Company registration number 12189164 (England and Wales)
ARAN GROUP HOLDINGS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
ARAN GROUP HOLDINGS LIMITED
COMPANY INFORMATION
Directors
Mrs C Bacon
Mr K Morris
Mr M D Randall
Mr C A Thomson
Mr J Whitefield
Company number
12189164
Registered office
1-6 The Old Station
Higham
Bury St Edmunds
IP28 6NE
Auditor
Ensors Accountants LLP
Saxon House
Moseley's Farm Business Centre
Fornham All Saints
Bury St Edmunds
IP28 6JY
Business address
1-6 The Old Station
Higham
Bury St Edmunds
IP28 6NE
ARAN GROUP HOLDINGS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Directors' responsibilities statement
5
Independent auditor's report
6 - 8
Group statement of comprehensive income
9
Group balance sheet
10
Company balance sheet
11
Group statement of changes in equity
12
Company statement of changes in equity
13
Group statement of cash flows
14
Notes to the financial statements
15 - 33
ARAN GROUP HOLDINGS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 1 -

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

Review of the business

The directors are pleased with the results for the year which showed strong growth in turnover of 49% up to £19.3m and profit before tax increased to £2.1m. This was achieved through the efficient delivery of government funded schemes, building strong relationships with councils and social housing providers, and improved staff retention. Turnover also increased relating to the ECO4 scheme, and this contributed to the improved performance. The directors are optimistic about the continuing growth opportunities and anticipate further increases to turnover and profits for the Group in 2024/25.

 

The principal activities of the trading subsidiaries during the year are as follows:

 

Aran Energy Holdings Ltd - Provision of management services to the Group.

 

Aran Energy Funding Ltd - Managing Agent for the funding of insulation, renewable energy and heating measures under the Energy Company Obligation (ECO) scheme.

 

Aran Insulation Ltd - Installation of insulation, heating and renewable energy measures to domestic and commercial customers to reduce customer fuel bills and reduce CO2 emissions.

 

Group turnover for the year was £19,266,744 (2023: £12,908,055), an increase of 49%. Gross profit margin was 24.8% compared to 24.3% in the prior year. Profit before tax was £2,164,357 (2023: £202,495). At the year end, Shareholders funds totalled £3,016,480 (2023: £1,388,665) and Bank balances stood at £1,315,399 (2023: £942,888).

Principal risks and uncertainties

The key business risks and uncertainties affecting the group are considered to be the following:

 

 

 

 

 

 

ARAN GROUP HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 2 -
Development and performance

The Directors are very optimistic about the current trading year. There has been a substantial number of new funded programs of work, which have taken time to bed in and commence, but which are now operating well. The Group has expanded the range of energy efficiency measures it installs and has been installing an increasing number of renewable measures, solar PV systems and air source heat pumps, as well as a full range of insulation measures, to improve housing stock and reduce carbon emissions. The future for the Group over the coming years continues to be strong due to increased Government support for energy efficiency and commitment to carbon zero by 2050.

 

The directors consider adequate finance is available to take advantage of business opportunities as they arise, whilst aiming to remain competitive in existing markets.

 

Future Developments

 

Future policy for the period 2025 – 2028 provides a positive outlook for the Group.

 

New Government Schemes:

Warm Homes Local Grant: The introduction of this scheme in 2025 presents a significant growth opportunity for Aran Insulation Limited to deliver measures which focus on energy performance upgrades for low-income households. Warm Homes Social Housing Fund: With social housing providers now required to meet higher energy performance standards, Aran Group can expect an increase in demand for its services from housing associations and local authorities.

 

Geographic Expansion:

Aran Group intends to expand its operations beyond its current regional strongholds. By forming partnerships with local authorities across more regions of the UK, the group aims to secure a wider number of large-scale contracts, particularly in areas with high levels of fuel poverty.

 

Strengthening Subcontractor Relationships:

To meet the increased demand from government schemes, Aran Group plans to onboard more subcontractors while ensuring strict quality control measures remain in place. Enhanced subcontractor training programs will be introduced to maintain compliance with new standards and ensure that project quality is upheld.

 

Key performance indicators

The key financial performance indicators are considered to be turnover and gross margin. Given the straightforward nature of the business, the directors are of the opinion that further analysis of key performance indicators is not necessary in understanding the development, performance or position of the business.

 

On behalf of the board

Mr M D Randall
Director
22 October 2024
ARAN GROUP HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 3 -

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

Principal activities

The principal activity of the group was that of offering "Whole House" energy efficiency solutions for domestic households under the Energy Company Obligation (ECO) Scheme delivering insulation and heating energy saving measures to reduce customer fuel bills and reduce CO2 emissions of buildings with the United Kingdom.

 

The group also work with social housing providers, government bodies and construction clients offering insulation and passive fire protection services across the United Kingdom.

 

The principal activity of Aran Group Holdings Limited is that of a holding company.

Results and dividends

The results for the year are set out on page 9.

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

Directors

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

Mrs C Bacon
Mr K Morris
Mr M D Randall
Mr C A Thomson
Mr J Whitefield
Financial instruments
Liquidity risk

The directors have ultimate responsibility for liquidity risk management in maintaining adequate reserves, banking facilities and reserve borrowing facilities. They do this by continuously monitoring forecasts and actual cash flows and matching the maturity profits of financial assets and liabilities.

Credit risk

The group is at risk of its customers defaulting in making payments for services that have been supplied to them. To minimise the risk the group has a policy of prior payment before fulfilment or giving credit to customers who have demonstrated creditworthiness. To determine previous creditworthiness the group makes use of independent rating agencies, other publicly available financial information and its own trading records.

Cash flow risk

The ability to meet all future business commitments is dependent on monitoring of the group's cash position and on meetings all its secured obligations. Current and future cash requirements are monitored on a regular basis.

Auditor

Ensors Accountants LLP were appointed as auditor to the group and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.

Strategic report

The truegroup has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the group's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of the review of the business, business risks and future developments.

ARAN GROUP HOLDINGS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 4 -
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 auditor of the company 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 auditor of the company is aware of that information.

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
Mr M D Randall
Director
22 October 2024
ARAN GROUP HOLDINGS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2024
- 5 -

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 company 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 group and company, and of the profit or loss of the group and 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 group and the company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

ARAN GROUP HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ARAN GROUP HOLDINGS LIMITED
- 6 -
Opinion

We have audited the financial statements of Aran Group Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2024 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows 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 group and the parent 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 group's and parent 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:

ARAN GROUP HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ARAN GROUP HOLDINGS LIMITED
- 7 -
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 their 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 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 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.

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.

 

Our audit was designed to include tests of detail together with an assessment of the control environment to enable us to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement due to fraud. This included work on areas where we consider there is a higher risk of fraud including transactions with related parties, revenue recognition and management override of systems and control and accounting estimates.

ARAN GROUP HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ARAN GROUP HOLDINGS LIMITED
- 8 -

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team:

 

 

However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the Group's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.

 

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.

Use of our report

This report is made solely to the parent 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 parent 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 parent company and the parent company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Christopher Barrett (Senior Statutory Auditor)
For and on behalf of Ensors Accountants LLP
23 October 2024
Chartered Accountants
Statutory Auditor
Saxon House
Moseley's Farm Business Centre
Fornham All Saints
Bury St Edmunds
IP28 6JY
ARAN GROUP HOLDINGS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2024
- 9 -
2024
2023
Notes
£
£
Turnover
3
19,266,744
12,908,055
Cost of sales
(14,523,532)
(9,775,245)
Gross profit
4,743,212
3,132,810
Administrative expenses
(2,593,376)
(3,098,148)
Other operating income
38,024
243,546
Operating profit
4
2,187,860
278,208
Interest receivable and similar income
8
640
117
Interest payable and similar expenses
9
(24,143)
(27,287)
Profit/(loss) on disposal of operations
- Subsidiary undertaking
-
(48,543)
Profit before taxation
2,164,357
202,495
Tax on profit
10
(536,542)
(20,691)
Profit for the financial year
25
1,627,815
181,804
Profit for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.
ARAN GROUP HOLDINGS LIMITED
GROUP BALANCE SHEET
AS AT
31 MARCH 2024
31 March 2024
- 10 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
11
465,082
264,647
Investments
12
66,667
66,667
531,749
331,314
Current assets
Stocks
15
110,137
99,854
Debtors
16
4,661,047
3,799,356
Cash at bank and in hand
1,315,399
942,888
6,086,583
4,842,098
Creditors: amounts falling due within one year
17
(3,452,434)
(3,594,558)
Net current assets
2,634,149
1,247,540
Total assets less current liabilities
3,165,898
1,578,854
Creditors: amounts falling due after more than one year
18
(50,605)
(147,422)
Provisions for liabilities
Deferred tax liability
21
98,813
42,767
(98,813)
(42,767)
Net assets
3,016,480
1,388,665
Capital and reserves
Called up share capital
24
59,400
59,400
Share premium account
25
39,600
39,600
Profit and loss reserves
25
2,917,480
1,289,665
Total equity
3,016,480
1,388,665

These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.

The financial statements were approved by the board of directors and authorised for issue on 23 October 2024 and are signed on its behalf by:
23 October 2024
Mrs C  Bacon
Mr M D Randall
Director
Director
Company registration number 12189164 (England and Wales)
ARAN GROUP HOLDINGS LIMITED
COMPANY BALANCE SHEET
AS AT 31 MARCH 2024
31 March 2024
- 11 -
2024
2023
Notes
£
£
£
£
Fixed assets
Investments
12
2,727,767
2,727,767
Current assets
Cash at bank and in hand
27,287
27,190
Creditors: amounts falling due within one year
17
(18)
(2,661,100)
Net current assets/(liabilities)
27,269
(2,633,910)
Net assets
2,755,036
93,857
Capital and reserves
Called up share capital
24
59,400
59,400
Share premium account
25
39,600
39,600
Profit and loss reserves
25
2,656,036
(5,143)
Total equity
2,755,036
93,857

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £2,661,179 (2023 - £5,186 loss).

The financial statements were approved by the board of directors and authorised for issue on 23 October 2024 and are signed on its behalf by:
23 October 2024
Mrs C  Bacon
Mr M D Randall
Director
Director
Company registration number 12189164 (England and Wales)
ARAN GROUP HOLDINGS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
- 12 -
Share capital
Share premium account
Profit and loss reserves
Total
£
£
£
£
Balance at 1 April 2022
59,400
39,600
1,107,861
1,206,861
Year ended 31 March 2023:
Profit and total comprehensive income
-
-
181,804
181,804
Balance at 31 March 2023
59,400
39,600
1,289,665
1,388,665
Year ended 31 March 2024:
Profit and total comprehensive income
-
-
1,627,815
1,627,815
Balance at 31 March 2024
59,400
39,600
2,917,480
3,016,480
ARAN GROUP HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
- 13 -
Share capital
Share premium account
Profit and loss reserves
Total
£
£
£
£
Balance at 1 April 2022
59,400
39,600
42
99,042
Year ended 31 March 2023:
Loss and total comprehensive income for the year
-
-
(5,185)
(5,185)
Balance at 31 March 2023
59,400
39,600
(5,143)
93,857
Year ended 31 March 2024:
Profit and total comprehensive income
-
-
2,661,179
2,661,179
Balance at 31 March 2024
59,400
39,600
2,656,036
2,755,036
ARAN GROUP HOLDINGS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2024
- 14 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
28
1,264,928
(27,715)
Interest paid
(24,143)
(27,287)
Income taxes paid
(268,896)
(24,373)
Net cash inflow/(outflow) from operating activities
971,889
(79,375)
Investing activities
Proceeds of disposal of subsidiary, net of cash disposed of
-
(6,075)
Purchase of tangible fixed assets
(296,064)
(39,714)
Proceeds on disposal of tangible fixed assets
59,271
31,656
Interest received
640
117
Net cash used in investing activities
(236,153)
(14,016)
Financing activities
Repayment of borrowings
(243,940)
(106,060)
Payment of finance leases obligations
(119,285)
(102,668)
Net cash used in financing activities
(363,225)
(208,728)
Net increase/(decrease) in cash and cash equivalents
372,511
(302,119)
Cash and cash equivalents at beginning of year
942,888
1,245,007
Cash and cash equivalents at end of year
1,315,399
942,888
ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
- 15 -
1
Accounting policies
Company information

Aran Group Holdings Limited (“the company”) is a private company limited by shares, domiciled and incorporated in England and Wales. The registered office of the company and all of its subsidiaries is 1-6 The Old Station, Higham, Bury St Edmunds, IP28 6NE.

 

The group consists of Aran Group Holdings Limited and all of its subsidiaries.

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.

The 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 for parent company information presented within the consolidated financial statements:

 

1.2
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 16 -
1.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Aran Group Holdings Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 31 March 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Aran Energy Holdings Limited and its subsidiaries have been included in the group financial statements using the purchase method of accounting. Accordingly, the group profit and loss account and statement of cash flows include the results and cash flows of Aran Energy Holdings Limited and its subsidiaries.The purchase consideration has been allocated to the assets and liabilities on the basis of fair value at the date of acquisition.

1.4
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 for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.5
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.

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.

Revenue from rendering of services is measured by reference to the stage of completion of the service transaction at the end of the reporting period provided that the outcome can be reliably estimated. Where the outcome cannot be reliably estimated, revenue is recognised only to the extent that expenses recognised are recoverable.

1.6
Tangible fixed assets

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

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

Leasehold improvements
20% straight line
Plant and equipment
20% - 33% straight line
Fixtures and fittings
20% - 33% straight line
Motor vehicles
25% - 33% straight line

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 recognised in the profit and loss account.

ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 17 -
1.7
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

1.8
Impairment of fixed assets

At each reporting period end date, the group 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.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

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.

1.9
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

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

1.10
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.

ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 18 -
1.11
Financial instruments

The group 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 group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and 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 group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

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

ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 19 -
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 group's contractual obligations expire or are discharged or cancelled.

1.12
Equity instruments

Equity instruments issued by the group 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 group.

1.13
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 group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 20 -
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 if, and only if, there is 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.

1.14
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.

1.15
Retirement benefits

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

1.16
Share-based payments

The Group provides share-based payment arrangements to certain employees.

 

Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the equity instruments granted using the Black-Scholes model. Unless it is deemed to be immaterial, the fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to equity.

 

Unless it is deemed to be immaterial, the expense in relation to options over the parent company’s shares granted to employees of a subsidiary is recognised by the company as a capital contribution, and presented as an increase in the company’s investment in that subsidiary.

When the terms and conditions of equity-settled share-based payments at the time they were granted are subsequently modified, the fair value of the share-based payment under the original terms and conditions and under the modified terms and conditions are both determined at the date of the modification. Any excess of the modified fair value over the original fair value is recognised over the remaining vesting period in addition to the grant date fair value of the original share-based payment. The share-based payment expense is not adjusted if the modified fair value is less than the original fair value.

 

Cancellations or settlements (including those resulting from employee redundancies) are treated as an acceleration of vesting and the amount that would have been recognised over the remaining vesting period is recognised immediately.

ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 21 -
1.17
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

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

1.18
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.

2
Judgements and key sources of estimation uncertainty

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 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.

Amounts recoverable on contracts

A key accounting estimate has been identified in regard to amounts recoverable on contracts. Management consider the contract amount completed as at the year end and deduct the amount invoiced up to the year end and the remainder should be the amount recoverable. There is a high level of estimation in relation to some balances and these often change with additional work being added on.

Funding clawback provision

The company makes an estimate for the value of the work which has been completed and invoiced to customers on work which is funded by energy providers, that may be applied to be reclaimed by these providers if the work does not meet expected requirements as specified by the ECO scheme. The assessment is made by management and is based on experience, historical results, and the requirements of the current energy funding scheme which is in place. Where there is any doubt in relation to the work completed as to whether it meets the requirement for funding, a provision is included in the financial statements.

ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 22 -
3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Principal activity
19,266,744
12,908,055
2024
2023
£
£
Other revenue
Interest income
640
117
28,246
-
Miscellaneous income
157,017
182,093
Recharges to related companies
9,778
224,289
4
Operating profit
2024
2023
£
£
Operating profit for the year is stated after charging/(crediting):
Depreciation of owned tangible fixed assets
91,012
76,153
Depreciation of tangible fixed assets held under finance leases
64,000
58,730
(Profit)/loss on disposal of tangible fixed assets
(33,955)
22,255
Operating lease charges
21,004
18,343
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 group and company
8,455
4,265
Audit of the financial statements of the company's subsidiaries
34,335
30,000
42,790
34,265
6
Employees

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

Group
Company
2024
2023
2024
2023
Number
Number
Number
Number
Production staff
22
24
-
-
Administrative staff
39
34
5
5
Total
61
58
5
5
ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
6
Employees
(Continued)
- 23 -

Their aggregate remuneration comprised:

Group
Company
2024
2023
2024
2023
£
£
£
£
Wages and salaries
2,779,374
2,496,532
-
0
-
0
Social security costs
296,467
272,083
-
-
Pension costs
53,649
50,380
-
0
-
0
3,129,490
2,818,995
-
0
-
0
7
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
441,752
391,552
Company pension contributions to defined contribution schemes
5,284
5,284
447,036
396,836
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
143,232
116,720
Company pension contributions to defined contribution schemes
1,321
1,321

There number of directors for whom retirement benefits are accruing under defined contribution pension schemes amounted to 4 (2022: 4).

8
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
201
90
Other interest income
439
27
Total income
640
117
ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 24 -
9
Interest payable and similar expenses
2024
2023
£
£
Other interest on financial liabilities
11,206
22,293
Interest on finance leases and hire purchase contracts
12,937
4,994
Total finance costs
24,143
27,287
10
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
480,903
66,533
Adjustments in respect of prior periods
(407)
(21,047)
Total current tax
480,496
45,486
Deferred tax
Origination and reversal of timing differences
56,046
(24,795)
Total tax charge
536,542
20,691

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
2,164,357
202,495
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
541,089
38,474
Tax effect of expenses that are not deductible in determining taxable profit
6,468
10,701
Gains not taxable
(6,094)
(1,776)
Adjustments in respect of prior years
-
0
(14,660)
Permanent capital allowances in excess of depreciation
-
0
(2,136)
Deferred tax adjustment
56,046
(5,925)
Other adjustments
(60,934)
(3,987)
(33)
-
Taxation charge
536,542
20,691
ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
10
Taxation
(Continued)
- 25 -

Factors that may affect future tax changes

 

The UK corporation tax rate during the financial period was 25% (2023:19%). Deferred taxes as at 31 March 2023 and 31 March 2024 have been calculated using the rates enacted at that date, being 25%.

 

11
Tangible fixed assets
Group
Leasehold improvements
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 April 2023
-
0
237,011
188,774
698,389
1,124,174
Additions
35,703
12,700
7,312
325,048
380,763
Disposals
-
0
(6,000)
-
0
(264,067)
(270,067)
At 31 March 2024
35,703
243,711
196,086
759,370
1,234,870
Depreciation and impairment
At 1 April 2023
-
0
230,576
143,434
485,517
859,527
Depreciation charged in the year
558
6,499
20,153
127,802
155,012
Eliminated in respect of disposals
-
0
(5,280)
-
0
(239,471)
(244,751)
At 31 March 2024
558
231,795
163,587
373,848
769,788
Carrying amount
At 31 March 2024
35,145
11,916
32,499
385,522
465,082
At 31 March 2023
-
0
6,435
45,340
212,872
264,647
The company had no tangible fixed assets at 31 March 2024 or 31 March 2023.

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

Group
Company
2024
2023
2024
2023
£
£
£
£
Motor vehicles
74,829
125,591
-
0
-
0

The above motor vehicles have been pledged as security against the obligations under finance leases shown in the Creditors notes.

ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 26 -
12
Fixed asset investments
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Investments in subsidiaries
13
-
0
-
0
2,661,100
2,661,100
Unlisted investments
66,667
66,667
66,667
66,667
66,667
66,667
2,727,767
2,727,767
Movements in fixed asset investments
Group
Investments
£
Cost or valuation
At 1 April 2023 and 31 March 2024
66,667
Carrying amount
At 31 March 2024
66,667
At 31 March 2023
66,667
Movements in fixed asset investments
Company
Shares in subsidiaries
Other investments
Total
£
£
£
Cost or valuation
At 1 April 2023 and 31 March 2024
2,661,100
66,667
2,727,767
Carrying amount
At 31 March 2024
2,661,100
66,667
2,727,767
At 31 March 2023
2,661,100
66,667
2,727,767
13
Subsidiaries

Details of the company's subsidiaries at 31 March 2024 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Indirect
Aran Energy Holdings Limited
1-6 The Old Station, Higham, Bury St Edmunds, IP28 6NE
Ordinary
100.00
-
Aran Insulation Limited
As above
Ordinary
-
100.00
Aran Energy Funding Limited
As above
Ordinary
-
100.00
ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 27 -
14
Financial instruments
Group
Company
2024
2023
2024
2023
£
£
£
£
Carrying amount of financial assets
Debt instruments measured at amortised cost
2,025,251
2,036,354
n/a
n/a
Carrying amount of financial liabilities
Measured at amortised cost
2,981,079
3,433,140
n/a
n/a

As permitted by the reduced disclosure framework within FRS 102, the company has taken advantage of the exemption from disclosing the carrying amount of certain classes of financial instruments, denoted by 'n/a' above.

15
Stocks
Group
Company
2024
2023
2024
2023
£
£
£
£
Finished goods and goods for resale
110,137
99,854
-
0
-
0
16
Debtors
Group
Company
2024
2023
2024
2023
Amounts falling due within one year:
£
£
£
£
Trade debtors
2,013,947
2,036,253
-
0
-
0
Gross amounts owed by contract customers
2,369,677
1,490,559
-
0
-
0
Other debtors
105,018
123,999
-
0
-
0
Prepayments and accrued income
172,405
148,545
-
0
-
0
4,661,047
3,799,356
-
-
17
Creditors: amounts falling due within one year
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Obligations under finance leases
20
17,127
71,563
-
0
-
0
Other borrowings
19
-
0
127,273
-
0
-
0
Trade creditors
2,117,294
1,466,415
-
0
-
0
Amounts owed to group undertakings
-
0
-
0
-
0
2,661,100
Corporation tax payable
322,518
110,918
18
-
0
Other taxation and social security
199,442
197,922
-
-
Other creditors
206,820
1,352,700
-
0
-
0
Accruals and deferred income
589,233
267,767
-
0
-
0
3,452,434
3,594,558
18
2,661,100
ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
17
Creditors: amounts falling due within one year
(Continued)
- 28 -

Included in Other Creditors is £32,091 (2023: £1,228,396) which is secured by way of a fixed and floating charge over the assets of the group. There is also a Cross Guarantee and Debenture in place between all group companies in respect of this amount.

 

Included in other borrowings is a loan balance of £Nil (2023: £127,273) which was secured by way of a fixed and floating charge over the assets of the group. This loan was repaid during the year.

18
Creditors: amounts falling due after more than one year
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Obligations under finance leases
20
50,605
30,755
-
0
-
0
Other borrowings
19
-
0
116,667
-
0
-
0
50,605
147,422
-
-

Included in other borrowings is a loan balance of £nil (2023: £116,667) which was secured by way of a fixed and floating charge over the assets of the group. This loan was repaid during the year.

19
Loans and overdrafts
Group
Company
2024
2023
2024
2023
£
£
£
£
Other loans
-
0
243,940
-
0
-
0
Payable within one year
-
0
127,273
-
0
-
0
Payable after one year
-
0
116,667
-
0
-
0

The group had no loans as at the 2024 year-end. In 2023 the whole loan balance pertained to 1 loan, this was fully repaid during the 2024 financial year.

20
Finance lease obligations
Group
Company
2024
2023
2024
2023
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
17,127
71,563
-
0
-
0
In two to five years
50,605
30,755
-
0
-
0
67,732
102,318
-
-
ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
20
Finance lease obligations
(Continued)
- 29 -

Finance lease payments represent rentals payable by the group for certain motor vehicles. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is four years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

21
Deferred taxation

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

Liabilities
Liabilities
2024
2023
Group
£
£
Accelerated capital allowances
101,133
44,923
General provision
(2,320)
(2,156)
98,813
42,767
The company has no deferred tax assets or liabilities.
Group
Company
2024
2024
Movements in the year:
£
£
Liability at 1 April 2023
42,767
-
Charge to profit or loss
56,046
-
Liability at 31 March 2024
98,813
-

The deferred tax liability set out above is expected to reverse within 12 months and relates to accelerated capital allowances and retirement benefits obligations that are expected to mature within the same period.

22
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
53,649
50,380

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

 

The pension commitment of the group, included in Creditors at the balance sheet date, amounted to £13,936 (2023:£11,551).

ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 30 -
23
Share-based payment transactions

The Group provides share option schemes for staff members.

 

There are presently two equity settled share option schemes; both of which are HMRC approved, in which employees may be invited to participate. Both of these schemes were introduced in March 2021. The share option schemes vest immediately and are therefore exercisable immediately upon grant. If the options remain unexercised after a period of ten years from the date of grant, or on an employee leaving the Group, the options expire.

 

In the year ended 31 March 2024, no share options were granted (2023: none). Details of the share options outstanding at the end of the period are as follows:

Group
Number of share options
Weighted average exercise price
2024
2023
2024
2023
Number
Number
£
£
Outstanding at 1 April 2023
9,974
12,944
-
-
Forfeited
-
(2,970)
-
3.37
Outstanding at 31 March 2024
9,974
9,974
3.68
3.68
Exercisable at 31 March 2024
9,974
9,974
3.68
3.68

The options outstanding at 31 March 2024 had an exercise price ranging from £3.37 to £4.38, and a remaining contractual life of 6.95 years.

Group

The weighted average fair value of options granted in the year was determined using the Black-Scholes option pricing model. The Black-Scholes model is considered to apply the most appropriate valuation method due to the relatively short contractual lives of the options and the requirement to exercise within a short period after the employee becomes entitled to the shares (the “vesting date”).

 

The expected life used in the model has been adjusted, based on management’s best estimate, for the

effect of non-transferability, exercise restrictions, and behavioral considerations.

 

Non-vesting conditions and market conditions are taken into account when estimating the fair value of the option at grant date. Service conditions and non-market performance conditions are taken into account by adjusting the number of options expected to vest at each reporting date.

On the basis that the value of the share options was deemed to be immaterial, no liability or expense have been accounted for in the financial statements.

24
Share capital
Group and company
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
19,800
19,800
19,800
19,800
A Ordinary shares of £1 each
19,800
19,800
19,800
19,800
B Ordinary shares of £1 each
19,800
19,800
19,800
19,800
59,400
59,400
59,400
59,400
ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
24
Share capital
(Continued)
- 31 -

The principal rights attached to each class of shares are as follows:

 

Ordinary Shares - This class of shares carry full rights in respect of distributions of dividends, voting and rank first in the repayment of capital in the event of winding up.

 

A Ordinary Shares - The distribution rights attached to these shares is calculated only by reference to the available profits arising in connection with Aran Insulation Limited to the exclusion of the holders of B Ordinary shares but not, for the avoidance of doubt, to the exclusion of the Ordinary shares. In the event of winding up, the A Ordinary shares rank behind the Ordinary shares. This class of shares carry no voting rights.

 

B Ordinary Shares - The distribution rights attached to these shares is calculated only by reference to the available profits arising in connection with Aran Energy Funding Limited to the exclusion of the holders of A Ordinary shares but not, for the avoidance of doubt, to the exclusion of the Ordinary shares. In the event of winding up, the B Ordinary shares rank behind the Ordinary shares. This class of shares carry no voting rights.

25
Reserves
Share premium

The share premium account represents the excess paid over the nominal value of the shares.

Profit and loss reserves

The profit and loss reserves represent cumulative profits or losses, net of dividends and other adjustments.

 

 

26
Operating lease commitments
Lessee

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

Group
Company
2024
2023
2024
2023
£
£
£
£
as restated
Within one year
139,655
108,822
-
-
Between two and five years
333,691
325,713
-
-
473,346
434,535
-
-
ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 32 -
27
Related party transactions
Remuneration of key management personnel

The remuneration of key management personnel is as follows.

2024
2023
£
£
Aggregate compensation
503,042
448,430
Transactions with related parties

During the year the group entered into the following transactions with related parties:

Sales
Sales
Purchases
Purchases
2024
2023
2024
2023
£
£
£
£
Group
Other related parties
46,522
382,938
305,173
634,417

The following unsecured amounts were outstanding at the reporting end date:

Amounts due to related parties
2024
2023
£
£
Group
Other related parties
30,066
39,226

The following unsecured amounts were outstanding at the reporting end date:

Amounts due from related parties
2024
2023
Balance
Balance
£
£
Group
Other related parties
2,609
46,229
ARAN GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 33 -
28
Cash generated from/(absorbed by) group operations
2024
2023
£
£
Profit for the year after tax
1,627,815
181,804
Adjustments for:
Taxation charged
536,542
20,691
Finance costs
24,143
27,287
Investment income
(640)
(117)
(Gain)/loss on disposal of tangible fixed assets
(33,955)
22,255
(Gain)/loss on disposal of business
-
48,543
Depreciation and impairment of tangible fixed assets
155,012
134,883
Movements in working capital:
(Increase)/decrease in stocks
(10,283)
20,151
Increase in debtors
(861,691)
(662,640)
(Decrease)/increase in creditors
(172,015)
179,428
Cash generated from/(absorbed by) operations
1,264,928
(27,715)
29
Analysis of changes in net funds - group
1 April 2023
Cash flows
New finance leases
31 March 2024
£
£
£
£
Cash at bank and in hand
942,888
372,511
-
1,315,399
Borrowings excluding overdrafts
(243,940)
243,940
-
-
Obligations under finance leases
(102,318)
119,285
(84,699)
(67,732)
596,630
735,736
(84,699)
1,247,667
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