Company registration number 14396977 (England and Wales)
SALLOUM HOLDINGS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023
SALLOUM HOLDINGS LIMITED
COMPANY INFORMATION
Directors
A Salloum
(Appointed 10 January 2023)
W Salloum
(Appointed 4 October 2022)
M Toft
(Appointed 6 November 2023)
Company number
14396977
Registered office
6th Floor
Manfield House
1 Southampton Street
London
WC2R 0LR
Auditor
Alliotts LLP
Manfield House
1 Southampton Street
London
WC2R 0LR
SALLOUM HOLDINGS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Group statement of comprehensive income
8
Group balance sheet
9
Company balance sheet
10
Group statement of changes in equity
11
Company statement of changes in equity
12
Group statement of cash flows
13
Company statement of cash flows
14
Notes to the financial statements
15 - 29
SALLOUM HOLDINGS LIMITED
STRATEGIC REPORT
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 1 -

The directors present the strategic report for the period ended 31 December 2023.

Review of the business

The Group is a newly established shipping group headquartered in London. Founded in 2022, the group specialises in operating roll-on/roll-off (RoRo) vessels, catering primarily to new car manufacturers. The main subsidiary, Polaris Autoliners Limited was launched to address a gap in the shipping industry, providing a reliable alternative during a period of limited shipping options. Despite entering a historically challenging market, The Group has quickly established a strong foothold, leveraging excellent customer relationships to achieve early success.

 

In its first period of operations, the group has made an impressive start. The group had gross revenue of approximately $114 million with a profit before tax of $18 million (16%). This strong performance reflects the group’s ability to capitalise on market opportunities and establish a solid foundation for future growth.

The Group had £5m cash in hand at the period end and accordingly the directors are satisfied with the position of the company at that date.

The last three years have seen a resurgence in the PCTC (pure car and truck carrier) market, which has allowed new entrants like the group to succeed by offering superior service and building strong customer relationships.

Principal risks and uncertainties

Competitive risks

The car carrier industry is characterised by intense competition to secure contracts and profitable rates. The Group tries to minimise this risk by entering in medium term contracts with its customers.

Legislative risks

In the UK and Europe, the main legislative risks are EU competition law, employment law, tax law, UK Bribery Act.

New regulations such as the Emissions Trading System (ETS), Carbon Intensity Indicator (CII), and FuelEU Maritime rules are becoming increasingly important. Compliance with these regulations will likely result in higher costs and necessitate further investment in the fleet.

Market risk

After several years of limited supply growth, the market is now seeing an increase in vessel deliveries, and demand growth is expected to stabilise. This could lead to increased competition and potential pressure on rates.

Supply Chain Disruptions

Ongoing disruptions in the global supply chain are expected to persist, which could impact the group’s operations and service reliability.

Liquidity risk

Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities.

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

Credit risk

Credit risk is the risk that one party to a financial instrument will cause a financial loss for that other party by failing to discharge an obligation. Group policies are aimed at minimising such losses and require that deferred terms are only granted to customers who demonstrate an appropriate payment history and satisfy credit worthiness procedures.

All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are reviewed on a regular basis and provision for doubtful debts is made where necessary. The Group does not suffer from significant bad debt.

SALLOUM HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 2 -
Key performance indicators

The Group’s key financial performance indicators during the period were as follows:

 

2023

 

US$ m

 

 

Turnover

114

Profit for the financial year

14

Total shareholders’ fund

14

Cash and cash equivalents

5

 

Other performance indicators

There were no non-financial KPIs used to monitor business performance in the period.

Promoting the success of the company

Under s172 of the Companies Act 2006 directors of UK companies have a duty to promote the success of their company for the benefit of the members as a whole and, in doing so, have regard to:

 

 

The Directors consider the following areas to be of key importance in fulfilment of their duty:

 

On behalf of the board

M Toft
Director
22 October 2024
SALLOUM HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 3 -

The directors present their annual report and financial statements for the period ended 31 December 2023.

Principal activities

The company was formed on 4 October 2022 and commenced to trade on that date. The principal activity of the group is that of shipping vehicles.

Results and dividends

The results for the period are set out on page 8.

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

Directors

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

A Salloum
(Appointed 10 January 2023)
W Salloum
(Appointed 4 October 2022)
M Toft
(Appointed 6 November 2023)
Financial instruments
Liquidity risk

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

Interest rate risk

The group is exposed to fair value interest rate risk on its fixed rate borrowings and cash flow interest rate risk on floating rate deposits, bank overdrafts and loans. The group uses interest rate derivatives to manage the mix of fixed and variable rate debt so as to reduce its exposure to changes in interest rates.

Foriegn currency risk

The group’s principal foreign currency exposures arise from trading with overseas companies. Group policy permits but does not demand that these exposures may be hedged in order to fix the cost in sterling. This hedging activity involves the use of foreign exchange forward contracts.

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.

Auditor

Alliotts 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.

Energy and carbon report

As the group has not consumed more than 40,000 kWh of energy in this reporting period, it qualifies as a low energy user under these regulations and is not required to report on its emissions, energy consumption or energy efficiency activities.

SALLOUM HOLDINGS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 4 -
Statement of directors' responsibilities

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 group and company, and of the profit or loss of the group 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’s and 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.

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 [xxx enter details as appropriate].

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.

On behalf of the board
M Toft
Director
22 October 2024
SALLOUM HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SALLOUM HOLDINGS LIMITED
- 5 -
Opinion

We have audited the financial statements of Salloum Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the period ended 31 December 2023 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, the company 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 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:

SALLOUM HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SALLOUM HOLDINGS LIMITED
- 6 -
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.

 

Extent to which the audit was considered capable of detecting irregularities, including fraud

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

SALLOUM HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SALLOUM HOLDINGS LIMITED
- 7 -

To address the risk of fraud through management bias and override of controls, we:

Audit response to risks identified

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

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 company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Nicholas Nicolaou FCCA
For and on behalf of
22 October 2024
Alliotts LLP
Chartered Accountants
Statutory Auditor
Manfield House
1 Southampton Street
London
WC2R 0LR
SALLOUM HOLDINGS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 8 -
Period
ended
31 December
2023
Notes
$
Turnover
3
114,064,365
Cost of sales
(94,896,226)
Gross profit
19,168,139
Administrative expenses
(856,129)
Other operating income
127,390
Operating profit
4
18,439,400
Interest receivable and similar income
7
7,260
Interest payable and similar expenses
8
(695,527)
Profit before taxation
17,751,133
Tax on profit
9
(3,729,129)
Profit for the financial period
19
14,022,004
Profit for the financial period is all attributable to the owners of the parent company.
Total comprehensive income for the period is all attributable to the owners of the parent company.
SALLOUM HOLDINGS LIMITED
GROUP BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 9 -
2023
Notes
$
$
Fixed assets
Tangible assets
10
33,647,107
Current assets
Debtors
13
22,496,930
Cash at bank and in hand
4,827,580
27,324,510
Creditors: amounts falling due within one year
14
(37,414,241)
Net current liabilities
(10,089,731)
Total assets less current liabilities
23,557,376
Creditors: amounts falling due after more than one year
15
(9,535,245)
Net assets
14,022,131
Capital and reserves
Called up share capital
18
127
Profit and loss reserves
19
14,022,004
Total equity
14,022,131
The financial statements were approved by the board of directors and authorised for issue on 22 October 2024 and are signed on its behalf by:
22 October 2024
M Toft
Director
Company registration number 14396977 (England and Wales)
SALLOUM HOLDINGS LIMITED
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 10 -
2023
Notes
$
$
Fixed assets
Investments
11
54,845
Current assets
Debtors
13
12,368
Cash at bank and in hand
27,521
39,889
Creditors: amounts falling due within one year
14
(178,593)
Net current liabilities
(138,704)
Net liabilities
(83,859)
Capital and reserves
Called up share capital
18
127
Profit and loss reserves
19
(83,986)
Total equity
(83,859)

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s loss for the year was $83,986.

The financial statements were approved by the board of directors and authorised for issue on 22 October 2024 and are signed on its behalf by:
22 October 2024
M Toft
Director
Company registration number 14396977 (England and Wales)
SALLOUM HOLDINGS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 11 -
Share capital
Profit and loss reserves
Total
Notes
$
$
$
Balance at 4 October 2022
-
-
-
Period ended 31 December 2023:
Profit and total comprehensive income
-
14,022,004
14,022,004
Issue of share capital
18
127
-
127
Balance at 31 December 2023
127
14,022,004
14,022,131
SALLOUM HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 12 -
Share capital
Profit and loss reserves
Total
Notes
$
$
$
Balance at 4 October 2022
-
-
-
Period ended 31 December 2023:
Profit and total comprehensive income
-
(83,986)
(83,986)
Issue of share capital
18
127
-
127
Balance at 31 December 2023
127
(83,986)
(83,859)
SALLOUM HOLDINGS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 13 -
2023
Notes
$
$
Cash flows from operating activities
Cash generated from/(absorbed by) operations
23
21,813,533
Interest paid
(695,527)
Net cash inflow/(outflow) from operating activities
21,118,006
Investing activities
Purchase of tangible fixed assets
(14,023,080)
New loans
(25,527)
Interest received
7,260
Net cash used in investing activities
(14,041,347)
Financing activities
Proceeds from issue of shares
127
Payment of finance leases obligations
(2,249,206)
Net cash used in financing activities
(2,249,079)
Net increase in cash and cash equivalents
4,827,580
Cash and cash equivalents at beginning of period
-
Cash and cash equivalents at end of period
4,827,580
SALLOUM HOLDINGS LIMITED
COMPANY STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 14 -
2023
Notes
$
$
Cash flows from operating activities
Cash generated from/(absorbed by) operations
24
84,247
Interest paid
(2,008)
Net cash inflow/(outflow) from operating activities
82,239
Investing activities
Purchase of subsidiaries
(54,845)
Net cash used in investing activities
(54,845)
Financing activities
Proceeds from issue of shares
127
Net cash generated from/(used in) financing activities
127
Net increase in cash and cash equivalents
27,521
Cash and cash equivalents at beginning of period
-
Cash and cash equivalents at end of period
27,521
SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 15 -
1
Accounting policies
Company information

Salloum Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 6th Floor, Manfield House, 1 Southampton Street, London, WC2R 0LR.

 

The group consists of Salloum Holdings Limited and all of its subsidiaries.

1.1
Reporting period

The Group has changed the year end to 31 December to better fit the seasonality of its services.

1.2
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.

1.3
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. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following 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.

1.4
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Salloum 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 December 2023. 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.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
1.5
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.

1.6
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for transportation 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 contracts for the provision of transportation services is recognised by reference to the stage of completion of the transportation when the stage of completion, costs incurred and costs to complete can be estimated reliably.

1.7
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:

Vessels
25% reducing balance
Computers
3 years 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.

Vessels are put into dry dock on a periodic basis, Vessels are refurbished at that time, Costs of dry docks are then capitalised and spread over the period until the next dry dock is anticipated. No vessels had been put into dry dock by the year end.

1.8
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.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
1.9
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.

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.

1.10
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.

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.

SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -
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.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans and loans from fellow group companies, 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.

SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 19 -
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.

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.

SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 20 -
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
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.

SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 21 -
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.

 

Leases

The company has entered into commercial property leases as a lessee to obtain the use of property, plant, and equipment (vessels). The classification of such leases as a operating or finance lease requires the company to determine, based on an evaluation of the terms and conditions of the arrangements, whether it acquires the significant risks and rewards of ownership of these assets and accordingly whether the lease requires an asset and liability to be recognised in the statement of financial position.

 

Plant, property and equipment

Property, plant and equipment are recorded at cost less accumulated depreciation. Judgement is required to

determine whether there are indicators of impairment of the company’s tangible assets. Factors taken into

consideration include the economic viability and expected future financial performance of the asset.

 

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.

 

Property, plant and equipment

Property, plant and equipment are depreciated over their useful lives taking into account residual values,

where appropriate. The actual lives of the assets and residual values are assessed annually and may vary

depending on a number of factors. In re-assessing asset lives, factors such as technological innovation,

product life cycles and maintenance programmes are taken into account. Residual value assessments

consider issues such as future market conditions, the remaining life of the asset and projected disposal

values.

 

Impairment of receivables

The company makes an estimate of the recoverable value of trade and other receivables. When assessing iimpairment of trade and other receivables, management considers factors including the current credit rating of the receivable, the ageing profile of receivables and historical experience.

 

 

3
Turnover and other revenue
2023
$
Turnover analysed by class of business
Ro Ro Shipping
110,719,385
Other Shipping
3,344,980
114,064,365
SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
3
Turnover and other revenue
(Continued)
- 22 -
2023
$
Turnover analysed by geographical market
European Union
93,098,292
United Kingdom
12,903,116
Rest of World
8,062,957
114,064,365
2023
$
Other revenue
Interest income
7,260
Commissions received
127,390
4
Operating profit
2023
$
Operating profit for the period is stated after charging/(crediting):
Exchange gains
(79,767)
Depreciation of owned tangible fixed assets
1,375,973
Operating lease charges
46,476
5
Auditor's remuneration
2023
Fees payable to the company's auditor and associates:
$
For audit services
Audit of the financial statements of the group and company
32,465
Audit of the financial statements of the company's subsidiaries
44,000
76,465
SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 23 -
6
Employees

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

Group
Company
2023
2023
Number
Number
Directors
2
2
Others
1
-
Total
3
2

Their aggregate remuneration comprised:

Group
Company
2023
2023
$
$
Wages and salaries
189,565
-
0
Social security costs
20,773
-
Pension costs
4,618
-
0
214,956
-
0
7
Interest receivable and similar income
2023
$
Interest income
Interest on bank deposits
7,260
2023
Investment income includes the following:
$
Interest on financial assets not measured at fair value through profit or loss
7,260
8
Interest payable and similar expenses
2023
$
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
4,155
Other interest on financial liabilities
691,372
695,527
SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 24 -
9
Taxation
2023
$
Current tax
UK corporation tax on profits for the current period
3,729,129

The actual charge for the period can be reconciled to the expected charge/(credit) for the period based on the profit or loss and the standard rate of tax as follows:

2023
$
Profit before taxation
17,751,133
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00%
4,437,783
Tax effect of expenses that are not deductible in determining taxable profit
44,239
Tax effect of income not taxable in determining taxable profit
(554,941)
Unutilised tax losses carried forward
4,320
Change in unrecognised deferred tax assets
420
Effect of change in corporation tax rate
(223,771)
Effect of overseas tax rates
21,079
Taxation charge
3,729,129
10
Tangible fixed assets
Group
Vessels
Computers
Total
$
$
$
Cost
At 4 October 2022
-
0
-
0
-
0
Additions
35,021,271
1,809
35,023,080
At 31 December 2023
35,021,271
1,809
35,023,080
Depreciation and impairment
At 4 October 2022
-
0
-
0
-
0
Depreciation charged in the period
1,375,886
87
1,375,973
At 31 December 2023
1,375,886
87
1,375,973
Carrying amount
At 31 December 2023
33,645,385
1,722
33,647,107
The company had no tangible fixed assets at 31 December 2023.

The vessels are subject to sale and leaseback agreements and accordingly not owned legally by the Group. The Group has the option to purchase the vessels at agreed prices during the period of lease.

SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 25 -
11
Fixed asset investments
Group
Company
2023
2023
Notes
$
$
Investments in subsidiaries
12
-
0
54,845
Movements in fixed asset investments
Company
Shares in subsidiaries
$
Cost or valuation
At 4 October 2022
-
Additions
54,845
At 31 December 2023
54,845
Carrying amount
At 31 December 2023
54,845
12
Subsidiaries

Details of the company's subsidiaries at 31 December 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Polaris Autoliners Limited
England & Wales
Ordinary
100.00
Polaris Liberty Limited
England & Wales
Ordinary
100.00
Polaris Princess Limited
England & Wales
Ordinary
100.00
Salloum Logistics - FZCO
United Arab Emirates
Ordinary
100.00
Polaris Autoliners Shipping LLC
United Arab Emirtaes
Ordinary
100.00
Salloun Services (PTY) Ltd
South Africa
Ordinary
100.00
13
Debtors
Group
Company
2023
2023
Amounts falling due within one year:
$
$
Trade debtors
18,251,693
-
0
Corporation tax recoverable
10,968
-
0
Amounts owed by group undertakings
-
11,834
Other debtors
1,378,612
534
Prepayments and accrued income
2,855,657
-
0
22,496,930
12,368
SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 26 -
14
Creditors: amounts falling due within one year
Group
Company
2023
2023
Notes
$
$
Obligations under finance leases
16
9,215,549
-
0
Trade creditors
7,787,606
-
0
Amounts owed to group undertakings
-
0
144,928
Corporation tax payable
3,740,097
-
0
Other taxation and social security
19,762
-
Other creditors
8,553,343
1,201
Accruals and deferred income
8,097,884
32,464
37,414,241
178,593
15
Creditors: amounts falling due after more than one year
Group
Company
2023
2023
Notes
$
$
Obligations under finance leases
16
9,535,245
-
0
16
Finance lease obligations
Group
Company
2023
2023
$
$
Future minimum lease payments due under finance leases:
Within one year
9,214,937
-
0
In two to five years
9,535,857
-
0
18,750,794
-

Finance lease payments represent rentals payable by the group for a vessel. 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 2 years.

The lease obligations are in respect of the vessel. The group has given pledges to the lessor in respect of several bank accounts as security. At the year end these bank accounts had balances amounting to $2.25m. In addition the Company has pledged its shares in Polaris Autoliners Limited as security. Further, the Company operating the vessel has undertaken to assign any contracts with the vessel in the event of a default.

 

17
Retirement benefit schemes
2023
Defined contribution schemes
$
Charge to profit or loss in respect of defined contribution schemes
4,618
SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
17
Retirement benefit schemes
(Continued)
- 27 -

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.

18
Share capital
Group and company
2023
2023
Ordinary share capital
Number
$
Issued and fully paid
Ordinary shares of £1 each
100
127

100 £1 ordinary shares were issued at the start of the period.

19
Profit and loss reserves
Group
Company
2023
2023
$
$
At the beginning of the period
-
-
Profit/(loss) for the period
14,022,004
(83,986)
At the end of the period
14,022,004
(83,986)
20
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
2023
2023
$
$
Within one year
20,130,000
-
Between two and five years
24,805,000
-
44,935,000
-
21
Capital commitments

Amounts contracted for but not provided in the financial statements:

Group
Company
2023
2023
$
$
Acquisition of tangible fixed assets
7,650,000
-
SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 28 -
22
Related party transactions
Transactions with related parties

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

Sales of services
2023
$
Group
Other related parties
48,608,032

The following amounts were outstanding at the reporting end date:

Amounts due to related parties
2023
$
Group
Other related parties
8,550,712

The following amounts were outstanding at the reporting end date:

Amounts due from related parties
2023
Balance
$
Group
Other related parties
492,043
23
Cash generated from/(absorbed by) group operations
2023
$
Profit for the period after tax
14,022,004
Adjustments for:
Taxation charged
3,729,129
Finance costs
695,527
Investment income
(7,260)
Depreciation and impairment of tangible fixed assets
1,375,973
Movements in working capital:
Increase in debtors
(22,460,435)
Increase in creditors
24,458,595
Cash generated from/(absorbed by) operations
21,813,533
SALLOUM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 29 -
24
Cash generated from/(absorbed by) operations - company
2023
$
Loss for the period after tax
(83,986)
Adjustments for:
Finance costs
2,008
Movements in working capital:
Increase in debtors
(12,368)
Increase in creditors
178,593
Cash generated from/(absorbed by) operations
84,247
25
Analysis of changes in net debt - group
4 October 2022
Cash flows
New finance leases
31 December 2023
$
$
$
$
Cash at bank and in hand
-
4,827,580
-
4,827,580
Obligations under finance leases
-
2,249,206
(21,000,000)
(18,750,794)
-
7,076,786
(21,000,000)
(13,923,214)
26
Analysis of changes in net funds - company
4 October 2022
Cash flows
31 December 2023
$
$
$
Cash at bank and in hand
-
27,521
27,521
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