Company registration number 07167526 (England and Wales)
BIOLEGEND UK LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
BIOLEGEND UK LIMITED
COMPANY INFORMATION
Director
J G Lay
Company number
07167526
Registered office
4th Floor Rear
Highgate Business Centre
33 Greenwood Place
London
NW5 1LB
Auditor
BKL Audit LLP
Chartered Accountants
5 Fleet Place
London
EC4M 7RD
BIOLEGEND UK LIMITED
CONTENTS
Page
Strategic report
1 - 3
Director's report
4 - 5
Independent auditor's report
6 - 8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Statement of cash flows
12
Notes to the financial statements
13 - 24
BIOLEGEND UK LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The director presents the strategic report for the year ended 31 December 2023.
Review of the business
BioLegend UK Ltd ("The Company"), is a wholly-owned subsidiary of BioLegend Inc ("BioLegend"). BioLegend is incorporated in the State of California and is a wholly-owned subsidiary of Revvity Inc. The principal business of BioLegend is to develop, manufacture and sell antibody and other reagent products for biomedical research. The primary role of the Company is to sell and distribute inventory that is manufactured by BioLegend to the UK and to select European markets, and support administrative, marketing and sales efforts for all of Europe.
The mission of BioLegend and its subsidiaries is to provide the highest quality research products available, so that its researchers can get reliable results quickly, easily, and consistently. Antibody products from BioLegend are manufactured in its San Diego facility. The Company operates under an ISO 13485:2016 certified quality management system, which ensures that all customers receive high quality products, superior customer support, and outstanding value.
Principal risks and uncertainties
The principal risks and uncertainties the company is facing are broadly grouped as - future economic, competitive and operational risks.
Future economic Risks
Changes in economic conditions could negatively impact the Company's revenues and earnings.
The Company's biotechnology products are sold primarily to research scientists at pharmaceutical and biotechnology companies and at university and government research institutions. Research and development spending by the Company's customers and the availability of government research funding can fluctuate due to available resources, mergers of pharmaceutical and biotechnology companies, spending priorities, general economic conditions and institutional and governmental budgetary policies.
Competitive Risks
The Company faces significant competition across all of its product lines. Competitors include companies ranging from start-up companies to large multinational companies, which may have greater financial, marketing, operational, and research and development resources than the Company. In addition, consolidation trends in the pharmaceutical and biotechnology industries have served to create fewer customer accounts and to concentrate purchasing decisions for some customers, resulting in increased pricing pressure on the Company. The entry into the market by manufacturers in China and other low-cost manufacturing locations is also creating increased pricing and competitive pressures, particularly in developing markets. Failure to anticipate and respond to competitors' actions may impact the Company's future sales and earnings.
Operational Risks
The main element of the Company's growth strategy is to increase revenues through new product releases, which are supplied by BioLegend. As a result, BioLegend must anticipate industry trends and develop products in advance of customer needs. New product development requires planning, designing and testing at both technological and manufacturing-process levels and may require significant research and development expenditures.
The Company is subject to risk associated with global operations. The Company sells within Europe and purchases inventory from the U.S. Therefore, fluctuations in the exchange rate can negatively impact reports sales, cost of sales and gross margin. This could in turn impact the selling price of products which could impact the price competitiveness in the market place.
BIOLEGEND UK LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Development and performance
The results of the Company for the year show a profit on ordinary activities before tax of £0.9m (2022 £0.5m). The shareholders' funds of the Company total £7.5m (2022 £6.8m). The Company had a turnover of £25.7m in 2023 compared to £23.1m in 2022. UK and non-EU turnover remained relatively steady which is attributable to a market perception of excellent quality, innovation, value, and support.
Business environment
A large percentage of the Company's revenues are derived from customers who are publicly funded through research grants. The consumers are spread across the academic, pharmaceutical, and biotechnology markets.
The antibody and other reagent products industry is highly competitive. There are many suppliers of similar products, which results in significant price competition. In addition to price competition, the Company faces exchange rate risk due to fluctuations of the dollar and euro against the pound, and against the dollar.
Introducing new products and product lines has a positive impact on the success of BioLegend and the subsidiaries it supplies. BioLegend addresses this challenge by providing a broad range of product options and focusing efforts on understanding upcoming product trends and investing scientific resources to develop the products that its customers demand.
Strategy
BioLegend's strategies include:
Continued innovation in core and related products. Through collaborations with key opinion leaders and participation in scientific discussions and associations, Biolegend expects to leverage its investment in research and development to be first-to-market with quality products that are at the leading edge of life science researchers' needs. This in turn serves the Company's strategy of growth in sales of existing and new products.
Expansion of geographic footprint. The Company's focus is to expand sales staff and distribution channels in the UK and other countries, and to make it easier for customers to transact with the Company.
Key performance indicators
The Company's key performance indicators include turnover, gross margin, days' sales in accounts receivable. The information below summarises these KPI's for the years ended 31 December 2023 and 31 December 2022.
Turnover £25,691,278 (2022 £23,131,835)
Gross margin 16.3% (2022 15.2%)
Days sales in receivables 35 days (2022 43 days)
The Company works hard to provide a complete solution to their customers, wherever the customers are located. Selling "direct" results in a onetime increase in sales.
Future developments
One element of BioLegend's growth strategy is to increase revenues through new product releases. As a result, the parent company will continue to focus time and resources on new product development which requires planning, designing and testing at technological and manufacturing-process levels. Also at the parent level, recruiting and retaining qualified scientific, production and management personnel are critical to the Company's success as this allows the Company to provide products the market wants prior to competitors. Adding to this foundation the Company retains qualified scientific personnel to troubleshoot and help with customer projects, and to develop ongoing relationships with customers. Another element on which Biolegend focuses is to reduce manufacturing costs where possible. Customer price, service and quality are central to the Company's overall business strategy. The Company's future success with these strategies is also highly dependent on macro issues, such as continued recovery in the markets and continued government funding for research institutions.
Items required under Schedule 7 to be disclosed in the directors' report are set out in the strategic report in accordance with s.414C( II) CA 2006.
BIOLEGEND UK LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
J G Lay
Director
21 October 2024
BIOLEGEND UK LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
The director presents his annual report and financial statements for the year ended 31 December 2023.
Results and dividends
The results for the year are set out on page 9.
No ordinary dividends were paid (2022 - £nil).
Director
The director who held office during the year and up to the date of signature of the financial statements was as follows:
J G Lay
Future developments
Details of future developments are set out in the strategic report on page 3.
Auditor
Wilson Wright LLP acted as auditor of the company up until 2 April 2024. On 2 April 2024, Wilson Wright LLP transferred its audit business to BKL Audit LLP. The members subsequently consented to the appointment of BKL Audit LLP as auditor to the company. The auditor BKL Audit LLP will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
Statement of director's responsibilities
The director is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless she is 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 director is required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The director is 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. She is 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.
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.
BIOLEGEND UK LIMITED
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 5 -
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
On behalf of the board
J G Lay
Director
21 October 2024
BIOLEGEND UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BIOLEGEND UK LIMITED
- 6 -
Opinion
We have audited the financial statements of Biolegend UK Limited (the 'company') for the year ended 31 December 2023 which comprise 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 the financial statements:
give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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 opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the director's 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 director with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The director is 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:
the information given in the strategic report and the director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the director's report have been prepared in accordance with applicable legal requirements.
BIOLEGEND UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BIOLEGEND UK LIMITED
- 7 -
Matters on which we are required to report by exception
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 director's report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of director
As explained more fully in the director's responsibilities statement, the director is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the director determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the director is responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the director either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
BIOLEGEND UK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BIOLEGEND UK LIMITED
- 8 -
Capability of the audit in detecting irregularities, including fraud:
Based on our understanding of the company and the industry, we identified that the principal risks of non-compliance with laws and regulations related to the failure to comply with tax regulations, environmental regulations, health and safety regulations, and anti-bribery and anti-corruption laws, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006. We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries and management bias in accounting estimates. Audit procedures performed by the auditors included:
- Discussions with key management personnel, including consideration of known or suspected instances of non-compliance with laws and regulations;
- Assessing management's significant judgements and estimates in particular those relating to the
obsolete stock provision;
- Identifying and testing manual journal entries, in particular any journal entries posted with unclear rationale.
There are inherent limitations in the audit procedures described above, and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
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.
Warren Baker FCA
Senior Statutory Auditor
For and on behalf of BKL Audit LLP
22 October 2024
Chartered Accountants and Statutory Auditor
5 Fleet Place
London
EC4M 7RD
BIOLEGEND UK LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
Notes
£
£
Turnover
3
25,691,278
23,131,435
Cost of sales
(21,494,400)
(19,610,348)
Gross profit
4,196,878
3,521,087
Distribution costs
(1,893,818)
(1,519,661)
Administrative expenses
(1,415,444)
(1,531,032)
Operating profit
4
887,616
470,394
Interest receivable and similar income
2,206
2,077
Interest payable and similar expenses
7
(1,108)
Profit before taxation
889,822
471,363
Tax on profit
8
(194,971)
(4,429)
Profit for the financial year
694,851
466,934
The profit and loss account has been prepared on the basis that all operations are continuing operations.
The company has no recognised gains or losses for the year other than the results above.
The notes on pages 13 to 24 form an integral part of these financial statements.
BIOLEGEND UK LIMITED
BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
9
15,482
11,411
Current assets
Stocks
10
4,603,994
6,575,969
Debtors
11
2,796,466
3,313,412
Cash at bank and in hand
2,307,523
3,422,155
9,707,983
13,311,536
Creditors: amounts falling due within one year
12
(2,234,564)
(6,529,032)
Net current assets
7,473,419
6,782,504
Total assets less current liabilities
7,488,901
6,793,915
Creditors: amounts falling due after more than one year
13
(488)
Provisions for liabilities
Deferred tax liability
14
3,328
2,705
(3,328)
(2,705)
Net assets
7,485,573
6,790,722
Capital and reserves
Called up share capital
17
1
1
Profit and loss reserves
7,485,572
6,790,721
Total equity
7,485,573
6,790,722
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
The financial statements were approved and signed by the director and authorised for issue on 21 October 2024
J G Lay
Director
Company registration number 07167526 (England and Wales)
BIOLEGEND UK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2022
1
6,323,787
6,323,788
Year ended 31 December 2022:
Profit and total comprehensive income
-
466,934
466,934
Balance at 31 December 2022
1
6,790,721
6,790,722
Year ended 31 December 2023:
Profit and total comprehensive income
-
694,851
694,851
Balance at 31 December 2023
1
7,485,572
7,485,573
BIOLEGEND UK LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash absorbed by operations
21
(873,612)
(4,105,736)
Interest paid
(1,108)
Taxes (paid)/refunded
(227,122)
97,463
Net cash outflow from operating activities
(1,100,734)
(4,009,381)
Investing activities
Purchase of tangible fixed assets
(16,104)
(8,005)
Interest received
2,206
2,077
Net cash used in investing activities
(13,898)
(5,928)
Net decrease in cash and cash equivalents
(1,114,632)
(4,015,309)
Cash and cash equivalents at beginning of year
3,422,155
7,437,464
Cash and cash equivalents at end of year
2,307,523
3,422,155
BIOLEGEND UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
1
Accounting policies
Company information
Biolegend UK Limited is a private company limited by shares incorporated in England and Wales. The registered office is 4th Floor Rear, Highgate Business Centre, 33 Greenwood Place, London, NW5 1LB.
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
Going concern
Atruet the time of approving the financial statements, the director has a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the director continues to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Revenue comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the company's activities. Turnover is shown net of value added tax, returns, rebates and discounts.
The company recognises revenue when:
The amount of revenue can be reliably measured;
It is probable that future economic benefits will flow to the entity;
and specific criteria have been met or each of the company's activities.
1.4
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.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
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 land and buildings
10% on cost
Computer equipment
33% on cost
Fixtures and fittings
20% on cost
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 the statement of income.
1.5
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
BIOLEGEND UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
1.6
Stocks
Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.
Cost is calculated using the first in, first out method.
1.7
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8
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.
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 the statement of income, 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 the statement of income.
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 the statement of income.
BIOLEGEND UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
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.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans and loans from fellow group companies, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
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.
1.9
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.
1.10
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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
BIOLEGEND UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
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.
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 when the company has 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.
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense.
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.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Share-based payments
Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the RSUs (Restricted Stock Unit awards) granted. This is determined by Revvity Inc.'s stock price on the date of the grant. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to the intercompany balance with Revvity Inc.
1.14
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.
1.15
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.
BIOLEGEND UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the director is 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.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows:
Provision for slow moving, faulty and obsolete stock
Management have devised a mathematical model to calculate the expected stock that will pass its sell-by date or otherwise become obsolete based on information of actual stock movements.
3
Turnover
2023
2022
£
£
Turnover analysed by class of business
Sale of goods
24,596,586
22,227,604
Commission receivable
1,094,692
903,831
25,691,278
23,131,435
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
18,636,674
16,777,740
Europe
6,986,539
6,324,455
Asia
59,721
18,480
Non EU/USA
8,344
10,760
25,691,278
23,131,435
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange gains
(98,129)
(120)
Depreciation of owned tangible fixed assets
12,033
19,855
Share-based payments
231,359
522,610
Operating lease charges
163,889
156,114
BIOLEGEND UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
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 company
38,950
26,350
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Admin
10
7
Sales/Marketing
20
19
Shipping/Manufacturing
5
4
35
30
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
1,711,227
1,453,747
Social security costs
210,038
172,020
Pension costs
65,762
53,061
Other short-term employee benefits
20,295
24,082
Other employee expense
70,827
51,475
2,078,149
1,754,385
The Company's Director was remunerated through other group companies and no recharges are made in relation to his services. No apportionment of his remuneration for these services was practicable.
7
Interest payable and similar expenses
2023
2022
£
£
Other finance costs:
Other interest
1,108
8
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
229,122
Adjustments in respect of prior periods
1,087
Total current tax
229,122
1,087
BIOLEGEND UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
8
Taxation
2023
2022
£
£
(Continued)
- 19 -
Deferred tax
Origination and reversal of timing differences
(34,151)
3,342
Total tax charge
194,971
4,429
An increase in the UK corporation tax main rate from 19% to 25% for financial years beginning 1 April 2023 was substantially enacted on 24 May 2021.
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Profit before taxation
889,822
471,363
Expected tax charge based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
209,286
89,559
Tax effect of income not taxable in determining taxable profit
(75)
Group relief
(106,896)
Effect of expense not deductible in determining taxable profit/(loss)
3,471
15,581
Tax increase from effect of capital allowances and depreciation
1,780
Other tax effects for reconciliation between accounting profit and tax expense
(45)
(24)
Adjustment from previous period
(8,745)
2,247
Under provided in prior years
2,182
Tax rate changes
(1,503)
Share options
(7,418)
Taxation charge for the year
194,971
4,429
BIOLEGEND UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
9
Tangible fixed assets
Leasehold land and buildings
Computer equipment
Fixtures and fittings
Total
£
£
£
£
Cost
At 1 January 2023
69,986
106,529
97,058
273,573
Additions
14,893
1,211
16,104
At 31 December 2023
69,986
121,422
98,269
289,677
Depreciation and impairment
At 1 January 2023
69,301
98,391
94,470
262,162
Depreciation charged in the year
685
9,778
1,570
12,033
At 31 December 2023
69,986
108,169
96,040
274,195
Carrying amount
At 31 December 2023
13,253
2,229
15,482
At 31 December 2022
685
8,138
2,588
11,411
10
Stocks
2023
2022
£
£
Finished goods and goods for resale
4,603,994
6,575,969
11
Debtors
2023
2022
£
£
Amounts falling due within one year:
Trade debtors
2,462,725
2,739,101
Corporation tax recoverable
2,001
Other debtors
206,855
510,770
Prepayments and accrued income
52,202
21,836
2,721,782
3,273,708
Deferred tax asset (note 14)
34,775
2,756,557
3,273,708
BIOLEGEND UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
11
Debtors
(Continued)
- 21 -
2023
2022
£
£
Amounts falling due after more than one year:
Other debtors
39,909
39,704
Total debtors
2,796,466
3,313,412
12
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
118,635
70,417
Taxation and social security
240,049
339,412
Deferred income
1,203,147
1,815,796
Other creditors
525,051
4,212,960
Accruals
147,682
90,447
2,234,564
6,529,032
13
Creditors: amounts falling due after more than one year
2023
2022
£
£
Deferred rent
488
14
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
Assets
Assets
2023
2022
2023
2022
Balances:
£
£
£
£
Accelerated capital allowances
-
(1,856)
-
-
Other differences
-
(3,284)
-
-
Share based payments
-
928
-
-
Short term timing differences - trading
-
-
34,775
-
Fixed asset timing differences
3,328
-
-
-
General provisions
-
6,917
-
-
3,328
2,705
34,775
-
BIOLEGEND UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
14
Deferred taxation
(Continued)
- 22 -
2023
Movements in the year:
£
Provision at start of period
2,705
Deferred tax charge to income statement for the period
(25,397)
Adjustment in respect of prior years
(8,755)
Asset at 31 December 2023
(31,447)
15
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
65,763
53,601
BIOLEGEND UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
16
Share-based payment transactions
During the year, the company recognised total share-based payment expenses of £231,359 (2022: £522,610) which related to equity settled share based payment transactions. Employees of Biolegend UK Limited were granted RSUs (Restricted Stock Unit awards) over the common share capital of the company's ultimate parent, Revvity Inc., at no cost to them, when Biolegend UK Limited joined the Revvity Inc. Group.
RSU awards vest monthly over a period of one to three years, subject to the grantee’s continued service to the Company. The fair value for RSUs is determined by Revvity Inc.'s stock price on the date of the grant. The fair value of the award at the time of the grant is expensed on a straight line basis in selling, general and administrative expenses over the vesting period and the share based payment expense for the relevant accounting period is recharged from Revvity Inc.. via the parent company Biolegend Inc. Charge to the profit and loss account has been translated at the exchange rate at the date the share based payment expense was recharged.
The total number of RSUs granted to the employees of Biolegend UK Limited was 6,996. 1,889 RSUs vested in the financial year. As at 31 December 2023, the total unrecognised share based payment expense in relation to nonvested RSUs was £128k (2022 - £374k). The cost is expected to be recognised over the remaining 0.8 years.
17
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
1
1
1
1
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:
2023
2022
£
£
Within one year
145,000
23,419
Between two and five years
36,250
4,033
181,250
27,452
The amount of non-cancellable operating lease payments recognised as an expense during the year was £142,243 (2022- £132,750).
Other financial commitments
The company has a commitment to pay service charges of £22,465 per annum in relation to the land and buildings. The total service charge payable within one year is £22,465 (2022 - £4,033) and total service charge payable between one and five years is £5,616 (2022 - £nil).
19
Related party transactions
The company has taken advantage of the exemption available in accordance with Section 33.1A of Financial Reporting Standard 102 whereby it has not disclosed transactions entered into between two or more members of a group, as the parent company wholly owns the subsidiary undertakings in which the company is party to the transactions.
BIOLEGEND UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
20
Ultimate controlling party
The parent company of the company is Biolegend Inc, a company incorporated in United States of America. The ultimate controlling party is Revvity Inc., a company incorporated in United States of America.
21
Cash absorbed by operations
2023
2022
£
£
Profit for the year after tax
694,851
466,934
Adjustments for:
Taxation charged
194,971
4,429
Finance costs
1,108
Investment income
(2,206)
(2,077)
Depreciation and impairment of tangible fixed assets
12,033
20,359
Equity settled share based payment expense
231,359
522,610
Movements in working capital:
Decrease/(increase) in stocks
1,971,975
(1,212,799)
Decrease/(increase) in debtors
318,361
(2,095,120)
Decrease in creditors
(3,682,307)
(2,475,806)
(Decrease)/increase in deferred income
(612,649)
664,626
Cash absorbed by operations
(873,612)
(4,105,736)
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