Company registration number:
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COMPANY INFORMATION
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CONTENTS
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DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024
The directors present their report and the financial statements for the year ended 31 March 2024.
The directors are responsible for preparing the Directors' report and the financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the company's financial statements and then apply them consistently;
∙make judgments 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 to 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.
The director who served during the year was:
The auditors, Menzies LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
In preparing this report, the directors have taken advantage of the small companies exemptions provided by section 415A of the Companies Act 2006.
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
This report was approved by the board on
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF EDGEN MURRAY EUROPE LIMITED
UNDER SECTION 449 OF THE COMPANIES ACT 2006
We have audited the financial statements of Edgen Murray Europe Limited (the 'company') for the year ended 31 March 2024, which comprise the Profit and loss account, the Statement of financial position and the related notes, 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).
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 United Kingdom, including the Financial Reporting Council'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.
We draw attention to Note 2.2 to the financial statements which explains that the directors intend to wind down the company and therefore do not consider it to be appropriate to adopt the going concern basis of accounting in preparing the financial statements.
Accordingly the financial statements have been prepared on a basis other than going concern as described in Note 2.2.
Our opinion is not modified in respect of this matter.
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' report thereon. The directors are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF EDGEN MURRAY EUROPE LIMITED (CONTINUED)
UNDER SECTION 449 OF 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.
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 Directors' report.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF EDGEN MURRAY EUROPE LIMITED (CONTINUED)
UNDER SECTION 449 OF THE COMPANIES ACT 2006
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 Auditors' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
The company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation. We determined that the following laws and regulations were most significant including:
∙The Companies Act 2006
∙Financial Reporting Standard 102
∙UK tax legislation
We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items. We understood how the company is complying with those legal and regulatory frameworks by, making inquiries to management and those responsible for legal and compliance procedures. We corroborated our inquiries through our review of relevant documentation. The engagement partner assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations. No issues were identified in this area. We assessed the susceptibility of the company’s financial statements to material misstatement, including how fraud might occur. We considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas:
∙Posting of unusual journals and complex transactions; or
∙The use of management override of controls to manipulate results, or to cause the company to enter into transactions
not in its best interest.
As a result of the above, the audit procedures performed by the engagement team included:
∙Identifying and assessing the design effectiveness of controls management has in place to prevent and detect fraud;
∙Understanding how those charged with governance considered and addressed the potential for override of controls or
other inappropriate influence over the financial reporting process;
∙Challenging assumptions and judgements made by management in its significant accounting estimates; and
∙Identifying and testing journal entries, in particular any journal entries posted with unusual account combinations.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities 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 Auditors' report.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF EDGEN MURRAY EUROPE LIMITED (CONTINUED)
UNDER SECTION 449 OF THE COMPANIES ACT 2006
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 Auditors' 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.
for and on behalf of
Chartered Accountants
Statutory Auditor
Lynton House
7-12 Tavistock Square
London
WC1H 9LT
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STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2024
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STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
The notes on pages 9 to 17 form part of these financial statements.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
Edgen Murray Europe Limited is a private company incorporated on 20 January 1976 and domiciled in the UK, with registered address of Vintners' Place, Upper Thames Street, London, EC4V 3BJ.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with FRS 102 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland' and the requirements of the Companies Act 2006. The disclosure requirements of Section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The following principal accounting policies have been applied:
As of 24 March 2021, the strategic decision was made by Sumitomo Corporation to move forward with a detailed and formal plan to wind down Edgen Murray Europe operations. The wind-down decision entailed an immediate cessation of new business origination and commencing of consultation procedures to terminate employees whose roles have been made redundant. Under the wind-down plan Edgen Murray Europe will continue to execute existing backlog of contracts on a business as usual basis and as these are wound down reduce its fixed cost base accordingly.
As the directors do not intend to conduct a replacement trade, the financial statements have been prepared on a basis other than that of going concern. The company exited all leases in the year to 31 March 2022 and disposed or scrapped the fixed assets and on hand inventory except for the inventory acquired during the sale of HSP Valves Group Limited. The effect on the financial statements is that all assets and liabilities have been classified as current and that the assets have be recorded at their estimated realisable value.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
Transactions in foreign currencies are translated to the functional currency of the company at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are retranslated to the functional currency at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation are recognised in the profit and loss account. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. Non-monetary assets and liabilities denominated in foreign cun-encies that are stated at fair value are retranslated to the functional currency at foreign exchange rates ruling at the dates the fair value was determined.
Financial instruments issued by the company are treated as equity (i.e. forming part of shareholder funds) only to the extent that they meet the following two conditions:
a) they include no contractual obligations upon the company to deliver cash or other financial assets or to exchange financial assets or financial liabilities with another party under conditions that are potentially unfavourable to the company; and b) where the instrument will or may be settled in the company's own equity instruments, it is either a non-derivative that includes no obligation to deliver a variable number of the company's own equity instruments or is a derivative that will be settled by the company's exchanging a fixed amount of cash or other financial assets for a fixed number of its own equity instruments. To the extent that this definition is not met, the proceeds of issue are classified as a financial liability. Where the instrument so classified takes the legal form of the company's own shares, the amounts presented in these financial statements for called up share capital and share premium account exclude amounts in relation to those shares. Finance payments associated with financial liabilities are dealt with as part of interest payable and similar expenses. Finance payments associated with financial instruments that are classified as part of shareholder funds (see dividends policy), are dealt with as appropriations in the reconciliation of movements in shareholder funds. Non-derivative financial instruments Non-derivative financial instruments comprise investments in equity, trade and other debtors, cash and cash equivalents, loans and borrowings, and trade and other creditors. Trade and other debtors Trade and other debtors are recognised initially at fair value less attributable transaction costs. Subsequent to initial recognition they are measured at amortised cost using the effective interest method, less any impairment losses. Trade and other creditors Trade and other creditors are recognised initially at fair value plus attributable transition costs. Subsequent to initial recognition they are measured at amortised cost using the effective interest method. Interest-bearing borrowings Interest-bearing borrowings are recognised initially at fair value plus attributable transaction costs. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost using the effective interest method, less any impairment losses.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
Investments
Investments are stated at cost less any provision for impairment. Derivative financial instruments Derivative financial instruments are recognised at fair value. The gain or loss on re-measurement to fair value is recognised immediately in profit or loss. The company does not use hedge accounting.
A defined contribution plan is a post-employment benefit under which the company pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contributions pension plans are recognised as an expense in the profit and loss account in the periods during which services are rendered by employees.
A provision is recognised in the balance sheet when the company has a present legal or constructive obligation as a result of a past event, that can be reliably measured and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects risks specific to the liability.
Revenue comprises the value of goods and services supplied in the normal course of business, net of discounts, rebates, VAT and similar taxes. Revenue from the sale of goods and services is recognised when the company has transferred control of the goods and services to the customer, the amount of revenue can be measured reliably and it is probable that the economic benefits associated with the transaction will flow to the company. The directors have reviewed the markets for which the company operates, and have determined that the company operates primarily in Europe and the Rest of the World.
The company's renewable agreements with customers may contain complex terms or separately identifiable performance obligations outside delivering product to customers. Revenue is recognised when the performance obligation is met. Revenue was earned in the year from agent commission earned on conductor orders. The conductor business was transferred to Sumitomo Corporation in October 2021 as part of the wind down process but the established conductor customers did not transfer the open orders to Sumitomo and the order obligations were fulfilled by Edgen Murray Europe, earning a commission as a result. All new conductor orders are channelled through Sumitomo and therefore the commission earned is not a continuing revenue stream. The warranties offered in the contracts are protective warranties given to the customer, also these warranties provided to customers are back-to-back with the warranty that Edgen Murray obtains from its suppliers. These warranties protect the customer against non-functional product. These are the standard warranties offered in the industry. No additional revenue was recognised against this standard warranty offered.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
Financing expenses comprises interest payable and finance leases recognised in profit or loss using the effective interest method, unwinding of the discount on provisions, and net foreign exchange losses that are recognised in the profit and loss account (see foreign currency accounting policy). Borrowing costs that are directly attributable to the acquisition, construction or production of an asset that takes a substantial time to be prepared for use, are capitalised as part of the cost of that asset. Financing income comprises interest receivable on funds invested, dividend income, and net foreign exchange gains.
Interest income and interest payable is recognised in profit or loss as it accrues, using the effective interest method. Dividend income is recognised in the profit and loss account on the date the entity's right to receive payments is established. Foreign currency gains and losses are reported on a net basis.
Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the income statement except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.
Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of previous years. Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The following temporary differences are not provided for: the initial recognition of goodwill; the initial recognition of assets or liabilities that affect neither accounting nor taxable profit other than in a business combination, and differences relating to investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date. A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the temporary difference can be utilised or where it is probable that the company will be paid to surrender its losses by a fellow group undertaking.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the amounts reported for revenues and expenses during the year. Due to the nature of estimation, the actual outcomes may well differ from these estimates.
Significant judgements Judgements are made in assessing whether provisions should be recognised in the financial statements, since there can be subjectivity over whether an individual provision is probable. Key sources of estimation uncertainty Fair value estimation The carrying values of investments, trade creditors, trade debtors and stocks less impairment provisions are assumed to approximate their fair values. Recoverability of debtors Trade debtors are assessed for recoverability and appropriate provisions are put in place where necessary after management have considered all available sources of information. Provisions During the year to 31 March 2021, Sumitomo Corporation announced the wind down of the Edgen Murray Europe operations. Provisions relate to the directors best estimate of the wind down costs.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
Subsidiary undertakings The following were subsidiary undertakings of the company:
*The company went into liquidation in March 2024 and it was liquidated in August 2024.
**Indirectly held via Edgen Murray Pte Limited holding 99.999% and Edgen Murray Europe Limited holding 0.001%. The company went into liquidation in December 2023.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
7.Provisions (continued)
The company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the company to the fund and amounted to £NIL (2023 - £34k). No contributions were payable to the fund at the reporting date.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
At the balance sheet date, the company was wholly owned by Pipe Acquisition Limited (immediate parent company).
The directors consider Sumitomo Corporation, a Japanese listed company, to be the ultimate parent undertaking at the balance sheet date. The largest group in which the results of the company are consolidated is that headed by that ultimate parent undertaking whose principal place of business is at Harumi Island Triton Square Office Tower Y 8-11, Harumi 1-chome, Chuo-ku, Tokyo, 104-8610. Copies of the consolidated financial statements of Sumitomo Corporation can be obtained from www.sumitomocorp.co.jp/english.
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