Registered number:
FOR THE YEAR ENDED 30 APRIL 2024
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
COMPANY INFORMATION
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
CONTENTS
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 30 APRIL 2024
The directors present their Strategic report and the consolidated financial statements for Trac Holdings Limited (formerly Rcap Eleven Limited) and its subsidiaries (together the "Group") for the year ended 30 April 2024.
The Group manufactures and supplies complex components into global blue chip customers, predominantly in the aero engine and power generation markets. The Group continues to focus on new engine development programmes in order to secure the long-term future. The Group is also focussed on a collaborative approach with its major customers in order to develop continuity of development and manufacture through improved efficiencies and investment in machining capabilities.
The results of the Group for the year, as set out on pages 9 and 10, show a profit before tax of £2.83m. of this amount, £1.76m relates to a release of negative goodwill. The performance of the trading subsidiary, Trac Precision Solutions Limited, significantly improved reporting an operating profit £1.91m for the year, which was compared to the £1.46m operating loss reported in the prior period. In summary, the Group has made significant commercial and operational improvements that have delivered solid profitability. Those improvements, as well as investments in new equipment, have also built a strong base for the Group to continue to develop. The new package of work secured in the year is now beginning to come through as sales and overall, the business is expecting to grow both revenue and profitability going forward. The overall net asset position of the Group has improved in line with profitability. As at 30 April 2024, net assets were £5.77m, compared to £2.93m in the prior period. Net assets excluding negative goodwill amounted to £10.40m as at 30 April 2024 (£9.31m as at 30 April 2023 ).
The process of risk acceptance and risk management is addressed through a framework of policies, procedures and internal controls. All policies are subject to Board approval and on going review by management, risk management and internal audit. Compliance with regulation, legal and ethical standards is a high priority for the Group and the compliance team and the Group finance department take on an important oversight role in this regard.
The Group uses various financial instruments including cash, invoice discounting facilities, trade debtors and trade creditors that arise directly from its operations. The main purpose of these financial instruments is to raise finance for the Group's operations. However, their existence exposes the Group to a number of financial risks which are described in more detail below. Currency risk The Group is exposed to foreign exchange risk due to transactions completed in US Dollar and Euro. These are included in forecast transactions and are post assessment, hedging is considered where the risks facing the Group are outside acceptable limits. Whilst the aim is to achieve an economic hedge, the Group does not adopt an accounting policy of hedge accounting for these financial statements. Foreign exchange differences on retranslation of these assets and liabilities are taken to the Consolidated Statement of Comprehensive Income. Liquidity risk The Group seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs. The objective is to ensure a mix of funding methods offering flexibility and cost effectiveness to match the needs of the Group. Longer term borrowing is achieved by utilising finance leases and invoice discounting. The maturity of borrowings is set out in notes 18 and 19 to the financial statements.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
Interest rate risk
During the reporting period the Group finances its operations through a mixture of finance leases, invoice discounting facilities and other loans. Whilst the loan and finance leases have a fixed interest rate, the invoice discounting facility is subject to variable interest rate. Credit risk The principal credit risk arises from its trade debtors. To manage credit risk, the directors set limits for customers based on a combination of payment history and third party credit references. Credit limits are reviewed by the finance department on a regular basis in conjunction with debt ageing and collection history.
Research and development expenditure is written off in the Consolidated Statement of Comprehensive Income in the year which it is incurred.
The market for air travel and efficient power generation continues to grow and as the Group continues to align itself with the major providers of engine development. With that said, the opportunities within the aviation and power-generation sectors continue to promote the growth within the Group.
This report was approved by the board and signed on its behalf.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 APRIL 2024
The directors present their report and the financial statements for the year ended 30 April 2024.
The directors are responsible for preparing the Group strategic report, the Directors' report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘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 Company and the Group and of the profit or loss of the Group for that period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgements and accounting estimates that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The profit for the year, after taxation, amounted to £2,830,000 (2023 - £2,930,000).
No dividends were paid during the year and no dividend is recommended by the directors.
The directors who served during the year were:
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
The Directors have reviewed the current performance of the business as well as future expectations. The Group has prepared cash flow forecasts to ensure that sufficient finance will be available to meet obligations as they fall due, in line with the Group's business plan, for a period of not less than twelve months from the date of signature of these financial statements.
The directors have chosen to set out in the Strategic report information required to be stated in the Directors report including a review of the business and principal risks and uncertainties.
An indication of the likely future developments in the business and details of research and development activities undertaken during the financial year have been included in the Strategic report.
Details of post balance sheet events affecting the Group are disclosed in note 30.
The auditors, PKF Smith Cooper Audit Limited, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
We have audited the financial statements of Trac Holdings Limited (formerly Rcap Eleven Limited) (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 30 April 2024, which comprise the Consolidated statement of comprehensive income, the Consolidated balance sheet, the Company balance sheet, the Consolidated statement of cash flows, the Consolidated statement of changes in equity, the Company statement of changes in equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
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 or the 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.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED) (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' report thereon. The directors are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Group strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group strategic report or the Directors' report.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED) (CONTINUED)
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Group 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.
Based on our understanding of the Group and industry, key laws and regulations that we identified included:
∙Companies Act;
∙Tax legislation; and
∙Health and safety and employment legislation.
We identified that the principal risk of fraud or non-compliance with laws and regulations related to:
∙Management bias in respect of accounting estimates and judgements made;
∙Management override of controls; and
∙Posting of unusual journals or transactions.
We focused on those areas that could give rise to a material misstatement in the Group's financial statements.
Our procedures included, but were not limited to:
∙Enquiry of management and those charged with governance around actual and potential litigation and claims, including instances of non-compliance with laws and regulations and fraud;
∙Reviewing minutes of meetings of those charged with governance, where available;
∙Reviewing legal expenditure in the year to identify instances of non-compliance with laws and regulations and fraud;
∙Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations; and
∙Performing audit work over the risk of management 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 bias, in particular the valuation of stock and the release of negative goodwill.
It is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED) (CONTINUED)
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' report.
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Statutory Auditors
Cornerblock
2 Cornwall Street
West Midlands
B3 2DX
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 APRIL 2024
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
REGISTERED NUMBER: 14189489
CONSOLIDATED BALANCE SHEET
AS AT 30 APRIL 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 17 to 35 form part of these financial statements.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
REGISTERED NUMBER: 14189489
COMPANY BALANCE SHEET
AS AT 30 APRIL 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 17 to 35 form part of these financial statements.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 APRIL 2024
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 APRIL 2024
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 APRIL 2024
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 30 APRIL 2024
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
Trac Holdings Limited (formerly Rcap Eleven Limited) is a private company, limited by shares, registered in England, United Kingdom. The Company's registration number and registered office address can be found on the Company Information page. The principal activity of the Company is disclosed in the Directors report.
The Group's principal place of business is 9A Marshfield Bank Business Park, Middlewich Road, Crewe, Cheshire, CW2 8UY. These financial statements cover a 12 month period from 1 May 2023 to 30 April 2024 which is the first full year of reporting for the Group. The Company was incorporated on 22 June 2022 and on 27 October 2022 it acquired 100% of the share capital of Broomco (4266) Limited and its subsidiary undertakings. The prior year financial statements covered a 6 month period from the date of acquisition up to 30 April 2023 to align the group reporting period to that of its subsidiary undertakings and, as a result, the current and comparative year are not entirely comparable.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgement in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of comprehensive income in these financial statements.
The presentation currency of these financial statements is Sterling. All amounts in the financial statements have been rounded to the nearest £1,000.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date control ceases.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
2.Accounting policies (continued)
These financial statements have been prepared on a going concern basis. The current economic conditions present risks for all businesses. In response to such conditions, the directors have carefully considered these risks, including the assessment of uncertainty on future trading projection for a period of at least 12 months from the date of signing the financial statements, and the extent to which they might affect the preparation of the financial statements on a going concern basis.
The directors have confirmed that they believe that the Group will be operating on a going concern basis. Demand from existing customers remains strong and coupled with the new product introduction the directors envisage the Group's position will enable to continue to grow and invest in machining capabilities, after taking into consideration possible downsides, which include increased energy costs, inflationary increases and increases to interest rates. The consolidated balance sheet is reflecting a net current asset position. Based on this assessment, the directors consider that the Group maintains an appropriate level of liquidity sufficient to meet the demands of the business. Consequently, the directors are confident that the Group will have sufficient funds to continue to meet it's liabilities as they fall due for at least 12 months from the date of approval of the financial statements and, therefore, have prepared the financial statements on a going concern basis. Revenues and costs expressed in foreign currencies are translated into Sterling rates of exchange ruling on the date on which the transactions occur, except for transactions to be settled at a contracted rate. Differences arising on the translation of such items are dealt with in the Consolidated Statement of Comprehensive Income.
Minimum lease payments are apportioned between the finance charge and reduction of the outstanding liability using the rate implicit in the lease. The finance charge is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
2.Accounting policies (continued)
Tax on profit or loss for the year comprises current and deferred tax. Tax is recognised in the Consolidated statement of comprehensive income 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 adjustments tax payable in respect of previous years. Payment is made for any tax losses surrendered by companies within the group.
Deferred taxation
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. 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 expenses. 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. Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
2.Accounting policies (continued)
Goodwill
Goodwill represents the difference between amounts paid on the cost of business combinations and the acquirer's interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Negative goodwill arises where the purchase price of the business combination is below the fair value of the Group's share of it's identifiable assets and liabilities of the acquiree on acquisition. Subsequent to initial recognition, negative goodwill is recognised in the Consolidated statement of comprehensive income over the period in which the non-monetary assets acquired are recovered. Negative goodwill on the non-monetary assets acquired is amortised through the Consolidated Statement of Comprehensive Income on the following basis:
∙Tangible fixed assets - as recovered, based on the depreciation or disposal of the relevant assets of the acquired subsidiaries.
∙Stock - as recovered based on the sale or disposal of stock of the acquired subsidiaries.
Tangible fixed assets are stated at cost less accumulated depreciation. Cost includes the original purchase price of the asset and the cost attributable to bringing the asset to its working condition for its intended use.
Depreciation is charged on a straight line basis at rates calculated to write down assets to estimated residual value over their expected useful life as follows:
The Group assesses at each reporting date whether tangible fixed assets are impaired.
Depreciation methods, useful lives and residual values are reviewed if there is an indication of a significant change since the last annual reporting date in the pattern by which the Group expects to consume an asset's future economic benefits.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
2.Accounting policies (continued)
The Group only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
Financial assets (including trade and other debtors)
A financial asset not carried at fair value through the Consolidated statement of comprehensive income 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 can be estimated reliably. An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount and the present value of the estimated future cash flows discounted at the asset's original effective interest rate.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
2.Accounting policies (continued)
For financial instruments measured at cost less impairment an impairment is calculated as the difference between its carrying amount and the best estimate of the amount that the Company would receive for the asset if it were to be sold at the reporting date. Interest on the impaired asset continues to be recognised through the unwinding of the discount. Impairment losses are recognised in the Consolidated Statement of Comprehensive Income. When subsequent events cause the amount of impairment loss to decrease, the decrease in impairment loss is reversed through the Consolidated Statement of Comprehensive Income.
Non-financial assets The carrying amounts of the Group's non-financial assets, other than stocks, 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 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 An impairment loss is recognised if the carrying amount of an asset exceeds its estimated recoverable amount. Impairment losses are recognised in the Consolidated Statement of Comprehensive Income. An impairment loss is reversed if and only if the reasons for the impairment have ceased to apply. Impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. The Directors consider that the following are critical account judgements in applying the Group's accounting policies. Carrying value of stocks One key source of estimation uncertainty at the balance sheet date relates to the carrying value of stock and work in progress. Management continually assesses the recoverability of its assets in light of customer demand.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
3.Judgements in applying accounting policies (continued)
The Directors have assessed the period over which the negative goodwill which has arisen on business combinations during the year should be released. A review of the non-monetary assets which were acquired as part of the business combination, which were tangible fixed assets and stocks, was performed and the Directors have made an appropriate assessment as to the value of non-monetary assets which have been recovered up to the balance sheet date and have calculated the amount of negative goodwill which should be released up to the year end. The Directors continue to assess the period over which the non-monetary assets will be recovered and will make appropriate judgements in future periods.
The whole of the turnover is attributable to the principal activity of the Group.
Analysis of turnover by country of destination:
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
10.Taxation (continued)
The Group has estimated tax losses carried forward of £100,467,000 (2023: £99,885,000) which are expected to offset against future trading profits of the Group.
There is an estimated unrecognised deferred tax asset of £27,106,000 (2023: £27,399,000) which will be recognised when the directors foresee future taxable profits.
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of comprehensive income in these financial statements. The loss after tax of the parent Company for the year/period was £
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
Page 27
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
Page 30
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
In the prior year, other loans include the principal amount of £1,000,000 which is repayable on 27 October 2024, net of the remaining £150,000 unamortised loan arrangement fee which has been capitalised and is being released over the term of the loan. Other loans are secured by fixed and floating charges over the assets of the Group.
Obligations under finance leases and hire purchase contracts are secured against the assets to which they relate.
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
Page 32
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
23.Share capital (continued)
During the year the Company issued 1,778 B Ordinary shares with a nominal value per share of £0.0001 with an aggregate nominal value of £0.18. The consideration received was £14,242 with the difference between the nominal value and the amount paid being treated as share premium. The Company also subdivided 480 A Ordinary Shares with a nominal value of £0.0001 each into 480 A1 Ordinary Shares with a nominal value of £0.0001 each.
Share premium account
Profit and loss account
The Group operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £806,000 (2023: £384,000). Contributions totaling £71,000 (2023: £64,000) were payable to the fund at the balance sheet date and are included in accruals.
The Company has given a guarantee, supported by a debenture, in relation to the amounts owed by Trac Precision Solutions Limited on its invoice financing facilities. The amount guaranteed at 30 April 2024 amounted to £901,000 (2023: £1,611,000).
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TRAC HOLDINGS LIMITED (FORMERLY RCAP ELEVEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
During the period amounts paid to the Group's key management personnel in relation to their services totalled £204,000 (2023: £115,000).
The ultimate controlling party is RCapital Limited by virtue of its majority holding of the issued share capital of Trac Holdings Limited (formerly Rcap Eleven Limited).
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