MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
Registered number 14619263
29 February 2024
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Contents
Strategic report
2-3
Directors' report
4
Statement of directors' responsibilities in respect of the strategic report, the directors' report
and the financial statements
5
Independent auditor's report to the members of MSL Property Services Holdings Limited
6-8
Consolidated statement of comprehensive income
9
Consolidated statement of other comprehensive income
10
Consolidated balance sheet
11
Company balance sheet
12
Consolidated statement of changes in equity
13
Company statement of changes in equity
14
Consolidated cash flow statement
15
Company cash flow statement
16
Notes (forming part of the financial statements)
17-28
Registered number 14619263
0
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Strategic report
The directors present their strategic report for the period ended 29th February 2024.
Incorporation and Principal activities
The company was incorporated on 26th January 2023.
The controlling shareholder in the company is the Foresight Group LLP which is a leading listed regional private equity and infrastructure investment manager. The investment is from its North West, North East and WYCA funded West Yorkshire SME Investment Funds.
Foresight Group LLP's investment will support the company's & group management team with its growth ambitions.
On 15th June 2023 the company acquired the entire share capital of MSL Property Care Services Holdings limited.
The principal activity of the company during the year under review is that of a holding company. The principal activities of the group are that of reactive property maintenance and compliance maintenance services.
We aim to represent a balanced and comprehensive review of the development and performance of the business during the year and its position at the end of the year. Our review is consistent with the size and non-complex nature of the business and is written in the context of the risks and uncertainties we face.
Business review and results
Group turnover for the 9 months to February 2024 was £22,074,277 and the operating profit before exceptional items and goodwill amortisation was £1,848,399. The profit before taxation was £324,037.
Key Performance Indicators
The board uses key performance indicators (KPIs) to monitor the Group's performance and development. Those KPIs include:
Turnover
Gross Profit %
Administrative Expenses to turnover %
Cash from operating activities
These KPIs for the 9 months trading were:
9 Months Ended
29th February
2024
Turnover
£
22,074,277
Gross Profit %
%
13.74 %
Administrative Expenses before exceptional items & amortisation of goodwill
£
1,184,938
Administrative Expenses to turnover
%
5.37 %
Cash from operating activities
£
1,915,932
Registered number 14619263
1
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Strategic report (continued)
Principal risks and uncertainties
The key risks to the Group's profitability continue to include managing service delivery costs and overheads whilst seeking to broaden the company's market range of customers.
In addition, the health & safety of the Group's employees and supply partners together with those of its clients and their customers is a major consideration.
The board has strategies in place to manage these risks.
Future prospects
The directors are confident about the long term prospects for the group, which is well established and focused on the reactive and compliance markets where quality and service have an intrinsic value.
Careful investment also continues to be made where necessary to support or improve the group's operating efficiency.
The overall qualities of the group's services it provides, together with the strength of relationships with its clients, are expected to provide a similar outcome for the 2024 – 2025 financial year despite the uncertain economic climate leading up to the signing of this report.
On behalf of the board
J Harrison
Premier House
Director
1 Canal Street
Halifax
HX3 9HT
26 September 2024
Registered number 14619263
2
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Directors' report
The directors present their directors' report and financial statements for the period ended 29 February 2024.
The Principal Activities, the Performance and Developments during the year, the Future Prospects, The Principal Risks and Uncertainties and the Key Performance Indicators are discussed in detail in the Strategic Review.
Proposed Dividend
The directors propose a dividend payment of £nil.
Directors
The directors who held office during the year and up to the date of this report were as follows:
J Harrison – appointed 26th January 2023
M Donnachie (Chairman) – appointed 15th June 2023
C Alvarez – appointed 15th June 2023
Disclosure of information to the auditor
The directors who held office at the date of approval of this directors' report confirm that, so far as they are each aware, there is no relevant audit information of which the company's auditor is unaware; and each director has taken all the necessary steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.
Auditor
Azets Audit Services Limited, trading as Azets Audit Services were appointed as auditor to the company following incorporation. In accordance with section 485 of the Companies Act 2006, a resolution to reappoint Azets Audit Services Limited, trading as Azets Audit Services as auditor will be put to the members at the next annual general meeting.
On behalf of the board
J Harrison
Premier House
Director
1 Canal Street
Halifax
HX3 9HT
26 September 2024
Registered number 14619263
3
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Statement of directors' responsibilities in respect of the strategic report, the directors' report and the financial statements
The directors are responsible for preparing the strategic report, the directors' 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 they have elected to prepare the financial statements in accordance with UK Accounting Standards and applicable law (UK Generally Accepted Accounting Practice), including FRS102 The Financial Reporting Standard applicable in the UK and Republic of Ireland.
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 the company and of the profit or loss of the group for that year.
In preparing these financial statements, the directors are required to:
a.
select suitable accounting policies and then apply them consistently;
b.
make judgements and accounting estimates that are reasonable and prudent; and
c.
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group's and the company's transactions and disclose with reasonable accuracy at any time the financial position of the group and the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Registered number 14619263
4
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MSL PROPERTY SERVICES HOLDINGS LIMITED
Opinion
We have audited the financial statements of MSL Property Services Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the period ended 29 February 2024 which comprise the group profit and loss account, 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:
*
give a true and fair view of the state of the group's and the parent company's affairs as at 29 February 2024 and of the group's profit for the period then ended;
*
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
*
have been prepared in accordance with the requirements of the Companies Act 2006.
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.
5
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
INDEPENDENT AUDITOR'S REPORT (CONTINUED) TO THE MEMBERS OF MSL PROPERTY SERVICES HOLDINGS LIMITED
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
•
the information given in the strategic report and the director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
•
the strategic report and the director's report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the director's report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
•
adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
•
the parent company financial statements are not in agreement with the accounting records and returns; or
•
certain disclosures of directors' remuneration specified by law are not made; or
•
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the director's responsibilities statement, the director is 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 director determines 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 director is 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 director either intends to liquidate the parent company or to cease operations, or has no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities is available on the Financial Reporting Council's website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
6
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
INDEPENDENT AUDITOR'S REPORT (CONTINUED) TO THE MEMBERS OF MSL PROPERTY SERVICES HOLDINGS LIMITED
Extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council's website, to detect material misstatements in respect of irregularities, including fraud.
We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework. Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.
In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:
•
Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud;
•
Reviewing minutes of meetings of those charged with governance;
•
Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the entity through enquiry and inspection;
•
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
•
Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Use of our report
This report is made solely to the company's 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.
Alison Whalley
Senior Statutory Auditor
For and on behalf of Azets Audit Services
26 September 2024
Chartered Accountants
Statutory Auditor
Carlton House
Grammar School Street
Bradford
BD1 4NS
7
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Consolidated statement of comprehensive income
for the 9 months ended 29 February 2024
Note
2024
£
Turnover
3
22,074,277
Cost of sales
(19,040,940)
Gross profit
3,033,337
Administrative expenses
(2,052,157)
Operating profit before exceptional items and goodwill amortisation
Exceptional items
Goodwill amortisation
4
9
1,848,399
(105,000)
(762,219)
Operating profit
981,180
Interest payable and similar charges
7
(657,143)
Profit on ordinary activities before taxation
324,037
Tax on profit on ordinary activities
8
(271,062)
Profit for the financial period
52,975
8
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
All of the turnover and operating results relate to continuing operations.
The notes on pages 17 to 28 form part of the financial statements.
9
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Consolidated statement of other comprehensive income
for 9 months ended 29 February 2024
2024
£
Profit for the period
Other comprehensive income
52,975
-
Total comprehensive income for the period
52,975
The notes on pages 17 to 28 form part of the financial statements.
10
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Consolidated balance sheet
at 29 February 2024
Note
2024
£
£
Fixed assets
Intangible assets (goodwill)
Tangible assets
9
10
9,400,701
1,047,692
10,448,393
Current assets
Stocks and work in progress
12
54,792
Debtors
13
5,662,739
Cash at bank and in hand
2,084,089
7,801,620
_________
Total assets
Creditors: amounts falling due
18,250,013
within one year
14
6,462,300
Current liabilities
6,462,300
Provision for liabilities and charges
Deferred tax liability
Creditors: long term liabilities
16
15
159,554
9,121,851
________
Total liabilities
15,743,705
Net assets
2,506,308
Capital and reserves
Called up equity share capital
18
2,453,333
Revaluation reserve
-
Profit and loss account
52,975
Shareholders' funds – equity
2,506,308
The notes on pages 17 to 28 form part of the financial statements.
These financial statements were approved by the board of directors and authorised for issue on 26 September 2024
and were signed on its behalf by:
J Harrison
Director
11
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Company balance sheet
at 29 February 2024
Note
2024
£
£
Fixed assets
Fixed asset investments
11
15,309,463
15,309,463
Current assets
Debtors
Cash at bank and in hand
13
-
60,559
60,559
_________
Total assets
15,370,022
Creditors: amounts falling due
within one year
14
1,991,083
1,991,083
Creditors: long term liabilities
15
9,121,851
________
Total liabilities
11,112,934
Net assets
4,257,088
Capital and reserves
Called up equity share capital
18
2,453,333
Profit and loss account
1,803,755
Shareholders' funds – equity
4,257,088
The notes on pages 17 to 28 form part of the financial statements.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes as it prepares group accounts. The company's profit for the year was £1,803,755.
These financial statements were approved by the board of directors and authorised for issue on 26 September 2024
and were signed on its behalf by:
J Harrison
Director
12
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Consolidated statement of changes in equity
for the period ended 29 February 2024
Called up share capital
Statement of comprehensive income
Total shareholders' equity
£
£
£
Balance at incorporation
-
-
-
Total comprehensive income for the period
Profit for the period
-
52,975
52,975
Share Capital issued
2,453,333
-
2,453,333
Balance at 29 February 2024
2,453,333
52,975
2,506,308
13
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Company statement of changes in equity
for the period ended 29 February 2024
Called up share capital
Statement of comprehensive income
Total shareholders' equity
£
£
£
Balance at incorporation
-
-
-
Total comprehensive income for the period
Profit for the period
-
1,803,755
1,803,755
Share Capital issued
2,453,333
-
2,453,333
Balance at 29 February 2024
2,453,333
1,803,755
4,257,088
The notes on pages 17 to 28 form part of the financial statements.
14
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Consolidated cash flow statement
for the period ended 29 February 2024
Note
2024
£
Cash flows from operating activities
Profit for the year
52,975
Adjustments for:
Depreciation, amortisation and impairment
4
161,278
Amortisation and impairment
4
762,219
Interest payable and similar charges
7
657,143
Taxation
8
271,062
__________
1,904,677
(Increase) / decrease in stocks
(20,604)
(Increase) / decrease in trade and other debtors
(217,403)
Increase / (decrease) in trade and other creditors
715,447
___________
2,382,117
Tax paid
(466,185)
__________
Net cash from operating activities
1,915,932
__________
Cash flows from investing activities
Acquisition of tangible fixed assets
10
(105,105)
Purchase of subsidiary less cash on hand at acquisition
(11,815,547)
__________
Net cash from investing activities
(11,920,652)
__________
Cash flows from financing activities
Interest paid
(153,750)
Repayment of loans
(300,000)
Deferred Consideration
(375,000)
Other Creditors (Deferred Consideration)
835,599
Proceeds from issue of shares
2,453,333
Proceeds from issue of shares in subsidiary
53,210
Proceeds from redeemable preference shares
Proceeds of new borrowings less repayments
770,417
8,805,000
__________
Net cash from financing activities
12,088,809
__________
Net (decrease)/increase in cash and cash equivalents
2,084,089
Cash and cash equivalents at 1 March 2023
-
__________
Cash and cash equivalents at 29 February 2024
2,084,089
The notes on pages 17 to 28 form part of the financial statements.
15
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Company cash flow statement
for the period ended 29 February 2024
Note
2024
£
Cash flows from operating activities
Profit for the period
1,803,755
Adjustments for:
Investment income
Interest payable and similar charges
7
(2,557,490)
648,735
Taxation
-
__________
(105,000)
Increase in trade and other creditors
773,363
___________
668,363
Tax paid
-
__________
Net cash from operating activities
668,363
__________
Cash flows from investing activities
Purchase of subsidiary
(12,751,973)
__________
Net cash from investing activities
(12,751,973)
__________
Cash flows from financing activities
Interest paid
(145,342)
Repayment of loans
(300,000)
Deferred Consideration
(375,000)
Other Creditors (Deferred Consideration)
935,761
Proceeds from issue of shares
2,453,333
Proceeds from redeemable preference shares
Proceeds of new borrowings less repayments
770,417
8,805,000
__________
Net cash from financing activities
12,144,169
__________
Net increase in cash and cash equivalents
60,559
Cash and cash equivalents at the beginning of the period
-
__________
Cash and cash equivalents at 29 February 2024
60,559
The notes on pages 17 to 28 form part of the financial statements.
16
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Notes
(forming part of the financial statements)
1
Accounting policies
Company information
MSL Property Services Holdings Limited (the “Company” and the ”Group”) is a Company limited by shares and incorporated and domiciled in the UK, its registered office is Premier House, 1 Canal Street, Halifax, HX3 9HT.
These financial statements were prepared in accordance with Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (“FRS 102”). The presentation currency of these financial statements is sterling.
1.1
Measurement convention
The financial statements are prepared on the historical cost basis except that the following assets and liabilities are stated at their fair value: tangible fixed assets measured at fair value on the date of transition to FRS 102.
1.2
Basis of consolidation
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.
The consolidated group financial statements consist of the financial statements of the parent company MSL Property Services 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 29 February 2024. Business combinations are accounted for under the acquisition method and the merger accounting method. 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.
Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.
Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group's share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill. If the group's share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.
Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group's interest in the entity.
17
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Notes (continued)
1
Accounting policies (continued
1.3
Going concern
With a net current asset position of £1,339,320 the financial statements have been prepared on a going concern basis which the Directors consider to be appropriate for the following reasons.
The Directors have considered all of the factors and are confident that the Group has adequate resources to continue to meet all liabilities as and when they fall due for at least 12 months from the date of approval of these financial statements. Accordingly, the financial statements are prepared on a going concern basis.
1.4
Foreign currency
Transactions in foreign currencies are translated to the Group's functional currency at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are retranslated to the functional currency at the foreign exchange rate ruling at that date. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are retranslated to the functional currency at foreign exchange rates ruling at the dates the fair value was determined. Foreign exchange differences arising on translation are recognised in the profit and loss account.
1.5
Classification of financial instruments issued by the Group
In accordance with FRS 102.22, financial instruments issued by the Group are treated as equity only to the extent that they meet the following two conditions:
(a)
they include no contractual obligations upon the Group to deliver cash or other financial assets or to exchange financial assets or financial liabilities with another party under conditions that are potentially unfavourable to the Group; and
(b)
where the instrument will or may be settled in the Group's own equity instruments, it is either a non-derivative that includes no obligation to deliver a variable number of the Group's own equity instruments or is a derivative that will be settled by the Group's exchanging a fixed amount of cash or other financial assets for a fixed number of its own equity instruments.
To the extent that this definition is not met, the proceeds of issue are classified as a financial liability. Where the instrument so classified takes the legal form of the Group's own shares, the amounts presented in these financial statements for called up share capital and share premium account exclude amounts in relation to those shares.
1.6
Basic financial instruments
Trade and other debtors / creditors
Trade and other creditors are recognised initially at transaction price plus attributable transaction costs. Subsequent to initial recognition they are measured at amortised cost using the effective interest method, less any impairment losses in the case of trade debtors. If the arrangement constitutes a financing transaction, for example if payment is deferred beyond normal business terms, then it is measured at the present value of future payments discounted at a market rate of instrument for a similar debt instrument.
Investments
These are separate financial statements of the Group. Investments in subsidiaries, jointly controlled entities and associates are carried at cost less impairment.
1.7
Tangible fixed assets
Tangible fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses. Certain items of tangible fixed assets that had been revalued to fair value on or prior to the date of transition to FRS 102, are measured on the basis of deemed cost, being the revalued amount at the date of that revaluation.
Depreciation is provided to write off the cost or valuation less the estimated residual value of tangible fixed assets by equal instalments over their estimated useful economic lives as follows:
Fixtures, fittings, tools and equipment -
Motor Vehicles
IT Development -
4 years
4 years
4 years
Freehold buildings
-
50 years
18
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Notes (continued)
1
Accounting policies (continued)
1.7
Intangible assets, goodwill and negative goodwill
Goodwill arising on an acquisition of a trade is the difference between the fair value of the consideration paid and the fair value of the assets and liabilities acquired. Positive goodwill is capitalised and amortised through the profit and loss account over the directors' estimate of its useful economic life of 10 years. Impairment tests on the carrying value of goodwill are undertaken if events or changes in circumstances indicate that the carrying value may not be recoverable.
Amortisation
Goodwill is amortised on a straight line basis over its useful life. Goodwill has no residual value. The finite useful life of goodwill is estimated to be 10 years.
•
The company reviews the amortisation period and method when events and circumstances indicate that the useful life may have changed since the last reporting date.
•
Goodwill is tested for impairment in accordance with Section 27 Impairment of assets when there is an indication that goodwill or an intangible asset may be impaired.
1.8
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is based on the first-in first-out principle and includes expenditure incurred in acquiring the stocks, production or conversion costs and other costs in bringing them to their existing location and condition.
1.9
Impairment excluding stocks and deferred tax assets
Financial assets (including trade and other debtors)
A financial asset not carried at fair value through profit or loss is assessed at each reporting date to determine whether there is objective evidence that it is impaired. A financial asset is impaired if objective evidence indicates that a loss event has occurred after the initial recognition of the asset, and that the loss event had a negative effect on the estimated future cash flows of that asset that can be estimated reliably.
Non-financial assets
The carrying amounts of the Group's non-financial assets, other than stocks and deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset's recoverable amount is estimated. The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. 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 the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the “cash-generating unit”). The goodwill acquired in a business combination, for the purpose of impairment testing is allocated to cash-generating units, or (“CGU”) that are expected to benefit from the synergies of the combination. For the purpose of goodwill impairment testing, if goodwill cannot be allocated to individual CGUs or groups of CGUs on a non-arbitrary basis, the impairment of goodwill is determined using the recoverable amount of the acquired entity in its entirety, or if it has been integrated then the entire entity into which it has been integrated.
An impairment loss is recognised if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognised in profit or loss.
1.10
Employee benefits
Defined contribution plans and other long term employee benefits
A defined contribution plan is a post-employment benefit plan under which the Group pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution pension plans are recognised as an expense in the profit and loss account in the periods during which services are rendered by employees.
19
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Notes (continued)
1
Accounting policies (continued)
1.11
Expenses
Operating lease
Payments (excluding costs for services and insurance) made under operating leases are recognised in the profit and loss account on a straight-line basis over the term of the lease unless the payments to the lessor are structured to increase in line with expected general inflation; in which case the payments related to the structured increases are recognised as incurred. Lease incentives received are recognised in profit and loss over the term of the lease as an integral part of the total lease expense.
Interest receivable and Interest payable
Interest payable and similar charges include interest payable, finance charges on shares classified as liabilities and finance leases recognised in profit or loss using the effective interest method, unwinding of the discount on provisions, and net foreign exchange losses that are recognised in the profit and loss account (see foreign currency accounting policy).
Other interest receivable and similar income include interest receivable on funds invested and net foreign exchange gains.
Interest income and interest payable are recognised in profit or loss as they accrue, using the effective interest method. Dividend income is recognised in the profit and loss account on the date the Company's right to receive payments is established. Foreign currency gains and losses are reported on a net basis.
1.12
Turnover
Turnover represents amounts invoiced by the Group in respect of sales completed during the period, excluding value added tax. Turnover is wholly attributable to the Group's principal activity/services for UK companies with sites both in the UK and Continental Europe.
The turnover attributed to the Ireland and European sites was £204,534.
1.13
Taxation
Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the profit and loss account except to the extent that it relates to items recognised directly in equity or other comprehensive income, in which case it is recognised directly in equity or other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of previous years.
Deferred tax is provided on timing differences which arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in the financial statements. The following timing differences are not provided for: differences between accumulated depreciation and tax allowances for the cost of a fixed asset if and when all conditions for retaining the tax allowances have been met; and differences relating to investments in subsidiaries to the extent that it is not probable that they will reverse in the foreseeable future and the reporting entity is able to control the reversal of the timing difference.
Deferred tax is not recognised on permanent differences arising because certain types of income or expense are non-taxable or are disallowable for tax or because certain tax charges or allowances are greater or smaller than the corresponding income or expense.
Deferred tax is measured at the tax rate that is expected to apply to the reversal of the related difference, using tax rates enacted or substantively enacted at the balance sheet date. Deferred tax balances are not discounted.
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that is it probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.
20
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Notes (continued)
1
Accounting policies (continued)
1.14
Government Grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received. A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
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.
3
Turnover
An analysis of the group's turnover by class of business is as follows:
2024
Group
£
Reactive and project sales
17,416,605
Compliance sales
4,657,672
22,074,277
4
Profit/(loss) on ordinary activities before taxation
2024
Group
£
Profit/(loss) on ordinary activities before taxation is stated
After charging:
Auditors remuneration:
audit of parent and consolidated accounts
3,000
audit of subsidiary accounts
17,000
fees paid to the auditor's associates in respect of taxation services
non-audit services
Depreciation and other amounts written off tangible fixed assets
2,000
1,750
161,278
Finance costs
105,000
Amortisation of goodwill
Operating lease rentals on motor vehicles
762,219
125,385
The audit fee for the holding company was borne by MSL Property Care Services Ltd.
The profit before taxation also included an exceptional charge for company re-organisation charges of £105,000.
21
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Notes (continued)
5
Remuneration of directors
2024
Group
£
Directors' emoluments
303,560
The number of directors of the parent company in the period was 3, and the number of directors appointed within the group in the period was 6. Retirement benefits are accruing in the group to 1 director under money purchase schemes. Remuneration of the highest paid director in the group was £ 81,454.
6
Staff numbers and costs
The average number of persons employed by the group (including directors) during the period, analysed by category, was as follows:
Number of employees
2024
Operations staff
14
Sales staff
8
Administration staff
56
Management staff
5
83
The aggregate payroll costs of these persons were as follows:
2024
Group
£
Wages and salaries
2,054,157
Social security costs
218,418
Other pension costs
39,083
2,311,658
The company has no employees.
7
Interest payable and similar charges
2024
Group
£
Bank interest
8,435
Bank loan interest
Shareholder loan interest
202,274
446,434
657,143
22
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Notes (continued)
8
Taxation
2024
Group
Analysis of tax charge for the period
£
Current tax
UK corporation tax at 24.49% (2023: 19.00%)
Prior year adjustment
295,363
(62)
Total current tax charge
295,301
Deferred tax
Origination and reversal of timing differences
(24,239)
Origination/reversal of change of tax rate
-
Total deferred tax charge/(credit)
(24,239)
Tax charge on profit on ordinary activities
271,062
Reconciliation of tax charge
Profit on ordinary activities before taxation
324,037
_________
Tax on profit on ordinary activities at standard corporation tax rate of 24.49% (2023: 19.00%).
79,363
Effects of:
Fixed asset differences
Expenses not deductible for tax purposes
Deferred tax
12,665
(24,239)
Other Permanent differences
Depreciation
Amortisation
Capital allowances
Tax adjustment for acquisition of subsidiary
Reversal of pre-acquisition tax credit
Prior year adjustment
Effect in change of corporation tax rates
(158,709)
52,577
186,681
(32,750)
91,026
61,280
(62)
3,230
________
Total tax charge for the year (see above)
271,062
23
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Notes (continued)
9
Intangible fixed assets
Cost
Group
£
At 15 June 2023
10,162,920
Amortisation
At 15 June 2023
-
Charged in year
762,219
At end of year
762,219
Net book value
At 29 February 2024
9,400,701
The company has no Intangible Fixed Assets.
10
Tangible fixed assets
Freehold
building
IT system development
Motor
vehicles
Fixtures,
fittings and
equipment
Total
Group
£
£
£
£
£
Cost
Acquired under business combinations
547,500
495,538
53,909
684,789
1,781,736
Additions
-
92,539
-
12,566
105,105
_______
_______
At end of year
547,500
588,077
53,909
697,355
1,886,841
Depreciation
Acquired under business combinations
1,520
295,156
33,670
347,525
677,871
Charge for period
4,558
54,318
5,357
97,045
161,278
At end of year
6,078
349,474
39,027
444,570
839,149
Net book value
At 29 February 2024
541,422
238,603
14,882
252,785
1,047,692
The directors had the land and buildings revalued in February 2023 by Malcolm Stuart Property Consultants, who gave a market value of £547,500.
The company has no Tangible Fixed Assets.
24
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Notes (continued)
11
Fixed asset investments
Shares in
group
undertakings
Company
£
Cost
At incorporation
Additions in the year
At 29 February 2024
-
15,309,463
15,309,463
Net book value at 29 February 2024
15,309,463
On 15th June 2023 the company acquired the entire share capital of MSL Property Care Services Holdings Limited.
Subsidiary undertakings
Country of
incorporation
Principal
activity
Class of shares
% of voting shares held
MSL Property Care Services Holdings Limited
England and Wales
Holding company
Ordinary
100 per cent
MSL Property Care Services Limited
England and Wales
Property maintenance and projects
Ordinary
100 per cent
MSL Property Compliance Services Limited
England and Wales
Property compliance services
Ordinary
100 per cent
12
Stocks
2024
Group
Company
£
£
Raw materials and consumables
Work in progress
12,000
42,792
-
-
-
54,792
-
-
13
Debtors
2024
Group
Company
£
£
Trade debtors
5,418,045
-
Other Debtors
116,152
-
Corporation tax receivable
65,972
-
Prepayments and accrued income
62,570
__________
-
__________
5,662,739
-
=
25
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Notes (continued)
14
Creditors: amounts falling due within one year
2024
Group
Company
£
£
Trade creditors
4,364,621
-
Bank loans
600,000
600,000
Associated undertakings
Other creditors including taxation and social security
-
700,011
773,363
-
Accruals and deferred income
797,668
617,720
6,462,300
1,991,083
15
Creditors: amounts falling due after more than one year
2024
Group
Company
£
£
Bank loan
2,100,000
2,100,000
Shareholder loans
Preference shares
Interest
5,805,000
770,417
446,434
5,805,000
770,417
446,434
9,121,851
9,121,851
16
Provision for deferred tax
2024
Deferred
taxation
Group
£
At beginning of period
183,728
Charge to the profit and loss for the year
Short term timing
(24,300)
126
At end of year
159,554
26
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Notes (continued)
The elements of deferred taxation are as follows:
2024
Group
£
Difference between accumulated depreciation and amortisation and capital allowances
159,554
Other comprehensive income
-
Undiscounted deferred tax liability
159,554
17
Loans and overdrafts
2024
Group
Company
£
£
Bank loans
2,700,000
2,700,000
Shareholder loans
5,805,000
5,805,000
8,505,000
8,505,000
Payable within one year
Payable between one and five years inclusive
600,000
2,100,000
600,000
2,100,000
Payable after five years
5,805,000
5,805,000
The bank loan from 15th June 2023 is over a 20 month period and is secured by a fixed charge over the assets of the company, the loan accrues interest of 4.75% over base per annum. The interest and capital amounts are payable per quarter ending June, September, December and March.
The shareholder loan from 15th June 2023 accrues interest of 10% per annum which is payable per quarter ending June, September, December and March.
18
Called up equity share capital
Company and group
Group
2024
Company
£
£
Allotted, called up and fully paid
Ordinary shares of £1 each
2,453,333
2,453,333
________
2,453,333
________
2,453,333
27
Registered number 14619263
MSL Property Services Holdings Limited
Directors' report and consolidated financial statements
For the period ended 29 February 2024
Notes (continued)
19
Commitments
The total future minimum lease payments under non-cancellable operating leases are as follows:
Group
2024
£
Within one year
87,206
In the second to fifth years inclusive
Over five years
55,136
17,000
159,342
Charged in the period £125,385 (2023: £nil)
The company has no capital or lease commitments other than as disclosed.
20
Acquisition of a business
On 15th June 2023 the company acquired 100 percent of the issued share capital of MSL Property Care Services Holdings Limited
Net assets acquired
Book Value
Adjustments
Fair Value
£
£
£
Fixed assets
1,103,866
0
1,103,866
Stock
34,188
0
34,188
Trade and other receivables
5,379,364
0
5,379,364
Cash and cash equivalents
3,493,916
0
3,493,916
Trade and other payables
(4,529,133)
0
(4,529,133)
Tax liabilities
(151,930)
0
(151,930)
Deferred tax
(183,728)
0
(183,728)
Total identifiable assets
5,146,543
0
5,146,543
Goodwill
10,162,920
Total consideration
15,309,463
The consideration was satisfied by:
Cash
12,062,452
Equity
2,311,250
Deferred consideration
935,761
15,309,463
Contribution by the acquired business for the reporting period included in the group statement of
comprehensive income since acquisition:
Turnover
22,074,277
Profit after tax
52,975
28
Registered number 14619263
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