The directors present the strategic report for the year ended 31 December 2023.
The principal activity of the group continues to be that of the manufacture of acrylic products for use within the pharmaceutical, medical and the manned submersible vehicle industries.
We aim to present a balanced and comprehensive review of the development and performance of our group during the year and its position at the year end. Our review is consistent with the size and non-complex nature of our group and is written in the context of the risks and uncertainties we face.
The King’s Awards for Enterprise are the most prestigious business awards in the UK and, in April 2023, the subsidiary company 'Blanson Limited' was honoured with such an award for its excellence in, and contribution to, International Trade. The awards were first established in 1965 to recognise outstanding, exciting and innovative UK businesses. This year only 148 businesses nationally have been recognised across the four categories of International Trade, Innovation, Sustainable Development and Promoting Opportunity, with just 78 awards for International Trade.
As for many groups of our size, the business environment in which we operate continues to be challenging. In light of the challenging business environment and competitive nature of the industry, we consider the group results for the year and financial position at the year end to be satisfactory and believe that the group is well placed to react quickly to any changes in trading conditions and to take advantage of any business opportunities that may arise.
We continually monitor the principal risks and uncertainties of the business and seek to mitigate any such risks.
The group operates in industries that are highly regulated in terms of product quality and acceptance. The group continually extends the product range, improves operational effectiveness, provides a strong brand identity and invests in the future of the business. Changes are implemented where deemed appropriate to retain market share and maintain margins.
The group undertakes transactions in Sterling, Euros and Canadian Dollars and is therefore subject to movements in foreign exchange rates.
We consider that our key financial performance indicators are those that communicate the financial performance and strength of the group as a whole, being turnover and gross profit margin.
Turnover and gross profit margin during the year have decreased to £10,512,766 (2022: £16,669,546) and 63.38% (2022: 66.95%) respectively. This has resulted in a decrease in profit before taxation to £2,934,155 (2022: £7,462,557). After taxation and dividends, £678,724 has been deducted from the group reserves.
Future developments
The group has continued its commitment to delivering high-quality products and improving operational effectiveness by investing in its equipment and product improvement. There have been no significant post balance sheet events affecting the group.
Research and development
The group's research and development has continued to ensure that its products remain at the leading edge of quality.
On behalf of the board
The directors present their report and financial statements for the year ended 31 December 2023.
The results for the year are set out on page 7.
Ordinary dividends were paid amounting to £2,991,854. The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
We have audited the financial statements of Tiffer Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023 which comprise the group statement of income and retained earnings, the group balance sheet, the company balance sheet, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
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 group and parent 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 group's and 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 other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept 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.
As explained more fully in the Directors' Responsibilities Statement set out on page 2, 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 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 parent company or to cease operations, or have no realistic alternative but to do so.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion. However, responsibility for the prevention and detection of fraud ultimately rests with both those charged with governance and management of the group and company.
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:
obtaining an understanding of the legal and regulatory framework applicable to the group and company by considering the nature of the industry in which the group and company operates and enquiring of management; and
identifying the key laws and regulations considered to have a direct impact on the financial statements including the UK Companies Act 2006, UK Generally Accepted Accounting Practice and UK tax legislation; and
assessing how the group and company is complying with the applicable legal and regulatory framework by making further enquiries of management and observing the group and company's control environment regarding compliance with regulations and fraud prevention; and
assessing the susceptibility of the group and company’s financial statements to material misstatement, including how fraud might occur, by considering the effectiveness of the group and company’s accounting systems and controls and how these were monitored by management. Performance related targets and bonuses were also considered. Where the risk of material misstatement was considered to be higher in certain areas, further audit procedures were designed to address this increased risk; and
discussing amongst the engagement team how and where fraud might occur in the financial statements and any potential indicators of fraud.
Our procedures to respond to risks identified included the following:
reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations; and
performing audit work over revenue recognition including substantive tests of detail of a sample of revenue transactions; and
enquiry of group and company staff responsible for compliance to identify any instances of non-compliance with laws and regulations; and
reviewing supporting documentation confirming compliance with specific laws and regulations considered central to the ability of the group and company to operate; and
enquiry of management, those charged with governance and other relevant parties around actual and potential litigation claims; and
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; and
communicating identified laws and regulations and potential fraud risks to all engagement team members and assessing whether there are any indications of fraud or non-compliance with laws and regulations throughout the audit.
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 is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £2,009,495 (2022: £4,715,941).
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
Tiffer Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Unit 7, Leicester Distribution Park, 35 Sunningdale Road, Leicester, LE3 1UX.
The group consists of Tiffer Holdings Limited and all of its subsidiaries.
These financial statements have been prepared in accordance with applicable accounting standards including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below. These policies have been consistently applied to all years presented unless otherwise stated.
The 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 the exemption from preparing a statement of cash flows on the basis that the group statement of cash flows, included in these financial statements, includes the company's cash flows.
The consolidated group financial statements consist of the financial statements of the parent company Tiffer Holdings Limited together with all entities controlled by the parent company (its subsidiaries).
All financial statements are made up to 31 December 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
At the time of approving the financial statements, the directors have a reasonable expectation that the group 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.
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.
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.
Revenue from construction contracts is recognised by reference to the stage of completion of the contract at the end of the reporting period when the stage of completion, costs incurred and costs to complete can be estimated reliably.
Research and development expenditure is written off to the profit and loss account in the year in which it is incurred.
In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Debtors and creditors with no stated interest rate and receivable or payable within one year are measured at transaction price. Any losses arising from impairment are recognised in the profit and loss account.
Loans are initially measured at transaction price and subsequently measured at amortised cost using
the effective interest method.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
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.
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.
When employees have rendered service to the group, short-term employee benefits to which the employees are entitled are recognised at the undiscounted amount expected to be paid in exchange for that service.
The cost of any unused holiday entitlement is recognised in the period in which the employee's services are received.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to the profit and loss account so as to produce a constant periodic rate of interest on the remaining balance of the liability.
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.
Assets held under sale and leaseback transactions are treated as finance leases and are recognised at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
Capital based government grants are credited to the profit and loss account over the expected useful economic lives of the assets to which they relate.
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.
Research and development
Research and development expenditure is written off to the profit and loss account in the year in which it is incurred.
In the application of the group’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.
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.
As explained in note 1.4, where the outcome of construction contracts can be estimated reliably, contract revenues and costs are recognised on a contract by contract basis using the percentage of completion method. The application of this accounting policy requires both the total costs and the stage of completion of contracts to be assessed. An inherent degree of judgement will exist in determining the stage of completion of a contract at the end of the reporting period.
Labour and overheads are attributed to the value of work in progress and finished goods based on an average absorption rate for the production hours involved. The application of this calculation requires an assessment of the average labour and overhead costs. An inherent degree of judgement will exist in determining the appropriate absorption rate for stock held at the end of the reporting period.
Included in turnover is revenue of £1,640,350 (2022 - £1,164,030) arising on construction contracts in the year.
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
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:
From 1 April 2023, the UK corporation tax rate increased from 19% to 25%. The current year rate is pro-rated accordingly.
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
Details of the company's subsidiaries at 31 December 2023 are as follows:
The registered address of the above subsidiary is the same as the company's registered office address as given in the company information page of these financial statements.
The aggregate amount of secured liabilities amounts to £1,547,610 (2022: £1,595,295). All finance lease liabilities have been secured against the assets to which they relate. Other borrowings include a liability of £109,750 (2022: £226,330) which is secured against certain items of plant and machinery.
Other borrowings relate to a Coronavirus Business Interruption Loan Scheme and sale and leaseback arrangements. These are repayable by monthly instalments by 2024 and 2025 respectively and carry a fixed rate of interest ranging from 1.3% to 3.5%. They are secured by a fixed charge over the assets to which they relate.
Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 3-5 years. All leases are on a fixed repayment basis.
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
Deferred income is included in the financial statements as follows:
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
There is a single class of ordinary shares. There are no restrictions on the distribution of dividends and the repayment of capital.
The share premium reserve represents the premium on shares issued at a value that exceeds their nominal value.
The profit and loss reserve comprises retained profits and losses for the current and prior periods.
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
Amounts contracted for but not provided in the financial statements: