Registration number:
DNACO Limited
for the Year Ended 31 December 2022
DNACO Limited
Contents
Company Information |
|
Strategic Report |
|
Directors' Report |
|
Statement of Directors' Responsibilities |
|
Independent Auditor's Report |
|
Consolidated Profit and Loss Account |
|
Consolidated Statement of Comprehensive Income |
|
Consolidated Balance Sheet |
|
Balance Sheet |
|
Consolidated Statement of Changes in Equity |
|
Statement of Changes in Equity |
|
Consolidated Statement of Cash Flows |
|
Notes to the Financial Statements |
DNACO Limited
Company Information
Directors |
A D Nelson M L Pearse R V Dorp |
Company secretary |
L J Ganderton |
Registered office |
|
Auditors |
|
DNACO Limited
Strategic Report for the Year Ended 31 December 2022
Strategic Management
DNACO Limited ('DNACO and 'the Group') is a non-trading Group Holding Company that was incorporated on 25th July 2018 in order to purchase Orchid Cellmark Limited ('OCL' and 'the Company') in August of that year. Established in 1987, the OCL business is primarily focused on the provision of high-quality DNA testing and forensic services and is one of the UKs largest Forensic Science Providers, contracted by the majority of police forces in England and Wales.
The initial strategic objective of DNACO was to return the OCL business to profitability and then to ensure sustainable profits and seek growth opportunities through service development and acquisition.
In August 2024, DNACO joined the Eurofins network as a wholly owned subsidiary of Eurofins Scientific SE to allow the Group to grow under the Eurofins umbrella.
Business Environment
Following a significant financial loss in 2018, DNACO's OCL business returned a profit before tax in 2019 of £308k, in part due to increased funding for police out-sourced forensic testing following a Home Office review and a House of Lords Inquiry which recognised the importance of sustainable forensic science provision to the Criminal Justice Sector. However, in 2020 the OCL business was impacted by the COVID-19 pandemic and the two national lock-downs; profit was reduced to £40k from a turnover which was 4.1% lower than the prior year. In 2021 the pandemic continued to impact the sales mix, the cost of laboratory supplies and the operational productivity of the OCL business.
Business review
The audited financial statements for the year ended 31 December 2022 are set out on pages 12-37. The Group recorded a loss before tax and before negative goodwill write-backs of £6.190m (2021 loss: £794k) from a turnover of £28.832m (2021: £30.115m). Loss after tax but before negative goodwill write-backs was £6.661m (2021: £1.114m).
In the 2021 Strategic Report the Directors forecasted 2022 to be a difficult year with the loss of revenue from COVID-19 testing and the slow return of volume from certain core forensic activities. In addition, a significant proportion of the forensic work outsourced by the police forces in England and Wales was due for re-tender in 2022, with the timing of contract implementations having a significant impact on workload and profitability. However, after a challenging 2022, OCL's success in the police forensic tenders means that the outlook is positive.
At the beginning of 2022 Cellmark's COVID-19 PCR testing revenue ceased before the Company's forensic income had fully recovered from the pandemic period.
2022 was also a year of significant police tendering activity. 30 of its police force customers (70% of police forces in England and Wales) tendered their outsourced forensic work in two national tendering exercises. This resulted in a change to the Company's product/service mix and also a temporary reduction in the overall value of work in the second half of the year, before certain new contracts started in April 2023.
The combination of all these temporary factors plus the impact of increased costs resulting from high UK inflation had a significant impact on workload and profitability, resulting in the large losses reported for 2022.
Despite the 2022 performance, the positive resolution of a number of the issues experienced during the year positioned the Company for revenue growth and a future return to profitability.
Forensic work carried out for law enforcement agencies in England and Wales accounts for approximately 80% of the Company's revenue (in the absence of revenue from Covid-19 testing). It is therefore notable that the Company was awarded a higher value of forensic work in the 2022 police tenders than it previously held, although the timing of some of the contract implementations presented financial challenges during 2022. The Company was awarded contracts from all 30 police forces that tendered their work, securing a significant proportion of the Company's forensic work for between three and seven years (depending on extension options). These forensic contracts were awarded at higher pricing and, for the first time, all contracts included annual index linked price increases.
At the end of September 2022, as well as Barristers' finishing their industrial action, the Legal Aid Agency agreed to increase its rates by 15% which would, over time, have a positive impact on the revenue generated by Cellmark's Keith Borer Consultants forensic defence division. During 2022 Cellmark also grew its complex casework toxicology revenue and in the second half of 2022 road traffic toxicology productivity started to recover, which together signalled positive toxicology revenue growth in 2023.
In addition, as part of its diversification strategy, in April 2022 Cellmark acquired a veterinary testing laboratory, Pinmoore Animal Laboratory Services Limited (PALS). In 2022 a number of integration activities and costs were required associated with the acquisition which have positioned this division for growth in 2023 and beyond.
DNACO Limited
Strategic Report for the Year Ended 31 December 2022
Strategic Management
DNACO Limited ('DNACO and 'the Group') is a non-trading Group Holding Company that was incorporated on 25th July 2018 in order to purchase Orchid Cellmark Limited ('OCL' and 'the Company') in August of that year. Established in 1987, the OCL business is primarily focused on the provision of high-quality DNA testing and forensic services and is one of the UKs largest Forensic Science Providers, contracted by the majority of police forces in England and Wales.
The initial strategic objective of DNACO was to return the OCL business to profitability and then to ensure sustainable profits and seek growth opportunities through service development and acquisition.
In August 2024, DNACO joined the Eurofins network as a wholly owned subsidiary of Eurofins Scientific SE to allow the Group to grow under the Eurofins umbrella.
Business Environment
Following a significant financial loss in 2018, DNACO's OCL business returned a profit before tax in 2019 of £308k, in part due to increased funding for police out-sourced forensic testing following a Home Office review and a House of Lords Inquiry which recognised the importance of sustainable forensic science provision to the Criminal Justice Sector. However, in 2020 the OCL business was impacted by the COVID-19 pandemic and the two national lock-downs; profit was reduced to £40k from a turnover which was 4.1% lower than the prior year. In 2021 the pandemic continued to impact the sales mix, the cost of laboratory supplies and the operational productivity of the OCL business.
Business review
The audited financial statements for the year ended 31 December 2022 are set out on pages 12-37. The Group recorded a loss before tax and before negative goodwill write-backs of £6.190m (2021 loss: £794k) from a turnover of £28.832m (2021: £30.115m). Loss after tax but before negative goodwill write-backs was £6.661m (2021: £1.114m).
In the 2021 Strategic Report the Directors forecasted 2022 to be a difficult year with the loss of revenue from COVID-19 testing and the slow return of volume from certain core forensic activities. In addition, a significant proportion of the forensic work outsourced by the police forces in England and Wales was due for re-tender in 2022, with the timing of contract implementations having a significant impact on workload and profitability. However, after a challenging 2022, OCL's success in the police forensic tenders means that the outlook is positive.
At the beginning of 2022 Cellmark's COVID-19 PCR testing revenue ceased before the Company's forensic income had fully recovered from the pandemic period.
2022 was also a year of significant police tendering activity. 30 of its police force customers (70% of police forces in England and Wales) tendered their outsourced forensic work in two national tendering exercises. This resulted in a change to the Company's product/service mix and also a temporary reduction in the overall value of work in the second half of the year, before certain new contracts started in April 2023.
The combination of all these temporary factors plus the impact of increased costs resulting from high UK inflation had a significant impact on workload and profitability, resulting in the large losses reported for 2022.
Despite the 2022 performance, the positive resolution of a number of the issues experienced during the year positioned the Company for revenue growth and a future return to profitability.
Forensic work carried out for law enforcement agencies in England and Wales accounts for approximately 80% of the Company's revenue (in the absence of revenue from Covid-19 testing). It is therefore notable that the Company was awarded a higher value of forensic work in the 2022 police tenders than it previously held, although the timing of some of the contract implementations presented financial challenges during 2022. The Company was awarded contracts from all 30 police forces that tendered their work, securing a significant proportion of the Company's forensic work for between three and seven years (depending on extension options). These forensic contracts were awarded at higher pricing and, for the first time, all contracts included annual index linked price increases.
At the end of September 2022, as well as Barristers' finishing their industrial action, the Legal Aid Agency agreed to increase its rates by 15% which would, over time, have a positive impact on the revenue generated by Cellmark's Keith Borer Consultants forensic defence division. During 2022 Cellmark also grew its complex casework toxicology revenue and in the second half of 2022 road traffic toxicology productivity started to recover, which together signalled positive toxicology revenue growth in 2023.
In addition, as part of its diversification strategy, in April 2022 Cellmark acquired a veterinary testing laboratory, Pinmoore Animal Laboratory Services Limited (PALS). In 2022 a number of integration activities and costs were required associated with the acquisition which have positioned this division for growth in 2023 and beyond.
Financial key performance indicators
The Directors monitor the progress of the Company in meeting its strategic objectives by reference to a range of financial and non-financial key performance indicators. The top-level financial performance indicators used are set out below:
Unit |
2022 |
2021 |
|
Group turnover |
£m |
28.83 |
30.12 |
Group gross profit / (loss) margin |
% |
5.13 |
17.30 |
Group operating profit / (loss) margin before negative goodwill write-back |
% |
(21.40) |
(2.60) |
DNACO Limited
Strategic Report for the Year Ended 31 December 2022
Principal risks and uncertainties
The Directors regularly review risks and uncertainties that impact the Group. The principal risks for the Group concern a number of factors, some of which the Group can influence and other that we are unable to control, including; pricing and the impact of pressure on public sector expenditure; matching capacity with the uncertainty of demand; the achievement of performance targets in ongoing contracts; continuing to win new work; changes in criminal activity and the policing response to the investigation of crime; changes in government policy and public health incidents; and rising costs associated with inflation. A key risk is that a significant proportion of the Group's work is concentrated in one core market.
Financial risk management objectives and policies
The Group seeks to manage financial risk by ensuring sufficient cash resources are available to meet foreseeable needs but there are some risks inherent with the Group's liquid resources and mitigation of these is summarised:
Interest rate risk
The Group currently finances its operations through retained profits and working capital. When the Group is cash positive the exposure to interest rate risk is limited to the effect of interest rates on income received on credit balances.
Credit risk
The Group's principal financial assets are cash and trade debtors. The credit risk associated with cash is limited, the principal credit risk therefore arises from its trade debtors. A significant proportion of the debt is from UK Government agencies but the remainder is managed through a diversified customer base such that no one customer represents a significant proportion of the Group's trade.
Currency risk
A small proportion of the Group's purchases are from continental Europe. The Group is exposed to foreign exchange risk in this respect. The Group manages this risk by monitoring exchange rates at the time of purchase and by maintaining Euro and Dollar accounts.
Non-financial and sustainability information
Environmental and Social Matters
The Directors comply with their corporate and social responsibility obligations across the Group's business activities. For environmental matters the Company's sustainability policies and activities are recognised through OCL's certification to IS014001 (Environmental Management). For employee issues OCL operates a professional Human Resources department with extensive HR policies; employee salary and benefits packages which exceed minimum wage requirements; staff training and development structures; employee wellbeing programmes and mental health support systems. For social, community and human rights matters the Group operates corporate responsibility policies including Anti-corruption and International Trade Law Compliance; an Ethical Labour and Anti-Human Trafficking Policy; a Code of Conduct and Ethics; policies and procedures to prevent discrimination and ensure equal opportunities for all in the workplace; and actively supports environmental and social responsibility activities and initiatives.
Approved by the
.........................................
Director
DNACO Limited
Directors' Report for the Year Ended 31 December 2022
The Directors present their report and the for the year ended 31 December 2022.
Directors of the Group
The Directors who held office during the year were as follows:
The following directors were appointed after the year end:
Principal activity
DNACO was formed in order to purchase Orchid Cellmark Limited ('OCL') from LabCorp Inc on 7th August 2018. Currently the principal activity of DNACO is to act as a Group Holding Company for OCL, which trades as Cellmark, Cellmark Forensic Services and Keith Borer Consultants. The Company is planning growth through service development and acquisition.
Dividends
Losses for the Group in the year to 31 December 2022 were £6.3m (loss of 0.534m in the previous period).
No dividend was declared for this period.
Compliance with Financial regulations and Social responsibility requirements
The Group works with quality standards, pension advisers and UK auditors to ensure it complies with all relevant financial regulation and accounting standards by means of regular audit and reviews.
The Group is a Real Living Wage and Equal Opportunity Employer and does not discriminate on the basis of race, national origin, religion, colour, gender, sexual orientation, age, non-disqualifying physical or mental disability or any other basis covered by law. Employment decisions are based solely on qualifications, merit and business need. The Group seeks to ensure that employees with disabilities are considered for promotion according to their abilities and qualifications, and that any employee who becomes disabled will receive continued employment and training by making any reasonable adjustments necessary to do so. The Group monitors gender diversity within OCL and publishes results in line with government requirements.
DNACO Limited
Directors' Report for the Year Ended 31 December 2022
Going concern
Following the loss in 2021 the Group experienced a 4.2% reduction in revenue in 2022 and reported a loss of 6.3m.
In the early part of 2022 the majority of the Group's police customers tendered their work and although the Group were successful and won a higher value of work then it had previously held, the staggered timing of the contract implementations meant that the full impact of the increased revenue was not seen until after Q2 2023. Given the significant timescales for recruitment, training and developing forensic expertise, the Group minimised expenditure where it could, but operated with similar levels of staffing overhead throughout 2022, in particular in preparation for the delivery of higher levels of forensic casework from Q2 2023. As a result the Group depleted its cash reserves in 2022. The Directors put in place an invoice discounting facility and reduced stocks to free up working capital.
In spite of this, losses in 2022 and 2023 put significant cash pressures on the business, but going into 2024, positive trading and prompt payments from customers is enabling the business to reduce debt.
In 2022 the Group was awarded index-linked multi-year contracts (between three and seven years) for the majority of its forensic work and during 2023 output from its toxicology, defence, relationship and veterinary testing businesses all increased. The Group also secured additional contracted work in 2023 which will contribute to further revenue and margin growth in 2024.
In 2023 the Group benefitted from increased work in most sectors as well as price increases from its major customers to reflect the impact of inflation. As a result, losses were significantly reduced. However, during 2023 the Group experienced cashflow challenges and extended its invoice discounting facility to assist with cash management. With the support of its police customers and its suppliers, the Group navigated the cashflow challenges of 2023 as business performance steadily improved.
In August 2024, DNACO joined the Eurofins network as a wholly owned subsidiary of Eurofins Scientific SE to allow the Group to grow under the Eurofins umbrella. Based upon this development the Directors have no reason to believe that a material uncertainty exists that may cast a significant doubt on the ability of this Group to continue operating.
Information included in the Strategic Report
The Directors have set out the Group's financial management risk objectives and policies in the strategic report rather than the Director's report.
Disclosure of information to the auditor
Each Director has taken 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 auditor is aware of that information. The Directors confirm that there is no relevant information that they know of and of which they know the auditor is unaware.
Approved by the
.........................................
Director
DNACO Limited
Statement of Directors' Responsibilities
The Directors acknowledge their responsibilities for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and the Company and of the profit or loss of the Group for that period. In preparing these financial statements, the Directors are required to:
• |
select suitable accounting policies and apply them consistently; |
• |
make judgements and accounting estimates that are reasonable and prudent; |
• |
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; 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 keeping adequate accounting records that are sufficient to show and explain the Group's and the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Group and 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 Group and the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
DNACO Limited
Independent Auditor's Report to the Members of DNACO Limited
Opinion
We have audited the financial statements of DNACO Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2022, which comprise the Consolidated Profit and Loss Account, Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Balance Sheet, Consolidated Statement of Changes in Equity, Statement of Changes in Equity, Consolidated Statement of Cash Flows, and Notes to the Financial Statements, including a summary of 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 Group's and the parent Company's affairs as at 31 December 2022 and of the Group's loss 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. |
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 responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the Director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's ability to continue as a going concern for a period of at least twelve months from when the original financial statements were 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 Directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.
In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.
Opinion on other matter prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
• |
the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
DNACO Limited
Independent Auditor's Report to the Members of DNACO Limited
• |
the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements. |
Matters on which we are required to report by exception
In the light of our 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 and the Directors' Report.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
• | adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or |
• | the parent Company financial statements are not in agreement with the accounting records and returns; or |
• | certain disclosures of Directors' 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 Statement of Directors' Responsibilities [set out on page 7], 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 Responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
DNACO Limited
Independent Auditor's Report to the Members of DNACO Limited
We obtained an understanding of the laws and regulations applicable to the company through discussions with management, and from our wider knowledge of the company and industry. We determined that the most significant laws and regulations, which may have a material effect on the financial statements, include the Companies Act 2006, Taxation Legislation, Employment Law and Health & Safety legislation.
- the identified laws and regulations were communicated to the audit engagement team;
- we assessed the extent of compliance with the laws and regulations identified, through making enquiries of management, inspecting legal correspondence, personnel records and health and safety logs.
We assessed the susceptibility of the company's financial statements to material misstatement due to fraud, by:
- reviewing managements’ own assessment of the company’s susceptibility to fraud;
- considering the strength of the control environment; and
- evaluating management’s incentives for fraudulent manipulation of the financial statements, such as capitalising costs to boost profits.
We determined that the principle risks were related to inflation of revenues and profit, through fraudulent manipulation of judgements relating to WIP valuation and debtor recoverability.
To address the risk of fraud, we:
- compared financial statement disclosures to supporting documentation;
- performed analytical procedures to identify any unusual trends;
- tested journal entries to identify unusual transactions; and
- investigated the rationale behind significant or unusual transactions, as well as key assumptions and estimates used in the preparation of the financial statements.
There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
DNACO Limited
Independent Auditor's Report to the Members of DNACO Limited
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.
......................................
For and on behalf of
Suite I Windrush Court
Abingdon Business Park
Oxfordshire
OX14 1SY
DNACO Limited
Consolidated Profit and Loss Account for the Year Ended 31 December 2022
Note |
2022 |
2021 |
|
Turnover |
|
|
|
Cost of sales |
( |
( |
|
Gross profit |
|
|
|
Administrative expenses |
( |
( |
|
Other operating income |
- |
|
|
Operating loss |
( |
( |
|
Negative goodwill written back |
386 |
580 |
|
Interest payable and similar expenses |
( |
- |
|
372 |
580 |
||
Loss before tax |
( |
( |
|
Taxation |
( |
( |
|
Loss for the financial year |
( |
( |
|
Profit/(loss) attributable to: |
|||
Owners of the company |
( |
( |
The loss shown is after writing back £386,000 of negative goodwill which arose from the acquisition of Orchid Cellmark Limited.
Without this write back the Group made a loss before tax of £6,190,000.
DNACO Limited
Consolidated Statement of Comprehensive Income for the Year Ended 31 December 2022
2022 |
2021 |
|
Loss for the year |
( |
( |
Total comprehensive income for the year |
( |
( |
Total comprehensive income attributable to: |
||
Owners of the Company |
( |
( |
DNACO Limited
(Registration number: 11484025)
Consolidated Balance Sheet as at 31 December 2022
Note |
2022 |
2021 |
|
Fixed assets |
|||
Goodwill |
|
- |
|
Negative goodwill |
- |
( |
|
|
( |
||
Intangible assets not including goodwill |
|
|
|
Tangible assets |
|
|
|
|
|
||
Current assets |
|||
Stocks |
|
|
|
Debtors |
|
|
|
Cash at bank and in hand |
|
|
|
|
|
||
Creditors: Amounts falling due within one year |
( |
( |
|
Net current (liabilities)/assets |
( |
|
|
Total assets less current liabilities |
|
|
|
Creditors: Amounts falling due after more than one year |
( |
( |
|
Provisions for liabilities |
( |
( |
|
Net (liabilities)/assets |
( |
|
|
Capital and reserves |
|||
Retained earnings |
(528) |
5,747 |
|
Shareholders' (deficit)/funds |
(528) |
5,747 |
Approved and authorised by the
.........................................
Director
DNACO Limited
(Registration number: 11484025)
Balance Sheet as at 31 December 2022
Note |
2022 |
2021 |
|
Fixed assets |
|||
Investments |
- |
- |
|
Capital and reserves |
|||
Called up share capital |
- |
- |
|
Total equity |
- |
- |
The company made a loss after tax for the financial year of £- (2021 - loss of £-).
Investments
At 31 December 2022 the investments of the Company amounted to £1 (2021: £1) - the investment in 100% of the share capital of Orchid Cellmark Limited.
Due to the rounding in £000s this is not displayed on the face of the balance sheet.
Called up share capital
At 31 December 2022 the called up share capital of the Company amounted to £6 consisting of 6,000 shares of £0.001 each which were issued in the period to 31 December 2019.
Due to the rounding in £000s this is not displayed on the face of the balance sheet.
Approved and authorised by the
.........................................
Director
DNACO Limited
Consolidated Statement of Changes in Equity for the Year Ended 31 December 2022
Equity attributable to the parent company
Retained earnings |
Total |
Total equity |
|
At 1 January 2021 |
|
|
|
Loss for the year |
( |
( |
( |
At 31 December 2021 |
|
|
|
Retained earnings |
Total |
Total equity |
|
At 1 January 2022 |
|
|
|
Loss for the year |
( |
( |
( |
At 31 December 2022 |
( |
( |
( |
DNACO Limited
Statement of Changes in Equity for the Year Ended 31 December 2022
Share capital |
Profit and loss account |
Total |
|
At 31 December 2021 |
- |
- |
- |
Share capital |
Profit and loss account |
Total |
|
At 31 December 2022 |
- |
- |
- |
DNACO Limited
Consolidated Statement of Cash Flows for the Year Ended 31 December 2022
Note |
2022 |
2021 |
|
Cash flows from operating activities |
|||
Loss for the year |
( |
( |
|
Adjustments to cash flows from non-cash items |
|||
Depreciation and amortisation |
|
|
|
Loss on disposal of tangible assets |
- |
|
|
Loss on disposal of intangible assets |
|
- |
|
Finance costs |
|
- |
|
Income tax expense |
|
|
|
Foreign exchange gains/losses |
( |
- |
|
Negative goodwill written back |
(386) |
(580) |
|
( |
( |
||
Working capital adjustments |
|||
Decrease in stocks |
|
|
|
Decrease in trade debtors |
|
|
|
Increase/(decrease) in trade creditors |
|
( |
|
Increase/(decrease) in provisions |
|
( |
|
Cash generated from operations |
|
( |
|
Income taxes paid |
( |
( |
|
Net cash flow from operating activities |
|
( |
|
Cash flows from investing activities |
|||
Acquisitions of tangible assets |
( |
( |
|
Proceeds from sale of tangible assets |
|
( |
|
Acquisition of intangible assets |
( |
- |
|
Intangible asset additions - internally generated |
(206) |
(312) |
|
Acquisition of net assets of acquired entity |
(23) |
- |
|
Net cash flows from investing activities |
( |
( |
|
Cash flows from financing activities |
|||
Interest paid |
( |
- |
|
Proceeds from bank borrowing draw downs |
( |
- |
|
Repayment of other borrowing |
|
- |
|
Payments to finance lease creditors |
( |
|
|
Net cash flows from financing activities |
( |
|
|
Net decrease in cash and cash equivalents |
( |
( |
|
Cash and cash equivalents at 1 January |
|
|
|
Cash and cash equivalents at 31 December |
166 |
1,144 |
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
General information |
The Company is a private company limited by share capital, incorporated in England and Wales.
The address of its registered office is:
United Kingdom
These financial statements were authorised for issue by the
Accounting policies |
Summary of significant accounting policies and key accounting estimates
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
Statement of compliance
These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.
Basis of preparation
These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.
The financial statements are presented in Sterling (£) which is the functional currency of the company and rounded to the nearest £000 for presentation purposes.
Basis of consolidation
The consolidated financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 31 December 2022.
No Profit and Loss account is presented for the company as permitted by section 408 of the Companies Act 2006.
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
A subsidiary is an entity controlled by the company. Control is achieved where the company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are included in the Profit and Loss Account from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the group.
The purchase method of accounting is used to account for business combinations that result in the acquisition of subsidiaries by the group. The cost of a business combination is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the business combination. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Any excess of the cost of the business combination over the acquirer’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised is recorded as goodwill.
Inter-company transactions, balances and unrealised gains on transactions between the company and its subsidiaries, which are related parties, are eliminated in full.
Intra-group losses are also eliminated but may indicate an impairment that requires recognition in the consolidated financial statements.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group. Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the group’s equity therein. Non-controlling interests consist of the amount of those interests at the date of the original business combination and the non-controlling shareholder’s share of changes in equity since the date of the combination.
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Going concern
The financial statements have been prepared on a going concern basis.
Following the loss in 2021 the Group experienced a 4.2% reduction in revenue in 2022 and reported a loss of 6.3m.
In the early part of 2022 the majority of the Group's police customers tendered their work and although the Group were successful and won a higher value of work then it had previously held, the staggered timing of the contract implementations meant that the full impact of the increased revenue was not seen until after Q2 2023. Given the significant timescales for recruitment, training and developing forensic expertise, the Group minimised expenditure where it could, but operated with similar levels of staffing overhead throughout 2022, in particular in preparation for the delivery of higher levels of forensic casework from Q2 2023. As a result the Group depleted its cash reserves in 2022. The Directors put in place an invoice discounting facility and reduced stocks to free up working capital.
In spite of this, losses in 2022 and 2023 put significant cash pressures on the business, but going into 2024, positive trading and prompt payments from customers is enabling the business to reduce debt.
In 2022 the Group was awarded index-linked multi-year contracts (between three and seven years) for the majority of its forensic work and during 2023 output from its toxicology, defence, relationship and veterinary testing businesses all increased. The Group also secured additional contracted work in 2023 which will contribute to further revenue and margin growth in 2024.
In 2023 the Group benefitted from increased work in most sectors as well as price increases from its major customers to reflect the impact of inflation. As a result, losses were significantly reduced. However, during 2023 the Group experienced cashflow challenges and extended its invoice discounting facility to assist with cash management. With the support of its police customers and its suppliers, the Group navigated the cashflow challenges of 2023 as business performance steadily improved.
In August 2024, DNACO joined the Eurofins network as a wholly owned subsidiary of Eurofins Scientific SE to allow the Group to grow under the Eurofins umbrella. Based upon this development the Directors have no reason to believe that a material uncertainty exists that may cast a significant doubt on the ability of this Group to continue operating.
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Judgements
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the amounts reported in the profit and loss account for the year. However, the nature of estimation means that actual outcomes could differ from those estimates. The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements: |
Operating lease commitments: The Group has entered into operating leases as a lessee. The classification of such leases as operating or finance leases requires the company to determine, based on an evaluation of the terms and conditions of the arrangements, whether it acquires the significant risks and rewards of ownership of these assets and accordingly whether the lease requires an asset and liabilities to be recognised in the balance sheet. |
The following are the Group's key sources of estimation uncertainty: |
Goodwill and intangible assets: The Group establishes a reliable estimate of the useful life of goodwill and intangible assets arising on business combinations. The estimate is based on a variety of factors such as the expected use of the acquired business, any legal, regulatory or contractual provision that can limit useful life and assumptions that market participants would consider in respect of similar business. |
Dilapidation provisions: The Group has made provisions for dilapidation in respect of its leasehold properties. The provision requires the cost of returning the properties to their original state at the end of the lease to be estimated and the actual costs incurred may differ from the original estimate. |
Revenue recognition
Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the Company’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts.
Revenue is recognised on the submission of a report of results of an analysis to the customer.
Foreign currency transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Profit and Loss Account except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Profit and Loss Account with ‘finance income or costs’. All other foreign exchange gains and losses are presented in the Profit and Loss Account within ‘other operating income’.
Tax
The tax expense for the period comprises current tax payable and deferred tax.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Group operates and generates taxable income.
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the consolidated financial statements.
Unrelieved tax losses and other deferred tax assets are recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.
Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference.
Tangible assets
Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
Depreciation
Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:
Asset class |
Depreciation method and rate |
Leasehold improvements |
life of lease |
Plant and machinery |
2 to 5 years |
Business combinations
Business combinations are accounted for using the purchase method. The consideration for each acquisition is measured at the aggregate of the fair values at acquisition date of assets given, liabilities incurred or assumed, and equity instruments issued by the group in exchange for control of the acquired, plus any costs directly attributable to the business combination. When a business combination agreement provides for an adjustment to the cost of the combination contingent on future events, the group includes the estimated amount of that adjustment in the cost of the combination at the acquisition date if the adjustment is probable and can be measured reliably.
Goodwill
Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is held in the currency of the acquired entity and revalued to the closing rate at each reporting period date. Goodwill is amortised over its useful life, which shall not exceed ten years if a reliable estimate of the useful life cannot be made.
Negative goodwill
Negative goodwill arising on an acquisition is recognised on the face of the balance sheet on the acquisition date and subsequently the excess up to the fair value of non-monetary assets acquired is recognised in profit or loss in the periods in which the non-monetary assets are recovered.
Amortisation
Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:
Asset class |
Amortisation method and rate |
Goodwill |
5 years straight line |
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Investments
Investments in equity shares which are publicly traded or where the fair value can be measured reliably are initially measured at fair value, with changes in fair value recognised in profit or loss. Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.
Interest income on debt securities, where applicable, is recognised in income using the effective interest method. Dividends on equity securities are recognised in income when receivable.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.
Trade debtors
Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell.
Trade creditors
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers.
Borrowings
Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the Profit and Loss Account over the period of the relevant borrowing.
Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.
Provisions
Provisions are recognised when the Group has an obligation at the reporting date as a result of a past event, it is probable that the Group will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Leases
Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee.
Assets held under finance leases are recognised at the lower of their fair value at inception of the lease and the present value of the minimum lease payments. These assets are depreciated on a straight-line basis over the shorter of the useful life of the asset and the lease term. The corresponding liability to the lessor is included in the balance sheet as a finance lease obligation.
Lease payments are apportioned between finance costs in the profit and loss account and reduction of the lease obligation so as to achieve a constant periodic rate of interest on the remaining balance of the liability.
Share capital
Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the Group has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Financial instruments
Classification
Debt instruments (other than those wholly repayable or receivable within on year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and are subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade payables or receivables, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration, expected to be paid or received. However if the arrangements of short-term instruments constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or financed at a rate of interest that is not a market rate or in case of an out-right short-term loan not at market rate, the financial asset or liability is measured, initially, at the present value of the future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence or impairment is found, an impairment loss is recognised in the Profit and Loss Account.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset’s carrying amount and best estimate, which is an approximation of the amount that the company would receive for the asset if it were to be sold at the reporting date.
Financial assets and liabilities are offset and the net amount reported in the Balance Sheet when there is an 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.
Turnover |
The analysis of the Group's Turnover for the year by market is as follows:
2022 |
2021 |
|
UK |
|
|
Europe |
|
|
Rest of world |
|
|
|
|
Other operating income |
The analysis of the Group's other operating income for the year is as follows:
2022 |
2021 |
|
Government grants |
- |
|
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Other gains and losses |
The analysis of the group's other gains and losses for the year is as follows:
2022 |
2021 |
|
Gain/loss on disposal of property, plant and equipment |
- |
( |
Gain/loss on disposal of intangible assets |
( |
- |
Negative goodwill written back |
386 |
580 |
102 |
578 |
Operating loss |
Arrived at after charging/(crediting)
2022 |
2021 |
|
Depreciation expense |
|
|
Amortisation expense |
|
- |
Research and development cost |
|
|
Foreign exchange gains |
( |
- |
Operating lease expense - property |
|
|
Loss on disposal of property, plant and equipment |
- |
|
Interest payable and similar expenses |
2022 |
2021 |
|
Interest on bank overdrafts and borrowings |
|
- |
Interest expense on other finance liabilities |
|
- |
|
- |
Staff costs |
The aggregate payroll costs (including Directors' remuneration) were as follows:
2022 |
2021 |
|
Wages and salaries |
|
|
Social security costs |
|
|
Pension costs, defined contribution scheme |
|
|
|
|
The average number of persons employed by the group (including directors) during the year, analysed by category was as follows:
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
2022 |
2021 |
|
Technician |
|
|
Administration and support |
|
|
|
|
Directors' remuneration |
The Directors' remuneration for the year was as follows:
2022 |
2021 |
|
Remuneration |
|
|
Contributions paid to money purchase schemes |
|
|
Sums paid to third parties for directors' services |
- |
|
293 |
295 |
During the year the number of Directors who were receiving benefits and share incentives was as follows:
2022 |
2021 |
|
Accruing benefits under money purchase pension scheme |
|
|
In respect of the highest paid Director:
2022 |
2021 |
|
Remuneration |
|
|
Company contributions to money purchase pension schemes |
|
|
Auditors' remuneration |
2022 |
2021 |
|
Audit of these financial statements |
25 |
25 |
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Taxation |
Tax charged/(credited) in the consolidated profit and loss account
2022 |
2021 |
|
Current taxation |
||
UK corporation tax |
( |
|
Deferred taxation |
||
Arising from changes in tax rates and laws |
|
- |
Tax expense in the income statement |
|
|
The tax on profit before tax for the year is higher than the standard rate of corporation tax in the UK (2021 - higher than the standard rate of corporation tax in the UK) of
The differences are reconciled below:
2022 |
2021 |
|
Loss before tax |
( |
( |
Corporation tax at standard rate |
( |
( |
Tax increase (decrease) from effect of unrelieved tax losses carried forward |
497 |
- |
Tax increase (decrease) from effect of capital allowances and depreciation |
86 |
23 |
Increase (decrease) in UK and foreign current tax from adjustment for prior periods |
(26) |
- |
Effect of tax losses |
1,090 |
448 |
Effect of expense not deductible in determining taxable profit (tax loss) |
(73) |
(110) |
Total tax charge |
|
|
Deferred tax
In the year, given the extent it is considered recoverable via future years' profitability, the deferred tax asset arising from unutilised losses brought forward of £247,000 has been written down to nil.
There is an unprovided asset in respect of depreciation in excess of capital allowances of £11,000 (2021: £84,000).
The debtor amounting to £118,000 relates to R&D tax claims (2021: £234,000).
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Intangible assets |
Group
Goodwill |
Internally generated software development costs |
Total |
|
Cost or valuation |
|||
At 1 January 2022 |
|
|
|
Additions internally developed |
- |
|
|
Acquired through business combinations |
|
- |
|
Disposals |
- |
( |
( |
At 31 December 2022 |
|
|
|
Amortisation |
|||
At 1 January 2022 |
|
- |
|
Amortisation charge |
|
|
|
Acquired through business combination |
|
- |
|
At 31 December 2022 |
|
|
|
Carrying amount |
|||
At 31 December 2022 |
|
|
|
At 31 December 2021 |
- |
|
|
The carrying value of goodwill represents goodwill on the acquisition of Pinmoore Animal Laboratory Services Limited by Orchid Cellmark Limited on 31 March 2022.
Keith Borer Consultants was aquired by Orchid Cellmark Limited in 2015 and the goodwill was amortised over 5 years and is fully written down.
The carrying value of development costs represents two internal development projects for which there is visible future income generation: (1) LIMS system upgrade; (2) Canine DNA Database Project.
The aggregate amount of research and development expenditure recognised as an expense during the period is £
Negative goodwill |
2022 |
At 1 January 2022 |
( |
Recognised in profit or loss |
|
At 31 December 2022 |
- |
|
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Tangible assets |
Group
Land and buildings |
Furniture, fittings and equipment |
Total |
|
Cost or valuation |
|||
At 1 January 2022 |
|
|
|
Acquired through business combinations |
- |
|
|
Additions |
|
|
|
Disposals |
- |
( |
( |
At 31 December 2022 |
|
|
|
Depreciation |
|||
At 1 January 2022 |
|
|
|
Acquired through business combination |
- |
|
|
Charge for the year |
|
|
|
Eliminated on disposal |
- |
( |
( |
At 31 December 2022 |
|
|
|
Carrying amount |
|||
At 31 December 2022 |
|
|
|
At 31 December 2021 |
|
|
|
Included within the net book value of land and buildings above is £426,000 (2021 - £185,000) in respect of short leasehold land and buildings.
Assets held under finance leases and hire purchase contracts
The net carrying amount of tangible assets includes the following amounts in respect of assets held under finance leases and hire purchase contracts:
2022 |
2021 |
|
Plant and machinery |
25 |
35 |
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Investments |
Company
In view of the substantial losses incurred in 2017 and 2018 with resultant liabilities, LabCorp Inc. sold 100% of the share capital (£100 nominal value) in Orchid Cellmark Limited to DNACO Limited for £1 and this is the value the investment is held on the company's balance sheet.
Details of undertakings
Details of the investments (including principal place of business of unincorporated entities) in which the Company holds 20% or more of the nominal value of any class of share capital are as follows:
Undertaking |
Registered office |
Holding |
Proportion of voting rights and shares held |
|
2022 |
2021 |
|||
Subsidiary undertakings |
||||
|
16 Blacklands Way, Abingdon, Oxon, OX14 1DY |
|
|
|
|
16 Blacklands Way, Abingdon, Oxon, OX14 1DY |
|
|
|
Subsidiary undertakings |
Orchid Cellmark Limited The principal activity of Orchid Cellmark Limited is |
Pinmoore Animal Laboratory Services Limited The principal activity of Pinmoore Animal Laboratory Services Limited is |
Business combinations |
On
Pinmoore Animal Laboratory Services Limited contributed £
The amounts recognised in respect of the identifiable assets acquired and liabilities assumed are as set out in the table below:
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Fair value |
|
Assets and liabilities acquired |
|
Financial assets |
|
Stocks |
|
Tangible assets |
|
Financial liabilities |
( |
Total identifiable assets |
|
- |
|
Total consideration |
22 |
Satisfied by: |
|
Cash |
|
Contingent consideration arrangement |
|
Settlement of pre-existing balance |
|
Other |
|
Total consideration transferred |
|
|
The acquisition of Orchid Cellmark Limited in 2018 resulted in the creation of negative goodwill of £9,671,000.
The negative goodwill of £9,671,000 is being recognised in the profit and loss in the periods in which the non-monetary assets are recovered.
In the year to 31 December 2022 the amount recognised as negative goodwill written back in the profit and loss was £386,000.
The detail of the non-monetary assets recovered is shown below:
The useful life of goodwill is
Non-monetary assets brought forward |
Non-monetary assets recovered |
Non-monetary assets carried forward |
|
Tangible assets acquired |
115 |
(115) |
- |
Of the non-monetary assets acquired amounting to £3,837,000, 4% of these or £115,000 were recovered in the year.
The negative goodwill (£9,671,000) is recognised to the extent that the non-monetary assets have been recovered (4%) giving the write back of negative goodwill in the profit and loss account of £386,000.
The negative goodwill has now been fully written back.
Stocks |
Group |
Company |
|||
2022 |
2021 |
2022 |
2021 |
|
Raw materials and consumables |
|
|
- |
- |
Work in progress |
|
|
- |
- |
|
|
- |
- |
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Group
Debtors |
Group |
Company |
||||
Current |
Note |
2022 |
2021 |
2022 |
2021 |
Trade debtors |
|
|
- |
- |
|
Other debtors |
|
|
- |
- |
|
Prepayments |
|
|
- |
- |
|
Income tax asset |
|
|
- |
- |
|
|
|
- |
- |
Cash and cash equivalents |
Group |
Company |
|||
2022 |
2021 |
2022 |
2021 |
|
Cash at bank |
|
|
- |
- |
Creditors |
Group |
Company |
||||
Note |
2022 |
2021 |
2022 |
2021 |
|
Due within one year |
|||||
Loans and borrowings |
|
|
- |
- |
|
Trade creditors |
|
|
- |
- |
|
Social security and other taxes |
|
|
- |
- |
|
Outstanding defined contribution pension costs |
|
|
- |
- |
|
Other payables |
|
( |
- |
- |
|
Accruals |
|
|
- |
- |
|
Income tax liability |
80 |
- |
- |
- |
|
|
|
- |
- |
||
Due after one year |
|||||
Loans and borrowings |
|
|
- |
- |
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Provisions for liabilities |
Group
Deferred tax |
Dilapidations |
Total |
|
At 1 January 2022 |
- |
|
|
Additional provisions |
|
- |
|
Increase (decrease) in existing provisions |
- |
|
|
At 31 December 2022 |
|
|
|
|
Pension and other schemes |
Defined contribution pension scheme
The Group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the Group to the scheme and amounted to £
Contributions totalling £
Share capital |
Allotted, called up and fully paid shares
2022 |
2021 |
|||
No. |
£ |
No. |
£ |
|
|
|
6.00 |
|
6.00 |
Rights, preferences and restrictions
A ordinary shares have the following rights, preferences and restrictions: |
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Loans and borrowings |
Group |
Company |
|||
2022 |
2021 |
2022 |
2021 |
|
Non-current loans and borrowings |
||||
Bank borrowings |
|
- |
- |
- |
Hire purchase contracts |
|
|
- |
- |
Other borrowings |
|
- |
- |
- |
|
|
- |
- |
Group |
Company |
|||
2022 |
2021 |
2022 |
2021 |
|
Current loans and borrowings |
||||
Bank borrowings |
|
- |
- |
- |
Hire purchase contracts |
|
|
- |
- |
Other borrowings |
|
- |
- |
- |
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|
- |
- |
Obligations under leases and hire purchase contracts |
Group
Operating leases
The total of future minimum lease payments is as follows:
2022 |
2021 |
|
Not later than one year |
|
|
Later than one year and not later than five years |
|
|
Later than five years |
|
|
|
|
The amount of non-cancellable operating lease payments recognised as an expense during the year was £
Commitments |
Group
Capital commitments
The total amount contracted for but not provided in the financial statements was £Nil (2021 - £
DNACO Limited
Notes to the Financial Statements for the Year Ended 31 December 2022
Related party transactions |
Group
Summary of transactions with key management
Key management personnel are considered to be senior management. During the year key management personnel compensation was £628,000 (2021:£682,000)
Parent and ultimate parent undertaking |
After 20 August 2024 the Company's immediate parent is
The ultimate parent is
Non adjusting events after the financial period |
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