Company Registration No. SC698641 (Scotland)
GREEN VOLT HOLDCO LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
GREEN VOLT HOLDCO LTD
COMPANY INFORMATION
Directors
A Quarta
(Appointed 1 June 2024)
C Af Geijerstam
(Appointed 30 October 2023)
J Dobson
(Appointed 30 October 2023)
T Fujishiro
(Appointed 30 October 2023)
C J Hill
(Appointed 30 October 2023)
Lord N Stephen
Company number
SC698641
Registered office
12 Alva Street
Edinburgh
United Kingdom
EH2 4QG
Auditor
Ernst & Young LLP
4th Floor
2 Marischal Square
Broad Street
Aberdeen
AB10 1BL
GREEN VOLT HOLDCO LTD
CONTENTS
Page
Directors' report
1 - 2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Group statement of comprehensive income
7
Group statement of financial position
8
Parent company statement of financial position
9
Group statement of changes in equity
10
Parent company statement of changes in equity
11
Group statement of cash flows
12
Parent company statement of cash flows
13
Notes to the group financial statements
14 - 25
GREEN VOLT HOLDCO LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Principal activities
The group began operating as a developer Green Volt Offshore Windfarm from 30 October 2023. The principal activity of the company continued to be that of a holding company.
Results and dividends
The results for the year are set out on page 7.
No ordinary dividends were paid (2022: £nil). The directors do not recommend payment of a further dividend (2022: £nil).
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
A Quarta
(Appointed 1 June 2024)
C Af Geijerstam
(Appointed 30 October 2023)
C De Santis
(Appointed 30 October 2023 and resigned 1 June 2024)
J Dobson
(Appointed 30 October 2023)
T Fujishiro
(Appointed 30 October 2023)
C J Hill
(Appointed 30 October 2023)
Lord N Stephen
Post reporting date events
On 13 August 2024, the company issued 15,745,222 Ordinary shares of £1 each.
In April 2024, Green Volt Offshore Windfarm Ltd was granted both onshore and offshore planning consents, marking an important milestone in the development of the project. On 3 September 2024, Green Volt Offshore Windfarm Ltd was awarded a Contract for Difference (CfD) with the Low Carbon Contracts Company (LCCC), a UK government-owned company. This contract, signed on 25 September 2024, does not affect the financial position as at 31 December 2023, and no adjustments have been made to the financial statements as at 31 December 2023.
Auditor
Ernst & Young LLP were appointed as auditor to the company and will continue in office as auditor until such time as a resolution to the contrary is passed in accordance with legislation and the Memorandum and Articles of Association.
Statement of disclosure to auditor
Each director in office at the date of approval of this annual report confirms that:
so far as the director is aware, there is no relevant audit information of which the company's auditor is unaware, and
the director has taken all the steps that he / she ought to have taken as a director in order to make himself / herself aware of any relevant audit information and to establish that the company's auditor is aware of that information.
This confirmation is given and should be interpreted in accordance with the provisions of section 418 of the Companies Act 2006.
Small companies exemption
In preparing this report, the directors have taken advantage of the small companies' exemptions provided by section 415A of the Companies Act 2006.
The company has also taken advantage of the small companies' exemption to prepare a strategic report as per section 414B of the Companies Act 2006.
GREEN VOLT HOLDCO LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Going concern
At the time of approving the financial statements, the directors have a reasonable expectation that the Group has adequate resources to continue in operational existence until 30 September 2025.
The Group has received a letter of financial support from its ultimate shareholders, Flotation Energy Limited and Vargronn AS, stating their current intention to continue to provide such funding to the Company and the Group as is necessary to enable the Company and Group to continue in operational existence and to meet their liabilities as they fall due, until 30 September 2025. The directors have assessed that Flotation Energy Limited and Vårgrønn AS have the financial means necessary to provide this support.
Having considered the Group’s financial projections together with the above confirmed financial support, the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
On behalf of the board
A Quarta
J Dobson
Director
Director
30 September 2024
GREEN VOLT HOLDCO LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 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 group and parent company financial statements in accordance with UK adopted international accounting standards. 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, International Accounting Standard 1 requires that directors:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
provide additional disclosures when compliance with the specific requirements in UK adopted international accounting standards are insufficient to enable users to understand the impact of particular transactions, other events and conditions on the company financial position and financial performance;
state whether applicable Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
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 group's and the company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
GREEN VOLT HOLDCO LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF GREEN VOLT HOLDCO LTD
- 4 -
Opinion
We have audited the financial statements of Green Volt Holdco Ltd (‘the parent company’) and its subsidiaries (the ‘group’) for the year ended 31 December 2023 which comprise the Group Statement of Comprehensive Income, the Group and Parent Company Statement of Financial Position, the Group and Parent Company Statement of Changes in Equity, the Group and Parent Company Statement of Cash Flows and the related notes 1 to 23, including material accounting policy information. The financial reporting framework that has been applied in their preparation is applicable law and UK adopted International Accounting Standards and as regards the parent company financial statements, as applied in accordance with section 408 of the Companies Act 2006.
In our opinion:
the financial statements give a true and fair view of the group’s and of the parent company’s affairs as at 31 December 2023 and of the group’s loss for the year then ended;
the group financial statements have been properly prepared in accordance with UK adopted International Accounting Standards;
the parent company financial statements have been properly prepared in accordance with UK adopted International Accounting Standards as applied in accordance with section 408 of the Companies Act 2006; and
the financial statements 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 group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group and parent company’s ability to continue as a going concern for a period to 30 September 2025.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the group’s ability to continue as a going concern.
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 this 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 the other information, we are required to report that fact.
We have nothing to report in this regard.
GREEN VOLT HOLDCO LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GREEN VOLT HOLDCO LTD
- 5 -
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 directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the directors’ report has been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the directors’ report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors’ remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit; or
the directors were not entitled to take advantage of the small companies’ exemptions in preparing the directors’ report and from the requirement to prepare a strategic report.
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement set out on page 3, 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 group’s and the parent company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.
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.
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect irregularities, including fraud. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and management.
GREEN VOLT HOLDCO LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GREEN VOLT HOLDCO LTD
- 6 -
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud (continued)
We obtained an understanding of the legal and regulatory frameworks that are applicable to the company and determined that the most significant are those that relate to the reporting framework (IFRS and the Companies Act 2006) and the relevant direct and indirect tax compliance regulations in the United Kingdom. In addition, the Company has to comply with laws and regulations relating to its operations, including health and safety, employees, GDPR, and anti-bribery and corruption.
We understood how Green Volt Holdco Ltd is complying with those frameworks by making enquiries of management to understand how the Company maintains and communicates its policies and procedures and corroborated responses by obtaining and reviewing supporting documentation.
We assessed the susceptibility of the Company’s financial statements to material misstatement, including how fraud might occur by making enquiries of management, to understand and identify the internal policies and procedures related to the identification and monitoring of fraud risks. We considered the opportunity and incentives for the perpetration of fraud based on our understanding of the business.
Based on this understanding we designed our audit procedures to identify noncompliance with such laws and regulations. Our procedures involved journal entry testing designed to identify unusual activity and lower testing thresholds applied to Financial Statement accounts with deemed higher risk of fraud. Transactions sampled were agreed to source documentation or independent confirmation, ensuring appropriate authorisation of the transactions.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
Gordon Edwards (Senior statutory auditor)
30 September 2024
for and on behalf of Ernst & Young LLP, Statutory Auditor
Aberdeen
GREEN VOLT HOLDCO LTD
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
Notes
£
£
Administrative expenses
(40,105)
Operating loss
(40,105)
-
Income tax expense
7
-
-
Loss and total comprehensive expense for the year
(40,105)
The loss for the financial year is all attributable to the owners of the parent company.
Total comprehensive expense for the year is all attributable to the owners of the parent company.
GREEN VOLT HOLDCO LTD
GROUP STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2023
31 December 2023
- 8 -
31 December
31 December
13 May
2023
2022
2021
Notes
£
£
£
Non-current assets
Intangible assets
8
27,097,997
Current assets
Trade and other receivables
11
1,401,983
100
100
Cash and cash equivalents
9,077,791
10,479,774
100
100
Current liabilities
Trade and other payables
12
5,370,893
Borrowings
13
1,037,111
6,408,004
-
-
Net current assets
4,071,770
100
100
Net assets
31,169,767
100
100
Equity
Called up share capital
16
30,427,640
100
100
Share premium account
17
782,232
Retained earnings
17
(40,105)
Total equity
31,169,767
100
100
The financial statements were approved by the board of directors and authorised for issue on
30 September 2024
30 September 2024
and were signed on its behalf by:
A Quarta
J Dobson
Director
Director
Company Registration No. SC698641
GREEN VOLT HOLDCO LTD
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2023
31 December 2023
- 9 -
31 December
31 December
13 May
2023
2022
2021
Notes
£
£
£
Non-current assets
Investments
9
100
100
-
Trade and other receivables
11
31,209,772
-
-
31,209,872
100
-
Current assets
Trade and other receivables
11
100
100
Current liabilities
Trade and other payables
12
20,000
100
-
Net current liabilities
(20,000)
-
100
Net assets
31,189,872
100
100
Equity
Called up share capital
16
30,427,640
100
100
Share premium account
17
782,232
Retained earnings
17
(20,000)
Total equity
31,189,872
100
100
As permitted by trues408 Companies Act 2006, the company has not presented its own income statement and related notes. The company’s loss for the year was £20,000 (2022: £nil).
The financial statements were approved by the board of directors and authorised for issue on 30 September 2024 and were signed on its behalf by:
A Quarta
J Dobson
Director
Director
Company Registration No. SC698641
GREEN VOLT HOLDCO LTD
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
Share capital
Share premium account
Retained earnings
Total
Notes
£
£
£
£
Balance at 1 January 2022
100
100
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
-
Balance at 31 December 2022
100
100
Year ended 31 December 2023:
Loss and total comprehensive expense for the year
-
-
(40,105)
(40,105)
Issue of share capital
16
30,427,540
782,232
-
31,209,772
Balance at 31 December 2023
30,427,640
782,232
(40,105)
31,169,767
GREEN VOLT HOLDCO LTD
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Share premium account
Retained earnings
Total
Notes
£
£
£
£
Balance at 1 January 2022
100
100
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
Balance at 31 December 2022
100
-
100
Year ended 31 December 2023:
Loss and total comprehensive expense for the year
-
-
(20,000)
(20,000)
Issue of share capital
16
30,427,540
782,232
-
31,209,772
Balance at 31 December 2023
30,427,640
782,232
(20,000)
31,189,872
GREEN VOLT HOLDCO LTD
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash used in operations
22
(22)
-
Net cash outflow from operating activities
(22)
-
Financing activities
Proceeds from issue of shares
9,077,813
Net cash generated from financing activities
9,077,813
-
Net increase in cash and cash equivalents
9,077,791
-
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
9,077,791
GREEN VOLT HOLDCO LTD
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
23
-
-
Net cash inflow from operating activities
-
-
Net increase in cash and cash equivalents
-
-
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
GREEN VOLT HOLDCO LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
1
Accounting policies
Company information
Green Volt Holdco Ltd is a private company limited by shares incorporated and domiciled in Scotland. The registered office is 12 Alva Street, Edinburgh, Scotland, EH2 4QG. The principal place of business is Hobart House, 80 Hanover Street, Edinburgh EH2 1EL. The company's principal activities and nature of its operations are disclosed in the directors' report.
The group consists of Green Volt Holdco Ltd and all of its subsidiaries.
1.1
Accounting convention
These are the first financial statements that have been prepared in accordance with UK-adopted International Accounting Standards (“IFRS”) and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS, except as otherwise stated.
Previously the financial statements were 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 as applicable to companies subject to the small companies’ regime. There are no transition adjustments on adoption of IFRS to be disclosed due to the nature of the balances of the group and the company at transition date (date of incorporation of 13 May 2021). As there are no transition adjustments, the group and company has not prepared a reconciliation of equity and a reconciliation of total comprehensive income.
The financial statements are prepared in sterling, which is the functional currency of the group. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The material accounting policies adopted are set out below.
1.2
Basis of consolidation
The consolidated group financial statements consist of the financial statements of the parent company Green Volt Holdco Ltd together with all entities controlled by the parent company (its subsidiaries).
All financial statements are made up to 31 December 2023. All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation.
A subsidiary is an entity controlled by the parent company. Control is achieved when the group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
1.3
Going concern
At the time of approving the financial statements, the directors have a reasonable expectation that the Group has adequate resources to continue in operational existence until 30 September 2025.true
The Group has received a letter of financial support from its ultimate shareholders, Flotation Energy Limited and Vargronn AS, stating their current intention to continue to provide such funding to the Company and the Group as is necessary to enable the Company and Group to continue in operational existence and to meet their liabilities as they fall due, until 30 September 2025. The directors have assessed that Flotation Energy Limited and Vårgrønn AS have the financial means necessary to provide this support.
Having considered the Group’s financial projections together with the above confirmed financial support, the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
GREEN VOLT HOLDCO LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
1.4
Intangible assets other than goodwill
Expenditure on development activities is capitalised as intangible assets if the project is considered to be technically and commercially feasible and the group intends to complete the project for use or for sale. Development projects consist of offshore wind farm developments. Costs incurred in bringing these projects to the consent stage include planning, environmental, and other costs, including costs incurred during the bidding and consenting phase.
Externally acquired intangible assets are recognised at cost.
The group assesses at each reporting date, whether there is an indication that an intangible asset may be impaired. If any indication exists, the group estimates the asset’s recoverable amount which is the higher of an asset’s fair value less costs to sell and its value in use. When the carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
1.5
Non-current investments
Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
1.6
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at call with banks.
1.7
Financial assets
Financial assets are recognised in the group's statement of financial position when the group becomes party to the contractual provisions of the instrument.
Financial assets held at amortised cost
Amounts owed by subsidiary undertakings are initially recognised at fair value plus transaction costs directly attributable to their acquisition or issue, and are subsequently carried at amortised cost using the effective interest rate method, less provision for impairment where necessary.
Derecognition of financial assets
Financial assets are derecognised 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 to another entity.
1.8
Financial liabilities
The group recognises financial debt when the group becomes a party to the contractual provisions of the instruments.
Fiinancial liabilities held at amortised cost
Financial liabilities, including borrowings, trade and other payables, are initially measured at fair value net of transaction costs directly attributable to the issuance of the financial liability. They are subsequently measured at amortised cost using the effective interest method.
Derecognition of financial liabilities
Financial liabilities are derecognised when, and only when, the group’s obligations are discharged, cancelled, or they expire.
1.9
Equity instruments
Equity instruments issued by the parent company are recorded at the proceeds received, net of direct issue costs.
GREEN VOLT HOLDCO LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
1.10
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 statement of comprehensive income 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 group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.
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 statement of comprehensive income, 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 group 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.
2
Adoption of new and revised standards and changes in accounting policies
The group has adopted all the standards and amendments to existing standards which are mandatory for accounting periods beginning on 1 January 2023, in particular:
There are no amendments to accounting standards or IFRS interpretations that are effective for the year ended 31 December 2023 that have had a material impact on the financial statements. Furthermore, there are no amendments to accounting standards or IFRS interpretations for periods commencing 1 January 2024 that the directors of the group expect to have a material impact on the financial statements.
GREEN VOLT HOLDCO LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
3
Critical accounting estimates and judgements
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are outlined below.
Critical judgements
Capitalisation of internally generated development costs
Accounting judgement is required in determining whether expenditure relating to the development of a project constitutes an intangible asset, i.e., it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the cost or value of the asset can be measured reliably; or if this expenditure pertains to a research phase of the project and therefore should be expensed. The group has processes and controls to evaluate the classification of such expenditure. £4,966,037 (2022: £nil) of development costs were capitalised during the period. This includes costs incurred in the bidding and consent phases of projects, where the directors have assessed that a successful outcome is probable.
4
Auditor's remuneration
2023
2022
Fees payable to the group's and the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
20,000
Audit of the financial statements of the company's subsidiaries
10,000
-
30,000
-
5
Employees
The average number of persons employed by the group and the company during the year was nil (2022: nil).
6
Directors' remuneration
The directors of the company are employed by and receive remuneration from joint venture partners. The directors’ emoluments are not paid to them due to their capacity as the directors of this company but are payable for services wholly attributable to other undertakings.
Accordingly, no details in respect of their emoluments have been included in the financial statements as no payments and no apportionment for qualifying services have been made.
GREEN VOLT HOLDCO LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
7
Income tax expense
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
The charge for the year can be reconciled to the loss per the the statement of comprehensive income as follows:
2023
2022
£
£
Loss before taxation
(40,105)
-
Expected tax credit based on a corporation tax rate of 23.52% (2022: 19.00%)
(9,433)
-
Unrecognised deferred tax assets
9,433
-
Taxation charge for the year
-
-
The group had gross UK corporation tax losses carried forward of £9,433 at 31 December 2023 (31 December 2022: £nil). No deferred tax asset has been recognised on these losses due to uncertainty around the generation of future taxable profits that will utilise these losses. From 1 April 2023, the rate of corporation tax in the United Kingdom increased from 19% to 25%. Deferred tax has been calculated at 25%.
8
Intangible assets - Group
Development costs
£
Cost
Additions - internally generated
4,966,037
Additions - purchased
22,131,960
At 31 December 2023
27,097,997
Carrying amount
At 31 December 2023
27,097,997
On 30 October 2023, the group acquired intellectual property and work product from both joint venture partners in relation to 'Green Volt' offshore wind farm project.
Further capitalised development costs relate to continued planning, environmental, and other costs incurred in the development of this project.
Development costs have not yet been completed and therefore the amortisation of these assets has not yet begun. Consequently, no amortisation charge has been recognised in the statement of comprehensive income.
GREEN VOLT HOLDCO LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
9
Investments - Company
Non-current
2023
2022
£
£
Investments in subsidiaries
100
100
10
Subsidiaries
Details of the company's subsidiaries at 31 December 2023 are as follows:
Name of undertaking
Registered office
Principal activities
Class of
% Held
shares held
Direct
Green Volt Offshore Windfarm Ltd
12 Alva Street, Edinburgh, Scotland, EH2 4QG
Developer of offshore wind energy projects
Ordinary
100.00
11
Trade and other receivables
Current
Non-current
Group
2023
2022
2023
2022
£
£
£
£
VAT recoverable
1,401,983
-
-
-
Amounts owed by fellow group undertakings
100
1,401,983
100
-
-
Current
Non-current
Company
2023
2022
2023
2022
£
£
£
£
Amounts owed by subsidiary undertakings
31,209,772
Amounts owed by fellow group undertakings
100
-
100
31,209,772
-
Amounts owed by subsidiary undertakings are unsecured, interest-free and repayable on demand. These balances were classified as non-current due to expectation of repayment date.
12
Trade and other payables
Group
Company
2023
2022
2023
2022
£
£
£
£
Trade payables
2,189,132
-
Amounts owed to fellow group undertakings
-
-
-
100
Accruals
3,181,761
20,000
5,370,893
-
20,000
100
GREEN VOLT HOLDCO LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
13
Borrowings - Group
Current
2023
2022
£
£
Borrowings held at amortised cost:
Loans from joint ventures
1,037,111
-
Loans from joint venture partners are unsecured, interest-free and repayable on demand.
14
Financial risk review and management
An analysis of the carrying value of the group's and the company's financial assets and liabilities is as follows:
Group
Company
2023
2022
2023
2022
£
£
£
£
Financial assets at amortised cost
Cash and cash equivalents
9,077,791
-
-
-
Amounts owed by fellow group undertakings
-
100
31,209,772
100
9,077,791
100
31,209,772
100
Financial liabilities at amortised cost
Trade and other payables
5,370,893
-
20,000
-
Borrowings
1,037,111
-
-
-
Amounts owed to fellow group undertakings
-
-
-
100
6,408,004
-
20,000
100
GREEN VOLT HOLDCO LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
14
Financial risk review and management
(Continued)
- 21 -
The carrying amounts of financial assets and financial liabilities recorded at amortised cost approximate their fair values due to their short term nature or contractual cash flow characteristics.
Risk management framework
The group and the company are reliant upon the funding from its ultimate joint venture shareholders, Flotation Energy Limited and Vårgrønn AS. The company operates under the same risk management framework as the group.
Its business activities expose the group to operational risk and financial risks such as credit risk and liquidity risk. Market risk is considered not significant for the group. The group's principal financial liabilities comprise trade and other payables as well as borrowings. The main purpose of these financial liabilities is to finance the group's operations. Financial assets include cash held at bank.
The board is responsible for setting and monitoring the group’s exposure to risk and for the setting of appropriate policies, controls and parameters. The group’s objective is to have comprehensive and timely control and disclosure of risk measures and exposures. The evaluation of these risks is the responsibility of senior internal management. The group seeks to manage financial risk, to ensure sufficient liquidity is available to meet foreseeable needs and to invest cash safely and profitably.
Credit risk
Credit risk is the risk that a counterparty to a financial instrument will fail to discharge an obligation or commitment that it has entered into with the group and the risk that any receivables of the group may default on amounts due to the group. The group does not have trade receivables and therefore is not exposed to significant credit risk. The group’s receivables consist of amounts due from related parties. As related parties are financially supported by their ultimate parent undertakings which have worthy credit ratings, the credit risk exposure of the group is assessed to be low. As a result, no expected credit loss allowance was recognised in relation to these receivables on the grounds of materiality and the directors have concluded that no further disclosures of credit risk exposure are required.
Credit risk on cash and cash equivalents is considered to be very low as the counterparty is a bank with a high credit rating.
The group's maximum exposure to credit risk relating to its financial assets and financial liabilities is equal to their carrying value.
All financial liabilities of the group are due within one year.
GREEN VOLT HOLDCO LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
14
Financial risk review and management
(Continued)
- 22 -
Liquidity risk
Liquidity risk is the risk that the group will encounter difficulties in meeting obligations associated with financial liabilities.
The group closely monitors its access to borrowings from its joint venture shareholders in comparison to its outstanding commitments on a regular basis to ensure that it has sufficient funds to meet the obligations as they fall due.
The Board receives regular debt management forecasts which estimate the cash inflows and outflows for the next twelve months, so that management can ensure that sufficient funding is in place as it is required.
The following table sets out the maturity profile of the group's and the company's financial liabilities, based on undiscounted contractual cash flows, as at the following dates:
Group
1-3 months
3-12 months
1-5 years
£
£
£
Financial liabilities
Trade payables
2,189,132
-
-
Accruals
3,181,761
-
-
Borrowings
-
1,037,111
-
5,370,893
1,037,111
-
Company
1-3 months
3-12 months
1-5 years
£
£
£
Financial liabilities
Accruals
20,000
-
-
20,000
-
-
15
Changes in liabilities arising from financing activities
The following table details the changes in the group's and the company's liabilities arising from financing activities.
At 1January 2023
Non-cash movements
At 31 December 2023
£
£
£
Loans from related parties
-
1,037,111
1,037,111
GREEN VOLT HOLDCO LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
16
Share capital - Group and Company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
30,427,640
100
30,427,640
100
New shares allotted
During the year 30,427,540 Ordinary shares having a nominal value of £1 were allotted in exchange for an aggregate consideration of £31,209,772.
Ordinary shares
Ordinary shares carry the right to vote and are entitled pari passu to dividend payments or any other distributions, including on winding up of the company.
Reconciliation of movements during the year:
Number
At 1 January 2023
100
Issue of fully paid shares
30,427,540
At 31 December 2023
30,427,640
17
Reserves
Share premium account
Share premium account represents consideration received for shares issued above their nominal value net of transaction costs.
Retained earnings
The retained earnings represent accumulated comprehensive income or expense for the year less any dividends paid.
18
Capital risk management
The group's and the company's capital management objectives are:
to ensure the group's ability to continue as a going concern;
to provide an adequate return to shareholders;
to support the group's stability and growth;
to provide capital for the purpose of strengthening the group's risk management capability; and
to provide capital for the purpose of further investments.
The capital structure of the group consists of debt (trade, other payables and borrowings) and equity (comprising issued capital and retained earnings).
The group is not subject to any externally imposed capital requirements.
The group actively and regularly reviews and manages its capital structure to ensure an optimal capital structure and to maximise equity holder returns in the future, taking into consideration the future capital requirements of the group and capital efficiency, prevailing and projected profitability, projected operating cash flows, and projected strategic investment opportunities. The management regard capital as total equity and reserves for capital management purposes.
GREEN VOLT HOLDCO LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
19
Events after the reporting date
On 13 August 2024, the company issued 15,745,222 Ordinary shares of £1 each.
In April 2024, Green Volt Offshore Windfarm Ltd was granted both onshore and offshore planning consents, marking an important milestone in the development of the project. On 3 September 2024, Green Volt Offshore Windfarm Ltd was awarded a Contract for Difference (CfD) with the Low Carbon Contracts Company (LCCC), a UK government-owned company. This contract, signed on 25 September 2024, does not affect the financial position as at 31 December 2023, and no adjustments have been made to the financial statements as at 31 December 2023.
20
Related party transactions
Group
During the year the group entered into the following transactions with related parties:
Services provided to the group
Acquisition of intangible assets
2023
2022
2023
2022
£
£
£
£
Flotation Energy Limited
4,485,514
11,065,980
Vårgrønn AS
480,523
11,065,980
4,966,037
-
22,131,960
-
The following amounts were outstanding at the reporting end date:
2023
2022
Amounts due to related parties
£
£
Flotation Energy Limited
1,037,111
2023
2022
Amounts due from related parties
£
£
Flotation Energy Limited
100
GREEN VOLT HOLDCO LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
20
Related party transactions
(Continued)
- 25 -
Company
During the year the company advanced funds of £31,209,773 (2022: £nil) to Green Volt Offshore Windfarm Ltd to finance the acquisition of intangible assets and operating activities.
The following amounts were outstanding at the reporting end date:
2023
2022
Amounts due to related parties
£
£
Green Volt Offshore Windfarm Ltd
-
100
2023
2022
Amounts due from related parties
£
£
Green Volt Offshore Windfarm Ltd
31,209,773
-
21
Controlling party
The company is jointly controlled by Flotation Energy Limited and Vårgrønn AS.
22
Cash flows from operating activities
2023
2022
Group
£
£
Loss for the year after tax
(40,105)
-
Movements in working capital:
Increase in trade and other receivables
(1,401,883)
-
Increase in trade and other payables
1,441,966
-
Cash used in operations
(22)
-
23
Cash flows from operating activities
2023
2022
Company
£
£
Loss for the year after tax
(20,000)
-
Movements in working capital:
Decrease/(increase) in trade and other receivables
100
(100)
Increase in trade and other payables
19,900
100
Cash generated from operations
-
-
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