Company Registration No. 07732524 (England and Wales)
SWYFT HOME LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024
LB GROUP
1 Vicarage Lane
Stratford
London
E15 4HF
SWYFT HOME LIMITED
COMPANY INFORMATION
Directors
K Hewkin
K Fazio
(Appointed 21 June 2024)
Company number
07732524
Registered office
376 London Road
High Wycombe
HP11 1LH
Auditor
LB Group Limited (Stratford)
1 Vicarage Lane
Stratford
London
E15 4HF
Bankers
HSBC UK Bank Plc
130 New Street
West Midlands
Birmingham
England
B2 4JU
Revolut Ltd
7 Westferry Circus
Canary Wharf
London
England
E14 4HD
SWYFT HOME LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Directors' responsibilities statement
5
Independent auditor's report
6 - 9
Profit and loss account
10
Balance sheet
12
Statement of changes in equity
13
Statement of cash flows
14
Notes to the financial statements
15 - 28
SWYFT HOME LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JANUARY 2024
- 1 -

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

Review of the business

The principal activity of Swyft Home Limited in the period under review is the design and retail of contemporary furniture and homeware accessories under the ‘Swyft’ brand name through its own online website and retail partners.

 

The company has shown a strong performance despite the reduced levels of profitability being driven by macro-economic factors led by the cost of living crisis. The directors are pleased with the performance of the company and feel it is well placed for growth in the future as economic pressures soften.

 

The retail market for upholstered furniture in the UK is highly competitive. The company’s success is therefore dependent on its ability to compete effectively, particularly during peak trading periods. The company continues to make substantial investments in marketing to maintain its leading brand status. This year, Swyft Home Limited continued to expand our online reach, tapping into emerging markets and optimising our digital platforms.

 

Next year, we will focus on growing our presence in emerging markets, expanding our product range, and strengthening our partner relationships. Since the year-end we have already launched our new ranges of dining and living room furniture and look to offer more products within this range as well as further products for other rooms within the home. We will continue to design and innovate our existing products such as sofas and beds. Another key focus for the year ahead is the improvement of our gross profit margin through streamlining of our manufacturing process and shortening the time it takes for goods to be delivered from date of ordering.

 

"Our mission is to make stylish, sustainable furniture accessible to all, revolutionising the way people shop for their homes online."

 

Strengths: Strong online presence, established customer base, and competitive pricing.

 

Weaknesses: High customer acquisition costs, historic high fixed costs.

 

Opportunities: Diversifying our product range, improving gross margin and reducing fixed costs.

 

Threats: Rising shipping costs and increasing competition.

 

Key Points: Clearly outline these points and address strategies to leverage strengths, mitigate weaknesses, and exploit opportunities.

 

Key performance indicators

The group uses a number of financial measures to monitor progress against strategies and corporate objectives.

These are summarised as follows

 

 

 

 

2024

 

2023

 

 

£

 

£

 

 

 

 

 

Turnover

 

22,348,604

 

21,066,902

Gross Profit

 

8,361,543

 

8,926,381

Gross Profit %

 

37.41%

 

42.37%

EBITDA

(4,962,883)

 

(2,523,960)

 

 

 

 

SWYFT HOME LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 2 -

On behalf of the board

K Hewkin
Director
30 October 2024
SWYFT HOME LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JANUARY 2024
- 3 -

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

Principal activities

The principal activity of the company during the year is that of an online furniture retailer.

Results and dividends

The results for the year are set out on page 10.

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

Directors

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

P Fielden
(Resigned 14 March 2024)
K Hewkin
K Fazio
(Appointed 21 June 2024)
Auditor

LB Group Limited (Stratford) were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.

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 company’s auditor 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 company’s auditor is aware of that information.

Fair review of the business

The principal activity of Swyft Home Limited in the period under review is the design and retail of contemporary furniture and homeware accessories under the ‘Swyft’ brand name through its own online website and retail partners.

 

The company has shown a strong performance despite the reduced levels of profitability being driven by macro-economic factors led by the cost of living crisis. The directors are pleased with the performance of the company and feel it is well placed for growth in the future as economic pressures soften.

 

The retail market for upholstered furniture in the UK is highly competitive. The company’s success is therefore dependent on its ability to compete effectively, particularly during peak trading periods. The company continues to make substantial investments in marketing to maintain its leading brand status. This year, Swyft Home Limited continued to expand our online reach, tapping into emerging markets and optimising our digital platforms.

 

Next year, we will focus on growing our presence in emerging markets, expanding our product range, and strengthening our partner relationships. Since the year-end we have already launched our new ranges of dining and living room furniture and look to offer more products within this range as well as further products for other rooms within the home. We will continue to design and innovate our existing products such as sofas and beds. Another key focus for the year ahead is the improvement of our gross profit margin through streamlining of our manufacturing process and shortening the time it takes for goods to be delivered from date of ordering.

 

"Our mission is to make stylish, sustainable furniture accessible to all, revolutionising the way people shop for their homes online."

Medium-sized companies exemption

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

SWYFT HOME LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 4 -
On behalf of the board
K Hewkin
Director
30 October 2024
SWYFT HOME LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 JANUARY 2024
- 5 -

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

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the 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 company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

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

SWYFT HOME LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SWYFT HOME LIMITED
- 6 -

Qualified opinion

We have audited the financial statements of Swyft Home Limited (the 'company') for the year ended 31 January 2024 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the 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, except for the effects of the matter described in the Basis for Qualified Opinion paragraph, the financial statements:

 

Basis for qualified opinion

As the company was unaudited in 2022, due to not requiring an audit, we were not appointed as auditor of the company until after 31 January 2022, and thus did not observe the counting of physical inventories at the end of the prior year. We were unable to satisfy ourselves by alternative means concerning the inventory quantities held at 31 January 2022, which are included in the balance sheet at £1,057,819, by using other audit procedures. Consequently we were unable to determine whether any adjustment to this amount was necessary.

 

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 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 qualified 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 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.

 

As described in the Basis for qualified opinion section of our report, our audit opinion is qualified for inventory quantities held as at 31 January 2022 and any adjustments to this amount.

SWYFT HOME LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SWYFT HOME LIMITED
- 7 -

Opinions on other matters prescribed by the Companies Act 2006

Except for the matter described in the Basis for qualified opinion section of our report, in our opinion, based on the work undertaken in the course of our audit:

 

Matters on which we are required to report by exception

In respect solely of the limitation on our work relating to stock, described above:

 

In respect solely of the limitation on our work relating to stock, described above:

 

 

In the light of the knowledge and understanding of the company and its 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 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 company or to cease operations, or have no realistic alternative but to do so.

SWYFT HOME LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SWYFT HOME LIMITED
- 8 -
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.

 

The extent to which the audit was considered capable of detecting irregularities including fraud

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

 

 

We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

 

 

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

 

 

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

 

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.

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.

SWYFT HOME LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SWYFT HOME LIMITED
- 9 -

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.

Richard Lane
Senior Statutory Auditor
For and on behalf of LB Group Limited (Stratford)
30 October 2024
Chartered Accountants
Statutory Auditor
1 Vicarage Lane
Stratford
London
E15 4HF
SWYFT HOME LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 JANUARY 2024
- 10 -
2024
2023
Notes
£
£
Turnover
3
22,348,604
21,066,902
Cost of sales
(13,987,061)
(12,140,521)
Gross profit
8,361,543
8,926,381
Distribution costs
(8,687,890)
(7,692,228)
Administrative expenses
(4,696,096)
(3,798,043)
Exceptional items
4
-
0
21,568,744
Exceptional items
4
-
0
(9,706,664)
Operating (loss)/profit
5
(5,022,443)
9,298,190
Interest receivable and similar income
8
-
0
2,132
Other interest payable and similar expenses
(663,089)
(466,674)
(Loss)/profit before taxation
(5,685,532)
8,833,648
Tax on (loss)/profit
9
-
0
-
0
(Loss)/profit for the financial year
(5,685,532)
8,833,648

The profit and loss account has been prepared on the basis that all operations are continuing operations.

SWYFT HOME LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JANUARY 2024
- 11 -
2024
2023
£
£
(Loss)/profit for the year
(5,685,532)
8,833,648
Other comprehensive income
-
-
Total comprehensive income for the year
(5,685,532)
8,833,648
SWYFT HOME LIMITED
BALANCE SHEET
AS AT 31 JANUARY 2024
31 January 2024
- 12 -
2024
2023
Notes
£
£
£
£
Fixed assets
Goodwill
10
76,107
82,204
Other intangible assets
10
205,400
195,888
Total intangible assets
281,507
278,092
Tangible assets
11
77,284
60,311
358,791
338,403
Current assets
Stocks
12
419,569
1,500,905
Debtors
13
1,938,683
3,860,349
Cash at bank and in hand
117,373
193,148
2,475,625
5,554,402
Creditors: amounts falling due within one year
14
(7,144,332)
(4,517,189)
Net current (liabilities)/assets
(4,668,707)
1,037,213
Net (liabilities)/assets
(4,309,916)
1,375,616
Capital and reserves
Called up share capital
17
97
97
Profit and loss reserves
(4,310,013)
1,375,519
Total equity
(4,309,916)
1,375,616

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

The financial statements were approved by the board of directors and authorised for issue on 30 October 2024 and are signed on its behalf by:
K Hewkin
Director
Company registration number 07732524 (England and Wales)
SWYFT HOME LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2024
- 13 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 February 2022
97
(7,458,129)
(7,458,032)
Year ended 31 January 2023:
Profit and total comprehensive income
-
8,833,648
8,833,648
Balance at 31 January 2023
97
1,375,519
1,375,616
Year ended 31 January 2024:
Loss and total comprehensive income
-
(5,685,532)
(5,685,532)
Balance at 31 January 2024
97
(4,310,013)
(4,309,916)
SWYFT HOME LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 JANUARY 2024
- 14 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
22
276,405
1,423,361
Interest paid
(663,090)
(308,323)
Net cash (outflow)/inflow from operating activities
(386,685)
1,115,038
Investing activities
Purchase of intangible assets
(38,957)
(111,850)
Proceeds from disposal of intangibles
-
0
17,537
Purchase of tangible fixed assets
(40,991)
(49,862)
Interest received
-
0
2,132
Net cash used in investing activities
(79,948)
(142,043)
Financing activities
Proceeds from borrowings
1,266,430
-
0
Repayment of bank loans
(875,572)
(799,005)
Net cash generated from/(used in) financing activities
390,858
(799,005)
Net (decrease)/increase in cash and cash equivalents
(75,775)
173,990
Cash and cash equivalents at beginning of year
193,148
19,158
Cash and cash equivalents at end of year
117,373
193,148
SWYFT HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024
- 15 -
1
Accounting policies
Company information

Swyft Home Limited is a private company limited by shares incorporated in England and Wales. The registered office is 376 London Road, High Wycombe, HP11 1LH.

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 £.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

 

 

The financial statements of the company are consolidated in the financial statements of Lombok Investments Limited. These consolidated financial statements are available from its registered office, 376 London Road, High Wycombe, England, HP11 1LH.

1.2
Going concern

During the year the company made a loss of £5,685,532 (2023: profits of £8,833,648) and had net liabilities of £7,144,332 (2023: net assets of £1,375,616).true

Subsequent to the year end, the company underwent a change in ownership in Spring 2024, with new investors committing substantial financial resources to fund operational restructuring.

The management, supported by the new investors, anticipates this restructuring will significantly increase the profitability and improve cash flows for the company from Autumn/Winter 2024.

Given these developments, management believes that the company’s financial stability is sufficiently assured to continue as a going concern.

1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (once the item has been shipped), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

SWYFT HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 16 -

Credit note provisions in relation to sales are recognised in the financial statements on a net profit basis taking into account the assessed gross profit margin relating to the item on return. The company recognises the full credit note to sales and adjustment to stock on the acceptance of the goods at its warehouse and the transfer of assets to its control.

1.4
Debtors

Trade debtors are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. Trade debtors are presented on the balance sheet at their net realisable value, which represents the gross amount of trade debtors less any provisions.

1.5
Research and development expenditure

Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.

1.6
Intangible fixed assets

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:

Patents & licences
10 Years Straight Line
Development costs
10 Years Straight Line
1.7
Tangible fixed assets

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

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

Plant and equipment
5 Years Straight Line
Computers
2 & 3 Years Straight Line
Motor vehicles
25% Reducing Balance

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 credited or charged to profit or loss.

1.8
Impairment of fixed assets

At each reporting period end date, the company 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.

SWYFT HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 17 -

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

 

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

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.9
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises of direct materials only.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

 

Stocks in transit are only recognised when risk and reward transfers and the passing of possession. There is no stocks is recognised where the seller remains liable for the asset’s performance.

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

1.10
Cash and cash equivalents

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

1.11
Financial instruments

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

 

Financial assets and liabilities are offset, with 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.

SWYFT HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 18 -
Other financial assets

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

Impairment of financial assets

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

 

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

 

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

Derecognition of financial assets

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

Classification of financial liabilities

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

Basic financial liabilities

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

 

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

 

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

SWYFT HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 19 -
Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.12
Equity instruments

Equity instruments issued by the company 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 company.

1.13
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.

1.14
Retirement benefits

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

1.15
Leases

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 leases asset are consumed.

1.16
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.

SWYFT HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 20 -
2
Judgements and key sources of estimation uncertainty

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

 

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

The most significant areas of estimation uncertainty are:

 

Provision for bad debt has been accounted by 15% of closing debtor balance as at 31 January 2024. The key assumptions take account of the management's expectations for the period. These expectations consider the industry and the market conditions, the experience in working with customers and any other circumstances particular to the customers, warranty and returns.

 

Warranty and returns are estimated by the directors by actual cost incurred till the reporting date. The director believes this is an immaterial number and has decided this is not to be recognised as a provision at the year end.

 

Management estimates that a portion of stock at the year end will be sold at lower than cost with amount of £200,000. This amount is made for impairment on the basis that any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss.

3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Retail
17,706,166
15,876,788
Trade
4,255,183
5,190,114
Other
387,255
-
22,348,604
21,066,902
2024
2023
£
£
Other revenue
Interest income
-
2,132
SWYFT HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 21 -
4
Exceptional items
2024
2023
£
£
Income
Intercompany write off - Lombok Retail Limited
-
(18,318,744)
Intercompany write off - Lombok Investments Limirted
-
(3,250,000)
-
(21,568,744)
Expenditure
Interest payable to related parties
-
5,503,543
Intercompany write off - Angora Furniture Manufacturing Unipessoal DLA
-
4,203,121
-
9,706,664

 

Intercompany write off in the comparative period is in relation to costs and debt written off in relation to a group debt restructure.

 

Related party interest in the comparative period includes an acceleration of interest under the terms of an agreement to convert debt due to the ultimate controlling party into share capital in the immediate parent company.

 

 

 

5
Operating (loss)/profit
2024
2023
Operating (loss)/profit for the year is stated after charging:
£
£
Exchange losses
30,398
84,559
Research and development costs
48,454
9,492
Fees payable to the company's auditor for the audit of the company's financial statements
26,500
25,000
Depreciation of owned tangible fixed assets
24,018
16,533
Amortisation of intangible assets
35,542
21,265
Operating lease charges
273,780
295,570
6
Employees

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

2024
2023
Number
Number
61
46
SWYFT HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
6
Employees
(Continued)
- 22 -

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
2,577,254
2,037,808
Social security costs
263,221
254,681
Pension costs
93,548
43,662
2,934,023
2,336,151
7
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
263,700
240,000
Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
131,850
120,000
8
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
-
0
2,132
9
Taxation

At 1 April 2023 the rate of UK corporation tax increased to 25%.

SWYFT HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
9
Taxation
(Continued)
- 23 -

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

2024
2023
£
£
(Loss)/profit before taxation
(5,685,532)
8,833,648
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
(1,421,383)
1,678,393
Tax effect of expenses that are not deductible in determining taxable profit
-
0
(1,678,393)
Unutilised tax losses carried forward
1,421,383
-
0
Taxation charge for the year
-
-
10
Intangible fixed assets
Patents
Development costs
Total
£
£
£
Cost
At 1 February 2023
108,992
227,853
336,845
Additions
4,970
33,987
38,957
At 31 January 2024
113,962
261,840
375,802
Amortisation and impairment
At 1 February 2023
26,788
31,965
58,753
Amortisation charged for the year
11,067
24,475
35,542
At 31 January 2024
37,855
56,440
94,295
Carrying amount
At 31 January 2024
76,107
205,400
281,507
At 31 January 2023
82,204
195,888
278,092

Patents relates to the acquisition of the trademark and intellectual property in relation to the company.

SWYFT HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 24 -
11
Tangible fixed assets
Plant and equipment
Computers
Motor vehicles
Total
£
£
£
£
Cost
At 1 February 2023
56,663
46,104
9,995
112,762
Additions
39,170
1,821
-
0
40,991
At 31 January 2024
95,833
47,925
9,995
153,753
Depreciation and impairment
At 1 February 2023
9,695
38,383
4,373
52,451
Depreciation charged in the year
15,811
6,801
1,406
24,018
At 31 January 2024
25,506
45,184
5,779
76,469
Carrying amount
At 31 January 2024
70,327
2,741
4,216
77,284
At 31 January 2023
46,968
7,721
5,622
60,311
12
Stocks
2024
2023
£
£
Finished goods and goods for resale
419,569
1,500,905

Stocks held are net of impairment of £200,000 (2023: £242,331).

13
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
699,739
1,131,224
Other debtors
591,337
383,832
Prepayments and accrued income
647,607
2,345,293
1,938,683
3,860,349

Included in other debtors is an amount due from a company with common directors of £140,566 (2023: £168,219). This balance is interest free with no fixed repayment terms.

 

SWYFT HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 25 -
14
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loans
15
869,250
478,392
Payments received on account
2,244,826
361,356
Trade creditors
1,492,481
1,174,001
Taxation and social security
1,737,984
1,219,365
Other creditors
440,389
964,802
Accruals and deferred income
359,402
319,273
7,144,332
4,517,189

Included in other creditors is £408,028 (2023: £890,820) in relation to invoice financing secured against relevant trade debtors.

15
Loans and overdrafts
2024
2023
£
£
Other loans
869,250
478,392
Payable within one year
869,250
478,392

The loan agreement with LDF Finance No. 3 Limited has been signed on 6 June 2023 for a loan with term of 24 months and accumulated interest for the whole term is £93,558. The loan has been settled early in April 2024.

 

 

 

16
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
93,548
43,662

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

17
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of 1p each
9,700
9,700
97
97
SWYFT HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 26 -
18
Operating lease commitments
Lessee

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

2024
2023
£
£
Within one year
258,876
235,000
Between two and five years
517,758
705,000
776,634
940,000
SWYFT HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 27 -
19
Security

Charges in the year

 

Industrial Lending 1 Sa has a fixed and floating charge created on 8 May 2015 on all present and future patents, trademarks, service marks, trade names, designs, copyrights, inventions, topographical or similar rights, confidential information and know-how and any interest in these rights whether or not registered. This was further updated by a new charge created by a fixed and floating charge created on 25 October 2019 on all property or undertaking of the company.

 

These charges were satisfied in full on 16 March 2023.

 

Amounts under invoice financing under one year are secured by a fixed and floating charge on all property and undertakings of the group by Vicarage Management No 1 Limited.

 

This charge was created on 26 October 2021 and satisfied in full on 25 April 2023.

 

Industrial Lending 1 Sa created on 28 March 2023 on all property or undertaking of the company.

This charge was satisfied in full after the year end on 8 May 2024.

Vicarage Fid Limited created a charge on 11 April 2023, without property by way of fixed charge: 1. All freehold and leasehold properties (whether registered or unregistered) and all commonhold properties, now or in the future (and from time to time) owned by the borrower, or in which the borrower holds an interest (including, but not limited to, the properties specified in schedule 1) in the future; 2. All present and future interests of the borrower not effectively mortgaged or charged under the preceding provisions of this clause in, or over, freehold or leasehold property; 3. All the borrower's present and future patents, trade-marks, service marks, trade names, designs, copyrights, inventions, topographical or similar rights, confidential information and know-how and any interest in any of these rights, whether or not registered, including all applications and rights to apply for registration and all fees, royalties and other rights derived from, or incidental to, these rights. The charge also contains a floating charge which covers all the property or undertaking of the company.

This charge was satisfied in full on 3 July 2023.

White Oak No.6 Limited created a charge on 26 June 2023, The relevant obligor, with full title guarantee in accordance with the law of property (miscellaneous provisions) act 1994 charges in favour of white oak as continuing security for the payment and discharge of the secured obligations: 4.1.2: by way of fixed charge, any real property now or at any time after the date of this deed belonging to any obligor (other than property charged under clause 4.1.1) 4.1.7 by way of fixed charge, all present and future intellectual property rights owned by it; real property (a) as defined in the finance agreement and any freehold, leasehold or other immovable property (including the property specified in part 1 of schedule 2 (if any)); and (b) any buildings, erections, fixtures or fittings from time to time situated on or forming part of such property (including any trade fixtures and fittings); and (c) all related rights. The charge also contains a floating charge which covers all the property or undertaking of the company.

This charge was satisfied in full after the year end on 21 May 2024.

SWYFT HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 28 -
20
Related party transactions

Transactions with group companies are conducted on an arms length basis. and therefore are not required to be disclosed under FRS102.

 

All non arms length exceptional items in relation to related parties are disclosed in note 4.

21
Ultimate controlling party

Events during the period:

 

There was no change in the ultimate controlling party, that continued to be Industrial Lending 1 Sa throughout the period. There was also no change to the the ultimate controlling parent, that continued to be Lombok Investments Limited throughout the period.

 

Events after the period end:

 

On 26 April 2024, Lombok Investments limited underwent a share restructure, whereby Sleep Brands Limited now owns more than 75% of the issued share capital in Lombok Investments Limited and is the new ultimate controlling party.

22
Cash generated from operations
2024
2023
£
£
(Loss)/profit for the year after tax
(5,685,532)
8,833,648
Adjustments for:
Finance costs
663,090
466,675
Investment income
-
0
(2,132)
Amortisation and impairment of intangible assets
35,542
21,265
Depreciation and impairment of tangible fixed assets
24,018
16,533
Movements in working capital:
Decrease/(increase) in stocks
1,081,336
(443,086)
Decrease/(increase) in debtors
1,921,666
(360,797)
Increase/(decrease) in creditors
2,236,285
(7,108,745)
Cash generated from operations
276,405
1,423,361
23
Analysis of changes in net debt
1 February 2023
Cash flows
Market value movements
31 January 2024
£
£
£
£
Cash at bank and in hand
193,148
(75,775)
-
117,373
Borrowings excluding overdrafts
(478,392)
44,136
(434,994)
(869,250)
(285,244)
(31,639)
(434,994)
(751,877)
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