Company registration number 02836965 (England and Wales)
THE SILVER CRANE COMPANY LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024
THE SILVER CRANE COMPANY LIMITED
CONTENTS
Page
Company information
1
Strategic report
2 - 4
Directors' report
5
Directors' responsibilities statement
6
Independent auditor's report
7 - 10
Income statement
11
Statement of financial position
12
Statement of changes in equity
13
Statement of cash flows
14
Notes to the financial statements
15 - 27
THE SILVER CRANE COMPANY LIMITED
COMPANY INFORMATION
- 1 -
Directors
V Darwin
A Goodman
J Goodman
R Goodman
S Goodman
Secretary
P Streatfield
Company number
02836965
Registered office
7-10 Riding School Yard
Somerley
Ringwood
Hampshire
United Kingdom
BH24 3PL
Auditor
Azets Audit Services
37 Commercial Road
Poole
Dorset
BH14 0HU
THE SILVER CRANE COMPANY LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JANUARY 2024
- 2 -
The directors present their Strategic Report for the year ended 31 January 2024.
This Strategic Report has been prepared solely to provide additional information to shareholders to assess the Company’s strategies and the potential for those strategies to succeed.
The Strategic Report contains certain forward-looking statements. These statements are made by the directors in good faith based on the information available to them up to the time of approval of this report, and such statements should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying any forward‑looking information.
The directors, in preparing this Strategic Report, have complied with s414C of the Companies Act 2006.
The Company designs, manufactures and distributes a range of decorative gifting products for the retail sectors. The Company, family owned, is based in Ringwood, Dorset. It subcontracts its manufacturing operations to factories in China and now utilises its own warehousing and packing operations in the UK supplemented by third parties to distribute its goods.
The Company sales historically are primarily in the UK, but the business has also secured healthy markets in the US and Europe.
Review of the business
The Company in the year to 31 January 2024 experienced a further significant increase in sales of 20% (year to January 2023 – an increase of 41.8%). The business has seen further consolidation of its increased sales activity arising from the adverse impact of the pandemic. The travel retail sector has returned to pre-pandemic levels as people are now confident in travelling overseas. The retail sector remains strong and consistent across most countries in which we trade.
Shipping and container availability returned to normal and capacity has increased in both areas to cater for the current level of demand. Consequently, with increased competition, these costs have fallen significantly which together with increased capacity in these sectors has contributed to a much improved operating profit.
Our overheads have increased to cater for the increased activity in selling and support services, and with the removal of travel restrictions the company has continued its aim of promoting its goods at shows and exhibitions around the world. The resulting operating profit has improved to £3,620k (2023: £2,439k).
The Balance Sheet position continues to strengthen from a net asset perspective and is consistent with previous years. Working capital has improved as a result of improved trading. Overall average employee numbers have increased to support the business growth. This growth is largely in our warehouse and packing operations where we have increasingly used our own staff rather than third parties. The office-based employees have increased throughout this period providing the necessary experience and continuity to support current and future growth.
Future developments
Since the Company’s year end the level of trading activity has remained strong in most markets. Travel retail is now operating at pre-pandemic levels, having lagged last year. The order book remains strong.
After a return to some degree of normality in shipping costs the beginning of 2024 saw unrest in the Middle East with the result that journey times increased as ships took alternative routes around South Africa and demand was brought forward, leading to a return to escalating costs. This will impact our margins.
The business has inevitably been impacted by UK inflationary pressures and the increased costs of borrowing. Businesses have not been subject to such sustained inflation increases since the late 1980s and early 1990s, some 30 years ago. It has not always been possible to pass on these increased costs due to the markets that we serve. UK base rate interest rates have escalated during the period from 3.5% to 5.25% increasing our costs of borrowing.
Our business strategy has not fundamentally changed during the period. The Company is seeking to consolidate its position in the UK market, to increase its presence in the US and to introduce new products in an ever-changing marketplace. To achieve and maintain our position it is essential to remain competitive on lead times, quality, innovation of design, price and delivery.
THE SILVER CRANE COMPANY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 3 -
Principal risks and uncertainties
The business continues to experience uncertainty and fluctuations in foreign currency, especially in US dollar and Euro. These situations will be closely monitored. The Company has a US dollar timing exposure as most of its products are made in China, paid for in dollars and subsequently invoiced to its customers in dollars.
Supply chain
The Company is dependent for its products on its sub‑contract manufacturing relationships in China and the ability to transport its goods in a timely manner around the world. The need for consistently high quality and on time delivery is paramount. These relationships are constantly monitored, and procurement practices remain under regular review and scrutiny.
Credit risk
The Company attempts to reduce its exposure to debtor default in most cases using credit insurance. Overdue debts are monitored constantly.
Employees
The Company’s performance depends on its management team, sales, design and support services staff. The resignation of key individuals and the inability to recruit people with the right experience and skills could affect performance. To mitigate these issues the Company actively encourages training and personnel development.
Competitors
The business operates in a highly competitive market with particular emphasis on price, delivery, design and quality. Our customers have high expectations which we aspire to meet. To mitigate this risk, we review and protect our designs, our product offering, new and existing markets and competitor activity.
Key performance indicators
The Company reviews the following key performance indicators:
| | | Definition and method of calculation |
Growth/(decline) in sales | | | Year‑on‑year sales growth as a % |
| | | Operating profit as a % of revenue |
Other performance indicators
As a family business the management team meet on a regular basis to discuss the business and make appropriate decisions. Where necessary the Company seeks advice from third parties.
The Company is conscious of the need to retain key employees as they will be essential to the business growing and succeeding.
| | | Definition and method of calculation |
| | | Average monthly employee numbers |
THE SILVER CRANE COMPANY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 4 -
A Goodman
Director
5 November 2024
THE SILVER CRANE COMPANY LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JANUARY 2024
- 5 -
The directors present their annual report and financial statements for the year ended 31 January 2024.
Principal activities
The principal activity of the company continued to be that of the production of tins.
Results and dividends
The operating profit for the year ended amounted to £3,619,966 (year ended 31 January 2023 ‑ £2,438,790).
Ordinary dividends were paid amounting to £639,410. The directors do not recommend payment of a further dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
V Darwin
A Goodman
J Goodman
R Goodman
S Goodman
Auditor
Azets Audit Services 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.
Directors’ confirmations
In the case of each director in office at the date the directors’ report is approved:
so far as the director is aware, there is no relevant audit information of which the company’s auditors are unaware; and
they have taken all the steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company’s auditors are aware of that information.
On behalf of the board
A Goodman
Director
5 November 2024
THE SILVER CRANE COMPANY LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 JANUARY 2024
- 6 -
The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulation.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have prepared the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”, and applicable law).
Under company law, 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 the financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
state whether applicable United Kingdom Accounting Standards, comprising FRS 102 have been followed, subject to any material departures disclosed and explained in the financial statements;
make judgements and accounting estimates that are reasonable and prudent; and
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 safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The directors are also 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.
THE SILVER CRANE COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF THE SILVER CRANE COMPANY LIMITED
- 7 -
Opinion
We have audited the financial statements of The Silver Crane Company Limited (the 'company') for the year ended 31 January 2024 which comprise the income statement, the statement of financial position, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 January 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.
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.
THE SILVER CRANE COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF THE SILVER CRANE COMPANY LIMITED
- 8 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the 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:
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.
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.
THE SILVER CRANE COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF THE SILVER CRANE COMPANY LIMITED
- 9 -
Extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.
We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework. Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.
In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:
Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud;
Reviewing minutes of meetings of those charged with governance;
Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the company through enquiry and inspection;
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias.
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 of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the manufacturing sector;
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation and data protection, anti-bribery, employment, environmental and health and safety legislation;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
To address the risk of fraud through management bias and override of controls, we:
performed analytical procedures to identify any unusual or unexpected relationships;
tested journal entries to identify unusual transactions;
assessed whether judgments and assumptions made in determining the accounting estimates set out in the accounting policies were indicative of potential bias; and
investigated the rationale behind significant or unusual transactions.
THE SILVER CRANE COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF THE SILVER CRANE COMPANY LIMITED
- 10 -
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.
Mr Paul Francis
Senior Statutory Auditor
For and on behalf of Azets Audit Services
6 November 2024
Chartered Accountants
Statutory Auditor
37 Commercial Road
Poole
Dorset
BH14 0HU
THE SILVER CRANE COMPANY LIMITED
INCOME STATEMENT
FOR THE YEAR ENDED 31 JANUARY 2024
- 11 -
2024
2023
Notes
£
£
Turnover
3
35,635,710
29,696,077
Cost of sales
(28,182,911)
(24,191,179)
Gross profit
7,452,799
5,504,898
Administrative expenses
(3,832,833)
(3,067,638)
Other operating income
1,530
Operating profit
4
3,619,966
2,438,790
Interest receivable and similar income
7
55,414
74,373
Interest payable and similar expenses
8
(264,735)
(157,311)
Exceptional item
9
500,000
-
Profit before taxation
3,910,645
2,355,852
Tax on profit
10
(1,005,682)
(472,125)
Profit for the financial year
2,904,963
1,883,727
The income statement has been prepared on the basis that all operations are continuing operations.
The notes on pages 15 to 27 form part of these financial statements.
THE SILVER CRANE COMPANY LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 JANUARY 2024
31 January 2024
- 12 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
12
8,562,034
6,699,310
Current assets
Stocks
14
1,033,131
1,400,251
Debtors
15
3,854,574
4,210,181
Cash at bank and in hand
2,416,599
2,227,641
7,304,304
7,838,073
Creditors: amounts falling due within one year
16
(3,003,974)
(3,574,081)
Net current assets
4,300,330
4,263,992
Total assets less current liabilities
12,862,364
10,963,302
Creditors: amounts falling due after more than one year
17
(3,254,364)
(3,625,213)
Provisions for liabilities
Deferred tax liability
19
172,058
167,700
(172,058)
(167,700)
Net assets
9,435,942
7,170,389
Capital and reserves
Called up share capital
21
1,770
1,770
Profit and loss reserves
9,434,172
7,168,619
Total equity
9,435,942
7,170,389
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:
A Goodman
Director
Company Registration No. 02836965
THE SILVER CRANE COMPANY LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2024
- 13 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 February 2022
1,770
5,284,892
5,286,662
Year ended 31 January 2023:
Profit and total comprehensive income for the year
-
1,883,727
1,883,727
Balance at 31 January 2023
1,770
7,168,619
7,170,389
Year ended 31 January 2024:
Profit and total comprehensive income for the year
-
2,904,963
2,904,963
Dividends
11
-
(639,410)
(639,410)
Balance at 31 January 2024
1,770
9,434,172
9,435,942
THE SILVER CRANE COMPANY LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 JANUARY 2024
- 14 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
25
4,406,422
1,211,163
Interest paid
(264,735)
(157,311)
Income taxes paid
(731,076)
(10,009)
Net cash inflow from operating activities
3,410,611
1,043,843
Investing activities
Purchase of tangible fixed assets
(2,151,183)
(110,328)
Advance of director loan
(115,625)
(504,617)
Interest received
55,414
74,373
Net cash used in investing activities
(2,211,394)
(540,572)
Financing activities
Repayment of bank loans
(370,849)
(376,473)
Dividends paid
(639,410)
Net cash used in financing activities
(1,010,259)
(376,473)
Net increase in cash and cash equivalents
188,958
126,798
Cash and cash equivalents at beginning of year
2,227,641
2,100,843
Cash and cash equivalents at end of year
2,416,599
2,227,641
THE SILVER CRANE COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024
- 15 -
1
Accounting policies
Company information
The Silver Crane Company Limited is a private company limited by shares incorporated in England and Wales. The registered office is 7-10 Riding School Yard, Somerley, Ringwood, Hampshire, United Kingdom, BH24 3PL.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, The principal accounting policies adopted are set out below.
1.2
Going concern
Atruet the time of approving the financial statements, the 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 goods provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (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.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
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:
Freehold land and buildings
3% Straight line
Plant and equipment
15% - 50% Straight line
Fixtures and fittings
15% Straight line
Computers
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.
THE SILVER CRANE COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 16 -
1.5
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
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.
1.6
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.
1.7
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's statement of financial position 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.
THE SILVER CRANE COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 17 -
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the 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.
THE SILVER CRANE COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 18 -
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement 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 income statement, 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.
THE SILVER CRANE COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 19 -
1.11
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.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
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.
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.
Stock Provision
At each reporting date, the company's stock holding is analysed to identify items which may be obsolete and a provision is made against those items. A provision of £460,283 (31 January 2023 - £289,218) is held at 31 January 2024.
Debtor Provision
At each reporting date, the company's debtor balance is reviewed to identify balances against which specific provisions are required. No specific provisions were considered necessary at 31 January 2024 (31 January 2023 - £NIL)
3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
24,919,378
20,591,351
Rest of Europe
1,446,368
1,588,162
Rest of World
9,269,964
7,516,564
35,635,710
29,696,077
THE SILVER CRANE COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
3
Turnover and other revenue
(Continued)
- 20 -
2024
2023
£
£
Other revenue
Interest income
55,414
74,373
4
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
69,844
(73,564)
Fees payable to the company's auditor for the audit of the company's financial statements
20,500
27,000
Depreciation of owned tangible fixed assets
288,459
286,170
Cost of stocks recognised as an expense
24,448,201
21,606,592
Operating lease charges
52,100
50,633
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Directors
5
5
Warehouse and office staff
106
97
Total
111
102
Their aggregate remuneration comprised:
2024
2023
£
£
Wages and salaries
4,120,568
3,289,405
Social security costs
255,590
230,470
Pension costs
312,379
75,729
4,688,537
3,595,604
THE SILVER CRANE COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 21 -
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
96,444
356,726
Company pension contributions to defined contribution schemes
245,169
15,410
341,613
372,136
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2023 - 3).
2024
2023
£
£
Remuneration for qualifying services
n/a
87,333
As total directors' remuneration was less than £200,000 in the current year, no disclosure is provided for the year.
7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
44,273
Other interest income
11,141
74,373
Total income
55,414
74,373
8
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
264,735
157,311
9
Exceptional item
An amount of £500,000 has been recognised in respect of the settlement of a legal dispute. The settlement was confirmed after the year end and was in respect of a claim that existed as at the balance sheet date.
THE SILVER CRANE COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 22 -
10
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
997,546
477,693
Adjustments in respect of prior periods
3,778
Total current tax
1,001,324
477,693
Deferred tax
Origination and reversal of timing differences
4,358
(5,568)
Total tax charge
1,005,682
472,125
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2024
2023
£
£
Profit before taxation
3,910,645
2,355,852
Expected tax charge based on the standard rate of corporation tax in the UK of 24.00% (2023: 19.00%)
938,555
447,612
Tax effect of expenses that are not deductible in determining taxable profit
24,710
57,588
Adjustments in respect of prior years
3,778
Permanent capital allowances in excess of depreciation
34,281
(27,507)
Movement in deferred tax
4,358
(5,568)
Taxation charge for the year
1,005,682
472,125
11
Dividends
2024
2023
£
£
Final paid
639,410
THE SILVER CRANE COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 23 -
12
Tangible fixed assets
Freehold land and buildings
Assets under construction
Plant and equipment
Fixtures and fittings
Computers
Total
£
£
£
£
£
£
Cost
At 1 February 2023
6,910,221
770,867
8,505
239,297
7,928,890
Additions
2,006,075
120,437
24,671
2,151,183
Disposals
(298,503)
(6,229)
(111,768)
(416,500)
At 31 January 2024
6,910,221
2,006,075
592,801
2,276
152,200
9,663,573
Depreciation and impairment
At 1 February 2023
608,240
446,879
7,394
167,067
1,229,580
Depreciation charged in the year
169,222
95,873
325
23,039
288,459
Eliminated in respect of disposals
(298,503)
(6,229)
(111,768)
(416,500)
At 31 January 2024
777,462
244,249
1,490
78,338
1,101,539
Carrying amount
At 31 January 2024
6,132,759
2,006,075
348,552
786
73,862
8,562,034
At 31 January 2023
6,301,981
323,988
1,111
72,230
6,699,310
13
Financial instruments
2024
2023
£
£
Carrying amount of financial assets measured at amortised cost
Trade debtors
2,433,113
1,707,270
Other debtors
1,283,709
668,294
3,716,822
2,375,564
Carrying amount of financial liabilities at amortised cost
Trade creditors
851,610
2,021,616
Bank loans
3,630,838
4,001,687
Other creditors
575,563
76,623
Accruals
193,923
565,521
5,251,934
6,665,447
14
Stocks
2024
2023
£
£
Finished goods and goods for resale
1,033,131
1,400,251
THE SILVER CRANE COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 24 -
15
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
2,433,113
1,707,270
Other debtors
1,283,709
854,267
Prepayments and accrued income
137,752
1,648,644
3,854,574
4,210,181
16
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loans
18
376,474
376,474
Trade creditors
851,610
2,021,616
Corporation tax
748,175
477,927
Other taxation and social security
258,229
55,920
Other creditors
575,563
76,623
Accruals and deferred income
193,923
565,521
3,003,974
3,574,081
17
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Bank loans and overdrafts
18
3,254,364
3,625,213
18
Loans and overdrafts
2024
2023
£
£
Bank loans
3,630,838
4,001,687
Payable within one year
376,474
376,474
Payable after one year
3,254,364
3,625,213
The long-term loans are secured by fixed charges over freehold buildings.
THE SILVER CRANE COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 25 -
19
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
172,058
167,700
2024
Movements in the year:
£
Liability at 1 February 2023
167,700
Charge to profit or loss
4,358
Liability at 31 January 2024
172,058
The deferred tax liability set out above is expected to reverse within 12 months and relates to accelerated capital allowances that are expected to mature within the same period.
20
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
312,379
75,729
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. The pension cost charge for the year ended 31 January 2024 represents contributions payable by the company to the fund as well as cetrain employees' personal schemes and amounted to £312,379 (2023 - £75,729). Contrinutions totalling £41,646 (2023 - £29,677) were payable to the fund at the balance sheet date.
21
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary A shares of £1 each
425
1,770
425
1,770
Ordinary B shares of £1 each
425
-
425
-
Ordinary C shares of £1 each
230
-
230
-
Ordinary D shares of £1 each
230
-
230
-
Ordinary E shares of £1 each
230
-
230
-
Ordinary F shares of £1 each
230
-
230
-
1,770
1,770
1,770
1,770
During the year ordinary share capital was redesignated from 1,770 £1 class A shares to 1,700 £1 class A - F shares in the values split as per above.
THE SILVER CRANE COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 26 -
22
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
77,926
50,000
Between two and five years
169,456
150,000
247,382
200,000
23
Directors' transactions
During the course of the year, the company paid dividends of £639,410 (31 January 2023 - £Nil) to the directors. At the year end, the company was owed £620,242 (31 January 2023 - £504,617) by the directors. Interest of 2% is charged on the balances with directors. During the year, interest of £11,141 was charged (31 January 2023 - £9,002).
Key management personnel are considered to be the directors, whose remuneration is disclosed in note 6.
24
Ultimate controlling party
The directors do not consider there to be an ultimate controlling party.
25
Cash generated from operations
2024
2023
£
£
Profit for the year after tax
2,904,963
1,883,727
Adjustments for:
Taxation charged
1,005,682
472,125
Finance costs
264,735
157,311
Investment income
(55,414)
(74,373)
Depreciation and impairment of tangible fixed assets
288,459
286,170
Movements in working capital:
Decrease/(increase) in stocks
367,120
(515,144)
Decrease/(increase) in debtors
471,232
(892,228)
Decrease in creditors
(840,355)
(106,425)
Cash generated from operations
4,406,422
1,211,163
THE SILVER CRANE COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 27 -
26
Analysis of changes in net debt
1 February 2023
Cash flows
31 January 2024
£
£
£
Cash at bank and in hand
2,227,641
188,958
2,416,599
Borrowings excluding overdrafts
(4,001,687)
370,849
(3,630,838)
(1,774,046)
559,807
(1,214,239)
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