Company registration number 02772373 (England and Wales)
FULFILMENTCROWD LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
FULFILMENTCROWD LTD
COMPANY INFORMATION
Directors
Mr L D Gregson
Mr L G Thompson
Mr S B Cummins
Mr S Livesey
Mr J Davies
Mr P A Taylor
Company number
02772373
Registered office
Western Avenue
Matrix Park
Chorley
PR7 7NB
Auditor
MHA
80 Mosley Street
Manchester
M2 3FX
FULFILMENTCROWD LTD
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 5
Independent auditor's report
6 - 8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 22
FULFILMENTCROWD LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 1 -
The directors present the strategic report for the year ended 31 March 2024.
The principal activity of the company continued to be that of providing fulfilment software technology services to omnichannel retailers.
Review of the business
The directors are pleased with performance in the year with an uplift in activity volume serviced across the network driving increased revenue and improved margins. This resulted in a profitable and cash generative year for the business.
This has been delivered against the backdrop of tough macro-economic trading conditions for our omnichannel customers as UK consumer confidence was negatively impacted by inflationary demands and associated cost-of-living pressures.
Despite these challenges, the business was able to execute its new customer acquisition strategy that is focussed on a premium value proposition. Equally, technological and operational processes have been continually enhanced to ensure we were able to manage volume growth from our existing customer base without impacting service levels. This was supported by the rollout of an additional network partner site in the UK, which alongside our owned warehouse premises, creates a unique hybrid operating model with unlimited capacity to meet customer needs.
Transaction volumes across our UK business increased by 44% in the year with revenue recorded of £13.7m (2023: £11.5m). A commercially focused approach with our key suppliers and resulting pricing decisions has supported margin improvement performance in the year. Whilst we continue to invest in growth resources, particularly related to our technology, the impact of increased volume alongside margin improvement has resulted in an operating profit for the year of £0.9m (2023: operating loss of £0.1m) and a significant improvement in profit after tax of £0.5m (2023: £0.1m).
Profitable growth has also delivered positive cash generation in year as the business closely monitored its working capital and investment decisions. The improved cash position and treasury management has enabled the business to take advantage of favourable interest rates to earn interest income on cash amounts held on deposit. This will be a continued focus of the business moving forward.
The business continues to maintain a strong balance sheet position and at 31 March 2024 had net assets of £4.8m (2023: £4.3m).
The company is committed to financially supporting research and development of its proprietary technology platform which controls a global network of fulfilment partner warehouses and enables customers to manage their products, stock levels, purchasing, sales orders and deliveries. The Software Development and Consulting teams lead on introduction of new products and features for key stakeholders. During the year, new best-in-class solutions have been launched, including the Service application which ensures consistent standards across the network and Delivery Assured, a consumer experience platform supporting timely responses and resolutions for complex parcel delivery queries.
The board recognises the importance of ESG which is a key component of our growth strategy. The fulfilmentcrowd model not only supports customers’ expansion goals, it also enables them to do it in more sustainable ways. By adopting sharing economy principles, we harness existing, underutilised warehousing infrastructure and fuse this with our software technology to create a sustainable, profitable and high-performance operating environment. We are benchmarking our carbon footprint to provide a baseline for future improvement and present contextualised data to customers, supporting plans to reduce the impact of their activities.
The board are confident that the actions taken in the year have set the business up to execute its growth plan for the forthcoming year and are pleased with trading in the early part of the new financial year outperforming budget.
FULFILMENTCROWD LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 2 -
Principal risks and uncertainties
Credit risk
Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. As of the balance sheet date, the company has no significant concentration of credit risk. It is the company's policy to enter financial instruments with a diversity of credit worthy third parties, and as such the company does not expect to incur material losses.
Liquidity risk
Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities. The liquidity risk is managed through regular monitoring and forecasting of cash generated from operations, rolling cash flow forecasts and review of actual and forecast overall cash levels.
Competition risk
Competition risk is the risk that the business may not perform as expected due to competitive pressures in the market in which it operates. There is a continued appetite for outsourced fulfilment which in turn has brought a number of competitors into the landscape offering their services. There is therefore a fragmented market with excess supply and price is therefore being driven down by competitors who are offering services at a loss to fill space. Whilst this is a challenge, the continued investment into the technology platform, creation of sufficient network capacity through the operating model, omnichannel functionality that we offer and ongoing focus on the level of customer support provided positions us well against our competitors to both retain existing customers and attract new.
Cyber security risk
Cyber security risk is the risk of exposure or loss resulting from a cyber-attack or data breach on the business. The business operates in a digital environment and recognises the importance that technology and cyber play in day-to-day operations. The company manages these risks by following best practice security procedures and reducing where possible the transmission of sensitive information. The company's IT security team continue to monitor ongoing compliance with data protection laws.
Geopolitical risk
The ongoing conflicts around the globe continue to impact on domestic affairs, in particular, on domestic fuel prices and inflation, although these have eased during the year. Whilst there is some impact on the business to an increased cost base for our owned warehouse space, the larger impact is perceived to be the level of consumer disposable income and the impact this may have on our customer base.
FULFILMENTCROWD LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 3 -
Key performance indicators
The board review a number of KPIs continually throughout the year form part of the monthly management accounts including:
Order volume growth
Revenue versus budget and year-on-year (YoY)
Gross margin (£ and %) to budget and YoY
EBITDA to budget and YoY
Cashflow to budget and YoY
Customer retention rates – volume and revenue
Retained customer growth rates
Average customer values
A regular forecast process is in place with key assumptions updated to keep the board informed of expected full year outturn. Variances to both budget, forecast and prior year are reviewed monthly.
In addition, there are a number of operational measures regularly reviewed such as inbound stock receipt and outbound dispatch timings to ensure we offer the very best service to our customers. Alongside this, measurement of our technology uptime is regularly reviewed given the critical importance of our proprietary platform in servicing the entire operation.
Mr L G Thompson
Director
24 September 2024
FULFILMENTCROWD LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 4 -
The directors present their annual report and financial statements for the year ended 31 March 2024.
Principal activities
The principal activity of the company continued to be that of a provider of e-commerce fulfilment solutions through its proprietary software platform.
Results and dividends
The results for the year are set out on page 9.
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:
Mr L D Gregson
Mr L G Thompson
Mr S B Cummins
Mr S Livesey
Mr J Davies
(Appointed 1 January 2024)
Mr P A Taylor
(Appointed 1 January 2024)
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are 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 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.
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.
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
FULFILMENTCROWD LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 5 -
On behalf of the board
Mr L G Thompson
Director
24 September 2024
FULFILMENTCROWD LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF FULFILMENTCROWD LTD
- 6 -
Opinion
We have audited the financial statements of Fulfilmentcrowd Ltd (the 'company') for the year ended 31 March 2024 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity 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 March 2024 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 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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
FULFILMENTCROWD LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF FULFILMENTCROWD LTD (CONTINUED)
- 7 -
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 directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the 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.
Matters on which we are required to report by exception
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 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.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud, is detailed below:
FULFILMENTCROWD LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF FULFILMENTCROWD LTD (CONTINUED)
- 8 -
Challenging assumptions and judgements made by management in their significant accounting estimates, in particular in relation to stock provisioning, debtor recoverability and future performance in light of the impact of the current economic uncertainty;
Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business; and
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities 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.
Lee Van Houplines FCA
Senior Statutory Auditor
For and on behalf of MHA, Statutory Auditor
Manchester, United Kingdom
24 September 2024
MHA is the trading name of MacIntyre Hudson LLP, a limited liability partnership in England and Wales (registered number OC312313)
FULFILMENTCROWD LTD
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2024
- 9 -
2024
2023
Notes
£
£
Turnover
3
13,678,183
11,466,055
Cost of sales
(11,429,418)
(9,836,398)
Gross profit
2,248,765
1,629,657
Administrative expenses
(1,892,824)
(1,952,518)
Other operating income
557,005
279,395
Operating profit/(loss)
4
912,946
(43,466)
Interest receivable and similar income
10,201
28
Interest payable and similar expenses
7
(130,146)
(73,752)
Profit/(loss) before taxation
793,001
(117,190)
Tax on profit/(loss)
8
(312,544)
183,609
Profit for the financial year
480,457
66,419
The profit and loss account has been prepared on the basis that all operations are continuing operations.
FULFILMENTCROWD LTD
BALANCE SHEET
AS AT 31 MARCH 2024
31 March 2024
- 10 -
2024
2023
Notes
£
£
£
£
Fixed assets
Intangible assets
9
1,368,252
1,066,288
Tangible assets
10
3,340,103
3,401,923
4,708,355
4,468,211
Current assets
Stocks
11
39,206
31,442
Debtors
12
2,503,211
1,905,985
Cash at bank and in hand
1,683,584
1,478,156
4,226,001
3,415,583
Creditors: amounts falling due within one year
13
(2,487,499)
(1,936,755)
Net current assets
1,738,502
1,478,828
Total assets less current liabilities
6,446,857
5,947,039
Creditors: amounts falling due after more than one year
14
(1,468,280)
(1,564,728)
Provisions for liabilities
Deferred tax liability
16
208,469
92,660
(208,469)
(92,660)
Net assets
4,770,108
4,289,651
Capital and reserves
Called up share capital
17
11,000
11,000
Share premium account
477,091
477,091
Revaluation reserve
971,398
971,398
Capital redemption reserve
284,237
284,237
Profit and loss reserves
3,026,382
2,545,925
Total equity
4,770,108
4,289,651
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 24 September 2024 and are signed on its behalf by:
Mr L G Thompson
Director
Company registration number 02772373 (England and Wales)
FULFILMENTCROWD LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
- 11 -
Share capital
Share premium account
Revaluation reserve
Capital redemption reserve
Profit and loss reserves
Total
£
£
£
£
£
£
Balance at 1 April 2022
11,000
477,091
971,398
284,237
2,479,506
4,223,232
Year ended 31 March 2023:
Profit and total comprehensive income
-
-
-
-
66,419
66,419
Balance at 31 March 2023
11,000
477,091
971,398
284,237
2,545,925
4,289,651
Year ended 31 March 2024:
Profit and total comprehensive income
-
-
-
-
480,457
480,457
Balance at 31 March 2024
11,000
477,091
971,398
284,237
3,026,382
4,770,108
FULFILMENTCROWD LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
- 12 -
1
Accounting policies
Company information
Fulfilmentcrowd Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Western Avenue, Matrix Park, Chorley, PR7 7NB.
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, modified to include the revaluation of freehold properties. The principal accounting policies adopted are set out below.
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:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of Fulfilmentcrowd Topco Limited. These consolidated financial statements are available from its registered office, Western Avenue, Matrix Park, Chorley, PR7 7NB and at Companies House.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for services 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.
1.4
Intangible fixed assets other than goodwill
Intangible assets are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
FULFILMENTCROWD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 13 -
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 basis:
Software
33% straight line
1.5
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 basis:
Leasehold land and buildings
Not depreciated
Plant and equipment
10-33% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
In accordance with the provisions of FRS 102, the individual long leasehold property is revalued as required on a regular basis by a qualified valuer and the company reviews the carrying value of the property at each period end to ensure that it is not materially different from its fair value. A provision is made for any impairment to the value of the long leasehold property during the year and accordingly it is not depreciated.
1.6
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.
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.
1.7
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to sell.
FULFILMENTCROWD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 14 -
1.8
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.
1.9
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.
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.
FULFILMENTCROWD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 15 -
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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.10
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.
1.11
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.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset 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.
FULFILMENTCROWD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 16 -
1.12
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.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
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.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Capitalisation and amortisation of software development costs
Software development costs are capitalised based on the time spent by staff on development projects. The costs are amortised over the useful economic lives of 3 years.
FULFILMENTCROWD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 17 -
3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Sale of services
13,678,183
11,466,055
2024
2023
£
£
Other revenue
Interest income
10,201
28
4
Operating profit/(loss)
2024
2023
Operating profit/(loss) for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
23,500
22,567
Depreciation of owned tangible fixed assets
84,953
83,719
Amortisation of intangible assets
606,139
523,771
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Management and administrative
75
76
Operational
29
33
Total
104
109
Their aggregate remuneration comprised:
2024
2023
£
£
Wages and salaries
3,177,507
2,939,750
Social security costs
391,518
354,629
Pension costs
201,625
180,281
3,770,650
3,474,660
FULFILMENTCROWD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 18 -
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
456,720
370,000
Company pension contributions to defined contribution schemes
60,206
56,771
516,926
426,771
Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
120,000
110,000
Company pension contributions to defined contribution schemes
15,000
40,000
7
Interest payable and similar expenses
2024
2023
£
£
Interest on bank overdrafts and loans
128,939
72,798
Interest on finance leases and hire purchase contracts
1,207
954
130,146
73,752
8
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
(196,735)
Adjustments in respect of prior periods
196,735
(77,334)
Total current tax
196,735
(274,069)
Deferred tax
Origination and reversal of timing differences
182,301
90,460
Adjustment in respect of prior periods
(66,492)
Total deferred tax
115,809
90,460
Total tax charge/(credit)
312,544
(183,609)
FULFILMENTCROWD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
8
Taxation
(Continued)
- 19 -
The actual charge/(credit) for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:
2024
2023
£
£
Profit/(loss) before taxation
793,001
(117,190)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
198,250
(22,266)
Tax effect of expenses that are not deductible in determining taxable profit
1,067
3,391
Adjustments in respect of prior years
130,243
13,127
Effect of change in corporation tax rate
5,312
Group relief
(17,016)
Amortisation on assets not qualifying for tax allowances
75,946
Research and development tax credit
(149,867)
Capitalised expenses allowable for tax
(111,214)
Superdeductions
(2,190)
Differences due to fixed assets not eligiable for capital allowances
4,152
Taxation charge/(credit) for the year
312,544
(183,609)
9
Intangible fixed assets
Software
£
Cost
At 1 April 2023
2,038,079
Additions - internally developed
908,103
At 31 March 2024
2,946,182
Amortisation
At 1 April 2023
971,791
Amortisation charged for the year
606,139
At 31 March 2024
1,577,930
Carrying amount
At 31 March 2024
1,368,252
At 31 March 2023
1,066,288
FULFILMENTCROWD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 20 -
10
Tangible fixed assets
Leasehold land and buildings
Plant and equipment
Total
£
£
£
Cost or valuation
At 1 April 2023
3,110,380
721,974
3,832,354
Additions
23,133
23,133
At 31 March 2024
3,110,380
745,107
3,855,487
Depreciation
At 1 April 2023
430,431
430,431
Depreciation charged in the year
84,953
84,953
At 31 March 2024
515,384
515,384
Carrying amount
At 31 March 2024
3,110,380
229,723
3,340,103
At 31 March 2023
3,110,380
291,543
3,401,923
Land and buildings with a carrying amount of £3,110,380 were revalued on an open market basis on 31 May 2022 by Avison Young Chartered Surveyors, independent valuers not connected with the company.
These assets are carried at valuation. If the assets were measured using the cost model, the carrying amounts would be as follows:
Leasehold land and buildings
2024
2023
£
£
Cost
2,046,007
2,046,007
Accumulated depreciation
(135,312)
(135,312)
Carrying value
1,910,695
1,910,695
11
Stocks
2024
2023
£
£
Goods for resale
39,206
31,442
FULFILMENTCROWD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 21 -
12
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
467,734
373,345
Corporation tax recoverable
261,959
Amounts owed by group undertakings
1,559,112
830,295
Other debtors
5,118
1,425
Prepayments and accrued income
471,247
438,961
2,503,211
1,905,985
13
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loans
15
110,477
118,572
Obligations under finance leases
7,575
Trade creditors
1,080,205
948,354
Taxation and social security
434,467
358,383
Other creditors
35,042
37,979
Accruals and deferred income
827,308
465,892
2,487,499
1,936,755
14
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Bank loans and overdrafts
15
1,468,280
1,564,097
Obligations under finance leases
631
1,468,280
1,564,728
15
Loans and overdrafts
2024
2023
£
£
Bank loans
1,578,757
1,682,669
Payable within one year
110,477
118,572
Payable after one year
1,468,280
1,564,097
The long-term loans are secured by a debenture and first legal charge over the properties included within tangible assets in these financial statements.
FULFILMENTCROWD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 22 -
16
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
393,054
66,354
Tax losses
(277,560)
(66,668)
Revaluations
92,975
92,974
208,469
92,660
2024
Movements in the year:
£
Liability at 1 April 2023
92,660
Charge to profit or loss
115,809
Liability at 31 March 2024
208,469
17
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
11,000
11,000
11,000
11,000
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
42,336
35,666
Between two and five years
90,433
30,550
132,769
66,216
19
Ultimate controlling party
Fulfilmentcrowd Topco Limited was the ultimate parent company throughout the year.
In the opinion of the directors, Fulfilmentcrowd Topco Limited is controlled by LD Gregson.
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