Company registration number 00469940 (England and Wales)
CENTRONIC LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 4 JANUARY 2024
CENTRONIC LIMITED
COMPANY INFORMATION
Directors
Dr. R.D. McKeag
Exosens International S.A.S
(Appointed 31 July 2024)
Company number
00469940
Registered office
Centronic House
King Henry's Drive
New Addington
Croydon
CR9 0BG
Auditor
Foot Davson Ltd
Lonsdale Gate, Lonsdale Gardens
Tunbridge Wells
Kent
TN1 1NU
Business address
Centronic House
King Henry's Drive
New Addington
Croydon
CR9 0BG
Bankers
National Westminster Bank
Crawley
West Sussex
RH10 1GL
CENTRONIC LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Statement of comprehensive income
7
Balance sheet
8
Statement of changes in equity
9
Notes to the financial statements
10 - 21
CENTRONIC LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 4 JANUARY 2024
- 1 -
The directors present the strategic report for the year ended 4 January 2024.
Principal activities
The principal activity of the company continued to be that of the design, manufacture and sale of electro-optic and radiation detection products.
Review of the business
Business performance in 2023 was in line with expectation and performed well with growth across the business in terms of orders, sales, and profitability. Further investments in technology, learning and development and infrastructure have been made to improve productivity and provide capacity for growth. The business ended the year with a strong order book.
The company has seen strong order book growth at the start of 2024. We continue to manage both challenges and opportunities because of the conflict in eastern Europe and other geopolitical influences. Sales and orders are in line with expectation and the business remains robust and well positioned to meet the requirements of its external creditors.
The company continues to maintain a consistent policy of revenue recognition on long term contracts, based on an accounting estimate of completion of such contracts. The directors are forecasting modest growth from traditional markets and customers in terms of sales and profit this year and the year following.
Principal risks and uncertainties
The business is able to manage its exposure to price and liquidity risk, has a strong order book, good sales forecast and high visibility of opportunities.
Key performance indicators
The company's key performance indicators during the year were as follows:
2024 2023 % change
Turnover £10,972,016 £9,650,204 13.70
Gross profit £4,919,306 £4,468,979 10.07
Profit on ordinary activities before tax £1,681,022 £1,684,200 -
Dr. R.D. McKeag
Director
4 October 2024
CENTRONIC LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 4 JANUARY 2024
- 2 -
The directors present their annual report and financial statements for the year ended 4 January 2024.
Results and dividends
The results for the year are set out on page 7.
Ordinary dividends were paid amounting to £500,000. 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:
Dr. R.D. McKeag
Mr N.C. Foreman
(Resigned 31 July 2024)
Exosens International S.A.S
(Appointed 31 July 2024)
Auditor
In accordance with the company's articles, a resolution proposing that Foot Davson Ltd be reappointed as auditor of the company will be put at a General Meeting.
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.
Going concern
After making appropriate enquiries, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the company's financial statements. Further details are given in the Notes to the financial statements.
Matters covered in the strategic report
The directors prepared a separate strategic report, which is included on page 1.
On behalf of the board
Dr. R.D. McKeag
Director
4 October 2024
CENTRONIC LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 4 JANUARY 2024
- 3 -
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
CENTRONIC LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF CENTRONIC LIMITED
- 4 -
Opinion
We have audited the financial statements of Centronic Limited (the 'company') for the year ended 4 January 2024 which comprise 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:
give a true and fair view of the state of the company's affairs as at 4 January 2024 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
CENTRONIC LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CENTRONIC LIMITED
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
In determining the susceptibility of the company's financial statements to material misstatement, including how fraud might occur, we carried out a risk assessment for the year, considering the following sources:
Communication with the client at commencement of audit
The results of our preliminary analytical review
Audit team discussion
Permanent file risk assessment summary
This assessment considered the risks, any mitigating internal controls, the likelihood of material misstatement and identified the specific tests to be carried out in our audit work.
Our audit plan and approach then documented the procedures to be undertaken in response to these assessed risks.
The laws and regulations we identified as being of significance in the context of the company are as follows:
CENTRONIC LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CENTRONIC LIMITED
- 6 -
Our audit response to the risks identified included, but was not limited to, the following:
- Enquiry of management and those charged with governance around actual and potential litigation and claims.
- Enquiry of company staff in compliance functions to identify any instances of non-compliance with laws and regulations.
- Reviewing minutes of meetings of those charged with governance.
- Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.
- Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of any significant transactions outside the normal course of business.
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.
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.
J P van der Merwe ACA
Senior Statutory Auditor
For and on behalf of Foot Davson Ltd
4 October 2024
Chartered Accountants
Statutory Auditor
Lonsdale Gate
Lonsdale Gardens
Tunbridge Wells
Kent
TN1 1NU
CENTRONIC LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 4 JANUARY 2024
- 7 -
2024
2023
Notes
£
£
Turnover
3
10,972,016
9,650,204
Cost of sales
(6,052,710)
(5,181,225)
Gross profit
4,919,306
4,468,979
Administrative expenses
(3,432,166)
(3,105,829)
Other operating income
268,913
373,022
Operating profit
4
1,756,053
1,736,172
Interest payable and similar expenses
8
(75,031)
(51,972)
Profit before taxation
1,681,022
1,684,200
Tax on profit
9
(343,693)
(257,644)
Profit for the financial year
1,337,329
1,426,556
The profit and loss account has been prepared on the basis that all operations are continuing operations.
The notes on pages 10 to 21 form part of these financial statements.
CENTRONIC LIMITED
BALANCE SHEET
AS AT
4 JANUARY 2024
04 January 2024
- 8 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
11
1,313,428
1,366,579
Current assets
Stocks
12
3,061,603
2,702,486
Debtors
13
8,857,667
5,881,694
Cash at bank and in hand
43,644
1,188,699
11,962,914
9,772,879
Creditors: amounts falling due within one year
14
(6,139,998)
(4,661,839)
Net current assets
5,822,916
5,111,040
Total assets less current liabilities
7,136,344
6,477,619
Creditors: amounts falling due after more than one year
15
(107,923)
(276,483)
Provisions for liabilities
Deferred tax liability
18
315,514
325,558
(315,514)
(325,558)
Net assets
6,712,907
5,875,578
Capital and reserves
Called up share capital
20
50,000
50,000
Profit and loss reserves
6,662,907
5,825,578
Total equity
6,712,907
5,875,578
The notes on pages 10 to 21 form part of these financial statements.
The financial statements were approved by the board of directors and authorised for issue on 4 October 2024 and are signed on its behalf by:
Dr. R.D. McKeag
Director
Company Registration No. 00469940
CENTRONIC LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 4 JANUARY 2024
- 9 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 5 January 2022
50,000
4,399,022
4,449,022
Year ended 4 January 2023:
Profit and total comprehensive income for the year
-
1,426,556
1,426,556
Balance at 4 January 2023
50,000
5,825,578
5,875,578
Year ended 4 January 2024:
Profit and total comprehensive income for the year
-
1,337,329
1,337,329
Dividends
10
-
(500,000)
(500,000)
Balance at 4 January 2024
50,000
6,662,907
6,712,907
The notes on pages 10 to 21 form part of these financial statements.
CENTRONIC LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 4 JANUARY 2024
- 10 -
1
Accounting policies
Company information
Centronic Limited is a private company limited by shares incorporated in England and Wales. The registered office is Centronic House, King Henry's Drive, New Addington, Croydon, CR9 0BG.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of certain assets and financial instruments at fair value, where applicable. The principal accounting policies adopted are set out below.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of Centronic Group Limited. These consolidated financial statements may be obtained from Companies House.
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.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
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.
CENTRONIC LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 4 JANUARY 2024
1
Accounting policies
(Continued)
- 11 -
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
Revenue on long term contracts is recognised on the basis of percentage of completion of each contract measured by the total labour hours to be spent.
1.4
Research and development expenditure
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
1.5
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Leasehold land and buildings
10% per annum
Plant and equipment
10% per annum
Computers
20% per annum
Motor vehicles
20% per annum
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.6
Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
1.7
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
CENTRONIC LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 4 JANUARY 2024
1
Accounting policies
(Continued)
- 12 -
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.8
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include direct labour costs and attributable overheads.
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.
1.9
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours.
1.10
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
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.
CENTRONIC LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 4 JANUARY 2024
1
Accounting policies
(Continued)
- 13 -
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
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.
CENTRONIC LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 4 JANUARY 2024
1
Accounting policies
(Continued)
- 14 -
The company makes claims under the research and development tax regime. The company recognises tax reliefs received under the scheme within operating profit.
1.12
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.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
Leases
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 profit or loss 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 except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
1.15
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.
CENTRONIC LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 4 JANUARY 2024
- 15 -
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.
Critical judgements
The directors have reviewed the financial statements and consider that the following are material judgements or key sources of estimation uncertainty:
Long term contract revenue recognition
Revenue on long term contracts is recognised on the basis of percentage of completion of each contract, which requires a judgement of total labour hours to completion for each contract to be made.
3
Turnover
2024
2023
£
£
Turnover analysed by class of business
Sale of goods
10,972,016
9,650,204
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
6,319,335
6,654,491
Overseas
4,652,681
2,995,713
10,972,016
9,650,204
4
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses
22,086
11,781
Research and development costs
699
7,084
Fees payable to the company's auditor for the audit of the company's financial statements
29,500
27,650
Depreciation of owned tangible fixed assets
245,640
251,911
Profit on disposal of tangible fixed assets
(1,700)
(11,215)
Operating lease charges
18,028
17,705
CENTRONIC LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 4 JANUARY 2024
- 16 -
5
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
29,500
27,650
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Direct staff
52
56
Administration
39
34
Directors
2
2
Total
93
92
Their aggregate remuneration comprised:
2024
2023
£
£
Wages and salaries
3,735,371
3,237,849
Social security costs
326,529
329,289
Pension costs
126,313
117,461
4,188,213
3,684,599
7
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
129,951
75,366
Company pension contributions to defined contribution schemes
3,442
3,320
133,393
78,686
8
Interest payable and similar expenses
2024
2023
£
£
Interest on bank overdrafts and loans
46,995
20,612
Interest on finance leases and hire purchase contracts
28,036
31,273
Other interest
87
75,031
51,972
CENTRONIC LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 4 JANUARY 2024
- 17 -
9
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
353,737
252,875
Deferred tax
Origination and reversal of timing differences
(10,044)
4,769
Total tax charge
343,693
257,644
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:
2024
2023
£
£
Profit before taxation
1,681,022
1,684,200
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
420,256
319,998
Tax effect of expenses that are not deductible in determining taxable profit
890
943
Tax effect of income not taxable in determining taxable profit
(56,250)
(61,744)
Gains not taxable
(425)
(2,131)
Tax effect of utilisation of tax losses not previously recognised
(9,489)
Permanent capital allowances in excess of depreciation
(10,469)
(4,577)
Other permanent differences
(265)
9,875
Movement in deferred tax not recognised
(10,044)
4,769
Taxation charge for the year
343,693
257,644
10
Dividends
2024
2023
£
£
Final paid
500,000
CENTRONIC LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 4 JANUARY 2024
- 18 -
11
Tangible fixed assets
Leasehold land and buildings
Plant and equipment
Total
£
£
£
Cost
At 5 January 2023
80,000
4,139,700
4,219,700
Additions
192,489
192,489
At 4 January 2024
80,000
4,332,189
4,412,189
Depreciation and impairment
At 5 January 2023
80,000
2,773,121
2,853,121
Depreciation charged in the year
245,640
245,640
At 4 January 2024
80,000
3,018,761
3,098,761
Carrying amount
At 4 January 2024
1,313,428
1,313,428
At 4 January 2023
1,366,579
1,366,579
Included within the net book value of £1,313,428 (2023: £1,366,579) is £609,993 (2023: £659,739) relating to assets held under hire purchase agreements. The depreciation charged to the financial statements in the year in respect of such assets amounted to £129,817 (2023: £114,862).
12
Stocks
2024
2023
£
£
Raw materials and consumables
2,135,499
1,627,159
Work in progress
776,980
941,007
Finished goods and goods for resale
149,124
134,320
3,061,603
2,702,486
13
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
2,790,620
1,115,506
Amounts owed by group undertakings
3,290,844
2,795,933
Other debtors
239,842
343,806
Prepayments and accrued income
2,536,361
1,626,449
8,857,667
5,881,694
CENTRONIC LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 4 JANUARY 2024
- 19 -
14
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loans
16
600,000
350,000
Obligations under finance leases
17
208,263
152,726
Trade creditors
432,017
255,976
Amounts owed to group undertakings
2,693,245
2,017,627
Corporation tax
353,737
252,875
Other taxation and social security
385,209
361,116
Accruals and deferred income
1,467,527
1,271,519
6,139,998
4,661,839
Included within accruals and deferred income are payments on account on long term contracts paid to customers amounting to £923,769 (2023: £295,535).
15
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Obligations under finance leases
17
107,923
276,483
16
Loans and overdrafts
2024
2023
£
£
Bank loans
600,000
350,000
Payable within one year
600,000
350,000
The trade loan is secured by unlimited cross guarantees across all subsidiaries and is supported by a charge over the freehold property held by Centronic Holdings Limited.
This trade facility agreement is subject to interest of 2% per annum over base rate, with a full facility available of £950,000. The expiry date is 31 December 2025 and the amount currently drawn down is due for repayment before the end of the following accounting period.
17
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
208,263
152,726
In two to five years
107,923
276,483
316,186
429,209
CENTRONIC LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 4 JANUARY 2024
- 20 -
18
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
315,514
325,558
2024
Movements in the year:
£
Liability at 5 January 2023
325,558
Credit to profit or loss
(10,044)
Liability at 4 January 2024
315,514
19
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
126,313
117,461
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.
20
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
50,000
50,000
50,000
50,000
21
Financial commitments, guarantees and contingent liabilities
The Centronic group of companies bank borrowings of £857,712 (2023: £654,620) are subject to unlimited cross guarantees across all subsidiaries and are secured by a charge over the freehold property held by Centronic Holdings Limited.
CENTRONIC LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 4 JANUARY 2024
- 21 -
22
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:
2024
2023
£
£
Within one year
8,580
8,580
Between two and five years
5,231
5,231
13,811
13,811
23
Events after the reporting date
On 31st July 2024 Exosens UK Limited acquired the entire share capital of company’s parent company, Centronic Group Limited. Exosens UK Limited is a wholly owned subsidiary of Exosens International S.A.S, a company incorporated in France.
24
Related party transactions
The company has taken advantage of the exemption available in Section 33.1A of FRS102 whereby it has not disclosed transactions with the ultimate parent company or any wholly owned subsidiary undertaking of the group.
25
Ultimate controlling party
The company's immediate parent entity is Centronic Holdings Limited, with the ultimate parent entity of the Centronic Group being Centronic Group Limited. Both companies are incorporated in England and Wales.
The immediate parent undertaking of Centronic Group Limited is Exosens UK Limited (incorporated in England and Wales), which in turn is a wholly owned subsidiary of Exosens International S.A.S, with the ultimate parent undertaking being Exosens S.A.
Both Exosens International S.A.S and Exosens S.A are companies incorporated in France.
The smallest group of companies where these accounts are consolidated is that headed by Centronic Group Limited. A copy of the financial statements of Centronic Group Limited can be obtained from Companies House.
The largest group of companies where these accounts are consolidated is that headed by Exosens S.A. A copy of the financial statements of Exosens S.A can be obtained from their website.
No sole party controls Exosens S.A.
2024-01-042023-01-05falseCCH SoftwareCCH Accounts Production 2024.100Dr. R.D. McKeagMr N.C. ForemanExosens International S.A.Sfalsefalse004699402023-01-052024-01-0400469940bus:Director12023-01-052024-01-0400469940bus:Director32023-01-052024-01-0400469940bus:Director22023-01-052024-01-0400469940bus:RegisteredOffice2023-01-052024-01-04004699402024-01-04004699402022-01-052023-01-0400469940core:RetainedEarningsAccumulatedLosses2022-01-052023-01-0400469940core:RetainedEarningsAccumulatedLosses2023-01-052024-01-04004699402023-01-0400469940core:LandBuildingscore:LeasedAssetsHeldAsLessee2024-01-0400469940core:PlantMachinery2024-01-0400469940core:LandBuildingscore:LeasedAssetsHeldAsLessee2023-01-0400469940core:PlantMachinery2023-01-0400469940core:CurrentFinancialInstrumentscore:WithinOneYear2024-01-0400469940core:CurrentFinancialInstrumentscore:WithinOneYear2023-01-0400469940core:Non-currentFinancialInstrumentscore:AfterOneYear2024-01-0400469940core:Non-currentFinancialInstrumentscore:AfterOneYear2023-01-0400469940core:CurrentFinancialInstruments2024-01-0400469940core:CurrentFinancialInstruments2023-01-0400469940core:ShareCapital2024-01-0400469940core:ShareCapital2023-01-0400469940core:RetainedEarningsAccumulatedLosses2024-01-0400469940core:RetainedEarningsAccumulatedLosses2023-01-0400469940core:ShareCapital2022-01-0400469940core:RetainedEarningsAccumulatedLosses2022-01-0400469940core:LandBuildingscore:LongLeaseholdAssets2023-01-052024-01-0400469940core:PlantMachinery2023-01-052024-01-0400469940core:ComputerEquipment2023-01-052024-01-0400469940core:MotorVehicles2023-01-052024-01-040046994012023-01-052024-01-040046994012022-01-052023-01-0400469940core:UKTax2023-01-052024-01-0400469940core:UKTax2022-01-052023-01-040046994022023-01-052024-01-040046994022022-01-052023-01-040046994032023-01-052024-01-040046994032022-01-052023-01-0400469940core:LandBuildingscore:LeasedAssetsHeldAsLessee2023-01-0400469940core:PlantMachinery2023-01-04004699402023-01-0400469940core:LandBuildingscore:LeasedAssetsHeldAsLessee2023-01-052024-01-0400469940core:Non-currentFinancialInstruments2024-01-0400469940core:Non-currentFinancialInstruments2023-01-0400469940core:WithinOneYear2024-01-0400469940core:WithinOneYear2023-01-0400469940core:BetweenTwoFiveYears2024-01-0400469940core:BetweenTwoFiveYears2023-01-0400469940bus:PrivateLimitedCompanyLtd2023-01-052024-01-0400469940bus:FRS1022023-01-052024-01-0400469940bus:Audited2023-01-052024-01-0400469940bus:FullAccounts2023-01-052024-01-04xbrli:purexbrli:sharesiso4217:GBP