Company registration number 12952157 (England and Wales)
KUBA GROUP LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
KUBA GROUP LTD
COMPANY INFORMATION
Directors
Mr D Saville
Mr A Ross
Mr S Gallagher
Mr D Hope
Secretary
ICM Administration Limited
Company number
12952157
Registered office
Ridgecourt
The Ridge
Epsom
Surrey
KT18 7EP
Auditor
Mercer & Hole LLP
Trinity Court
Church Street
Rickmansworth
WD3 1RT
KUBA GROUP LTD
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Group income statement
8
Group statement of comprehensive income
9
Group statement of financial position
10 - 11
Group statement of changes in equity
12
Group statement of cash flows
13
Notes to the group financial statements
14 - 34
Parent company statement of financial position
35
Parent company statement of changes in equity
36
Notes to the parent company financial statements
37 - 38
KUBA GROUP LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 1 -

The directors present the strategic report for the year ended 30 June 2023.

Review of the business

Kuba Group Limited (Kuba) and its subsidiaries (the Group) is a global key market participant in Automatic Fare Collection (AFC). Our innovative and convenient mobility solutions support riders and drivers in over 500 cities and regions globally. We have delivered on key projects, secured important new business, in both Europe and the US, further strengthening our position as key market participant in the AFC arena.

 

The forthcoming year sees a continuation of this growth as we have continued to invest in the development of our next generation AFC system, a SaaS offering designed to be quicker and easier to deploy to meet customer and market needs. The first customer launch of the product was completed in June 2023 as part of a wider platform roll out in the Nouvelle Acquitaine Region in France.

Financial Performance

The year saw impressive revenue growth across Kuba's markets as a number of significant new contracts were secured, in all regions, whilst other contracts entered the delivery phase. The result was a 36% increase in year on year revenue to £26.5m. Revenue is a key performance indicator for the group.

 

As the business continued to invest in growth, overhead costs rose in line with expectations with EBITDA for the year decreasing to a loss of £799,375 from £758,880. This investment will enable the business to effectively deliver against the new customer contracts that were secured within the year delivering additional revenue growth and profitability.

 

 

Operating Loss

(£3,226,004)

(£1,830,269)

Foreign Exchange (gain)/ loss

(£115,648)

£12,144

Depreciation

£1,588,076

£598,219

Amortisation

£954,201

£461,026

EBITDA

(£799,375)

(£758,880)

 

 

Market Insights & Strategic Approach

Efficient public transport is central to positive, sustainable change in our world. From cutting emissions and boosting the local economy to removing societal barriers and opening up new opportunities. Based on our market leading technology, Kuba works with world leading transit agencies and operators to expand and secure ridership, remove barriers to mobility and increase revenues.

 

This trend is expected to continue as governments in advanced economies in Europe and the US are expected to make more funding available for transport agencies, which will translate to more opportunities for the Group.

 

Our strategy for the next financial year continues to orbit around two key pillars:

 

  1. Benefiting from continued support from ICM Mobility Group, we intend to amplify our investments in our AFC platforms, assuring they remain market leading. These investments will centre on delivering functionally rich, multi-tenant systems, enabling rapid onboarding of new business and providing a mature upgrade pathway for our existing customers.

  2. We plan to venture into related businesses to diversify revenue and capitalise on market synergies. This includes transit-related data services, integrated mobility solutions, and a strategic foray into the EV charging market.

Commitment to ESG Principles

Our dedication towards Environmental, Social, and Governance (ESG) principles is unwavering. Our ESG strategy revolves around reducing our environmental footprint, making positive contributions to our communities, and fostering a culture of transparency, accountability, and robust governance.

 

KUBA GROUP LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 2 -
Risks and Mitigation

We recognise potential risks, including technological disruptions, regulatory changes, and economic uncertainties. To mitigate these risks, we have in place comprehensive strategies that encompass continuous market trend monitoring, stringent compliance procedures, and maintaining a robust financial buffer to absorb potential shocks.

 

Foreign currency risk

 

The company's principal foreign currency exposures arise from trading with overseas companies. The company policy permits but does not mandate hedging.

 

Market risk

 

Market risk represents the risk that the fair value of future expected cashflows of a particular financial instrument will fluctuate because of changes in market price. This is primarily comprised of interest rate risk, currency risk and equity price risk.

 

Liquidity risk

 

The company manages its cash and borrowing requirements in order to maximise the interest income and minimises the finance cost, whilst ensuring the company has sufficient liquid resource to meet the operating needs of the company.

 

Credit risk

 

Investments of cash surpluses, borrowings and financial instruments are made through banks and companies which must fulfil management's approval criteria.

 

All customers who wish to trade on credit terms are subject to credit verification procedures. Trade recievables are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

 

At 30 June 2023 all borrowings were repayable within 12 months, with the exception of lease liabilities with maturity as disclosed in note 18.

Outlook

The outlook for Kuba in the coming year remains robust. The continued deployment of new projects and the transitioning of existing deployments to operations, leaves the business with a healthy sales mix and strong revenue growth for 2024. Combined with the continued focus on enhancing our AFC systems and venturing into associated sectors means that we are well prepared for future growth.

 

We extend our heartfelt gratitude to our dedicated team, clients, and shareholders for their unwavering trust and support. We remain resolutely committed to delivering value and eagerly anticipate another year of success.

On behalf of the board

Mr A Ross
Director
19 November 2024
KUBA GROUP LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 3 -

The directors present their annual report and financial statements for the year ended 30 June 2023.

Principal activities

The principal activity of the group continued to be that of technology services.

Results and dividends

The results for the year are set out on page 8.

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

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

Directors

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

Mr D Saville
Mr A Ross
Mr S Gallagher
Mr D Hope
Auditor

In accordance with the company's articles, a resolution proposing that be reappointed as auditor of the company and group will be put at a General Meeting.

Statement of disclosure to auditor

Each director in office at the date of approval of this annual report confirms that:

 

This confirmation is given and should be interpreted in accordance with the provisions of section 418 of the Companies Act 2006.

On behalf of the board
Mr A Ross
Director
19 November 2024
KUBA GROUP LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 JUNE 2023
- 4 -

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

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the group and parent company financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the United Kingdom. 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, International Accounting Standard 1 requires that directors:

 

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.

KUBA GROUP LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF KUBA GROUP LTD
- 5 -
Opinion

We have audited the financial statements of Kuba Group Ltd (the ‘parent company’) and its subsidiaries (the ‘group’) for the year ended 30 June 2023 which comprise the group income statement, the group statement of comprehensive income, the group and parent company statement of financial position, the group and parent company statement of changes in equity, the group statement of cash flows and the group and parent company notes to the financial statements, including significant accounting policies.

 

The financial reporting framework that has been applied in their preparation is applicable law and UK adopted international accounting standards.

In our opinion:

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 group and parent 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 group's and parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

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:

KUBA GROUP LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF KUBA GROUP LTD
- 6 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the parent 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 parent 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.

Extent to which the audit was considered capable of detecting irregularities, including fraud

We gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates and considered the risk of acts by the company that were contrary to applicable laws and regulations, including fraud. These included, but were not limited to, the Companies Act 2006 and tax legislation.

We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements and the financial report (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate entries including journals to overstate revenue or understate expenditure and management bias in accounting estimates

Audit procedures performed by the engagement team included:

 

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non- compliance and cannot be expected to detect non-compliance with all laws and regulations.

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.

KUBA GROUP LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF KUBA GROUP LTD
- 7 -

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.

Mark Cassidy FCA (Senior Statutory Auditor)
For and on behalf of Mercer & Hole LLP
19 November 2024
Chartered Accountants
Statutory Auditor
Trinity Court
Church Street
Rickmansworth
WD3 1RT
KUBA GROUP LTD
GROUP INCOME STATEMENT
FOR THE YEAR ENDED 30 JUNE 2023
- 8 -
2023
2022
as restated
Notes
£
£
Revenue
3
26,487,654
19,512,966
Cost of sales
(10,396,158)
(5,050,744)
Gross profit
16,091,496
14,462,222
Other operating income
1,967,881
169,978
Administrative expenses
(21,285,381)
(16,462,469)
Operating loss
4
(3,226,004)
(1,830,269)
Share of profits of associates
44,148
41,279
Investment revenues
8
53,455
24,470
Finance costs
9
(97,177)
(95,731)
Other gains and losses
10
953,574
830,994
Loss before taxation
(2,272,004)
(1,029,257)
Income tax (income)/expense
11
49,402
(155,144)
Loss for the year
(2,222,602)
(1,184,401)
The income statement has been prepared on the basis that all operations are continuing operations.
Profit for the financial year is all attributable to the owners of the parent company.
KUBA GROUP LTD
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2023
- 9 -
2023
2022
as restated
£
£
Loss for the year
(2,222,602)
(1,184,401)
Other comprehensive income:
Items that may be reclassified to profit or loss
Currency translation differences:
- Translation (loss)/gain arising in the year
(441,449)
42,730
Total comprehensive income for the year
(2,664,051)
(1,141,671)
Total comprehensive income for the year is all attributable to the owners of the parent company.
KUBA GROUP LTD
GROUP STATEMENT OF FINANCIAL POSITION
AS AT
30 JUNE 2023
30 June 2023
- 10 -
2023
2022
as restated
Notes
£
£
Non-current assets
Goodwill
13
6,885,616
6,885,616
Intangible assets
13
4,622,272
2,918,432
Property, plant and equipment
14
3,484,771
3,322,670
Investments
15
340,968
356,453
Other receivables
19
5,639
6,797
Deferred tax asset
22
450,219
424,936
15,789,485
13,914,904
Current assets
Inventories
18
3,780,306
3,701,204
Trade and other receivables
19
11,788,942
10,125,581
Current tax recoverable
25,643
-
0
Cash and cash equivalents
837,013
1,355,519
16,431,904
15,182,304
Current liabilities
Trade and other payables
20
17,325,842
13,279,022
Lease liabilities
21
597,039
701,680
17,922,881
13,980,702
Net current (liabilities)/assets
(1,490,977)
1,201,602
Non-current liabilities
Trade and other payables
20
47,108
134,677
Lease liabilities
21
1,329,665
1,581,642
1,376,773
1,716,319
Net assets
12,921,735
13,400,187
Equity
Called up share capital
24
473
453
Share premium account
25
15,935,105
13,749,526
Translation reserve
26
(436,144)
5,305
Retained earnings
(2,577,699)
(355,097)
Total equity
12,921,735
13,400,187
KUBA GROUP LTD
GROUP STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT
30 JUNE 2023
30 June 2023
- 11 -
The financial statements were approved by the board of directors and authorised for issue on 19 November 2024 and are signed on its behalf by:
Mr D Hope
Director
Company registration number 12952157 (England and Wales)
KUBA GROUP LTD
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
- 12 -
Share capital
Share premium account
Currency translation reserve
Retained earnings
Total controlling interest
Notes
£
£
£
£
£
As restated for the period ended 30 June 2022:
Balance at 1 July 2021
452
7,346,231
(37,425)
829,304
8,138,562
Year ended 30 June 2022:
Loss
-
-
-
(1,184,401)
(1,184,401)
Other comprehensive income:
Currency translation differences
-
-
42,730
-
0
42,730
Total comprehensive income
-
-
42,730
(1,184,401)
(1,141,671)
Transactions with owners:
Issue of share capital
24
1
6,403,295
-
-
6,403,296
Balance at 1 July 2022
453
13,749,526
5,305
(355,097)
13,400,187
Adjusted balance at 1 July 2022
453
13,749,526
5,305
(355,097)
13,400,187
Year ended 30 June 2023:
Loss
-
-
-
(2,222,602)
(2,222,602)
Other comprehensive income:
Currency translation differences
-
-
(441,449)
-
0
(441,449)
Total comprehensive income
-
-
(441,449)
(2,222,602)
(2,664,051)
Transactions with owners:
Issue of share capital
24
20
2,185,579
-
-
2,185,599
Balance at 30 June 2023
473
15,935,105
(436,144)
(2,577,699)
12,921,735
KUBA GROUP LTD
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2023
- 13 -
2023
2022
as restated
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
30
1,524,665
1,210,098
Interest paid
(97,177)
(95,731)
Income taxes (paid)/refunded
(1,524)
210,104
Net cash inflow from operating activities
1,425,964
1,324,471
Investing activities
Purchase of intangible assets
(2,658,041)
(4,139,908)
Purchase of property, plant and equipment
(1,771,012)
(1,218,221)
Receipt / (repayment) of loans
850,414
(1,228,908)
Interest received
(107,244)
24,470
Net cash used in investing activities
(3,685,883)
(6,562,567)
Financing activities
Proceeds from issue of shares
2,185,599
6,403,296
Payment of lease liabilities
(444,186)
(847,073)
Net cash generated from financing activities
1,741,413
5,556,223
Net (decrease)/increase in cash and cash equivalents
(518,506)
318,127
Cash and cash equivalents at beginning of year
1,355,519
1,037,392
Cash and cash equivalents at end of year
837,013
1,355,519
KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
- 14 -
1
Accounting policies
Company information

Kuba Group Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Ridgecourt, The Ridge, Epsom, Surrey, United Kingdom, KT18 7EP. The company's principal activities and nature of its operations are disclosed in the directors' report.

 

The group consists of Kuba Group Ltd and all of its subsidiaries.

1.1
Accounting convention

The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted for use in the United Kingdom and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS, except as otherwise stated.

The financial statements are prepared in sterling, which is the functional currency of the group. Monetary amounts in these financial statements are rounded to the nearest £.

 

Transactions in foreign currencies are initially recorded at the functional currency rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling at the balance sheet date with all differences taken to the profit and loss account. Nonmonetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

1.2
Business combinations

The cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill.

The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date.

 

Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date.

1.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Kuba Group Ltd together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 30 June 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 15 -

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

Investments in joint ventures and associates are carried in the group statement of financial position at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

 

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

 

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

1.4
Going concern

These financial statements are prepared on the going concern basis. It has been confirmed with the ultimate parent entity, ICM Mobility Group Limited, that the entity will provide financial assistance as required to enable the entity to meet its financial liabilities as they fall due for a period of at least 12 months from the date of signing these financial statements. Based on ICM Mobility Group Limited's audited financial statements the directors consider there to be sufficient resource to enable the support to be available should it be required. Therefore the directors have at the time of approving the financial statements a reasonable expectation that the company has access to adequate resources to continue its operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in the financial statements.true

1.5
Revenue

Revenue is measured based on the consideration specified in a contract with a customer and excludes amounts collected on behalf of third parties. The group recognises revenue when it transfers control of a product or service to a customer.

 

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.

The group recognises revenue from the following major sources:

 

Revenue from customer contract

 

Revenue from customer contracts is recognised on the following basis:

 

 

Revenue from intercompany service agreements

 

Revenue from intercompany service agreements is recognised based on the agreements in place. When services are transferred between group companies the revenue is recognised when it can be measured reliably, and it is probable that the consideration will be received.

KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 16 -
1.6
Goodwill

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less impairment losses.

 

The gain on a bargain purchase is recognised in profit or loss in the period of the acquisition.

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit. An impairment loss recognised for goodwill is not subsequently reversed.

1.7
Intangible 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:

1.8
Property, plant and equipment

Property, plant and equipment 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:

Leasehold land and buildings
Straight Line over the term of the lease
Fixtures and fittings
Straight Line over 5 years
Plant and equipment
Straight Line over 5 years
Computers
Straight Line over 3 years
Motor vehicles
Straight Line over 5 years
WIP
WIP is not depreciated until completion of the project
Right of use assets
Straight Line over the term of the lease

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 recognised in the income statement.

1.9
Non-current 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.

KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 17 -

A subsidiary is an entity controlled by the parent 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 group holds a long-term interest and has significant influence. The group 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 group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

1.10
Impairment of tangible and intangible assets

At each reporting end date, the group 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 group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment annually, and whenever there is an indication that the asset may be impaired.

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.

 

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.

1.11
Inventories

Inventories 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 inventories to their present location and condition.

 

Inventories 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.

Net realisable value is the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution.

1.12
Cash and cash equivalents

Cash and cash equivalents 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.

KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 18 -
1.13
Financial assets

Financial assets are recognised in the group's statement of financial position when the group becomes party to the contractual provisions of the instrument. Financial assets are classified into specified categories, depending on the nature and purpose of the financial assets.

 

At initial recognition, financial assets classified as fair value through profit and loss are measured at fair value and any transaction costs are recognised in profit or loss. Financial assets not classified as fair value through profit and loss are initially measured at fair value plus transaction costs.

Financial assets at fair value through profit or loss

When any of the above-mentioned conditions for classification of financial assets is not met, a financial asset is classified as measured at fair value through profit or loss. Financial assets measured at fair value through profit or loss are recognized initially at fair value and any transaction costs are recognised in profit or loss when incurred. A gain or loss on a financial asset measured at fair value through profit or loss is recognised in profit or loss, and is included within finance income or finance costs in the statement of income for the reporting period in which it arises.

Financial assets held at amortised cost

Financial instruments are classified as financial assets measured at amortised cost where the objective is to hold these assets in order to collect contractual cash flows, and the contractual cash flows are solely payments of principal and interest. They arise principally from the provision of goods and services to customers (eg trade receivables). They are initially recognised at fair value plus transaction costs directly attributable to their acquisition or issue, and are subsequently carried at amortised cost using the effective interest rate method, less provision for impairment where necessary.

Financial assets at fair value through other comprehensive income

Debt instruments are classified as financial assets measured at fair value through other comprehensive income where the financial assets are held within the group’s business model whose objective is achieved by both collecting contractual cash flows and selling financial assets, and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

 

A debt instrument measured at fair value through other comprehensive income is recognised initially at fair value plus transaction costs directly attributable to the asset. After initial recognition, each asset is measured at fair value, with changes in fair value included in other comprehensive income. Accumulated gains or losses recognised through other comprehensive income are directly transferred to profit or loss when the debt instrument is derecognised.

The parent company has made an irrevocable election to recognize changes in fair value of investments in equity instruments through other comprehensive income, not through profit or loss. A gain or loss from fair value changes will be shown in other comprehensive income and will not be reclassified subsequently to profit or loss. Equity instruments measured at fair value through other comprehensive income are recognized initially at fair value plus transaction cost directly attributable to the asset. After initial recognition, each asset is measured at fair value, with changes in fair value included in other comprehensive income. Accumulated gains or losses recognized through other comprehensive income are directly transferred to retained earnings when the equity instrument is derecognized or its fair value substantially decreased. Dividends are recognized as finance income in profit or loss.

Impairment of financial assets

Financial assets carried at amortised cost and FVOCI are assessed for indicators of impairment at each reporting end date.

 

The expected credit losses associated with these assets are estimated on a forward-looking basis. A broad range of information is considered when assessing credit risk and measuring expected credit losses, including past events, current conditions, and reasonable and supportable forecasts that affect the expected collectability of the future cash flows of the instrument.

KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 19 -
Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.

1.14
Financial liabilities

The group recognises financial debt when the group becomes a party to the contractual provisions of the instruments. Financial liabilities are classified as either 'financial liabilities at fair value through profit or loss' or 'other financial liabilities'.

Other financial liabilities

Other financial liabilities, including borrowings, trade payables and other short-term monetary liabilities, are initially measured at fair value net of transaction costs directly attributable to the issuance of the financial liability. They are subsequently measured at amortised cost using the effective interest method. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.

Derecognition of financial liabilities

Financial liabilities are derecognised when, and only when, the group’s obligations are discharged, cancelled, or they expire.

1.15
Equity instruments

Equity instruments issued by the parent company are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer payable at the discretion of the company.

1.16
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 group’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 is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary 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 group 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.

KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 20 -
1.17
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 inventories or non-current 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 group is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.18
Retirement benefits

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

1.19
Leases

At inception, the group assesses whether a contract is, or contains, a lease within the scope of IFRS 16. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Where a tangible asset is acquired through a lease, the group recognises a right-of-use asset and a lease liability at the lease commencement date. Right-of-use assets are included within property, plant and equipment, apart from those that meet the definition of investment property.

The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date plus any initial direct costs and an estimate of the cost of obligations to dismantle, remove, refurbish or restore the underlying asset and the site on which it is located, less any lease incentives received.

 

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of other property, plant and equipment. The right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are unpaid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the group's incremental borrowing rate. Lease payments included in the measurement of the lease liability comprise fixed payments, variable lease payments that depend on an index or a rate, amounts expected to be payable under a residual value guarantee, and the cost of any options that the group is reasonably certain to exercise, such as the exercise price under a purchase option, lease payments in an optional renewal period, or penalties for early termination of a lease.

The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in: future lease payments arising from a change in an index or rate; the group's estimate of the amount expected to be payable under a residual value guarantee; or the group's assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

The group has elected not to recognise right-of-use assets and lease liabilities for short-term leases of machinery that have a lease term of 12 months or less, or for leases of low-value assets including IT equipment. The payments associated with these leases are recognised in profit or loss on a straight-line basis over the lease term.

KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 21 -
1.20
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.

2
Critical accounting estimates and judgements

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, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

 

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are outlined below.

 

Valuation of goodwill on subsidiaries

 

Goodwill represents the excess of cost of acquisition over the fair value of the net assets acquired. As per IFRS 3, annual impairment reviews are undertaken to compare the recoverable amount to the carrying value. The estimation of the recoverable amount is inherently subjective and as such there remains a risk that the carrying value is not valued correctly.

 

Valuation of intangible assets

Intangible assets includes amounts capitalised in relation to wage costs. There is inherent uncertainty with respect to the proportion of the wages cost capitalised.

 

Valuation of investments

Investments are valued at cost less accumulated impairment losses. There is inherent subjectivity in the identification and valuation of impairments.

3
Revenue
2023
2022
£
£
Revenue analysed by class of business
Revenue from contracts with customers
26,487,654
19,512,966
2023
2022
£
£
Revenue analysed by geographical market
Rest of World
26,487,654
19,512,966
KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 22 -
4
Operating (loss)/profit
2023
2022
as restated
Operating loss for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(115,648)
12,144
Fees payable to the company's auditor for the audit of the company's financial statements
44,000
83,193
Depreciation of property, plant and equipment
1,588,076
598,219
Amortisation of intangible assets
954,201
461,026
Cost of inventories recognised as an expense
10,396,158
5,050,744
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements
44,000
83,193
For other services
Other services pursuant to legislation
9,500
37,934
6
Employees

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

2023
2022
Number
Number
154
181

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
9,654,636
8,387,393
Social security costs
307,931
161,997
Pension costs
263,402
198,455
10,225,969
8,747,845

Payroll expenditure of £429,498 has been capitalised within intangible assets and has not been included in note 6.

KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 23 -
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
512,850
484,596
Company pension contributions to defined contribution schemes
47,123
37,732
559,973
522,328
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
325,500
310,000
Company pension contributions to defined contribution schemes
26,250
25,000
8
Investment income
2023
2022
£
£
Interest income
Financial instruments measured at amortised cost:
Other interest income on financial assets
53,455
24,470
9
Finance costs
2023
2022
£
£
Other interest payable
97,177
95,731
10
Other gains and losses
2023
2022
£
£
Exchange gain on financial assets held at fair value through profit or loss
953,574
830,994
11
Income tax expense
2023
2022
£
£
Current tax
Other taxes
(49,402)
155,144
KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
11
Income tax expense
2023
2022
(Continued)
- 24 -

The charge for the year can be reconciled to the (loss)/profit per the income statement as follows:

2023
2022
£
£
as restated
Loss before taxation
(2,272,004)
(1,029,257)
Expected tax credit based on a corporation tax rate of 19.00% (2022: 19.00%)
(431,681)
(195,559)
Effect of expenses not deductible in determining taxable profit
483,033
387,910
Utilisation of tax losses not previously recognised
(25,569)
-
Unutilised tax losses carried forward
-
229,781
Effect of overseas tax rates
(49,902)
155,144
Deferred tax adjustments in respect of prior years
(25,283)
(422,132)
Taxation (credit)/charge for the year
(49,402)
155,144
12
Impairments

Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:

2023
2022
£
£
In respect of:
Intangible assets
-
0
77,237
Recognised in:
Administrative expenses
-
77,237
KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 25 -
13
Intangible assets
Goodwill
Patents
R&D
Total
£
£
£
£
Cost
At 1 July 2021
5,249,333
8,057
2,189,339
7,446,729
Additions
3,817,112
-
1,563,489
5,380,601
Acquired through business combinations
-
-
0
521,630
521,630
Transfer
-
-
915,519
915,519
Foreign currency adjustments
6,730
-
-
6,730
At 30 June 2022
9,073,175
8,057
5,189,977
14,271,209
Additions - purchased
-
0
-
0
2,658,041
2,658,041
At 30 June 2023
9,073,175
8,057
7,848,018
16,929,250
Amortisation and impairment
At 1 July 2021
2,187,559
8,057
1,617,276
3,812,892
Charge for the year
-
-
0
577,032
577,032
Impairment loss
-
0
-
0
77,237
77,237
At 30 June 2022
2,187,559
8,057
2,271,545
4,467,161
Charge for the year
-
0
-
0
954,201
954,201
At 30 June 2023
2,187,559
8,057
3,225,746
5,421,362
Carrying amount
At 30 June 2023
6,885,616
-
4,622,272
11,507,888
At 30 June 2022
6,885,616
-
2,918,432
9,804,048
At 30 June 2021
3,061,774
-
572,063
3,633,837

 

 

KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 26 -
14
Property, plant and equipment
Leasehold land and buildings
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
WIP
Right of use assets
Total
£
£
£
£
£
£
£
£
Cost
At 1 July 2021
350,160
181,881
205,033
564,742
63,759
1,117,312
2,910,878
5,393,765
Additions
-
0
138,260
73,639
83,296
-
0
286,855
-
0
582,050
Business combinations
2,953
222,835
-
0
-
0
-
0
-
0
-
0
225,788
Disposals
(14,652)
(8,371)
3,883
-
0
-
0
-
0
(341,549)
(360,689)
Transfer
-
0
-
0
-
0
-
0
-
0
(915,519)
-
0
(915,519)
Foreign currency adjustments
(34,294)
(62)
(173)
(1,065)
-
0
-
0
-
0
(35,594)
At 30 June 2022
304,167
534,543
282,382
646,973
63,759
488,648
2,569,329
4,889,801
Additions
126,297
63,651
46,162
54,789
-
0
1,480,113
-
0
1,771,012
Disposals
-
0
(20,238)
(3,520)
(12,616)
-
0
-
0
-
0
(36,374)
At 30 June 2023
430,464
577,956
325,024
689,146
63,759
1,968,761
2,569,329
6,624,439
Accumulated depreciation and impairment
At 1 July 2021
91,414
174,645
50,378
330,262
23,276
41,537
-
711,512
Charge for the year
49,046
4,216
33,844
112,513
8,833
-
0
389,767
598,219
Business combinations
2,953
182,020
59,219
-
0
-
0
-
0
-
0
244,192
Eliminated on disposal
-
0
13,208
-
0
-
0
-
0
-
0
-
0
13,208
At 30 June 2022
143,413
374,089
143,441
442,775
32,109
41,537
389,767
1,567,131
Charge for the year
119,689
76,633
45,604
95,202
28,048
773,017
449,883
1,588,076
Eliminated on disposal
-
0
(15,539)
-
0
-
0
-
0
-
0
-
0
(15,539)
At 30 June 2023
263,102
435,183
189,045
537,977
60,157
814,554
839,650
3,139,668
KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
14
Property, plant and equipment
Leasehold land and buildings
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
WIP
Right of use assets
Total
£
£
£
£
£
£
£
£
(Continued)
- 27 -
Carrying amount
At 30 June 2023
167,362
142,773
135,979
151,169
3,602
1,154,207
1,729,679
3,484,771
At 30 June 2022
160,754
160,454
138,941
204,198
31,650
447,111
2,179,562
3,322,670
KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
14
Property, plant and equipment
(Continued)
- 28 -

 

15
Investments
Current
Non-current
2023
2022
2023
2022
as restated
£
£
£
£
Investments in subsidiaries
-
0
-
0
340,968
356,453
Fair value of financial assets carried at amortised cost

Except as detailed below, the directors believe that the carrying amounts of financial assets carried at amortised cost in the financial statements approximate to their fair values.

Movements in non-current investments
Shares in associates
£
Cost or valuation
At 1 July 2022  as restated
356,453
Disposal
(59,633)
Share of result
44,148
At 30 June 2023
340,968
Carrying amount
At 30 June 2023
340,968
At 30 June 2022 as restated
356,453
16
Subsidiaries

Details of the company's subsidiaries at 30 June 2023 are as follows:

KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
16
Subsidiaries
(Continued)
- 29 -
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Kuba SA
France
Ordinary
100.00
Kuba Pay Limited
UK
Ordinary
100.00
Kuba Pay (Pty) Ltd
South Africa
Ordinary
100.00
Kuba Italia S.R.L.
Italy
Ordinary
100.00
Kuba Inc
USA
Ordinary
100.00
Vix Consortium (Pty) Ltd
South AFrica
Ordinary
100.00
Vixnet Africa (Pty) Ltd
South Africa
Ordinary
100.00
Spatial Planning Agency of Southern Africa
South Africa
Ordinary
100.00
Unwire ApS
Denmark
Ordinary
100.00
Xtremetec Consortium (Tshwane) (Pty) Ltd
South Africa
Ordinary
50.00
Vix Xtelekom Consortium (Pty) Ltd
South AFrica
Ordinary
50.00
17
Associates

Details of the group's associates at 30 June 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Indirect
Site Oise
France
Ordinary
-
34.00
Mobi-Oise
France
Ordinary
-
23.00
18
Inventories
2023
2022
£
£
Finished goods
3,780,306
3,701,204
19
Trade and other receivables
Current
Non-current
2023
2022
2023
2022
as restated
£
£
£
£
Trade receivables
5,431,277
5,549,758
-
-
VAT recoverable
37,667
-
-
-
Amounts owed by fellow group undertakings
1,066,302
1,102,261
-
0
-
0
Amounts owed by related parties
59,355
59,355
-
0
-
0
Other receivables
1,901,347
2,844,289
5,639
6,797
Prepayments
3,292,994
569,918
-
-
11,788,942
10,125,581
5,639
6,797

The directors consider that the carrying amount of trade receivables and other receivables are appropriately equal to their fair value. No significant receivable balances are impaired at the reporting date.

KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 30 -
20
Trade and other payables
Current
Non-current
2023
2022
2023
2022
£
£
£
£
Trade payables
4,459,044
1,378,482
-
0
-
0
Amounts owed to fellow group undertakings
693,795
1,508,250
-
-
Accruals
8,790,868
7,305,321
-
0
-
0
Social security and other taxation
2,837,724
2,246,713
-
0
-
0
Other payables
544,411
840,256
47,108
134,677
17,325,842
13,279,022
47,108
134,677

The carrying amount of trade and other payables are considered to be the same as their fair values, due to their short-term nature.

21
Lease liabilities
2023
2022
Maturity analysis
£
£
Within one year
245,476
701,680
In two to five years
846,924
1,011,722
In over five years
834,304
569,920
Total undiscounted liabilities
1,926,704
2,283,322

Lease liabilities are classified based on the amounts that are expected to be settled within the next 12 months and after more than 12 months from the reporting date, as follows:

2023
2022
£
£
Current liabilities
597,039
701,680
Non-current liabilities
1,329,665
1,581,642
1,926,704
2,283,322
Deferred tax assets are expected to be recovered after more than one year
22
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the group and movements thereon during the current and prior reporting period.

KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
Deferred tax assets are expected to be recovered after more than one year
(Continued)
- 31 -
ACAs
£
Deferred tax movements in prior year
Charge/(credit) to profit or loss
(422,132)
Asset at 1 July 2022
(424,936)
Deferred tax movements in current year
Charge/(credit) to profit or loss
(25,283)
Asset at 30 June 2023
(450,219)
23
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
263,402
198,455

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

24
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of 1p each
47,301
45,301
473
453

On 20 December 2022, 1,000 Ordinary shares of nominal value £0.01 were issued at £1,085.759 per share. On 28 June 2023, 1,000 Ordinary shares of nominal value £0.01 were issued at £1173.73596 per share. All Ordinary shares are ranked pari passu and are entitled to equal distribution and voting rights.

 

25
Share premium account
2023
2022
£
£
At the beginning of the year
13,749,526
7,346,231
Issue of new shares
2,185,579
6,403,295
At the end of the year
15,935,105
13,749,526
KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 32 -
26
Currency translation reserve
2023
2022
£
£
At the beginning of the year
5,305
(37,425)
Translation (loss)/gain arising in the year
(441,449)
42,730
At the end of the year
(436,144)
5,305
27
Capital risk management

The group is not subject to any externally imposed capital requirements.

28
Related party transactions

Related party transactions between wholly owned entities are exempt from disclosure and are therefore not disclosed in these consolidated financial statements.

28
Related party transactions

The following amounts were outstanding at the reporting end date:

2023
2022
Amounts due to related parties
£
£
Other related parties
72,143
-
0

The following amounts were outstanding at the reporting end date:

2023
2022
Amounts due from related parties
£
£
Other related parties
61,290
-
29
Controlling party

The ultimate controlling parent company is ICM Mobility Group Ltd.

KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 33 -
30
Cash generated from operations
2023
2022
as restated
£
£
Loss for the year before income tax
(2,272,004)
(1,029,257)
Adjustments for:
Share of results of associates and joint ventures
(44,148)
(41,279)
Finance costs
97,177
95,731
Investment income
(53,455)
(24,470)
Amortisation and impairment of intangible assets
954,201
465,852
Depreciation and impairment of property, plant and equipment
1,510,903
582,162
Foreign exchange gains on cash equivalents
(18,440)
(12,566)
Other gains and losses
(953,574)
(830,994)
Movements in working capital:
Increase in inventories
(79,102)
(974,732)
Increase in trade and other receivables
(1,625,676)
(3,897,241)
Increase in trade and other payables
4,008,783
6,876,813
Cash generated from operations
1,524,665
1,210,019
31
Prior period adjustment
Reconciliation of changes in equity
1 July
30 June
2021
2022
Notes
£
£
Equity as previously reported
8,124,392
12,405,452
Adjustments to prior year
Reversal of goodwill amortisation
-
939,286
Share of result in associate
-
55,449
Equity as adjusted
8,124,392
13,400,187
Analysis of the effect upon equity
Retained earnings
-
994,735
KUBA GROUP LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
31
Prior period adjustment
(Continued)
- 34 -
Reconciliation of changes in loss for the previous financial period
2022
Notes
£
Loss as previously reported
(2,164,966)
Adjustments to prior year
Reversal of goodwill amortisation
939,286
Share of result in associate
41,279
Loss as adjusted
(1,184,401)
Notes to reconciliation

During the period three items were adjusted with respect to errors identified in the previous period.

 

A prior year adjustment was recognised with respect to the reversal of amortisation of goodwill arising from subsidiaries. The loss for the year ended 30 June 2022 was reduced by £939,286, with an increase of the same amount in the valuation of goodwill.

 

An amount of £59,355 was reclassified from investments to related party debtors.

 

A further adjustment was recorded to recognise the share of result in associates from the date of acquisition as required by IAS 28. The loss for the year ended 30 June 2022 was reduced by £41,279, with an increase in the valuation of investments of the same amount. Retained earnings brought forward at 01 July 2021 was increased by £55,449, with a corresponding increase in the valuation of investments.

 

A balance was reclassified within intangible assets from goodwill to R&D, equating to a carrying value of £1,357,058.

KUBA GROUP LTD
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023
30 June 2023
- 35 -
2023
2022
Notes
£
£
Non-current assets
Intangible assets
33
3,570,707
912,666
Investments
34
12,864,429
12,864,429
16,435,136
13,777,095
Current assets
Trade and other receivables
35
2,069,200
951,892
Current liabilities
Trade and other payables
36
2,008,563
529,136
Net current assets
60,637
422,756
Net assets
16,495,773
14,199,851
Equity
Called up share capital
37
473
453
Share premium account
15,935,105
13,749,526
Retained earnings
560,195
449,872
Total equity
16,495,773
14,199,851

The notes on pages 14 to 38 form part of these parent financial statements.

As permitted by trues408 Companies Act 2006, the company has not presented its own income statement and related notes. The company’s profit for the year was £110,322 (2022 - £99,850 loss).

The financial statements were approved by the board of directors and authorised for issue on 19 November 2024 and are signed on its behalf by:
19 November 2024
Mr D Hope
Director
Company registration number 12952157 (England and Wales)
KUBA GROUP LTD
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
- 36 -
Share capital
Share premium account
Retained earnings
Total
Notes
£
£
£
£
Balance at 1 July 2021
452
7,346,231
549,722
7,896,405
Year ended 30 June 2022:
Loss and total comprehensive income
-
-
(99,850)
(99,850)
Transactions with owners:
Issue of share capital
37
1
6,403,295
-
6,403,296
Balance at 30 June 2022
453
13,749,526
449,872
14,199,851
Year ended 30 June 2023:
Profit and total comprehensive income
-
-
110,323
110,323
Transactions with owners:
Issue of share capital
37
20
2,185,579
-
2,185,599
Balance at 30 June 2023
473
15,935,105
560,195
16,495,773
KUBA GROUP LTD
COMPANY STATEMENT OF CHANGES IN EQUITY (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 37 -
32
Employees

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

2023
2022
Number
Number
12
4
33
Intangible assets
Intellectual property
£
Cost
Transfer to held for sale
912,666
At 30 June 2022
912,666
Additions - purchased
2,658,041
At 30 June 2023
3,570,707
Carrying amount
At 30 June 2023
3,570,707
At 30 June 2022
912,666
34
Investments
Current
Non-current
2023
2022
2023
2022
£
£
£
£
Investments in subsidiaries
-
0
-
0
12,864,429
12,864,429
Fair value of financial assets carried at amortised cost

Except as detailed below the directors believe that the carrying amounts of financial assets carried at amortised cost in the financial statements approximate to their fair values.

Investment in subsidiary undertakings

Details of the company's principal operating subsidiaries are included in note 14.

KUBA GROUP LTD
COMPANY STATEMENT OF CHANGES IN EQUITY (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 38 -
35
Trade and other receivables
2023
2022
£
£
VAT recoverable
1,240
-
Amounts owed by fellow group undertakings
2,067,960
951,892
2,069,200
951,892
36
Trade and other payables
2023
2022
£
£
Amount owed to parent undertaking
-
0
22,469
Amounts owed to fellow group undertakings
1,697,475
195,578
Accruals
311,088
311,089
2,008,563
529,136
37
Share capital
Refer to note 24 of the group financial statements.
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