PHUEL OIL TOOLS LIMITED
No. SC269131
DIRECTORS' REPORT
AND
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PHUEL OIL TOOLS LIMITED
COMPANY INFORMATION
Directors
Mark McCorry
Colin McCracken
Katy Helgeland
(Appointed 30 October 2023)
Helge Hustoft
(Appointed 30 October 2023)
Secretary
Brodies Secretarial Services Limited
Company number
SC269131
Registered office
Brodies House
31-33 Union Grove
Aberdeen
AB10 6SD
Business address
Unit 2 Barratt Trading Estate
Denmore Place
Bridge of Don
Aberdeen
AB23 8JS
Auditor
Hall Morrice LLP
6 & 7 Queens Terrace
Aberdeen
AB10 1XL
Bankers
DNB Bank ASA
London Branch
The Walbrook Building
25 Walbrook
London
EC4N 8AF
PHUEL OIL TOOLS LIMITED
CONTENTS
Page
Directors' report
1 - 2
Independent auditor's report
3 - 5
Statement of comprehensive income
6
Balance sheet
7
Statement of changes in equity
8
Notes to the financial statements
9 - 23
PHUEL OIL TOOLS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -

The directors present their report and audited financial statements for the year ended 31 December 2023.

Principal activities

The principal activity of the company continued to be that of the design, manufacture, sale and rental of wireline pressure control equipment.

Results and dividends

The results for the year are set out on page 6.

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:

Mark McCorry
Colin McCracken
Katy Helgeland
(Appointed 30 October 2023)
Helge Hustoft
(Appointed 30 October 2023)
Eimund Sletten
(Resigned 30 October 2023)
Auditor

Hall Morrice LLP were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.

Statement of directors' responsibilities

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

 

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

 

 

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

Strategic report

The company has taken the exemption under Section 414B of the Companies Act 2006 from the requirement to prepare a Strategic report for the financial year.

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.

PHUEL OIL TOOLS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
On behalf of the board
Colin McCracken
Director
5 November 2024
PHUEL OIL TOOLS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PHUEL OIL TOOLS LIMITED
- 3 -
Opinion

We have audited the financial statements of Phuel Oil Tools Limited (the 'company') for the year ended 31 December 2023 which comprise the profit and loss account, 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:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the 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.

Other information

The other information comprises the information included in the Directors' report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the Directors' 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:

PHUEL OIL TOOLS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PHUEL OIL TOOLS LIMITED
- 4 -
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 directors' report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

 

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, as set out in the Directors' report, 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 extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

In identifying and assessing the risk of material misstatement due to non-compliance with laws and regulations we have:

 

PHUEL OIL TOOLS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PHUEL OIL TOOLS LIMITED
- 5 -

In identifying and assessing the risk of material misstatement due to irregularities, including fraud and how it may occur, and the potential for management bias and the override of controls we have:

 

 

We did not identify any matters relating to non-compliance with laws and regulations, or relating to fraud.

 

Because of the inherent limitations of an audit, there is an unavoidable risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. The risk of not detecting a material misstatement due to fraud is inherently more difficult than detecting those that result from error as fraud may involve intentional concealment, forgery, collusion, omission or misrepresentation. In addition, the further removed any 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.

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.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Derek Petrie MA (Hons) CA
Senior Statutory Auditor
For and on behalf of Hall Morrice LLP
Statutory Auditor
Aberdeen
5 November 2024
PHUEL OIL TOOLS LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 6 -
2023
2022
Notes
£
£
Turnover
3
2,610,451
3,227,763
Cost of sales
(1,400,378)
(1,840,566)
Gross profit
1,210,073
1,387,197
Administrative expenses
(1,282,167)
(1,382,866)
Other operating income
101,140
115,307
Operating profit
4
29,046
119,638
Interest receivable and similar income
367,500
-
0
Interest payable and similar expenses
7
3,376
(52,420)
Intercompany loan written off
8
(38,806)
-
Profit before taxation
361,116
67,218
Tax on profit
9
-
0
39,851
Profit for the financial year
361,116
107,069

The statement of comprehensive income has been prepared on the basis that all operations are continuing operations.

PHUEL OIL TOOLS LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 7 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
10
26,735
21,906
Tangible assets
11
33,872
84,586
Investments
12
143,546
144,191
204,153
250,683
Current assets
Stocks
14
1,482,854
1,338,245
Debtors
15
1,754,385
1,284,407
Cash at bank and in hand
21,523
1,918
3,258,762
2,624,570
Creditors: amounts falling due within one year
16
(1,944,466)
(2,117,652)
Net current assets
1,314,296
506,918
Total assets less current liabilities
1,518,449
757,601
Creditors: amounts falling due after more than one year
17
-
0
(262,500)
Net assets
1,518,449
495,101
Capital and reserves
Called up share capital
20
2,495,446
2,052,185
Share premium account
21
478,871
259,900
Profit and loss reserves
(1,455,868)
(1,816,984)
Total equity
1,518,449
495,101
The financial statements were approved by the board of directors and authorised for issue on 5 November 2024 and are signed on its behalf by:
Colin McCracken
Director
Company Registration No. SC269131
PHUEL OIL TOOLS LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 January 2022
2,052,185
259,900
(1,924,053)
388,032
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
107,069
107,069
Balance at 31 December 2022
2,052,185
259,900
(1,816,984)
495,101
Year ended 31 December 2023:
Profit and total comprehensive income for the year
-
-
361,116
361,116
Issue of share capital
20
443,261
218,971
-
662,232
Balance at 31 December 2023
2,495,446
478,871
(1,455,868)
1,518,449
PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
1
Accounting policies
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 company has taken advantage of the following disclosure exemptions:

 

The financial statements present information about the company as an individual undertaking and not about its group. The company and its subsidiary undertakings comprise a small-sized group. The company has therefore taken advantage of the exemption provided by section 399 of the Companies Act 2006 not to prepare group accounts.

 

Phuel Oil tools Limited is a subsidiary of Dwellops AS (Norway) and the results of Phuel Oil tools Limited are included in the consolidated financial statements of Habu Holdings AS, a company incorporated in Norway, which are available from the address given in note 25.

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

Revenue represents amounts receivable for goods and services net of VAT and trade discounts and is recognised as goods are dispatched or as rental assets and maintenance services are provided.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably. Revenue from maintenance services is recognised as the maintenance is completed and equipment returned to the customer.

Revenue from the rental of equipment is recognised according to the terms of the rental contract. Generally, this is on a straight line basis over the life of the rental agreement, when a customer has a right to the specific asset for a specified period of time.

PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies (continued)
- 10 -
1.4
Intangible fixed assets other than goodwill

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

 

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

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

Patents
33% straight line
Development Costs
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 bases:

Tennant improvements
15% straight line
Plant and equipment
20% straight line
Fixtures and fittings
20% straight line
Computers
33% straight line
Motor vehicles
25% 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.

1.6
Fixed asset investments

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

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

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

1.7
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.

PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies (continued)
- 11 -

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.

1.8
Stocks

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

 

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

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

1.9
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.

1.10
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.

PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies (continued)
- 12 -
Other financial assets

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

Impairment of financial assets

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

 

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

 

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

Derecognition of financial assets

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

Classification of financial liabilities

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

Basic financial liabilities

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

 

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

 

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

PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies (continued)
- 13 -
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.

1.11
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.

1.12
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.

PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies (continued)
- 14 -
1.13
Provisions

Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

 

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

1.14
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.

1.15
Retirement benefits

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

1.16
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.

1.17
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.

PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 15 -
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.

Recoverability of group receivables

Management make an assessment of the recoverable value of amounts due from fellow group undertakings. When assessing the recoverability of these amounts owed, management considers factors such as the market value of certain assets held by the group undertakings and the cash generating ability of the counterparty. Amounts due from group undertakings are shown net of any provision for amounts not expected to be recovered.

Investment impairment

Management make an assessment of indicators of impairment in relation to investments held. When assessing the risk of impairment, management considers factors such as the market value of certain assets held by the investment company and the cash generating ability of the counterparty.

Stock and work in progress

Management make an assessment of the recoverable value of stock and work in progress. When assessing the recoverability of this, management considers factors such as the age of the stock and work in progress plus any potential technical obsolescence. Provisions are made by management on the basis of the relevant items estimated selling price less costs to complete. Stock and work in progress are stated net of provisions identified by management.

Stock and work in progress overhead allocation

Allocation of overheads included in stock and work in progress is a judgement made by management, through assessment of overheads to be included and allocated based in their applied methodology.

 

The directors consider that there are no other judgements, estimates and underlying assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities.

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.

Useful lives of intangible assets

Management consider the expected useful lives of intangible assets when capitalising costs. This impacts upon the amortisation charge in the year. The useful lives are based on intended use of the intangible asset and historical experience.

Useful lives of fixed assets

Management consider the expected useful lives of fixed assets when capitalising costs. This impacts upon the deprecation charge in the year. The useful lives are based on intended use of the fixed asset and historical experience.

 

PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Product sales
1,516,167
1,876,229
Maintenance
805,022
994,271
Equipment rental
289,262
357,263
2,610,451
3,227,763
2023
2022
£
£
Turnover analysed by geographical market
Europe
1,929,372
2,386,572
North America
150,331
185,672
Middle East
366,938
453,200
Rest of the World
163,810
202,319
2,610,451
3,227,763
2023
2022
£
£
Other revenue
Dividends received
367,500
-
Management charges
100,730
113,643
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
3,262
(20,705)
Fees payable to the company's auditor for the audit of the company's financial statements
16,500
16,300
Depreciation of owned tangible fixed assets
53,562
59,469
Amortisation of intangible assets
9,756
2,606
Loss on disposal of intangible assets
4,143
-
Operating lease charges
201,743
215,334
PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
5
Employees

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

2023
2022
Number
Number
Workshop and Engineering
9
11
Admin
2
2
Directors
3
3
Total
14
16

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
558,488
731,701
Social security costs
61,550
75,364
Pension costs
97,071
45,944
717,109
853,009
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
227,233
227,198
Company pension contributions to defined contribution schemes
67,671
19,639
294,904
246,837

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2022 - 2).

Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
115,839
115,839
Company pension contributions to defined contribution schemes
11,167
11,167
7
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
(3,376)
52,420
PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
8
Intercompany loan written off
2023
2022
£
£
Intercompany loan written off
38,806
-
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
-
0
(39,851)

Changes to the UK corporation tax rates were substantively enacted as part of Finance Bill 2023 (on 10 January 2023). These changes included an increase in the main rate to 25% from April 2023. Deferred taxes at the balance sheet date, in relation to UK companies, are measured using tax rates enacted as at the balance sheet date (25%).

The actual charge/(credit) 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
361,116
67,218
Expected tax charge based on the standard rate of corporation tax in the UK of 24% (2022: 19%)
84,934
12,771
Tax effect of expenses that are not deductible in determining taxable profit
9,127
5,390
Adjustments in respect of prior years
-
0
(16,920)
Research and development tax credit
-
0
5,379
Dividend income
(86,438)
-
0
Fixed asset differences
(50)
(2,221)
Additional deduction for R&D expenditure
-
0
(22,931)
Movement in deferred tax not recognised
(8,049)
(28,051)
Remeasurement of deferred tax for changes in tax rates
476
6,732
Taxation charge/(credit) for the year
-
(39,851)
PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
10
Intangible fixed assets
Patents
Development Costs
Total
£
£
£
Cost
At 1 January 2023
81,590
310,666
392,256
Additions
18,728
-
0
18,728
Disposals
-
0
(20,727)
(20,727)
At 31 December 2023
100,318
289,939
390,257
Amortisation and impairment
At 1 January 2023
63,827
306,523
370,350
Amortisation charged for the year
9,756
-
0
9,756
Disposals
-
0
(16,584)
(16,584)
At 31 December 2023
73,583
289,939
363,522
Carrying amount
At 31 December 2023
26,735
-
0
26,735
At 31 December 2022
17,763
4,143
21,906
11
Tangible fixed assets
Tennant improvements
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 January 2023
56,206
519,734
35,200
74,501
17,672
703,313
Additions
-
0
2,848
-
0
-
0
-
0
2,848
At 31 December 2023
56,206
522,582
35,200
74,501
17,672
706,161
Depreciation and impairment
At 1 January 2023
42,452
473,042
31,966
53,595
17,672
618,727
Depreciation charged in the year
2,452
38,878
1,781
10,451
-
0
53,562
At 31 December 2023
44,904
511,920
33,747
64,046
17,672
672,289
Carrying amount
At 31 December 2023
11,302
10,662
1,453
10,455
-
0
33,872
At 31 December 2022
13,754
46,692
3,234
20,906
-
0
84,586
PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
12
Fixed asset investments
2023
2022
£
£
Unlisted investments
143,546
144,191
Movements in fixed asset investments
Shares in group undertakings and participating interests
£
Cost
At 1 January 2023
144,191
Disposals
(645)
At 31 December 2023
143,546
Carrying amount
At 31 December 2023
143,546
At 31 December 2022
144,191
13
Subsidiaries

Details of the company's subsidiaries at 31 December 2023 are as follows:

Name of undertaking
Registered office
Nature of business
Class of shares held
% Held
Direct
Indirect
Phuel Norway AS
Norway
Tool rental
Ordinary
100.00
-
Phuel Oil Tools S.A.
Saudi Arabia
Sale and maintenance
of wireline pressure
control equipment
Ordinary
60.00
-
14
Stocks
2023
2022
£
£
Raw materials and consumables
1,038,473
936,827
Work in progress
115,197
108,444
Finished goods and goods for resale
329,184
292,974
1,482,854
1,338,245
PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
15
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
404,443
509,359
Corporation tax recoverable
-
0
39,851
Amounts owed by group undertakings
577,854
217,788
Amounts owed by undertakings in which the company has a participating interest
469,324
330,037
Other debtors
114,768
125,860
Prepayments and accrued income
187,996
61,512
1,754,385
1,284,407
16
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans
18
-
0
564,351
Trade creditors
415,691
486,548
Amounts owed to group undertakings
1,326,959
676,245
Taxation and social security
68,194
19,124
Other creditors
24,944
-
0
Accruals and deferred income
108,678
371,384
1,944,466
2,117,652

 

17
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans
18
-
0
262,500

The bank loan was repaid in full during October 2023. Interest was payable at 10% per annum. The bank loan was secured by a parent company guarantee.

18
Loans and overdrafts
2023
2022
£
£
Bank loans
-
0
826,851
Payable within one year
-
0
564,351
Payable after one year
-
0
262,500
PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
19
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
97,071
45,944

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

20
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
923,461
480,200
923,461
480,200
Ordinary A shares of £1 each
1,499,985
1,499,985
1,499,985
1,499,985
Ordinary B shares of £1 each
72,000
72,000
72,000
72,000
2,495,446
2,052,185
2,495,446
2,052,185

On 25 September 2023, the company issued 443,261 Ordinary Shares of £1 each for a consideration of £662,232 resulting in a share premium of £218,971.

 

All share classifications carry equal rights but for voting rights, Ordinary A Shares are non-voting shares. Ordinary B shares are also non-voting shares until they are fully paid.

21
Share premium account

The share premium account represents the excess amount received by the company over the par value of its shares.

22
Profit and loss reserves

The profit and loss account represents cumulative realisable profits and losses.

23
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
140,199
101,863
Between two and five years
320,405
348,070
Total
460,604
449,933
PHUEL OIL TOOLS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
24
Related party transactions
Transactions with related parties

During the year the company entered into the following transactions with related parties:

Sales
Sales
Purchases
Purchases
2023
2022
2023
2022
£
£
£
£
Entities over which the entity has control, joint control or significant influence
327,877
463,265
1,417
-
The following amounts were outstanding at the reporting end date:

 

2023
2022
Amounts due to related parties
£
£
Entities with control, joint control or significant influence over the company
-
0
4,600

The company's ultimate parent company, Habu Holding AS, had provided a guarantee to the bank in respect of the company's borrowings. A charge of £8,414 (2022: £32,787) was made during the year in relation to this guarantee. At year end there was no accrual (2022: £196,695) because the loan was repaid in full during October 2023.

25
Ultimate controlling party

Up until 14 September 2023 the company was controlled by its parent company Habu Services AS, a company incorporated in Norway. Subsequent to this date, the company's immediate parent company is Dwellop AS, a company incorporated in Norway.

 

The largest group in which the financial results of the company are consolidated is headed by Habu Holding AS, a company incorporated in Norway. The consolidated accounts for Habu Holding AS can be obtained from Energivegen 20, 4056 Tananger, Norway.

26
Company information

Phuel Oil Tools Limited is a private company limited by shares incorporated in Scotland. The registered office is Brodies House, 31-33 Union Grove, Aberdeen, AB10 6SD.

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