Company registration number 3932965 (England and Wales)
IMK AUTOMOTIVE LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024
IMK AUTOMOTIVE LIMITED
COMPANY INFORMATION
Directors
Mr L Christiaen
Mrs M Christiaen
Ms N Christiaen
ECA NV
Mr J A Matthews
Mr G M Hotchkies
Mr G F Hughes
Mr B J Cole
Company number
3932965
Registered office
Unit 4 Weekley Wood Avenue
Kettering
Northamptonshire
United Kingdom
NN14 1UD
Auditor
Azets Audit Services
Thorpe House
93 Headlands
Kettering
Northamptonshire
United Kingdom
NN15 6BL
IMK AUTOMOTIVE LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 5
Directors' responsibilities statement
6
Independent auditor's report
7 - 9
Statement of income and retained earnings
10
Balance sheet
11
Notes to the financial statements
12 - 24
IMK AUTOMOTIVE LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JANUARY 2024
- 1 -

The directors present the strategic report for the year ended 31 January 2024.

 

We aim to present a balanced and comprehensive review of the development and performance of our business during the year and its position at the year end. Our review is consistent with the size and nature of our business and is written in the context of the risks and uncertainties we face.

Fair review of the business

Year ending January 2024 represented another strong performance for the Company. A marked reduction in sales volumes in the final quarter did however dampen the full year results and meant that sales were £1m lower than the prior year. These reductions are forecast to continue to into quarter 1 2024/25 pending program launches later in the year. As a consequence of these volume changes, there was also a drop in overall 2023/24 profitability to £1.85m 5.6% ROS.

Whilst the management operate several important operational KPI’s, we consider that our key financial performance activities are those that communicate the financial performance and strength of the Company, these being turnover and operating profit margin.

Macro-economic factors continue to be of major significance to the Company’s performance. Primary amongst these is inflation and whilst the UK headline rates are now reducing, there continues to be significant pressure on pay rates.

With supply issues now having far less operational impact, the UK luxury car manufacturing sector remains strong and continues with heavy investment into both products and processes to transition to a more sustainable future. Backed by strong shareholder support, the management remain confident of the Business’ ability to support this essential evolution.

Principal risks and uncertainties

The business environment in which we operate continues to be challenging. Operating in the automotive sector, the business is heavily affected by macro issues such as Brexit and government regulations in relation to the transition to EV. Despite the recent delay, the premium UK automotive market continues to invest heavily into this evolution. The sheer extent of the technological change has led to a number of new entrants into the market at the OEM level. It is important to identify which of these entrants will remain active in the market in the longer term.

Statutory duties under s172(1) Companies Act 2006

The Board of Directors believe that they have acted in the way they consider to be both in good faith and would be most likely to promote the success of the  Group for the benefit of its members as a whole (having regard to the stakeholders and matters set out in s172(1)(a-f) of the Act) in the decisions taken during the year ended 31 January 2024; and in so having regard, amongst other matters to; 

 

(a)          the likely consequences of any decision in the long term,

(b)          the interests of the Group’s employees

(c)          the need to foster the Group's business relationships with suppliers, customers and others,

(d)         the impact of the Group's operations on the community and the environment,

(e)          the desirability of the Group maintaining a reputation for high standards of business conduct, and 

(f)           the need to act fairly as between members of the Group.

 

The Board has a business plan which is based around achieving our long-term goal of being regarded as a leading manufacturer of high quality interior trim for the Automotive market.

 

The Board understands the importance of engaging with all its stakeholders and regularly discusses issues concerning employees, clients, suppliers, community and environment, regulators and shareholders which inform its decision making processes.

 

Inherently, there is an inter-dependency on the success of the Company and the success of its stakeholders.

IMK AUTOMOTIVE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 2 -

Employees

Our employees remain fundamental to the achievement of our business plan. In addition to aiming to be a responsible employer in our approach to pay and benefits, we continue to engage with our team to ascertain which training and development opportunities should be made available to improve our team’s productivity and our individual employees’ potential within the business.

 

Clients

We continue to engage closely with our clients, who are mainly large UK based Automotive Manufacturers. Our aim is ensure that our customers’ needs are met and in particular our products arrive on time and meet their specifications.

 

Suppliers

We value the supplier base as partners and our aim is to develop and enter into strong stable working relationships with them. We seek to be fair and transparent in our dealings with suppliers and we ensure that we honour our arrangements with them.

 

Environment and community

The Board recognises the effect that its operations have on the environment both locally and nationally. Consequently, it continues to strengthen its management systems to ensure year on year real improvement. IMK Automotive Ltd remains certified to ISO14001.

 

As a practical demonstration of the Company’s ongoing commitment to lowering its environmental footprint, the Board sanctioned a further significant investment into renewable power in 2023 with the installation of a 300kwp solar panel array at the main Coventry facility. It is envisaged that this investment will produce over 240,000kwh and avoid 45,000kg of carbon emissions in its first full year. This facility was commissioned in March 2024.

 

Governance and regulation

The Board’s intention is to behave responsibly and to ensure that the management team operates the business in a responsible manner, acting with the high standards of business conduct and good governance expected of a business of our nature and size and in full alignment with the rules and regulations. In doing so, we believe we will achieve our long-term business strategy and also further develop our reputation in our sector.

 

Members

The Board has a close working relationship with the shareholders and seeks to treat them fairly and equally, in order that they too benefit from the Group achieving its long term business strategy.

 

The Board seeks to provide information relevant to the shareholders, including monthly management accounts including key metrics set by the Board. 

On behalf of the board

Mr J A Matthews
Director
15 May 2024
IMK AUTOMOTIVE LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JANUARY 2024
- 3 -

The directors present their annual report and financial statements for the year ended 31 January 2024.

Principal activities

The principal activity of the Company continued to be that of the manufacture and sale of interior automotive components.

Results and dividends

The results for the year are set out on page 10.

Ordinary dividends were paid amounting to £4,000,000. The directors do not recommend payment of a final dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Mr L Christiaen
Mrs M Christiaen
Ms N Christiaen
ECA NV
Mr J A Matthews
Mr G M Hotchkies
Mr G F Hughes
Mr B J Cole
Principal risks and uncertainties
Financial instruments

The Company does not use financial derivatives to raise finance for the Company's operations. The Company uses financial instruments comprising cash and various other items such as debtors and creditors, which are generated from the Company's operations, to finance the future operations of the Company. The main risks arising from the Company's financial instruments are liquidity risk and credit risk.

Liquidity risk

The Company manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the company has sufficient liquid resources to meet the operating needs of the business.

Credit risk

Investments of cash surpluses, borrowings and derivative instruments are made through banks and companies which must fulfil credit rating criteria approved by the Board.

 

All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

Disabled persons

The Company recognises its responsibility to employ disabled persons in suitable employment and gives full and fair consideration to applications for employment made by such persons, having regard to their particular circumstances.

 

Disabled employees are treated equally in respect of their eligibility for training and career development.

IMK AUTOMOTIVE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 4 -
Employee involvement

The Company believes that regular communication and consultation with its employees is essential for the efficient running of the business.

 

There is a staff association which the Company uses to facilitate two-way communication to help efficiency and future growth.

Auditor

The auditor, Azets Audit Services, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Energy and carbon report
2024
2023
Energy consumption
kWh
kWh
Aggregate of energy consumption in the year
4,034,542
4,607,775
2024
2023
Emissions of CO2 equivalent
metric tonnes
metric tonnes
Scope 1 - direct emissions
- Gas combustion
62.22
79.60
- Fuel consumed for owned transport
34.84
51.97
97.06
131.57
Scope 2 - indirect emissions
- Electricity purchased
236.97
322.74
Scope 3 - other indirect emissions
- Fuel consumed for transport not owned by the company
647.12
647.06
Total gross emissions
981.15
1,101.37
Intensity ratio
Tonnes CO2e per employee
3.3
3.7
Quantification and reporting methodology

We have followed the 2019 HM Government Environmental Reporting Guidelines. We have also used the GHG Reporting Protocol – Corporate Standard and have used the 2020 UK Government’s Conversion Factors for Company Reporting.

Intensity measurement

The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per employee, the recommended ratio for the sector.

Measures taken to improve energy efficiency

The Business has now located the majority of its manufacturing operations to a new energy efficient Head Office which utilises both the latest levels of building insulation and solar panelling. Video conferencing is extensively utilised by staff, thus reducing the need for travel between sites, customers and suppliers.

Restated comparative information

During the completion of the data analysis for the above reporting, for the year ended 31 January 2024, management also reviewed the reporting data for the year ended 31 January 2023. As a result of this review the comparatives have been restated.

IMK AUTOMOTIVE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 5 -
Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

On behalf of the board
Mr J A Matthews
Director
15 May 2024
IMK AUTOMOTIVE LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 JANUARY 2024
- 6 -

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

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.

IMK AUTOMOTIVE LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF IMK AUTOMOTIVE LIMITED
- 7 -
Opinion

We have audited the financial statements of IMK Automotive Limited (the 'company') for the year ended 31 January 2024 which comprise the statement of income and retained earnings, the balance sheet and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the 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 other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

IMK AUTOMOTIVE LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF IMK AUTOMOTIVE LIMITED
- 8 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

IMK AUTOMOTIVE LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF IMK AUTOMOTIVE LIMITED
- 9 -

Extent to which 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 and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

 

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework.  Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.  This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

 

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

 

 

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 of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Use of our report

This report is made solely to the company's member 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 member those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.

Mr Paul Tyler
Senior Statutory Auditor
For and on behalf of Azets Audit Services
16 May 2024
Chartered Accountants
Statutory Auditor
Thorpe House
93 Headlands
Kettering
Northamptonshire
United Kingdom
NN15 6BL
IMK AUTOMOTIVE LIMITED
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 JANUARY 2024
- 10 -
2024
2023
Notes
£
£
Turnover
3
32,830,744
34,839,407
Cost of sales
(26,715,114)
(28,683,628)
Gross profit
6,115,630
6,155,779
Distribution costs
(63,915)
(76,883)
Administrative expenses
(4,237,133)
(4,161,330)
Operating profit
4
1,814,582
1,917,566
Interest receivable and similar income
8
46,751
10,386
Interest payable and similar expenses
9
(4,235)
(62)
Profit before taxation
1,857,098
1,927,890
Tax on profit
10
(447,011)
(380,505)
Profit for the financial year
1,410,087
1,547,385
Retained earnings brought forward
7,547,687
6,000,302
Dividends
11
(4,000,000)
-
0
Retained earnings carried forward
4,957,774
7,547,687

The profit and loss account has been prepared on the basis that all operations are continuing operations.

IMK AUTOMOTIVE LIMITED
BALANCE SHEET
AS AT
31 JANUARY 2024
31 January 2024
- 11 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
12
1,057,448
1,176,801
Current assets
Stocks
13
4,095,797
3,937,955
Debtors
14
2,612,323
6,425,620
Cash at bank and in hand
3,861,491
3,346,597
10,569,611
13,710,172
Creditors: amounts falling due within one year
15
(6,099,239)
(6,789,441)
Net current assets
4,470,372
6,920,731
Total assets less current liabilities
5,527,820
8,097,532
Provisions for liabilities
Deferred tax liability
16
28,467
8,266
(28,467)
(8,266)
Net assets
5,499,353
8,089,266
Capital and reserves
Called up share capital
18
477,566
477,566
Share premium account
19
15,263
15,263
Capital redemption reserve
20
48,750
48,750
Profit and loss reserves
21
4,957,774
7,547,687
Total equity
5,499,353
8,089,266
The financial statements were approved by the board of directors and authorised for issue on 15 May 2024 and are signed on its behalf by:
Mr J A Matthews
Mr B J Cole
Director
Director
Company Registration No. 3932965
IMK AUTOMOTIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024
- 12 -
1
Accounting policies
Company information

IMK Automotive Limited is a private company limited by shares incorporated in England and Wales. The registered office is Unit 4 Weekley Wood Avenue, Kettering, Northamptonshire, United Kingdom, NN14 1UD.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

 

- Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

- Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’: Interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

- Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;

- Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

 

The financial statements of the company are consolidated in the financial statements of I M Kelly Holdings Limited.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

IMK AUTOMOTIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 13 -
1.4
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Plant and machinery
Pre 2016 assets at 25% reducing balance and post 2016 assets at 12.5% on cost
Computer and office equipment
33% on reducing balance
Motor vehicles
25% on reducing balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

1.5
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.6
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell.

 

The cost of raw materials is computed at the average net invoice price of materials held at the year end on a first-in-first-out basis. The cost of finished goods and work in progress is the purchase price of raw materials and conversion costs appropriate to location and condition.

 

Net realisable value is the estimated proceeds of sale less all further costs to completion and less all costs to be incurred in distributing, marketing and selling.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

IMK AUTOMOTIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 14 -
1.7
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.8
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

IMK AUTOMOTIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 15 -
Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.9
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

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 profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

IMK AUTOMOTIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 16 -
Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.11
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.12
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

 

1.13
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

1.14
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

IMK AUTOMOTIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 17 -
2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Useful economic life of tangible fixed assets

The useful economic life of tangible fixed assets is judged at the point of purchase and is then re-assessed at each reporting date as necessary. The useful economic life of each asset class is stated in the accounting policies above.

Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Provision for irrecoverable trade debtors

At each balance sheet date, management undertake a review of the outstanding trade debtor balances and estimate the balance that should be either impaired or provided against.

 

This calculation is based on the financial position of the customers, the historical speed of payment and any ongoing discussions.

Provision for slow moving and obsolete stock

At each balance sheet date, management undertake an assessment of the value at which stock items are held within the accounts. The provision is calculated on a stock usage basis, allowing for known obsolete stock items. This provision is reviewed and updated at each reporting date.

3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
32,696,527
34,031,392
Europe
134,217
808,015
32,830,744
34,839,407
2024
2023
£
£
Other revenue
Interest income
46,751
10,386
IMK AUTOMOTIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 18 -
4
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses
40,875
111,596
Depreciation of owned tangible fixed assets
360,899
422,219
(Profit)/loss on disposal of tangible fixed assets
(1,321)
181,283
Operating lease charges
856,668
871,389
5
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
8,850
10,750

Remuneration receivable by the company's auditors for other services are disclosed in the group financial statements of I M Kelly Holdings Limited.

6
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2024
2023
Number
Number
Management
58
55
Other activities
237
240
Total
295
295

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
9,614,447
9,858,674
Social security costs
864,625
730,770
Pension costs
309,088
355,190
10,788,160
10,944,634
IMK AUTOMOTIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 19 -
7
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
436,921
395,521
Company pension contributions to defined contribution schemes
95,737
146,481
532,658
542,002

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2023 - 2).

Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
183,803
141,942
Company pension contributions to defined contribution schemes
16,880
52,146
8
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
46,751
8,124
Other interest income
-
0
2,262
Total income
46,751
10,386
9
Interest payable and similar expenses
2024
2023
£
£
Other interest
4,235
62
10
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
426,810
447,745
Adjustments in respect of prior periods
-
0
(14,557)
Total current tax
426,810
433,188
IMK AUTOMOTIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
10
Taxation
2024
2023
£
£
(Continued)
- 20 -
Deferred tax
Origination and reversal of timing differences
20,201
(75,844)
Changes in tax rates
-
0
23,161
Total deferred tax
20,201
(52,683)
Total tax charge
447,011
380,505

The UK Budget 2021 announcements on 3 March 2021 included measures to support economic recovery as a result of the ongoing COVID-19 pandemic. These measures included an increase in the UK's main corporation tax rate from 19% to 25%, effective from 1 April 2023, and which was substantively enacted in the Finance Act 2021. As a result of this, the effective rate of corporation tax for the company in the year to 31 January 2024 was 24.03% compared to 19% in the previous year.

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2024
2023
£
£
Profit before taxation
1,857,098
1,927,890
Expected tax charge based on the standard rate of corporation tax in the UK of 24.03% (2023: 19.00%)
446,261
366,299
Tax effect of expenses that are not deductible in determining taxable profit
6,027
10,545
Depreciation on assets not qualifying for tax allowances
3,517
3,784
Research and development tax credit
-
0
(19,018)
Other non-reversing timing differences
(9,517)
(10,227)
Under/(over) provided in prior years
-
0
4,461
Changes in deferred tax rates
723
24,661
Taxation charge for the year
447,011
380,505
11
Dividends
2024
2023
£
£
Interim paid
4,000,000
-
0
IMK AUTOMOTIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 21 -
12
Tangible fixed assets
Plant and machinery
Computer and office equipment
Motor vehicles
Total
£
£
£
£
Cost
At 1 February 2023
3,703,776
541,660
119,907
4,365,343
Additions
204,089
38,581
-
0
242,670
Disposals
-
0
-
0
(27,892)
(27,892)
At 31 January 2024
3,907,865
580,241
92,015
4,580,121
Depreciation and impairment
At 1 February 2023
2,688,767
418,474
81,301
3,188,542
Depreciation charged in the year
304,914
46,572
9,413
360,899
Eliminated in respect of disposals
-
0
-
0
(26,768)
(26,768)
At 31 January 2024
2,993,681
465,046
63,946
3,522,673
Carrying amount
At 31 January 2024
914,184
115,195
28,069
1,057,448
At 31 January 2023
1,015,009
123,186
38,606
1,176,801
13
Stocks
2024
2023
£
£
Raw materials and consumables
2,709,673
2,282,469
Work in progress
1,070,223
1,193,204
Finished goods and goods for resale
315,901
462,282
4,095,797
3,937,955
14
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
2,450,228
4,266,474
Corporation tax recoverable
-
0
14,557
Amounts owed by group undertakings
-
0
1,988,332
Other debtors
6,561
5,932
Prepayments and accrued income
155,534
150,325
2,612,323
6,425,620

 

IMK AUTOMOTIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 22 -
15
Creditors: amounts falling due within one year
2024
2023
£
£
Trade creditors
1,820,193
1,617,994
Amounts owed to group undertakings
315,227
1,000
Corporation tax
301,809
327,745
Other taxation and social security
466,922
813,900
Other creditors
2,779,733
3,216,147
Accruals and deferred income
415,355
812,655
6,099,239
6,789,441

 

16
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
63,560
56,530
Short term timing differences
(35,093)
(48,264)
28,467
8,266
2024
Movements in the year:
£
Liability at 1 February 2023
8,266
Charge to profit or loss
20,201
Liability at 31 January 2024
28,467

 

17
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
309,088
355,190

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

IMK AUTOMOTIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 23 -
18
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
477,566
477,566
477,566
477,566
19
Share premium account
2024
2023
£
£
At the beginning and end of the year
15,263
15,263

This reserve records the amount above the nominal value received for shares sold, less transaction costs.

20
Capital redemption reserve
2024
2023
£
£
At the beginning and end of the year
48,750
48,750

This reserve records the nominal value of shares repurchased by the company.

21
Profit and loss reserves
2024
2023
£
£
At the beginning of the year
7,547,687
6,000,302
Profit for the year
1,410,087
1,547,385
Dividends declared and paid in the year
(4,000,000)
-
At the end of the year
4,957,774
7,547,687
22
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2024
2023
£
£
Within one year
916,100
814,561
Between two and five years
2,577,216
2,515,103
In over five years
3,276,000
3,822,000
6,769,316
7,151,664
IMK AUTOMOTIVE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 24 -
23
Capital commitments

Amounts contracted for but not provided in the financial statements:

2024
2023
£
£
Acquisition of tangible fixed assets
88,977
206,500
25
Ultimate controlling party

The intermediate parent undertaking is I M Kelly Holdings Limited, a company incorporated in England and Wales, and whose registered office is Unit 4 Weekley Wood Avenue, Kettering, Northamptonshire, NN14 1UD.

 

The ultimate parent undertaking is ECA NV, a company incorporated in Belgium.

The ultimate controlling parties are L Christiaen and Mrs M Christiaen.

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