Company registration number 02343004 (England and Wales)
MANDARIN SLATE LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
MANDARIN SLATE LIMITED
COMPANY INFORMATION
Directors
R Pick
C Ryan
L E Morgan
S W Small
A L Small
S J C Small
E C Small
T Bentham
B Handley
Company number
02343004
Registered office
Unit 1
Wonastow Road
Industrial Estate East
Monmouth
NP25 5JB
Auditor
UHY Hacker Young
Bradbury House
Mission Court
Newport
Gwent
United Kingdom
NP20 2DW
Bankers
Lloyds Bank Plc
18 Monnow Street
Monmouth
Monmouthshire
NP25 3XH
MANDARIN SLATE LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 4
Independent auditor's report
5 - 7
Profit and loss account
8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 25
MANDARIN SLATE LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -

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

Review of the business

The UK market started to weaken in 2023 after two years of unprecedented growth following the COVID pandemic. Although external data is limited, we estimated that the UK tile Market is approximately 18% lower than in the pre-pandemic period. Despite this, our turnover has only decreased by 2.25% to £43.9 million in 2023 from £44.9 million in 2022. An increase in cost of sales of 2.75% has resulted in a slight erosion of our margin due to inflationary price rises and higher inbound delivery charges.

 

The company has performed well in a difficult environment where consumer confidence is low. We opened our 15th showroom in Harrogate in November with further planned growth for 2024 which includes an additional showroom and continued renovations of our existing branches. We have continued to invest in our website, warehouse management system and fleet of specialist delivery vehicles.

Principal risks and uncertainties

The management of the business and the execution of the company's strategies are continually being monitored and reviewed. One of the main key factors is failure to identify and react to changes in the business environment and marketing conditions, resulting in increased costs, fall in demand or margin erosion.

 

We have seen some supply issues and increased costs from suppliers as they deal with the impact of war, the Board are continually reviewing, mitigating the impact by monitoring both suppliers and product range.

 

Close observation of the economic and marketing conditions monitoring trends, and proactively managing any currency.

 

Customers are our focus, understanding their needs and supporting them is key to our success.

Our employees are central to our success, we engage wherever possible to support their development and contribution to the company.

Key performance indicators

The directors consider that the key financial performance indicators are those that communicate the financial performance and strength of the company as a whole, these being turnover, gross profit, operating profit and profit before taxation as set out in the statement of comprehensive income.

Companies Act s172 - Promoting the success of the company

The Directors place significant importance on the strength of the Company’s relationships with all its stakeholders to promote the sustainable success of the Company. In order to fulfil their duties, the Directors take care to have regard to the likely consequences on all stakeholders of the decisions and actions which they take. Such considerations ensure the business is making decisions with a long-term view and with the sustainable success of the business at its core.

 

Where possible, decisions are carefully discussed with affected groups and are therefore fully understood and supported when taken.

On behalf of the board

A L Small
Director
26 September 2024
MANDARIN SLATE LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -

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

Principal activities

The principal activity of the company continued to be that of the supply of high quality stone, porcelain and related ancillary products. The company is a wholly-owned subsidiary of Mandarin Stone Holdings Limited.

Results and dividends

The results for the year are set out on page 8. A review of business is set out in the Strategic Report on page 1.

Ordinary dividends were paid amounting to £1,213. The directors do not recommend payment of a further dividend.

Directors

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

R Pick
C Ryan
L E Morgan
S W Small
A L Small
S J C Small
E C Small
T Bentham
B Handley
Financial instruments
Currency contracts

The company’s principal foreign currency exposures arise from trading with overseas companies. Company policy permits but does not demand that these exposures may be hedged in order to fix the cost in sterling. This hedging activity involves the use of foreign exchange forward contracts.

Financial risk management

The company's operations expose it to a variety of financial risks, the most significant being the effects of changes in exchange rates. These are actively monitored by the Directors and the Finance Department in order to utilise any such movements to its advantage.

Auditor

The auditor, UHY Hacker Young, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Energy and carbon report

The Company’s primary energy consumption is vehicle fuel associated with buying and selling the Company’s products.

Greenhouse gas emissions and energy consumption are as follows:

2023
2022
Energy consumption
kWh
kWh
Aggregate of energy consumption in the year
655,403
589,922
MANDARIN SLATE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
2023
2022
Emissions of CO2 equivalent
metric tonnes
metric tonnes
Scope 1 - direct emissions
- Gas combustion
-
-
- Fuel consumed for owned transport
3,429.81
3,071.08
3,429.81
3,071.08
Scope 2 - indirect emissions
- Electricity purchased
126.74
114.08
Scope 3 - other indirect emissions
- Fuel consumed for transport not owned by the company
172.74
314.07
Total gross emissions
3,729.29
3,499.23
Intensity ratio
Tonnes CO2e per £1m of revenue
67
78
Quantification and reporting methodology

We have followed the 2019 HM Government Environmental Reporting Guidelines. We have also used the GHG Reporting Protocol – Corporate Standard and have used the 2022 UK Government’s Conversion Factors for Company Reporting.

Intensity measurement

The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per £m of revenue, the recommended ratio for the sector.

Measures taken to improve energy efficiency

With a view to reducing our carbon footprint and saving costs, the Company continues to implement energy saving measures, including the purchase of electric fork lift trucks and energy saving lighting. The Company is currently undertaking a viability assessment in relation to the installation of solar panels.

MANDARIN SLATE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
Statement of directors' responsibilities

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

 

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

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Statement of disclosure to auditor

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

Matters covered in the strategic report

Further details of future developments are provided under the "Business Review" section within the Strategic Report.

On behalf of the board
A L Small
Director
26 September 2024
MANDARIN SLATE LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF MANDARIN SLATE LIMITED
- 5 -
Opinion

We have audited the financial statements of Mandarin Slate Limited (the 'company') for the year ended 31 December 2023 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

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

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

MANDARIN SLATE LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF MANDARIN SLATE LIMITED
- 6 -
Matters on which we are required to report by exception

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

 

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

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

 

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

 

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

 

We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

MANDARIN SLATE LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF MANDARIN SLATE LIMITED
- 7 -

To address the risk of fraud through management bias and override of controls, we:

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial statements, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

 

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

 

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

Use of our report

This report is made solely to the company's member in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's member those matters we are required to state to 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 member for our audit work, for this report, or for the opinions we have formed.

Mr John Griffiths (Senior Statutory Auditor)
For and on behalf of UHY Hacker Young
26 September 2024
Chartered Accountants
Statutory Auditor
Newport
Gwent
United Kingdom
MANDARIN SLATE LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
2023
2022
Notes
£000
£000
Turnover
3
43,917
44,929
Cost of sales
(21,539)
(20,963)
Gross profit
22,378
23,966
Distribution costs
(9,586)
(9,340)
Administrative expenses
(7,989)
(7,448)
Other operating income
27
187
Operating profit
4
4,830
7,365
Interest receivable and similar income
8
15
-
0
Fair value gains/(losses) on financial instruments
9
42
109
Profit before taxation
4,887
7,474
Tax on profit
10
(1,133)
(1,381)
Profit for the financial year
3,754
6,093

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

MANDARIN SLATE LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
£000
£000
Profit for the year
3,754
6,093
Other comprehensive income
-
-
Total comprehensive income for the year
3,754
6,093
MANDARIN SLATE LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
Notes
£000
£000
£000
£000
Fixed assets
Tangible assets
12
3,551
3,162
Current assets
Stocks
13
7,518
9,388
Debtors
15
714
699
Cash at bank and in hand
8,282
4,886
16,514
14,973
Creditors: amounts falling due within one year
16
(7,442)
(9,279)
Net current assets
9,072
5,694
Total assets less current liabilities
12,623
8,856
Provisions for liabilities
Provisions
17
1,009
1,098
Deferred tax liability
18
761
658
(1,770)
(1,756)
Net assets
10,853
7,100
Capital and reserves
Called up share capital
20
23
23
Share premium account
22
909
909
Profit and loss reserves
22
9,921
6,168
Total equity
10,853
7,100
The financial statements were approved by the board of directors and authorised for issue on 26 September 2024 and are signed on its behalf by:
A L Small
Director
Company registration number 02343004 (England and Wales)
MANDARIN SLATE LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£000
£000
£000
£000
Balance at 1 January 2022
20
-
0
12,435
12,455
Year ended 31 December 2022:
Profit and total comprehensive income
-
-
6,093
6,093
Issue of share capital
20
3
909
-
912
Dividends
11
-
-
(12,360)
(12,360)
Balance at 31 December 2022
23
909
6,168
7,100
Year ended 31 December 2023:
Profit and total comprehensive income
-
-
3,754
3,754
Dividends
11
-
-
(1)
(1)
Balance at 31 December 2023
23
909
9,921
10,853
MANDARIN SLATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
1
Accounting policies
Company information

Mandarin Slate Limited is a private company limited by shares incorporated in England and Wales. The registered office is Unit 1, Wonastow Road, Industrial Estate East, Monmouth, NP25 5JB.

1.1
Accounting convention

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

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £000.

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

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

 

 

The financial statements of the company are consolidated in the financial statements of Mandarin Stone Holdings Limited. These consolidated financial statements are available from its registered office, Unit 1 Wonastow Road Industrial Estate (East), Monmouth, Monmouthshire, United Kingdom, NP25 5JB.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

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

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

1.4
Tangible fixed assets

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

MANDARIN SLATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -

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

Leasehold improvements
15% on cost
Plant and equipment
15% on cost
Fixtures and fittings
15% on cost
Motor vehicles
25% on cost

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

1.5
Stocks

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

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

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

1.6
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

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

 

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

 

Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account in other administrative expense.

Other financial assets

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

MANDARIN SLATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
Impairment of financial assets

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

 

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

 

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

Derecognition of financial assets

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

Other financial liabilities

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

 

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

Derecognition of financial liabilities

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

1.7
Taxation

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

Current tax

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

MANDARIN SLATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Deferred tax

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

 

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

1.8
Provisions

Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

 

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

1.9
Employee benefits

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

 

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

 

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

1.10
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.11
Leases

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

1.12
Foreign exchange

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

MANDARIN SLATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
2
Judgements and key sources of estimation uncertainty

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

 

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

Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Dilapidations

The company has a number of operating leases relating to premises. These leases include dilapidation clauses requiring the company to return premises to the condition they were in prior to the company taking over the lease. The company has made extensive modifications to premises to facilitate display of its products. This creates a current obligation.

 

The board has calculated its best estimate of the cost of returning all properties to the condition they were in when the company entered the leases, however this involved significant judgement; actual costs may vary significantly.

Warranty provision

The company often provides assurances or guarantees in respect of its products; for significant customers the company may provide advice that effectively means the company has provided a "warranty".

 

At each reporting date the board considers the possibility of any potential claims under warranties that the company has given and estimates the potential cost of rectification.

 

In most cases the board believes that the company would have a reasonable counter claim against the company's supplier or the installer, however the board has not taken account of this "potential asset" because it does not deem it to be "virtually certain", therefore the board has included its best estimate of the cost of rectification where it has provided a warranty and the board believes that an economic outflow is more likely than not.

 

This clearly involves considerable judgement and actual costs may vary significantly from the provision made.

Useful economic lives of tangible assets

The annual depreciation charge for tangible assets is sensitive to changes in the estimated useful economic lives of the assets. The useful economic lives are re-assessed and amended when necessary to reflect current estimates, based on technological advancement, future investments, economic utilisation and physical condition of the assets.

Inventory provisioning

The company supplies high quality slate and stone products. As a result it is necessary to consider the recoverability of the cost of inventory and the associated provisioning required. When calculating the inventory provision. management considered the nature and condition of the inventory, as well as applying assumptions around anticipated saleability of finished goods. See note 13 for the carrying amount of the inventory and associated provision.

MANDARIN SLATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
3
Turnover and other revenue
2023
2022
£000
£000
Turnover analysed by class of business
Sale of goods
43,917
44,929
2023
2022
£000
£000
Turnover analysed by geographical market
United Kingdown
43,621
44,490
Europe
119
205
Rest of the World
177
234
43,917
44,929
2023
2022
£000
£000
Other revenue
Interest income
15
-
4
Operating profit
Notes
2023
2022
Operating profit for the year is stated after charging/(crediting):
£000
£000
Exchange losses
60
107
Fees payable to the company's auditor for the audit of the company's financial statements
16
15
Depreciation of owned tangible fixed assets
830
759
Profit on disposal of tangible fixed assets
(33)
(24)
Operating lease charges
1,464
1,283
Warranty claim provision
17
(152)
-
Dilapidations provision
17
63
31

Included within operating lease charges is rent paid to Mandarin Stone Holdings Limited, its parent company totalling £860,856 (2022: £482,872)

Exchange differences recognised in profit or loss during the year, except for those arising on financial instruments measured at fair value through profit or loss, amounted to £59,514 loss (2022: £106,598 loss).

MANDARIN SLATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
5
Employees

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

2023
2022
Number
Number
Staff
216
214
Directors
9
9
Total
225
223

Their aggregate remuneration comprised:

2023
2022
£000
£000
Wages and salaries
7,596
7,428
Social security costs
865
762
Pension costs
359
334
8,820
8,524
6
Auditor's remuneration
2023
2022
Fees payable to the company's auditor:
£000
£000
For audit services
Audit of the financial statements of the company
16
15
7
Directors' remuneration
2023
2022
£000
£000
Remuneration for qualifying services
763
832
Company pension contributions to defined contribution schemes
23
21
786
853

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 6 (2022 - 6).

MANDARIN SLATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
7
Directors' remuneration
(Continued)
- 19 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£000
£000
Remuneration for qualifying services
166
170
8
Interest receivable and similar income
2023
2022
£000
£000
Interest income
Interest on bank deposits
15
-
0
9
Fair value gains/(losses) on financial instruments
2023
2022
£000
£000
Fair value gains/(losses) on financial instruments
Gain on financial assets held at fair value through profit or loss
42
109
10
Taxation
2023
2022
£000
£000
Current tax
UK corporation tax on profits for the current period
1,030
1,099
Deferred tax
Origination and reversal of timing differences
120
318
Adjustment in respect of prior periods
(17)
(36)
Total deferred tax
103
282
Total tax charge
1,133
1,381
MANDARIN SLATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
10
Taxation
(Continued)
- 20 -

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

2023
2022
£000
£000
Profit before taxation
4,887
7,474
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
1,149
1,420
Tax effect of expenses that are not deductible in determining taxable profit
4
4
Effect of change in corporation tax rate
8
73
Permanent capital allowances in excess of depreciation
-
0
14
Other permanent differences
(4)
(94)
Deferred tax adjustments in respect of prior years
(17)
(36)
Other fixed asset differences
(7)
-
0
Taxation charge for the year
1,133
1,381
11
Dividends
2023
2022
£000
£000
Final paid
1
12,360

Ordinary dividend equivalent to £0.05 (2022: £545.00) per £1 ordinary share.

MANDARIN SLATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
12
Tangible fixed assets
Leasehold improvements
Assets under construction
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£000
£000
£000
£000
£000
£000
Cost
At 1 January 2023
114
401
954
2,991
2,412
6,872
Additions
2
217
193
456
378
1,246
Disposals
-
0
-
0
(13)
(2)
(83)
(98)
At 31 December 2023
116
618
1,134
3,445
2,707
8,020
Depreciation and impairment
At 1 January 2023
9
-
0
592
1,693
1,416
3,710
Depreciation charged in the year
12
-
0
89
296
433
830
Eliminated in respect of disposals
-
0
-
0
(13)
(2)
(56)
(71)
At 31 December 2023
21
-
0
668
1,987
1,793
4,469
Carrying amount
At 31 December 2023
95
618
466
1,458
914
3,551
At 31 December 2022
105
401
362
1,298
996
3,162
13
Stocks
2023
2022
£000
£000
Finished goods and goods for resale
7,518
9,388

Stocks are stated after provisions for impairment of £1,635,234 (2022: £1,464,919).

14
Financial instruments
2023
2022
£000
£000
Carrying amount of financial assets
Debt instruments measured at amortised cost
186
332
Instruments measured at fair value through profit or loss
7
-
Carrying amount of financial liabilities
Measured at fair value through profit or loss
- Other financial liabilities
-
35
Measured at amortised cost
6,280
7,514
MANDARIN SLATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
14
Financial instruments
(Continued)
- 22 -

The other financial assets/liabilities relates to the movement in fair value on the foreign currency contracts held at the year end.

 

Financial assets measured at amortised cost comprise trade debtors and other debtors (excluding VAT recoverable).

 

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

15
Debtors
2023
2022
Amounts falling due within one year:
£000
£000
Trade debtors
161
133
Derivative financial instruments
7
-
Other debtors
25
199
Prepayments and accrued income
521
367
714
699
16
Creditors: amounts falling due within one year
2023
2022
£000
£000
Trade creditors
3,934
4,097
Corporation tax
110
499
Other taxation and social security
1,052
1,231
Derivative financial instruments
-
0
35
Other creditors
1,626
2,655
Accruals and deferred income
720
762
7,442
9,279
17
Provisions for liabilities
2023
2022
Notes
£000
£000
Warranty
165
317
Dilapidations
844
781
1,009
1,098
Deferred tax liabilities
18
761
658
1,770
1,756
MANDARIN SLATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
17
Provisions for liabilities
(Continued)
- 23 -
Movements on provisions apart from deferred tax liabilities:
Warranty
Dilapidations
Total
£000
£000
£000
At 1 January 2023
317
781
1,098
Additional provisions in the year
100
63
163
Reversal of provision
(252)
-
(252)
At 31 December 2023
165
844
1,009

Warranty

 

The company often provides assurances or guarantees in respect of its products; for significant customers the company may provide advice that effectively means the company has provided a "warranty".

 

The current year reversal is due to the board's revised estimate on potential claims over 3 years old.

 

At each reporting date the board considers the possibility of any potential claims under warranties that the company has given and estimates the potential cost of rectification.

 

In most cases the board believes that the company would have a reasonable counter claim against the company's supplier or the installer, however the board has not taken account of this "potential asset" because it does not deem it to be "virtually certain", therefore the board has included its best estimate of the cost of rectification where it has provided a warranty and the board believes that an economic outflow is more likely than not.

Dilapidations

 

The company has a number of operating leases relating to premises. These leases include dilapidation clauses requiring the company to return premises to the condition they were in prior to the company taking over the lease. The company has made extensive modifications to premises to facilitate display of its products. This creates a current obligation.

 

The board has calculated its best estimate of the cost of returning all properties to the condition they were in when the company entered the leases.

18
Deferred taxation

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

Liabilities
Liabilities
2023
2022
Balances:
£000
£000
Fixed asset timing differences
767
674
Short term timing differences
(6)
(16)
761
658
MANDARIN SLATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
18
Deferred taxation
(Continued)
- 24 -
2023
Movements in the year:
£000
Liability at 1 January 2023
658
Charge to profit or loss
103
Liability at 31 December 2023
761
19
Retirement benefit schemes
2023
2022
Defined contribution schemes
£000
£000
Charge to profit or loss in respect of defined contribution schemes
359
334

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

 

At the year end the company had outstanding pension contributions of £44,000 (2022: £43,000), this amount being included within creditors due within one year.

20
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£000
£000
Issued and fully paid
Ordinary shares of £1.00 each
22,679
22,679
23
23

On 2 April 2022 a reorganisation was undertaken whereby the company’s shareholders exchanged their shares in the company for shares in Mandarin Stone Holdings Limited, see note 21.

21
Re-organisation

On 1 April 2022 the company issued 2,630 ordinary shares of £1 Mrs A Small and Mr S Small in exchange for their interests in Mandarin Stone Properties LLP (MSP). Also on 1 April 2022 the company received a return on its investment in Mandarin Stone Properties LLP and a transfer of property and other assets from Mandarin Stone Properties LLP as part of a re-organisation.

 

On 2 April 2022 the company was acquired by Mandarin Stone Holdings Limited via a share for share exchange.

 

On 3 April 2022 the property assets acquired were transferred to Mandarin Stone Holdings Limited.

22
Reserves
Share premium

The share premium represents the excess on the fair value of shares issued above the nominal value.

Profit and loss reserves

The profit and loss reserve represents the accumulated profits, losses and distributions of the company.

MANDARIN SLATE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 25 -
23
Operating lease commitments
Lessee

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

2023
2022
£000
£000
Within one year
571
511
Between two and five years
1,484
1,459
In over five years
342
532
2,397
2,502
24
Capital commitments

Amounts contracted for but not provided in the financial statements:

2023
2022
£000
£000
Acquisition of tangible fixed assets
-
354
25
Related party transactions

The company has taken advantage of the exemption in FRS 102 Section 33 from the requirement to disclose transactions with wholly owned group companies on the grounds that consolidated financial statements are prepared by the ultimate parent company.

26
Ultimate controlling party

The ultimate parent company of Mandarin Slate Limited is Mandarin Stone Holdings Limited, incorporated in England and Wales. Mandarin Stone Holdings Limited is the parent undertaking of the smallest and largest group which includes the company for which group financial statements are prepared. Copies of the group financial statements of Mandarin Stone Holdings Limited are available from the registered office Unit 1 Wonastow Road Industrial Estate (East), Monmouth, Monmouthshire, United Kingdom, NP25 5JB.

 

The company is ultimately controlled by A L Small, by virtue of her shareholding.

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