreciation for the year on these assets was £2,344,862 (2022 - £2,311,813).

Pentagon Investments Limited (Registered number: 00721312)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

12. TANGIBLE FIXED ASSETS - continued

Group

Cost or valuation at 31 December 2023 is represented by:

Assets in
the
Freehold Short course of
property leasehold construction
£'000 £'000 £'000
Valuation in 1996 3,286 - -
Cost 13,158 10 18
16,444 10 18

Fixtures
and Motor Computer
fittings vehicles equipment Totals
£'000 £'000 £'000 £'000
Valuation in 1996 - - - 3,286
Cost 2,412 21,260 23 36,881
2,412 21,260 23 40,167

Freehold property was revalued to reflect its open market value at 31 March 1996. The valuations were undertaken by Wilson Orridge, Chartered Surveyors, in accordance with the RICS Appraisal and Valuation Manual. The valuation for the remaining properties held is lower than their historical cost. There is consequently no difference between the aggregate depreciation above and that calculated on an historical cost basis. Under the transitional provisions of Financial Reporting Standard number 102 the directors have frozen these valuations at the 31 March 1996 values. The amount of freehold land included above which has not been depreciated is £4,542,000 (2022 - £4,542,000).

The net book value of tangible fixed assets includes £2,635,196 (2022 - £2,175,311) in respect of assets held under hire purchase contracts.

Company
Assets in
the
Freehold Short course of
property leasehold construction Totals
£'000 £'000 £'000 £'000
COST OR VALUATION
At 1 January 2023
and 31 December 2023 16,444 10 18 16,472
DEPRECIATION
At 1 January 2023 2,687 - - 2,687
Charge for year 247 - - 247
At 31 December 2023 2,934 - - 2,934
NET BOOK VALUE
At 31 December 2023 13,510 10 18 13,538
At 31 December 2022 13,757 10 18 13,785

Pentagon Investments Limited (Registered number: 00721312)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

12. TANGIBLE FIXED ASSETS - continued

Company

Freehold property was revalued to reflect its open market value at 31 March 1996. The valuations were undertaken by Wilson Orridge, Chartered Surveyors, in accordance with the RICS Appraisal and Valuation Manual. The valuation for the remaining properties held is lower than their historical cost. There is consequently no difference between the aggregate depreciation above and that calculated on an historical cost basis. Under the transitional provisions of Financial Reporting Standard number 102 the directors have frozen these valuations at the 31 March 1996 values. The amount of freehold land included above which has not been depreciated is £4,542,000 (2022 - £4,542,000).

Cost or valuation at 31 December 2023 is represented by:

Assets in
the
Freehold Short course of
property leasehold construction Totals
£'000 £'000 £'000 £'000
Valuation in 1996 3,286 - - 3,286
Cost 13,158 10 18 13,186
16,444 10 18 16,472

13. FIXED ASSET INVESTMENTS

Company
Unlisted
investments
£'000
COST
At 1 January 2023
and 31 December 2023 350
NET BOOK VALUE
At 31 December 2023 350
At 31 December 2022 350


Investment in Subsidiary Undertakings
At the balance sheet date, the company had the following wholly owned subsidiaries all of which are involved in the motor trade except Toptrux (Nottingham) Limited, Truck Parts 4 U Limited and Central Vanz & Trux Limited which are dormant companies. All are included in these consolidated financial statements:-
Class of share
Mertrux Limited Ordinary
Lawrence Vehicles Limited Ordinary
Pentagon Vehicle Rentals Limited Ordinary
Meadow Group Services Limited Ordinary
Central Vanz & Trux Limited Ordinary
Toptrux (Nottingham) Limited Ordinary
Truck Parts 4 U Limited Ordinary

The registered offices of the undertakings are that of the parent.

Pentagon Investments Limited (Registered number: 00721312)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

14. STOCKS

Group
2023 2022
as restated
£'000 £'000
Vehicles and parts for resale 78,938 92,153
Consignment stock 35,305 15,765
114,243 107,918

15. DEBTORS

Group Company
2023 2022 2023 2022
as
restated
as
restated
£'000 £'000 £'000 £'000
Amounts falling due within one year:
Trade debtors 18,745 31,535 - -
Other debtors 2,306 6,202 563 2,313
Amounts due from group undertakings - - 7,289 5,390
Prepayments and accrued income 760 4,560 - -
21,811 42,297 7,852 7,703

Amounts falling due after more than one year:
Deferred tax asset - - 29 -

Aggregate amounts 21,811 42,297 7,881 7,703

16. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group Company
2023 2022 2023 2022
as
restated
as
restated
£'000 £'000 £'000 £'000
Hire purchase contracts (see note 18) 1,452 958 - -
Trade creditors 58,225 86,703 - -
Tax 1,504 695 274 -
Social security and other taxes 3,860 716 - -
Other creditors 5,388 3,301 3,255 1,835
Consignment stock 35,305 15,765 - -
Amounts due to group undertakings - - 8,812 4,634
Accruals and deferred income 24,894 28,147 423 382
130,628 136,285 12,764 6,851

Pentagon Investments Limited (Registered number: 00721312)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

17. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE
YEAR

Group
2023 2022
as restated
£'000 £'000
Hire purchase contracts (see note 18) 1,321 1,190

18. LEASING AGREEMENTS

Minimum lease payments fall due as follows:

Group
Hire purchase contracts
2023 2022
as restated
£'000 £'000
Net obligations repayable:
Within one year 1,452 958
Between one and five years 1,321 1,190
2,773 2,148

Group
Non-cancellable operating leases
2023 2022
as restated
£'000 £'000
Within one year 277 289
Between one and five years 284 60
561 349

Company
Non-cancellable operating leases
2023 2022
as restated
£'000 £'000
Within one year 60 120
Between one and five years - 60
60 180

Pentagon Investments Limited (Registered number: 00721312)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

18. LEASING AGREEMENTS - continued

Minimum lease income falls due as follows:

Group Company
2023 2022 2023 2022
£'000 £'000 £'000 £'000

Within one year 3,594 3,303 120 120
Between one and five years 6,182 4,541 - -
In more than five years - 31 - -
9,776 7,875 120 120

19. SECURED DEBTS

The following secured debts are included within creditors:

Group
2023 2022
as restated
£'000 £'000
Hire purchase contracts 2,773 2,148
Consignment stock 35,205 15,765
37,978 17,913

Vehicles subject to hire purchase agreements are secured by charges to their respective finance companies in accordance with normal practice.

Consignment stock is secured by way of a floating charge over the company's stock.

20. PROVISIONS FOR LIABILITIES

Group Company
2023 2022 2023 2022
as
restated
as
restated
£'000 £'000 £'000 £'000
Deferred taxation -
accelerated capital allowances 468 405 - 12
468 405 - 12

Group
Deferred
tax
£'000
Balance at 1 January 2023 405
Provided during year 63
Balance at 31 December 2023 468

Pentagon Investments Limited (Registered number: 00721312)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

20. PROVISIONS FOR LIABILITIES - continued

Company
Deferred
tax
£'000
Balance at 1 January 2023 12
Utilised during year (12 )
Balance at 31 December 2023 -

21. CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:
Number: Class: Nominal value: 2022 2021
£    £   
45,920 Ordinary £1 45,920 45,920
510 Ordinary B1 £1 510 510
510 Ordinary B2 £1 510 510
510 Ordinary B3 £1 510 510
510 Ordinary B4 £1 510 510
510 Ordinary B5 £1 510 510
510 Ordinary B6 £1 510 510
510 Ordinary B7 £1 510 510
510 Ordinary B8 £1 510 510
510 Ordinary B9 £1 510 510
510 Ordinary B10 £1 510 510
51,020 51,020

22. RESERVES

Group
Capital
Retained redemption
earnings reserve Totals
£'000 £'000 £'000

At 1 January 2023 46,540 111 46,651
Prior year adjustment (675 ) (675 )
45,865 45,976
Profit for the year 8,059 8,059
Dividends (6,169 ) (6,169 )
At 31 December 2023 47,755 111 47,866

Pentagon Investments Limited (Registered number: 00721312)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

22. RESERVES - continued

Company
Capital
Retained redemption
earnings reserve Totals
£'000 £'000 £'000

At 1 January 2023 15,976 111 16,087
Profit for the year 631 631
Dividends (6,169 ) (6,169 )
At 31 December 2023 10,438 111 10,549


23. OTHER FINANCIAL COMMITMENTS

The company has given a guarantee to the Bank of Scotland covering the liabilities due to the bank of whatever nature relating to Pentagon Investments Limited and its subsidiaries. In addition, the bank holds a debenture conferring fixed and floating charges to secure all monies from time to time owed by the company to the bank. At the balance sheet date, the net liability was £Nil (2022 - £Nil).

24. RELATED PARTY DISCLOSURES

During the year, the dividends were paid by the company to the beneficiaries of the family trusts.

The directors and shareholders maintain current accounts with the company. At the balance sheet date, the balances owed to/from such persons included in other creditors were £1,998,386 (2022 - £736,281) and in other debtors were £Nil (2022 - £728,853). The balances are interest free and repayable on demand.

Pentagon Investments Limited leases land and buildings from a Retirement Benefit Scheme of which Pentagon Investments Limited is the principal employer. Directors and other family members are members of the scheme. The land and buildings are occupied by subsidiaries, which accounts for the rent due of £217,000 (2022 - £217,000) and are paid directly to the scheme. At the balance sheet date £Nil (2022 - £Nil) was owed to the pension scheme. During 2012, Pentagon Investments Limited advanced a loan of £1,050,000 to the pension scheme. The loan was due for repayment on 27 May 2022 under an agreement signed in February 2017, and has been received during the year. Interest was charged on this loan at a rate of 3.25% above Lloyds Bank base rate.

25. ULTIMATE CONTROLLING PARTY

Mrs H Marshall is the group's ultimate controlling party.

26. EMPLOYEE BENEFITS

Included in the notes to the financial statements are payments to the defined contribution pension scheme.

Pentagon Investments Limited (Registered number: 00721312)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

27. RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM
OPERATIONS
2023 2022
as restated
£'000 £'000
Profit before taxation 10,910 8,604
Depreciation charges 3,302 3,099
Profit on disposal of fixed assets (214 ) (186 )
Finance costs 3,242 1,048
Finance income (310 ) (76 )
16,930 12,489
Increase in stocks (6,325 ) (50,689 )
Decrease/(increase) in trade and other debtors 20,486 (13,327 )
(Decrease)/increase in trade and other creditors (6,960 ) 51,944
Cash generated from operations 24,131 417

28. CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 December 2023
31.12.23 1.1.23
£'000 £'000
Cash and cash equivalents 18,827 10,184
Year ended 31 December 2022
31.12.22 1.1.22
as restated
£'000 £'000
Cash and cash equivalents 10,184 17,657


29. ANALYSIS OF CHANGES IN NET FUNDS

At 1.1.23 Cash flow At 31.12.23
£'000 £'000 £'000
Net cash
Cash at bank and in hand 10,184 8,643 18,827
10,184 8,643 18,827
Debt
Finance leases (2,148 ) (625 ) (2,773 )
(2,148 ) (625 ) (2,773 )
Total 8,036 8,018 16,054