Company registration number 12718911 (England and Wales)
H E SIMM HOLDINGS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023
H E SIMM HOLDINGS LIMITED
COMPANY INFORMATION
Directors
Mr G Simm
Mr G M Simm
Mr M R Simm
Mrs V Brereton
Company number
12718911
Registered office
Spinnaker House
141 Sefton Street
Liverpool
Merseyside
L8 5SN
Auditor
Mitchell Charlesworth (Audit) Limited
5 Temple Square
Temple Street
Liverpool
L2 5RH
H E SIMM HOLDINGS LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 6
Independent auditor's report
7 - 10
Group statement of comprehensive income
11
Group and company balance sheets
12 - 13
Group statement of changes in equity
14
Company statement of changes in equity
15
Group statement of cash flows
16
Notes to the financial statements
17 - 35
H E SIMM HOLDINGS LIMITED
STRATEGIC REPORT
FOR THE PERIOD ENDED
31 DECEMBER 2023
31 December 2023
- 1 -

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

 

Introduction and business review

The group results reflect the trade of H E Simm Group Limited, H E Simm & Son Limited, HESIS Limited and Sheq-Aspen Thorn Limited.

 

During the reporting period, the group changed its accounting reference date to 31 December. These financial statements cover a 17-month period ending 31 December 2023.

 

The main trading subsidiary in the group is HE Simm & Son Limited, which has recorded a loss before taxation of £10.3m (2022: profit £0.9) for the extended financial period ending 31 December 2023. This company was significantly impacted by high inflationary pressures on fixed price contracts, whilst also experiencing performance issues on a number of legacy projects located in London. The loss was partially offset by profits generated in HESIS Limited and Sheq-Aspen Thorn Limited during the period.

 

During the period, the Directors' and their family converted outstanding loans due to them amounting to £2.1m into share capital to recapitalise the group balance sheet.

 

In addition, the Directors and their family transferred a separately owned investment property company, HES Property Company Limited, into the group through a share for share exchange on 31 December 2023 to further strengthen the group balance sheet. This company owns investment property which was valued at £4.58m and had net assets totalling £1.86m at the period end.

 

The property investments are being sold to inject £4m of cash into the group in 2024. So far, £2.5m has been received and a further £1.5m is expected to be received before the end of 2024. The remaining mortgage debt on these properties which was transferred into the group following the share for share exchange will be settled in 2024 as the properties are sold, with the group having no exposure to bank debt at this point.

 

Trading performance for the 8 months to 31 August 2024 shows a significant improvement and a return to profitability for the group. The directors have produced forecasts to 31 December 2025 which show continued profitability during the financial years ended 31 December 2024 and 31 December 2025. The group consolidated balance sheet has returned to a positive net asset position following the year end with further increases in net assets forecast at the end of the financial years ended 31 December 2024 and 31 December 2025.

 

The key financial and other performance indicators during the year were as follows:

17 months ended                 31 December 2023
12 months ended         31 July 2022
£'000
£'000
Turnover
133,658
66,106
Operating (loss)/profit
(10,440)
925
(Loss)/profit after tax
(8,423)
685
Shareholders' funds
(728)
3,711
Current assets % current liabilities
84%
115%
Average number of employees
345
370
H E SIMM HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 2 -
Principal activities

The principal activity of the company continued to be that of a holding company.

 

The principal activity of the group included that of the provision of engineering services to the construction industry, the installation and testing of advanced fire, security and monitoring systems, along with mechanical and electrical maintenance, and the provision of health and safety training and consultancy services.

 

The group has a class leading reputation for delivering its services and projects responsibly and sustainably. Through building exceptional client relationships, consistently delivering high performance, the business has a strong forward order book and a robust pipeline of future opportunities across a balanced portfolio of resilient sectors.

Principal risks and uncertainties

Health and Safety

There are many inherent risks for all companies currently operating in the contractor sector of the construction industry however, health and safety remains a primary and constant focus for the company. Our zero tolerance attitude to poor health and safety behaviours enables us to influence our workforce, customers and supply chain, through positive leadership, to act in a way that prioritises safety. This is bound by our Safety Comes First initiative, where nothing we do is worth getting hurt for, no matter how urgent or important it may be.

 

Market Conditions

During the reporting period the operating environment of the group's main subsidiary, H E Simm & Son Limited, has experienced significant levels of hyperinflation and shortages of materials and labour. As this company typically contracts on a fixed price basis this has had a significant impact on performance and profitability of the business. We have learnt from this experience and have adjusted our strategy accordingly.

 

A strategic restructuring of the business has now been implemented leading to a streamlining of management structures and reporting processes, a more selective approach to tendering and a strong focus on working capital management. Rigorous management reviews have been undertaken to ensure any operational performance issues have been identified and recognised.

 

The directors manage risk associated with general market conditions through regular meetings of senior management. The company has rigid financial and operational controls and robust governance supported by an overarching integrated management system containing frameworks of policies and procedures designed to manage and minimise avoidable risk. Alongside these policies and procedures sits the company’s matrix which defines responsibility levels for delegated authority, when key decisions or approvals to take certain actions are required.

 

Financial instruments

We do not actively use financial instruments as part of our financial risk management and we are not exposed to foreign exchange risk. We are subject to the usual credit and cash flow risks associated with selling on credit and we manage this through credit control procedures.

Development and performance

The strategic actions taken during the period mean that the group is now well positioned to return to profitability. Our focus will be on de-risking the business by targeting quality work winning opportunities, with customers who we trust and have long-term relationships with, in sectors where we have a clear customer advantage and a proven track record of delivery. However, this selectivity will initially result in lower levels of turnover but with improved profitability.

Key performance indicators

The group uses conventional forms of working capital to finance its day to day activities and as such the figures appearing in the accounts reflect the absolute value of amounts recoverable and payable.

H E SIMM HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 3 -
Directors' duties

As directors, we have a legal responsibility under section 172 of the Companies Act 2006 to act in the way we consider, in good faith, will be most likely to promote the group’s success for the benefit of its members as a whole, having regard to the long-term effect of our decisions on the group and its stakeholders. This statement outlines how we deliver this responsibility.

Promoting the group's success for its members

The oldest trading subsidiary in the group, H E Simm & Son Limited, was established in 1948. We therefore have a proud heritage and a proven track record of achievement that has seen the group go from strength to strength. Whilst the group has changed significantly over the years, our focus has always been on safety, delivering outstanding levels of performance and customer satisfaction.

 

We make strategic decisions aligned to our long-term objectives. Recent years have seen us investing significantly in resources that enable us to deliver high-quality, innovative solutions and efficiencies for our customers.

 

Moving forward, we need to ensure that our size aligns to our pipeline while enabling us to continue delivering exceptional project quality. We will continue to seek profitable business in our core markets through established client relationships.

We remain strongly focused at all times on maintaining exceptional relationships with our group’s key stakeholders: our employees, customers, suppliers and within the communities in which we operate.

 

Our talented workforce

We rely on skilled teams throughout HE Simm Group. The recruitment, development and retention of staff is business-critical. We engage all colleagues by rewarding performance, developing individuals by providing training and support. We also ensure that all team members participate and collaborate in business activities.

 

Mental and physical wellbeing continues to be an important part of our people policy, and we operate a number of initiatives to support our talented team.

 

Our customers and suppliers

We continually invest in innovation to deliver continuous improvement and a high-quality, efficient service, under agreed project terms. Honesty and integrity are key to the strong, positive relationships we build with our customers, which is reflected in the fact that the majority of our work is repeat business. We maintain a reputation for transparency and fair dealing in our interaction with both customers and suppliers.

 

Our community

As a family-owned-and-run company we have invested in our community since we were established. We constantly monitor and review how we can best support the areas in which we operate through practical projects and charitable initiatives. This focus has expanded in recent times to ensure we look after those around us in all operating regions From a wider perspective, we are always mindful of, and aim to minimise, the impact of our work on the environment.

On behalf of the board

Mr G Simm
Director
29 October 2024
H E SIMM HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 4 -

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

Results and dividends

The results for the year are set out on page 11.

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

No preference dividends were paid. The directors do not recommend payment of a final dividend.

Directors

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

Mr G Simm
Mr G M Simm
Mr M R Simm
Mrs V Brereton
Disabled persons

Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the group continues and that the appropriate training is arranged. It is the policy of the group that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.

Employee involvement

The group's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.

 

Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the group's performance.

 

There is no employee share scheme at present, but the directors are considering the introduction of such a scheme as a means of further encouraging the involvement of employees in the company's performance.

Auditor

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

Streamlined energy and carbon report
2023
Energy consumption
kWh
Aggregate of energy consumption in the year
4,281,129
H E SIMM HOLDINGS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 5 -
2023
Emissions of CO2 equivalent
metric tonnes
Scope 1 - direct emissions
- Gas combustion
415.71
- Fuel consumed for owned transport
-
415.71
Scope 2 - indirect emissions
- Electricity purchased
42.74
Total gross emissions
458.45
Intensity ratio
Tonnes CO2e per employee
1.76
Quantification and reporting methodology

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

Intensity measurement

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

Measures taken to improve energy efficiency

HE Simm have undertaken the following energy efficiency actions during the financial reporting period:

 

H E SIMM HOLDINGS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 6 -
Statement of directors' responsibilities

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

 

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

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Strategic report

The truegroup has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the group's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 is noted in the strategic report on page 1.

Statement of disclosure to auditor

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

On behalf of the board
Mr G Simm
Director
29 October 2024
H E SIMM HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF H E SIMM HOLDINGS LIMITED
- 7 -
Opinion

We have audited the financial statements of H E Simm Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the period ended 31 December 2023 which comprise the group statement of comprehensive income, the group balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

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

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

H E SIMM HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF H E SIMM HOLDINGS LIMITED
- 8 -
Matters on which we are required to report by exception

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

 

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

Responsibilities of directors

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

Auditor's responsibilities for the audit of the financial statements

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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

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

We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.

H E SIMM HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF H E SIMM HOLDINGS LIMITED
- 9 -

Identifying and assessing potential risks related to irregularities

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:

 

As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas:

 

(i) The presentation of the Profit and Loss Account, (ii) the accounting policy for revenue recognition (iii) amounts recoverable on long term contracts, (iv) understatement of creditors. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.

 

We also obtained an understanding of the legal and regulatory framework that the company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act.

 

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the company’s ability to operate or to avoid a material penalty.

Audit reponse to risks identified

Our procedures to respond to risks identified included the following:

 

 

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

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.

H E SIMM HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF H E SIMM HOLDINGS LIMITED
- 10 -

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.

Adam McGowan
For and on behalf of
29 October 2024
Mitchell Charlesworth (Audit) Limited
Accountants
Statutory Auditor
5 Temple Square
Temple Street
Liverpool
L2 5RH
H E SIMM HOLDINGS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 11 -
Period
Year
ended
ended
31 December
31 July
2023
2022
Notes
£
£
Turnover
3
133,657,502
66,106,112
Cost of sales
(127,092,259)
(55,449,529)
Gross profit
6,565,243
10,656,583
Administrative expenses
(17,320,192)
(9,773,896)
Other operating income
314,619
42,568
Operating (loss)/profit
4
(10,440,330)
925,255
Interest receivable and similar income
8
598,259
454
Interest payable and similar expenses
9
63,617
(101,623)
(Loss)/profit before taxation
(9,778,454)
824,086
Tax on (loss)/profit
10
1,354,772
(139,545)
(Loss)/profit for the financial period
(8,423,682)
684,541
Total comprehensive income for the period is attributable to:
- Owners of the parent company
(8,462,320)
662,919
- Non-controlling interests
38,638
21,622
(8,423,682)
684,541
H E SIMM HOLDINGS LIMITED
GROUP AND COMPANY BALANCE SHEETS
AS AT
31 DECEMBER 2023
31 December 2023
- 12 -
Group
Group
Company
Company
31 December
31 July
31 December
31 July
2023
2022
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
11
770,747
948,153
-
0
-
0
Negative goodwill
11
(454,944)
(543,407)
-
0
-
0
Net goodwill
315,803
404,746
-
-
Other intangible assets
11
74,206
-
-
-
Total intangible assets
390,009
404,746
-
-
Tangible assets
12
427,121
591,711
-
0
-
0
Investment property
13
4,580,000
-
0
-
0
-
0
Investments
14
-
0
-
0
1,980
980
5,397,130
996,457
1,980
980
Current assets
Stocks
16
84,524
147,804
-
-
Debtors
17
21,598,868
23,040,718
3,495,621
2,478,899
Cash at bank and in hand
3,893,096
7,264,227
9,492
-
0
25,576,488
30,452,749
3,505,113
2,478,899
Creditors: amounts falling due within one year
18
(30,445,641)
(26,538,252)
(1,577,321)
(1,405,137)
Net current (liabilities)/assets
(4,869,153)
3,914,497
1,927,792
1,073,762
Total assets less current liabilities
527,977
4,910,954
1,929,772
1,074,742
Creditors: amounts falling due after more than one year
19
(1,143,321)
(1,099,081)
-
(1,071,842)
Provisions for liabilities
Deferred tax liability
22
(113,500)
(101,100)
-
0
-
0
Net assets
(728,844)
3,710,773
1,929,772
2,900
Capital and reserves
Called up share capital
24
1,524,425
1,000
1,524,425
1,000
Other reserves
3,997,062
2,136,422
732
-
0
Profit and loss reserves
(6,935,064)
1,527,256
404,615
1,900
Equity attributable to owners of the parent company
(1,413,577)
3,664,678
1,929,772
2,900
Non-controlling interests
684,733
46,095
-
-
(728,844)
3,710,773
1,929,772
2,900
H E SIMM HOLDINGS LIMITED
GROUP AND COMPANY BALANCE SHEETS (CONTINUED)
AS AT
31 DECEMBER 2023
31 December 2023
- 13 -

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £402,715 (2022 - £5,800 profit).

The financial statements were approved by the board of directors and authorised for issue on 29 October 2024 and are signed on its behalf by:
29 October 2024
Mr G Simm
Director
Company registration number 12718911 (England and Wales)
H E SIMM HOLDINGS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 14 -
Share capital
Other reserves
Profit and loss reserves
Total controlling interest
Non-controlling interest
Total
Notes
£
£
£
£
£
£
Balance at 1 August 2021
1,000
2,136,422
864,337
3,001,759
96,473
3,098,232
Year ended 31 July 2022:
Profit and total comprehensive income
-
-
662,919
662,919
21,622
684,541
Dividends
-
-
-
-
(72,000)
(72,000)
Balance at 31 July 2022
1,000
2,136,422
1,527,256
3,664,678
46,095
3,710,773
Period ended 31 December 2023:
Loss and total comprehensive income
-
-
(8,462,320)
(8,462,320)
38,638
(8,423,682)
Issue of share capital
24
1,523,425
-
-
1,523,425
-
1,523,425
Merger reserve
-
1,859,908
-
1,859,908
-
1,859,908
Other movements
-
732
-
732
600,000
600,732
Balance at 31 December 2023
1,524,425
3,997,062
(6,935,064)
(1,413,577)
684,733
(728,844)
H E SIMM HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 15 -
Share capital
Other reserves
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 August 2021
1,000
-
(3,900)
(2,900)
Year ended 31 July 2022:
Profit and total comprehensive income for the year
-
-
5,800
5,800
Balance at 31 July 2022
1,000
-
1,900
2,900
Period ended 31 December 2023:
Profit and total comprehensive income
-
-
402,715
402,715
Issue of share capital
24
1,523,425
-
-
1,523,425
Other movements
-
732
-
732
Balance at 31 December 2023
1,524,425
732
404,615
1,929,772
H E SIMM HOLDINGS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 16 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
27
(3,275,199)
1,481,647
Interest paid
(6,307)
(101,623)
Income taxes refunded
3,851
442,193
Net cash (outflow)/inflow from operating activities
(3,277,655)
1,822,217
Investing activities
Purchase of intangible assets
(76,375)
-
Purchase of tangible fixed assets
(205,954)
(440,453)
Proceeds from disposal of tangible fixed assets
41,121
-
Payment of loans
(39,608)
38,000
Interest received
51,226
454
Cash received on business combinations
238,076
-
Net cash generated from/(used in) investing activities
8,486
(401,999)
Financing activities
Payment of finance leases obligations
(101,962)
(96,580)
Dividends paid to non-controlling interests
-
0
(72,000)
Net cash used in financing activities
(101,962)
(168,580)
Net (decrease)/increase in cash and cash equivalents
(3,371,131)
1,251,638
Cash and cash equivalents at beginning of period
7,264,227
6,012,589
Cash and cash equivalents at end of period
3,893,096
7,264,227
H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 17 -
1
Accounting policies
Company information

H E Simm Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Spinnaker House, 141 Sefton Street, Liverpool, Merseyside, L8 5SN.

 

The group consists of H E Simm Holdings Limited and all of its subsidiaries as detailed in the note 15.

1.1
Accounting convention

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

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

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

1.2
Business combinations

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

 

On 31 December 2023, the group acquired the entire issued share capital of HES Property Company Limited though a share for share exchange. This was accounted for as a group reconstruction as the ultimate owners remained the same following the reconstruction. The merger accounting method has been used to introduce the carrying value of assets and liabilities of HES Property Company Limited into the consolidated financial statements at 31 December 2023. The difference between the nominal value of shares issued and the net assets acquired is recognised as a merger reserve.

1.3
Basis of consolidation

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

 

All financial statements are made up to 31 December 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

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

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

Upon acquisition of subsidiaries in which there is no monetary consideration, other reserves reflect the value of assets over liabilities acquired.

H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -
1.4
Going concern

The Board of Directors is required to consider the group's ability to continue as a going concern over a period of at least 12 months from the date of approval of the financial statements.

 

Following a difficult trading period arising due to the conditions noted in the strategic report, the group has incurred a loss before taxation of £9.8m (2022: profit £0.8m) during the extended period ended 31 December 2023. At the period end, the group had liabilities in excess of total assets of £0.7m.

 

Due to the losses, there was an inevitable tightening in liquidity and the group has had to manage its working capital carefully.

 

During the period, the Directors' and their family converted outstanding loans due to them amounting to £2.1m into share capital to recapitalise the group balance sheet.

 

In addition, the Directors and their family transferred a separately owned investment property company, HES Property Company Limited, into the group through a share for share exchange on 31 December 2023 to further strengthen the group balance sheet. This company owns investment property which was valued at £4.58m and had net assets totalling £1.86m at the period end.

 

The investment properties are being sold to inject £4m of cash into the group in 2024. So far, £2.5m has been received and a further £1.5m is expected to be received before the end of 2024. The remaining mortgage debt on these properties which was transferred into the group following the share for share exchange will be settled in 2024 as the properties are sold, with the group having no exposure to bank debt at this point.

 

Trading performance for the 8 months to 31 August 2024 shows a significant improvement and a return to profitability for the group. The directors have produced forecasts to 31 December 2025 which show continued profitability during the financial years ended 31 December 2024 and 31 December 2025. The group consolidated balance sheet has returned to a positive net asset position following the year end with further increases in net assets forecast at the end of the financial years ended 31 December 2024 and 31 December 2025.

 

As various legacy projects come to an end and with the cash injection noted above, the liquidity challenge is easing and the outlook for working capital is substantially improved.

 

As a result, the Board is satisfied that the company and Group has sufficient financial resources to continue to operate for a period of at least 12 months and therefore has adapted the going concern basis in the preparation of the 2023 financial statements.

1.5
Turnover

 

Construction contracts

Turnover represents construction contracts with third parties as detailed in the 'Construction Contracts' accounting policy.

 

All other services

Revenue from contracts for the provision of services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The profit recognised reflects the proportion of work completed to date on the contract determined by reference to the proportion of the value of work completed to total contract value.

 

 

H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 19 -
1.6
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.

1.7
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

 

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

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

Software
10% straight line.
1.8
Tangible fixed assets

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

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

Leasehold improvements
20% straight line
Plant and equipment
20% straight line
Fixtures and fittings
15% reducing balance / 33% straight line
Computers
33% straight line
Motor vehicles
33% straight line

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

1.9
Investment property

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.

 

1.10
Fixed asset investments

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

 

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

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

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

1.11
Impairment of fixed assets

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

 

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

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

 

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

1.12
Stocks

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

1.13
Construction contracts

Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the reporting end date. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.

 

When it is probable that total contract costs will exceed total contract turnover, the expected loss is recognised as an expense immediately.

 

Where the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised to the extent of contract costs incurred where it is probable that they will be recoverable. Contract costs are recognised as expenses in the period in which they are incurred. When costs incurred in securing a contract are recognised as an expense in the period in which they are incurred, they are not included in contract costs if the contract is obtained in a subsequent period.

The “percentage of completion method” is used to determine the appropriate amount to recognise in a given period. The stage of completion is measured by the proportion of contract costs incurred for work performed to date compared to the estimated total contract costs. Costs incurred in the year in connection with future activity on a contract are excluded from contract costs in determining the stage of completion. These costs are presented as stocks, prepayments or other assets depending on their nature, and provided it is probable they will be recovered.

H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 21 -
1.14
Cash and cash equivalents

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

1.15
Financial instruments

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

 

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

 

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

Basic financial assets

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

Other financial assets

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

Impairment of financial assets

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

 

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

 

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

Derecognition of financial assets

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

H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 22 -
Classification of financial liabilities

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

Basic financial liabilities

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

 

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

 

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

Derecognition of financial liabilities

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

1.16
Equity instruments

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

1.17
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

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

 

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

H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 23 -
1.18
Employee benefits

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

 

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

 

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

1.19
Retirement benefits

The group operates a number of defined contribution pension schemes and the pension charge represents the amounts payable by the group to the funds in respect of the year.

1.20
Leases

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

 

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

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

1.21
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.

1.22
Foreign exchange

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

2
Judgements and key sources of estimation uncertainty

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

 

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

H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 24 -
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Provision of services
133,657,502
66,106,112
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
133,657,502
66,106,112
2023
2022
£
£
Other revenue
Interest income
598,259
454
Grants received
-
42,568
4
Operating (loss)/profit
2023
2022
£
£
Operating (loss)/profit for the period is stated after charging/(crediting):
Research and development costs
-
(8,817)
Government grants
-
(42,568)
Depreciation of owned tangible fixed assets
335,114
230,398
Profit on disposal of tangible fixed assets
(5,691)
-
Amortisation of intangible assets
91,112
62,783
Operating lease charges
781,970
732,830
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
4,500
4,200
Audit of the financial statements of the company's subsidiaries
42,500
16,800
47,000
21,000
For other services
All other non-audit services
9,800
9,300
H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 25 -
6
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Direct labour
260
277
-
-
Administration
80
89
-
-
Directors
3
4
4
4
Total
343
370
4
4

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
25,761,218
17,112,632
-
0
-
0
Social security costs
2,844,775
1,941,190
-
-
Pension costs
1,449,442
899,299
-
0
-
0
30,055,435
19,953,121
-
0
-
0
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
481,271
461,188
Company pension contributions to defined contribution schemes
61,968
52,890
543,239
514,078
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
163,759
104,360
Company pension contributions to defined contribution schemes
16,811
10,000
H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
7
Directors' remuneration
(Continued)
- 26 -

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

8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
51,226
454
Other interest income
547,033
-
Total income
598,259
454
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
51,226
454
9
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
608
-
Other interest on financial liabilities
(69,255)
91,012
(68,647)
91,012
Other finance costs:
Interest on finance leases and hire purchase contracts
5,030
10,611
Total finance costs
(63,617)
101,623
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
-
0
100,368
Adjustments in respect of prior periods
(94,315)
(43,623)
Total current tax
(94,315)
56,745
H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
10
Taxation
2023
2022
£
£
(Continued)
- 27 -
Deferred tax
Origination and reversal of timing differences
(1,260,457)
82,800
Total tax (credit)/charge
(1,354,772)
139,545

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

2023
2022
£
£
(Loss)/profit before taxation
(9,778,454)
824,086
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 25.00% (2022: 19.00%)
(2,444,614)
156,576
Tax effect of expenses that are not deductible in determining taxable profit
18,000
19,742
Unutilised tax losses carried forward
1,166,157
-
0
Under/(over) provided in prior years
(94,315)
(43,623)
Effect of changes in deferred tax rate
-
0
6,850
Taxation (credit)/charge
(1,354,772)
139,545
11
Intangible fixed assets
Group
Goodwill
Negative goodwill
Software
Total
£
£
£
£
Cost
At 1 August 2022
1,252,278
(624,448)
-
0
627,830
Additions
-
0
-
0
76,375
76,375
At 31 December 2023
1,252,278
(624,448)
76,375
704,205
Amortisation and impairment
At 1 August 2022
304,125
(81,041)
-
0
223,084
Amortisation charged for the period
177,406
(88,463)
2,169
91,112
At 31 December 2023
481,531
(169,504)
2,169
314,196
H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
11
Intangible fixed assets
(Continued)
- 28 -
Carrying amount
At 31 December 2023
770,747
(454,944)
74,206
390,009
At 31 July 2022
948,153
(543,407)
-
0
404,746
The company had no intangible fixed assets at 31 December 2023 or 31 July 2022.
12
Tangible fixed assets
Group
Leasehold improvements
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 August 2022
86,996
208,607
331,138
11,943
343,665
982,349
Additions
-
0
59,593
146,361
-
0
-
0
205,954
Disposals
-
0
-
0
-
0
-
0
(89,995)
(89,995)
Business combinations
-
0
-
0
119,231
-
0
-
0
119,231
At 31 December 2023
86,996
268,200
596,730
11,943
253,670
1,217,539
Depreciation and impairment
At 1 August 2022
34,026
42,046
162,124
3,783
148,659
390,638
Depreciation charged in the period
24,015
74,864
148,878
3,853
83,504
335,114
Eliminated in respect of disposals
-
0
-
0
-
0
-
0
(54,565)
(54,565)
Business combinations
-
0
-
0
119,231
-
0
-
0
119,231
At 31 December 2023
58,041
116,910
430,233
7,636
177,598
790,418
Carrying amount
At 31 December 2023
28,955
151,290
166,497
4,307
76,072
427,121
At 31 July 2022
52,970
166,561
169,014
8,160
195,006
591,711
The company had no tangible fixed assets at 31 December 2023 or 31 July 2022.
H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 29 -
13
Investment property
Group
Company
2023
2023
£
£
Fair value
At 1 August 2022
-
-
Business combinations
4,580,000
-
At 31 December 2023
4,580,000
-

Investment properties held by the company have been valued on an open market value basis during the period ended 31 December 2023 by Bruton Knowles, being surveyors and property consultants,

14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
15
-
0
-
0
1,980
980
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 August 2022
980
Additions
1,000
At 31 December 2023
1,980
Carrying amount
At 31 December 2023
1,980
At 31 July 2022
980
15
Subsidiaries
H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
15
Subsidiaries
(Continued)
- 30 -
Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
H E Simm & Son Limited
England and Wales
The provision of engineering services to the construction industry
Ordinary
100.00
HESIS Limited
England and Wales
The installation and testing of advanced fire, security and monitoring systems, along with mechanical and electrical maintenance and related small works.
Ordinary
80.00
HES Property Company Limited
England and Wales
The letting of property
Ordinary
100.00
H E Simm Group Limited
England and Wales
A holding company and the management of group entities
Ordinary
100.00
Sheq-Aspen Thorn Limited
England and Wales
The provision of health and safety training and consultancy services
Ordinary
100.00
16
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Raw materials and consumables
-
63,280
-
-
Finished goods and goods for resale
84,524
84,524
-
0
-
0
84,524
147,804
-
-
17
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
1,726,192
1,669,813
-
0
-
0
Gross amounts owed by contract customers
11,132,046
14,647,555
-
0
-
0
Corporation tax recoverable
14,013
17,242
-
0
-
0
Amounts owed by group undertakings
-
-
1,861,754
2,477,899
Other debtors
6,547,949
6,343,723
1,633,867
1,000
Prepayments and accrued income
943,811
362,385
-
0
-
0
20,364,011
23,040,718
3,495,621
2,478,899
Deferred tax asset (note 22)
1,234,857
-
0
-
0
-
0
21,598,868
23,040,718
3,495,621
2,478,899
H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 31 -
18
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans
20
138,656
-
0
-
0
-
0
Obligations under finance leases
21
-
0
74,723
-
0
-
0
Trade creditors
19,290,982
15,173,338
-
0
-
0
Amounts owed to group undertakings
-
0
-
0
1,563,617
-
0
Corporation tax payable
13,368
107,061
-
0
-
0
Other taxation and social security
1,414,011
978,646
-
-
Other creditors
1,260,215
2,955,318
980
1,397,037
Accruals and deferred income
8,328,409
7,249,166
12,724
8,100
30,445,641
26,538,252
1,577,321
1,405,137
19
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans
20
1,143,321
-
0
-
0
-
0
Obligations under finance leases
21
-
0
27,239
-
0
-
0
Other creditors
-
0
1,071,842
-
0
1,071,842
1,143,321
1,099,081
-
1,071,842
20
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
1,281,977
-
0
-
0
-
0
Payable within one year
138,656
-
0
-
0
-
0
Payable after one year
1,143,321
-
0
-
0
-
0

The long-term loans represent amounts brought into the group from the business combinations with HES Property Company Limited. The mortgages are secured by fixed charges over a number of freehold and leasehold investment properties held by the group.

 

H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 32 -
21
Finance lease obligations
Group
Company
2023
2022
2023
2022
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
-
0
74,723
-
0
-
0
In two to five years
-
0
27,239
-
0
-
0
-
101,962
-
-

 

22
Deferred taxation

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

Liabilities
Liabilities
Assets
Assets
2023
2022
2023
2022
Group
£
£
£
£
Accelerated capital allowances
75,500
119,100
-
-
Tax losses
-
-
1,234,857
-
Business combinations
38,000
-
-
-
Short term timimg differences
-
(18,000)
-
-
113,500
101,100
1,234,857
-
The company has no deferred tax assets or liabilities.
Group
Company
2023
2023
Movements in the period:
£
£
Liability at 1 August 2022
101,100
-
Credit to profit or loss
(1,260,457)
-
Business combinations
38,000
-
Asset at 31 December 2023
(1,121,357)
-
H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 33 -
23
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
1,449,442
899,299

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

24
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
1,080
1,000
1,080
1,000
A Ordinary of £1 each
188
-
188
-
1,268
1,000
1,268
1,000
2023
2022
2023
2022
Preference share capital
Number
Number
£
£
Issued and fully paid
Preference of £1 each
1,523,157
-
1,523,157
-
Preference shares classified as equity
1,523,157
-
Total equity share capital
1,524,425
1,000
25
Operating lease commitments
Lessee

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

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
58,942
449,546
-
-
Between two and five years
216,550
1,262,380
-
-
In over five years
-
223,010
-
-
275,492
1,934,936
-
-
H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 34 -
26
Related party transactions
Transactions with related parties

HES Property Company Limited

HES Property Company Limited is a company in which Mr. G A Simm, Mr. G M Simm, Mr. M R Simm, Mrs. V Brereton, Mr. A Simm, Mr G Simm and Mrs J Simm were shareholders prior to a share for share exchange with H E Simm Holdings Limited on 31 December 2024, and in which Mr. G.A. Simm and Mr. M R Simm are directors.

 

During the period ended 31 December 2023 the group paid rent of £162,260 (31 July 2022 - £108,184), and received interest of £273,361 (31 July 2022 £nil).

 

At the period end the group was owed £1,728,359 (31 July 2022 – £224,556) by HES Property Company Limited.

 

Cu-Plas Supplies Limited

Cu-Plas Supplies Limited is a company in which Mr. G A Simm, Mr. G M Simm, Mr. M R Simm and Mrs. V Brereton, have an interest as shareholders in the parent company Alma Supplies Limited.

 

During the period ended 31 December 2023 the group made purchases of £4,641,298 (31 July 2022 - £1,707,572), recharged costs of £31,706 (31 July 2022 £45,582) and a management charge of £129,397 (31 July 2022 £Nil).

 

At the period end the company owed £764,380 (31 July 2022 – £534,234) to Cu-Plas Supplies Limited.

 

Cu-Plas Supplies (Manchester) Limited

Cu-Plas Supplies (Manchester) Limited is a company in which Mr. G A Simm, Mr. G M Simm, Mr. M R Simm and Mrs. V Brereton, have an interest as shareholders in the parent company Alma Supplies Limited.

 

During the period ended 31 December 2023 the group made purchases of £680,833 (31 July 2022 - £17,519), and recharged costs of £2,983 (31 July 2022 £2,684).

 

At the period end the company owed £185,178 (31 July 2022 – £3,494) to Cu-Plas Supplies Limited.

 

Alma Supplies Limited

Alma Supplies Limited is a company in which Mr. G A Simm is a director, and Mr. G M Simm, Mr. M R Simm and Mrs. V Brereton, have an interest as shareholders.

 

At the period end the group was owed £1,132,587 (31 July 2022 – £588,967) from Alma Supplies Limited.

 

HES Developments Limited

HES Developments Limited is a company in which Mr. G A Simm, Mr. G M Simm, Mr. M R Simm and Mrs. V Brereton, are directors and shareholders.

 

At the period end the group was owed £566,173 (31 July 2022 – £Nil) from HES Developments Limited.

 

HES Investments Limited

HES Investments Limited is a company in which Mr. G A Simm, Mr. G M Simm, Mr. M R Simm and Mrs. V Brereton, are directors and shareholders.

 

At the period end the group was owed £1,517 (31 July 2022 – £Nil) from HES Developments Limited.

 

Teknikal Design Solutions Limited

Teknikal Design Solutions Limited is a company in which Mr. G A Simm, Mr. G M Simm, Mr. M R Simm are directors and shareholders and Mrs. V Brereton, has an interest as a shareholder.

 

At the period end the group owed £855 (31 July 2022 – £855) to Teknikal Design Solutions Limited.

 

H E SIMM HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023
- 35 -
27
Cash (absorbed by)/generated from group operations
2023
2022
£
£
(Loss)/profit for the period after tax
(8,423,682)
684,541
Adjustments for:
Taxation (credited)/charged
(1,354,772)
139,545
Finance costs
(63,617)
101,623
Investment income
(598,259)
(454)
Gain on disposal of tangible fixed assets
(5,691)
-
Amortisation and impairment of intangible assets
91,112
62,783
Depreciation and impairment of tangible fixed assets
335,114
230,398
Movements in working capital:
Decrease/(increase) in stocks
63,280
(66,009)
Decrease/(increase) in debtors
1,567,535
(1,276,496)
Increase in creditors
5,113,781
1,605,716
Cash (absorbed by)/generated from operations
(3,275,199)
1,481,647
28
Analysis of changes in net funds - group
1 August 2022
Cash flows
Business combinations
31 December 2023
£
£
£
£
Cash at bank and in hand
7,264,227
(3,609,207)
238,076
3,893,096
Borrowings excluding overdrafts
-
-
(1,281,977)
(1,281,977)
Obligations under finance leases
(101,962)
101,962
-
-
7,162,265
(3,507,245)
(1,043,901)
2,611,119
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