REGISTERED NUMBER: |
Constellation Cold Logistics UK 2 Ltd |
Strategic Report, Report of the Directors and |
Financial Statements for the Year Ended 31st December 2023 |
REGISTERED NUMBER: |
Constellation Cold Logistics UK 2 Ltd |
Strategic Report, Report of the Directors and |
Financial Statements for the Year Ended 31st December 2023 |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Contents of the Financial Statements |
for the year ended 31st December 2023 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 4 |
Report of the Independent Auditors | 6 |
Statement of Comprehensive Income | 9 |
Balance Sheet | 10 |
Statement of Changes in Equity | 11 |
Notes to the Financial Statements | 12 |
Constellation Cold Logistics UK 2 Ltd |
Company Information |
for the year ended 31st December 2023 |
DIRECTORS: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
INDEPENDENT AUDITORS: |
Chartered Accountants |
Statutory Auditor |
Regent's Court |
Princess Street |
Hull |
East Yorkshire |
HU2 8BA |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Strategic Report |
for the year ended 31st December 2023 |
The directors present their strategic report for the year ended 31st December 2023. |
Principle activities |
The principal activities of the company are temperature-controlled storage and distribution and dry goods warehousing. The company is a company limited by shares, domiciled and registered in England and Wales. The principal place of business is situated in Grimsby, Lincolnshire, as is the registered office with the address as set out on page 1. |
REVIEW OF BUSINESS, PRINCIPLE RISKS AND UNCERTAINTIES |
The total comprehensive income and expenditure for the period is set out on page 9. |
The directors report that the business achieved an operating loss of £1,989,608 (2022 profit: £873,140). |
Turnover in 2023 decreased by 24.8% to £19.3m (2022: £25.7m). |
Cold storage utilisation was down 7%, and pallet throughput was down 21%, due to Stage 3 cold store at Grimsby docks being rented out to the company's parent. |
Total loads transported has increased by 9% year on year after adjusting for the closure of the Seamer transport depot in September 2022. |
Following exchange of contracts on 26 November 2022, the sale of the business to Constellation Cold Logistics UK Limited completed on 10 January 2023. |
On 23 March 2023 an investigation was opened by the Competition and Markets Authority to look into the completed acquisition and whether it may be expected to result in a substantial lessening of competition within any market in the UK for goods and services. On 20 June 2023, the CMA cleared the completed acquisition. |
On 22 June 2023, the company rebranded in line with its new parent company, resulting in a change of name to Constellation Cold Logistics UK 2 Limited. |
During the year the cold stores have been brought in line with the Constellation standard with reference to maintenance, hygiene and safety. In addition, organisation structures have been aligned with the parent company, giving rise to redundancies, especially within the head office areas where synergies have been identified. This in turn has given rise to a significant level of non-recurring expenditure throughout the year totalling £932,860, dragging the EBITDA level down in comparison to the prior year. |
The directors are comfortable that these addition costs are non-recurring, and that profitability will and has returned in 2024. |
Capital investment during the year was higher, at £1,532,625 (2022: £867,459) concentrating on safety, plant efficiency and racking. All company cars continue to be plug-in hybrid electric as a minimum, with several being fully electric. The capital investment was primarily made using cash reserves rather than through debt and this is an indication of the financial strength of the company. |
At the end of 2023, the company was in a strong financial position with net assets standing at £9.7m (2022: £11.2m). |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Strategic Report |
for the year ended 31st December 2023 |
FUTURE DEVELOPMENTS |
During 2024, the company has started the process of transferring or hiving up assets to its parent company, Constellation Cold Logistics UK Limited. This process is expected to be complete by 31 October 2024. As a result of this process, benefits of the acquisition will be fully optimised. |
On 24th June it was announced that the ultimate parent company, Arcus Infrastructure Partners, had agreed to sell the whole of the Constellation Cold Group to EQT, a global investment organisation with assets in Europe, Asia-Pacific and the Americas. The acquisition is expected to complete in the months following. |
KEY PERFORMANCE INDICATORS |
The company measured its performance for the period ended 31 December 2023 using a series of key performance indicators as follows: |
Gross margin % | 7.3% (2022: 22%) |
Average Debtor days | 62 days (2022: 52 days) |
Management has undertaken qualitative assessment of these KPIs, alongside other non-financial KPI's such as warehouse utilisation, throughput and number of loads transported, when appraising business performance, and remains confident in the strategic direction of the business as we move towards the hive up into Constellation Cold Logistics UK Limited. Emphasis continues on debt collection during the year through all levels of the organisation. |
ON BEHALF OF THE BOARD: |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Report of the Directors |
for the year ended 31st December 2023 |
The directors present their report with the financial statements of the company for the year ended 31st December 2023. |
CHANGE OF NAME |
The company passed a special resolution on 22nd June 2023 changing its name from |
DIVIDENDS |
No dividends will be distributed for the year ended 31st December 2023. |
EVENTS SINCE THE END OF THE YEAR |
Information relating to events since the end of the year is given in the notes to the financial statements. |
DIRECTORS |
Mrs A Wiltshire has held office during the whole of the period from 1st January 2023 to the date of this report. A Howard was initially appointed on 10th January 2023 and resigned on 21st April 2023, with a reappointment commencing on 19th June 2023. |
Other changes in directors holding office are as follows: |
GOING CONCERN |
During 2024, the company has begun the process of transferring assets to its parent company, Constellation Cold Logistics UK Limited. As a result of this process, benefits of the acquisition will be fully optimised. It is with consideration of this process that the accounts have been prepared on the going concern basis. Consideration has been given to the carrying value of the assets and liabilities in the balance sheet and no adjustment is needed as all assets will be transferred at net book value and current assets and liabilities will be realised under normal trading conditions. Long term liabilities for leases will be transferred to the parent company and continue to the lease end date. The Directors have obtained a letter of parental support ensure this funding will be in place when it is required. The Directors have considered the parent company's ability to provide this support and concluded that it has substantial resources from which to provide this should it be required. On this basis, the Directors continue to adopt the going concern basis of preparation in these financial statements. |
POST BALANCE SHEET EVENTS |
On 24th June it was announced that the ultimate parent company, Arcus Infrastructure Partners, had agreed |
to sell the whole of the Constellation Cold Group to EQT, a global investment organisation with assets in |
Europe, Asia-Pacific and the Americas. The acquisition is expected to complete in the months following. |
ENGAGEMENT WITH EMPLOYEES |
The company's policy is to consult and discuss with employees any matters likely to affect their interests. |
The company's policy is to recruit disabled workers for those vacancies that they are able to fill and to give them such training as appropriate. Should any employee become disabled, every practical effort is made to provide continuing employment. |
Information on matters of concern to employees is given through regular bulletins, notices and briefings, in order to achieve a common awareness of the financial and economic factors affecting the performance of the company. |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Report of the Directors |
for the year ended 31st December 2023 |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations. |
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and 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; |
- | 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. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
AUDITORS |
The auditors, Smailes Goldie, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
Report of the Independent Auditors to the Members of |
Constellation Cold Logistics UK 2 Ltd |
Opinion |
We have audited the financial statements of Constellation Cold Logistics UK 2 Ltd (the 'company') for the year ended 31st December 2023 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 31st December 2023 and of its loss for the year then ended; |
- | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
- | have been prepared in accordance with the requirements of the Companies Act 2006. |
Basis for opinion |
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the 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 directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. |
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. |
Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of the audit: |
- | the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
Report of the Independent Auditors to the Members of |
Constellation Cold Logistics UK 2 Ltd |
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 Report of the Directors. |
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | adequate accounting records have not been kept, 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 directors' remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page five, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. |
In preparing the financial statements, the directors are responsible for assessing the 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. |
Auditors' responsibilities for the audit of the financial statements |
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. |
The extent to which the audit was considered capable of detecting irregularities including fraud |
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 focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation, data protection, anti-bribery, employment, environmental and health and safety legislation. An understanding of these laws and regulations and the extent of compliance was obtained through discussion with management and inspecting legal and regulatory correspondence. |
We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by making enquiries of management and considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. |
To address the risk of fraud through management bias and override of controls, we: |
- | performed analytical procedures to identify any unusual or unexpected relationships; |
- | tested journal entries to identify unusual transactions; |
- |
assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and |
- | investigated the rationale behind significant or unusual transactions. |
Report of the Independent Auditors to the Members of |
Constellation Cold Logistics UK 2 Ltd |
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to: |
- | agreeing financial statement disclosures to underlying supporting documentation; |
- | reading the minutes of meetings of those charged with governance; and |
- | enquiring of management as to actual and potential litigation and claims; |
Due to 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. 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. |
The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission, or misrepresentation. |
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
Use of our report |
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed. |
for and on behalf of |
Chartered Accountants |
Statutory Auditor |
Regent's Court |
Princess Street |
Hull |
East Yorkshire |
HU2 8BA |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Statement of Comprehensive Income |
for the year ended 31st December 2023 |
2023 | 2022 |
As restated |
Notes | £ | £ |
TURNOVER |
Cost of sales |
GROSS PROFIT |
Administrative expenses |
(2,022,965 | ) | 653,263 |
Other operating income |
OPERATING (LOSS)/PROFIT | 4 | ( |
) |
Interest receivable and similar income |
(1,976,363 | ) | 817,708 |
Interest payable and similar expenses | 5 |
(LOSS)/PROFIT BEFORE TAXATION | ( |
) |
Tax on (loss)/profit | 6 | ( |
) |
(LOSS)/PROFIT FOR THE FINANCIAL YEAR |
( |
) |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE (LOSS)/INCOME FOR THE YEAR |
( |
) |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Balance Sheet |
31st December 2023 |
2023 | 2022 |
As restated |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 8 |
Tangible assets | 9 |
CURRENT ASSETS |
Stocks | 10 |
Debtors | 11 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 12 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
PROVISIONS FOR LIABILITIES | 15 |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 16 |
Retained earnings |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Statement of Changes in Equity |
for the year ended 31st December 2023 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1st January 2022 |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - |
Balance at 31st December 2022 |
Changes in equity |
Total comprehensive loss | - | ( |
) | ( |
) |
Balance at 31st December 2023 |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Notes to the Financial Statements |
for the year ended 31st December 2023 |
1. | STATUTORY INFORMATION |
Constellation Cold Logistics UK 2 Ltd is a |
The principal accounting policies in the presentation of these financial statements are set out below. These policies have been consistently applied to all periods, unless otherwise stated. The company adopted FRS 102 in the current year and an explanation of how the transition to FRS 102 from IFRS has affected the reported financial position and performance is given in note 20. The accounts each year are drawn up to the nearest calendar month. |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Going concern |
During 2024, the company has begun the process of transferring assets to its parent company, Constellation Cold Logistics UK Limited. As a result of this process, benefits of the acquisition will be fully optimised. It is with consideration of this process that the accounts have been prepared on the going concern basis. Consideration has been given to the carrying value of the assets and liabilities in the balance sheet and no adjustment is needed as all assets will be transferred at net book value and current assets and liabilities will be realised under normal trading conditions. Long term liabilities for leases will be transferred to the parent company and continue to the lease end date. The Directors have obtained a letter of parental support ensure this funding will be in place when it is required. The Directors have considered the parent company's ability to provide this support and concluded that it has substantial resources from which to provide this should it be required. On this basis, the Directors continue to adopt the going concern basis of preparation in these financial statements. |
Financial Reporting Standard 102 - reduced disclosure exemptions |
The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland": |
• | the requirements of Section 7 Statement of Cash Flows; |
• | the requirement of paragraph 3.17(d); |
• | the requirements of paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c); |
• | the requirement of paragraph 33.7. |
Going Concern |
During 2024, the company has begun the process of transferring assets to its parent company, Constellation Cold Logistics UK Limited. As a result of this process, benefits of the acquisition will be fully optimised. It is with consideration of this process that the accounts have been prepared on a basis other than going concern. Consideration has been given to the carrying value of the assets and liabilities in the balance sheet and no adjustment is needed as all assets will be transferred at net book value and current assets and liabilities will be realised under normal trading conditions. Long term liabilities for leases will be transferred to the parent company and continue to the lease end date. |
Related party exemption |
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Notes to the Financial Statements - continued |
for the year ended 31st December 2023 |
2. | ACCOUNTING POLICIES - continued |
Significant judgements and estimates |
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. |
1) Significant judgements in applying the Company's accounting policies |
The directors do not consider there to be any critical accounting judgements that must be applied. |
2) The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. |
The company has recognised a provision totalling £834,217 (2022: £777,462) for demolition costs. The provision is based on the current estimated cost. Inflation and discount rates are not material. This provision is an estimate, and the actual costs and timing of future cash flows are dependent on future events and market conditions. Because actual outflows can differ from estimates due to changes in prices and conditions, the carrying amounts of provisions are regularly reviewed and adjusted to take account of such changes. Any difference between expectations and the actual future liability will be accounted for in the period when such determination is made. The provision is detailed in note 15. |
Turnover |
Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. |
Intangible assets |
Costs associated with maintaining computer software programmes are recognised as an expense as incurred. Development costs that are directly attributable to the design and testing of identifiable and unique software products controlled by the company are recognised as intangible assets when the following criteria are met: |
- | it is technically feasible to complete the software product so that it will be available for use; |
- | management intends to complete the software product and use or sell it; |
- | there is an ability to use or sell the software product; |
- | it can be demonstrated how the software product will generate probable future economic benefits; |
- | adequate technical, financial and other resources to complete the development and to use or sell the software product are available; and |
- | the expenditure attributable to the software product during its development can be reliably measured. |
Directly attributable costs that are capitalised as part of the software product include the software development employee costs and an appropriate portion of relevant overheads. |
Other development expenditures that do not meet these criteria are recognised as and expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period. |
Computer software development costs recognised as assets are amortised over their useful lives (i.e. on a straight-line basis) over three to five years, and are recognised in cost of sales. |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Notes to the Financial Statements - continued |
for the year ended 31st December 2023 |
2. | ACCOUNTING POLICIES - continued |
Tangible fixed assets |
All tangible assets are shown at cost less subsequent depreciation and impairment. Cost includes expenditure that is directly attributable to the acquisition of these assets. Subsequent costs are included in the asset's carrying amount, only when it is probable that future economic benefits associated with the item will flow to the company and the cost of the item can be measured reliably. Repairs and maintenance are charged to the statement of comprehensive income during the financial period in which they are incurred. |
No depreciation is provided on freehold land. Depreciation of HGV motor vehicles is calculated to write off their cost less residual value on a diminishing balance basis over their expected useful lives. Depreciation of other fixed assets is calculated to write off their cost less residual value on a straight-line basis over their expected useful lives, which are as follows: |
Land and Buildings: |
Freehold buildings | 10 - 40 years |
Long leasehold buildings | period of lease |
Short leasehold buildings | period of lease |
Fixtures & fittings | 3 - 24 years |
Plant and Machinery : |
General plant and machinery | 3 - 24 years |
Motor vehicles | 3 - 10 years |
Fixtures & fittings | 3 - 24 years |
The assets' residual values nad useful lives are reviewed, and adjusted if appropriate, at each statement of financial position date. The gain or loss arising on the disposal or retirement of an asset is determined as the difference between the sales proceeds and the carrying amount of the asset and is included in the statement of comprehensive income. |
Trade receivables |
Trade receivables are carried at original invoice amount less provision made for expected credit losses. Expected credit losses of trade receivables are established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms. The amount of the provision is recognised in the statement of comprehensive income. |
Cash and cash equivalents |
Cash and cash equivalents comprise deposits with banks and other bank and cash balances. For the purposes of the cash flow statement, cash equivalents include bank overdrafts. In the statement of financial position, bank overdrafts are included in borrowings in current liabilities. |
Stocks |
Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items. |
Cost is determined using the first in, first out method. |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Notes to the Financial Statements - continued |
for the year ended 31st December 2023 |
2. | ACCOUNTING POLICIES - continued |
Financial assets |
Financial assets and financial liabilities are recognised in the company's balance sheet when the company becomes a party to the contractual provisions of the instrument. |
Financial assets and financial liabilities are initially measured at fair value, except for trade receivables that do not have a significant financing component which are measured at transaction price. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognised immediately in profit or loss. |
Impairment of financial assets |
The company always recognises expected credit losses (ECL) for trade receivables and intercompany receivables. The company has implemented policies that require appropriate credit checks on potential customers before sales are made. The amount of exposure to any individual warehouse customer is limited by the warehouse keeper's lien over the customer's stock. If a customer is to exit business with the company, final stock cannot be cleared until the outstanding debtor balance is paid. |
The company writes off a financial asset when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery, e.g. when the debtor has been placed under liquidation or has entered into bankruptcy proceedings, or in the case of trade receivables, when the amounts are over two years past due, whichever occurs sooner. Financial assets written off may still be subject to enforcement activities under the company's recovery procedures, considering legal advice where appropriate. Any recoveries made are recognised in profit or loss. |
De-recognition of financial assets |
The company derecognises a financial asset only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership and continues to control the transferred asset, the company recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the company retains substantially all the risks and rewards of ownership of a transferred financial asset, the company continues to recognise the financial asset and also recognises a collateralised borrowing for the proceeds received. |
Financial liabilities and equity |
Debt and equity instruments are classified as either financial liabilities or s equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Notes to the Financial Statements - continued |
for the year ended 31st December 2023 |
2. | ACCOUNTING POLICIES - continued |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Foreign currencies |
The financial statements are presented in pounds sterling which is the company's functional and presentational currency. Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result. |
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
Provisions |
Provisions are recognised when the company has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount has been reliably established. Provisions are not recognised for future operating losses. |
Provisions are measured at the present value of the expenditure expected to be required to settle the obligation using a pre-tax discount rate that reflects the current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to the passage of time is recognised as an interest expense. |
Hire purchase and leasing commitments |
Assets obtained under hire purchase contracts or finance leases, are recognised at the present value of lease payments to be made over the lease term from the commencement date of the lease. The lease payments include fixed payments (including in-substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option reasonably certain to be exercised by the company and payments of penalties for terminating a lease, if the lease term reflects the company exercising the option to terminate. The variable lease payments that do not depend on an index or a rate are recognised as an expense in the period on which the event or condition that triggers the payment occurs. |
In calculating the present value of lease payments, the company uses the incremental borrowing rate at the lease commencement date if the interest rate, implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset. |
Rentals paid under operating leases are charged to the profit or loss on a straight line basis over the period of the lease. |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Notes to the Financial Statements - continued |
for the year ended 31st December 2023 |
3. | EMPLOYEES AND DIRECTORS |
2023 | 2022 |
As restated |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
2023 | 2022 |
As restated |
Production | 168 | 195 |
Management and administration | 35 | 46 |
Sales and distribution | 2 | 2 |
2023 | 2022 |
As restated |
£ | £ |
Directors' remuneration |
Directors' pension contributions to money purchase schemes |
Information regarding the highest paid director is as follows: |
2023 | 2022 |
As restated |
£ | £ |
Emoluments etc |
Pension contributions to money purchase schemes |
No retirement benefits are accruing to the directors under the defined contribution scheme, and the key management of the company is deemed to be the Board of Directors. |
4. | OPERATING (LOSS)/PROFIT |
The operating loss (2022 - operating profit) is stated after charging/(crediting): |
2023 | 2022 |
As restated |
£ | £ |
Depreciation - owned assets |
Loss/(profit) on disposal of fixed assets | ( |
) |
Computer software amortisation |
Auditors' remuneration |
5. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2023 | 2022 |
As restated |
£ | £ |
Interest payable |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Notes to the Financial Statements - continued |
for the year ended 31st December 2023 |
6. | TAXATION |
Analysis of the tax (credit)/charge |
The tax (credit)/charge on the loss for the year was as follows: |
2023 | 2022 |
As restated |
£ | £ |
Deferred tax | ( |
) |
Tax on (loss)/profit | ( |
) |
Reconciliation of total tax (credit)/charge included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
2023 | 2022 |
As restated |
£ | £ |
(Loss)/profit before tax | ( |
) |
(Loss)/profit multiplied by the standard rate of corporation tax in the UK of |
( |
) |
Effects of: |
Expenses not deductible for tax purposes |
Capital allowances in excess of depreciation | - | ( |
) |
Depreciation in excess of capital allowances | - |
Adjustments to tax charge in respect of previous periods |
Movement in deferred tax not recognised | 14,189 | 918,777 |
Temporary differences not recognised | - | 459 |
Re-measurement of deferred tax - change in UK tax rate | (28,059 | ) | (188,125 | ) |
Impact of reversal of IFRS 16 reporting requirements | 12,470 | (10,074 | ) |
Other differences | 246 | 742 |
Total tax (credit)/charge | (459,960 | ) | 142,918 |
7. | DIVIDENDS |
2023 | 2022 |
As restated |
£ | £ |
Ordinary shares of £1 each |
Interim |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Notes to the Financial Statements - continued |
for the year ended 31st December 2023 |
8. | INTANGIBLE FIXED ASSETS |
Computer |
software |
£ |
COST |
At 1st January 2023 |
Additions |
Disposals | ( |
) |
At 31st December 2023 |
AMORTISATION |
At 1st January 2023 |
Amortisation for year |
Eliminated on disposal | ( |
) |
At 31st December 2023 |
NET BOOK VALUE |
At 31st December 2023 |
At 31st December 2022 |
9. | TANGIBLE FIXED ASSETS |
Fixtures |
Freehold | Plant and | and | Motor |
property | machinery | fittings | vehicles | Totals |
£ | £ | £ | £ | £ |
COST |
At 1st January 2023 |
Additions |
Disposals | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) |
At 31st December 2023 |
DEPRECIATION |
At 1st January 2023 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) |
At 31st December 2023 |
NET BOOK VALUE |
At 31st December 2023 |
At 31st December 2022 |
10. | STOCKS |
2023 | 2022 |
As restated |
£ | £ |
Stocks |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Notes to the Financial Statements - continued |
for the year ended 31st December 2023 |
11. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
As restated |
£ | £ |
Trade debtors |
Amounts owed by group undertakings |
Deferred tax asset | 2,224,300 | 1,764,340 |
Prepayments and accrued income |
The movement in deferred tax assets and liabilities during the year is set out below. |
Temporary taxable differences | Deductible temporary differences | Carried forward unused losses | Total |
£ | £ | £ | £ |
Deferred tax asset |
At 1st January 2022 | 1,900,620 | 6,638 | - | 1,907,258 |
Charged to the statement of comprehensive income | (544,380 | ) | 44,875 | 356,587 | (142,918 | ) |
At 1st January 2023 | 1,356,240 | 51,513 | 356,587 | 1,764,340 |
Charged to the statement of comprehensive income | (643,340 | ) | (31,646 | ) | 1,134,946 | 459,960 |
At 31st December 2023 | 712,900 | 19,866 | 1,491,534 | 2,224,300 |
Unrecognised deferred tax assets consist of £847,300 (2022: £847,300) in relation to fixed assets and a further £208,555 (2022: £194,366) in relation to the dilapidation provision. The recognised deferred tax asset is deemed to be recoverable against the future profitability of the company and the group. |
12. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2023 | 2022 |
As restated |
£ | £ |
Trade creditors |
Amounts owed to group undertakings |
Social security and other taxes |
VAT | 363,424 | 728,509 |
Accruals and deferred income |
13. | LEASING AGREEMENTS |
Minimum lease payments under non-cancellable operating leases fall due as follows: |
2023 | 2022 |
As restated |
£ | £ |
Within one year |
Between one and five years |
In more than five years |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Notes to the Financial Statements - continued |
for the year ended 31st December 2023 |
14. | SECURED DEBTS |
National Westminster Bank plc hold a charge created on 10th January 2023. The charge consists of a fixed and floating charge over all assets. The floating charge covers all the property or undertaking of the company. The charge contains a negative pledge. |
RBS Invoice Finance Ltd hold a charge created on 7th September 2023. The charge consists of fixed and floating charge over all assets. The floating charge covers all the property or undertaking of the company. The charge contains a negative pledge. |
15. | PROVISIONS FOR LIABILITIES |
2023 | 2022 |
As restated |
£ | £ |
Other provisions | 834,217 | 777,462 |
Other |
provisions |
£ |
Balance at 1st January 2023 |
Provided during year |
Balance at 31st December 2023 |
Other provisions relate to the demolition of 3 cold stores, on leased land, thought more likely to require demolition than not at the end of the land lease in September 2026, value being based on a 3rd party quote. |
16. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
value: | £ | £ |
Ordinary | £1 | 9,000,000 | 9,000,000 |
17. | PENSION COMMITMENTS |
The entity operates defined contribution pension schemes, the cost to the entity for the period ended 31 December 2023 was £347,253 (2022: £366,092). The amount outstanding at 31 December 2023 was £51,103 (2022: £54,107). |
18. | CAPITAL COMMITMENTS |
2023 | 2022 |
As restated |
£ | £ |
Contracted but not provided for in the |
financial statements |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Notes to the Financial Statements - continued |
for the year ended 31st December 2023 |
19. | POST BALANCE SHEET EVENTS |
During 2024, the company has started the process of transferring or hiving up assets to its parent company, Constellation Cold Logistics UK Limited. This process is expected to be complete by 31 October 2024. As a result of this process, benefits of the acquisition will be fully optimised. |
On 24th June it was announced that the ultimate parent company, Arcus Infrastructure Partners, had agreed to sell the whole of the Constellation Cold Group to EQT, a global investment organisation with assets in Europe, Asia-Pacific and the Americas. The acquisition is expected to complete in the months following. |
20. | ULTIMATE CONTROLLING PARTY |
At the year end the ultimate controlling party is Constellation Cold Logistics United Kingdom s.a.r.l. a company registered in Luxembourg. |
Constellation Cold Logistics UK 2 Ltd (Registered number: 00553154) |
Notes to the Financial Statements - continued |
for the year ended 31st December 2023 |
21. | FIRST YEAR ADOPTION OF FRS 102 |
The company transitioned to FRS 102 from International Financial Reporting Standards in the year to 31 December 2023 to align with group reporting. Consequently the date of transition is 1 January 2022. The impact of the transition to FRS 102 is as follows: |
Reconciliation of equity and profit or loss |
1 January 2022 | 31 December 2022 |
As previously stated |
Effect of transition |
FRS 102 (as restated |
) |
As previously stated |
Effect of transition |
FRS 102 (as restated |
) |
£ | £ | £ | £ | £ | £ |
Non-current assets |
12,937,609 |
(3,343,220 |
) |
9,594,389 |
11,693,813 |
(3,217,305 |
) |
8,476,508 |
Current assets |
7,010,104 |
1,907,258 |
8,917,362 |
6,315,191 |
1,764,340 |
8,079,531 |
Creditors: amounts falling due within one year |
(4,667,984 |
) |
946,490 |
(3,721,494 |
) |
(5,904,314 |
) |
1,323,433 |
(4,580,881 |
) |
Net current assets |
2,342,120 |
2,853,748 |
5,195,868 |
410,877 |
3,087,773 |
3,498,650 |
Total assets less current liabilities |
15,279,729 |
(489,472 |
) |
14,790,257 |
12,104,690 |
(129,532 |
) |
11,975,158 |
Non-current liabilities |
(1,018,666 |
) |
544,904 |
(473,762 |
) |
(960,011 |
) |
182,549 |
(777,462 |
) |
Net assets | 14,261,063 | 55,432 | 14,316,495 | 11,144,679 | 53,017 | 11,197,696 |
Capital and reserves |
14,261,063 |
55,432 |
14,316,495 |
11,144,679 |
53,017 |
11,197,696 |
Profit or loss |
(152,503 |
) |
- |
(152,503 |
) |
677,205 |
(2,415 |
) |
674,790 |
Changes to accounting policies |
Under IFRS the company recognised right of use leased assets and associated liabilities on its balance sheet. Upon transition to FRS 102 the company has de-recognised these assets and associated liabilities and adjusted its accounting policy to be compliant with the treatment of operating leases. |