The directors present the strategic report for the year ended 28 February 2024.
The principal activity of the group during the year was to provide the service of dispensing chemists.
The group continued to return a strong operating profit in the year.
The directors are ultimately responsible for the system of internal control, which covers all aspects of the business, and for reviewing its effectiveness. However, any such system is designed to manage, rather than eliminate, the risk of failure to achieve the group's objectives. Therefore any system is only able to provide reasonable, and not absolute assurance against material misstatement or loss. The directors regularly review the risks to which the group is exposed, as well as the operation and effectiveness of the system of internal controls. This is an ongoing process, involving the identification, evaluation and management of the significant risks faced by the group.
Risks are assessed on a regular basis across all areas but, in particular, health and safety, information flow, asset protection and regulatory requirements.
The key financial indicators used by the directors are detailed below
| 2024 | 2023 | 2022 | 2021 |
| £’000 | £’000 | £’000 | £’000 |
Turnover | 36,058 | 30,881 | 26,994 | 22,038 |
Gross Profit | 13,691 | 10,951 | 10,276 | 8,853 |
Operating Profit | 618 | 612 | 1,585 | 2,306 |
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The directors also make use of a number of monthly non-financial metrics based around the NHS service provision to provide insight and assist decision making within the group.
The director’s acknowledge and understand their duties and responsibilities, including that of section 172 of the Companies Act 2006. All directors of the Right Medicine Pharmacy Group must act in the way he or she considers, in good faith, would be most likely to promote the success of the business for the benefit of its members, and in doing so have regards (amongst other matters) to:
the likely consequences of any decision in the long term
the interests of the group's employees
the need to foster the company's business relationships with suppliers, customers, and others
the impact of the group's operations on the community and the environment
the desirability of the group maintaining a reputation for high standards of business conduct
the need to act fairly as members of the group.
This statement describes how the directors have complied with section 172(1) (a)-(f) of the Companies Act 2006 to promote the success of the Group for the benefit of its stakeholders which are outlined below.
Employees
Our people play a crucial role in implementing our strategy. They can look forward to being fully supported from day one via our support team and amazing pharmacy teams. We are keen to see people progress within the company throughout your time with us.
Right Medicine was formed in 2000 with our first Pharmacy in Stirling University. Since then we have grown in size to 42 pharmacies across Scotland covering most health board areas. We have managed to grow due to the teams we have working with us. We continue to grow and want to ensure that we have pharmacists of the future to join this growth. We have invested significant time and funding into supporting students and pharmacists of the future via our summer placements, uni placements, and also via our early year’s pharmacist programme which has allowed an extremely supported first year as a pharmacist post-registration and beyond.
The group has various formal and informal processes to actively engage with its employees. These include performance reviews/appraisals, communications through email, staff intranet and meetings. The directors use these processes to understand employees' views and take these into account while making decisions. The group monitors employee-related matters and throughout the year, key matters are communicated with staff.
Customers
The Group remains committed to providing its customers with expert advice, information and exceptional customer service. We are proud that our pharmacies act as a first port of call for healthcare advice in the communities they serve. Our expert pharmacy teams are always on hand to help with advice, prescriptions or treatments for minor ailments. So whether you're looking for advice on travel vaccines or the best way to take your medicines we are always here to help.
The interests of customers are considered in key decisions such as selection of product lines, brands, environmental, sustainability and ethical considerations and supplier selection.
Suppliers
The Group recognise the importance of building and maintaining strong relationships with our suppliers. It is important to us that our suppliers are paid in accordance with agreed terms for the service they provide. The Group strives to meet all covenant requirements and payment due dates for finance costs, to enable us to continue to acquire new businesses and expand operations.
Government and regulators
We operate in a highly regulated industry and patient safety is crucial. Government bodies determine reimbursement levels for the supply chain and we engage with the government and regulators through sector organisations. Key areas of engagement include laws and regulation changes within the sector and how these impact the Group. The board is updated on developments through regular meetings and takes these into account when making decisions.
Communities and the environment
As mentioned above, the Group started off in 2000 and have grown significantly since then, using expert knowledge and excellent customer care to support the local communities. The Group continues to demonstrate an ongoing commitment to operating as a socially responsible business and recognises the active role it can have in helping to build happier and healthier communities.
On behalf of the board
The directors present their annual report and financial statements for the year ended 28 February 2024.
The results for the year are set out on page 9.
Ordinary dividends were paid amounting to £248,410. The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
During the year, the policy of providing employees with information about the company has been continued through regular visits by Area Support Managers and updates via an online portal developed for staff. The directors also visit and work in pharmacies regularly are always open to suggestions and new ideas from employees which encourages involvement and awareness of the business.
The auditor, Thomson Cooper, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
The company’s energy use includes purchased electricity, gas and fuel for company transport and was collated by gathering information from sites and suppliers. Meter readings were predominantly used for gas and electricity and fuel data was gathered from mileage data and fuel spend. Where actual data was not readily available, estimates have been used. The conversion factors used to calculate the emissions are those published in UK government GHG Conversion Factors for Company Reporting Standard Set Version 2.0 for the year 2022.
The group has followed the 2019 HM Government Environmental Reporting Guidelines. The group has also used the GHG Reporting Protocol – Corporate Standard and have used the 2020 UK Government’s Conversion Factors for Company Reporting
The reporting intensity ratio used is tonnes of CO2 per £m turnover. It is considered that this provides the best representation of the activities of the company and comparison throughout the industry.
These include a programme to upgrade lighting across our estate to LED units and replacement of electric radiators and blown heating with more efficient infra-red panel heaters. We have also introduced thermostats to more carefully regulate heating and replacing ICE vehicles with electric vehicles where appropriate.
We have audited the financial statements of Right Medicine Pharmacy Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 28 February 2024 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the revised financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
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 revised financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the revised 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 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 other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the group and the 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:
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.
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.
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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
We considered the opportunities and incentives that may exist within the group for fraud and identified the greatest potential for fraud in the following areas; existence and timing of recognition of income, posting of unusual journals along with complex transactions and non-compliance with laws and regulations. We discussed these areas in detail with management and designed audit procedures to test the timing and existence of revenue, carried out analytical review and reviewed the internal controls in place and asked questions of management with regard laws and regulations.
We discussed with management the laws and regulations as being significant to the company and the group and whether there had been any breaches or litigation. The group and company are not considered to be in a particularly regulated industry which has reduced the level of risk.
We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our sector experience through discussions with management (as required by the auditing standards).
We reviewed the laws and regulations in areas that directly affect the financial statements including applicable company law and considered the extent of compliance with those laws and regulations as part of our procedures of the related financial statement items,
With the exception of the known or possible non-compliance with relevant and significant laws and regulations, and as required by the auditing standards, our work in respect of these was limited to enquiry of the officers and management of the company.
We communicated identified laws and regulations and potential fraud risks throughout our team and remained alert to any indications of non-compliance or fraud throughout the audit. However, the primary responsibility for the prevention and detection of fraud rests with the directors.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
The profit and loss account has been prepared on the basis that all operations are continuing operations.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s loss for the year was £233,855 (2023 - £201,094 loss).
Right Medicine Pharmacy Limited (“the company”) is a private limited company domiciled and incorporated in Scotland. The registered office is Unit 79-81, Bandeath Industrial Estate, Throsk, Stirling, FK7 7NP.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The consolidated group financial statements consist of the financial statements of the parent company Right Medicine Pharmacy Limited 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 28 February 2024. 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.
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 balance sheet 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.
Minority interests in the net assets of consolidated subsidiaries are identified separately from the Group’s equity. Minority interests consist of the amount of those interests at the date of the original business combination and the minority’s share of changes in equity since the date of the combination.
The proportions of profit or loss and changes in equity allocated to the owners of the parent and to the minority interests are determined on the basis of existing ownership interests and do not reflect the possible exercise or conversion of options or convertible instruments.
Parental guarantees have been provided for RMP2 Limited and Web Alt Limited under section 479A of the Companies Act 2006. They have been included in the consolidated financial statements but have not been subject to audit.
At the time of approving the financial statements, the directors expect that the group has adequate resources to continue in operational existence for a period of not less than twelve months. The directors have reviewed their cashflow requirements and are satisfied that both short term liquidity and longer term financial viability is appropriate and as such the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
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 profit and loss account.
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.
Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.
In the parent company financial statements, investments in associates are accounted for at cost less impairment.
Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
At each reporting period 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 company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The 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 liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
Amounts above represent the fair value adjustments in investment properties.
The actual charge for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
Investment properties were valued by various third party surveyors depending on the location of pharmacies at their dates of purchase. The directors do not consider there to have been any material change in the value between the date of the valuations and the balance sheet date.
Details of the company's subsidiaries at 28 February 2024 are as follows:
On 17 March 2023 Web Pharmacy Limited acquired 100% of the share capital in Web Alt Limited.
On 19 June 2023 Right Medicine Pharmacy Limited acquired 100% of the share capital in LP North Ten Limited. On the same day the assets and liabilities were hived up into Right Medicine Pharmacy Limited.
On 20 June 2023 Web Alt Limited acquired 100% of the share capital in LP North Nine Limited. On the same day the assets and liabilities were hived up into Web Alt Limited.
On 11 July 2023 Right Medicine Pharmacy Limited acquired 100% of the share capital in LP North Twenty Five Limited. On the same day the assets and liabilities were hived up into Right Medicine Pharmacy Limited.
On 12 July 2023 Web Pharmacy Limited acquired 100% of the share capital in LP North Twenty Four Limited. On the same day the assets and liabilities were hived up into Web Pharmacy Limited.
Stock with a carrying value of £1,848,722 (2023 - £1,635,943) is pledged as security for the group's bank loans.
The following securities are held in respect of the company bank loans: The Bank of Scotland Plc hold legal charges dated 7th May 2013, 27th May 2013, 23 May 2019. 15 July 2019, 18 September 2019 and 26 June 2023 over all of the heritable property owned by the company.
The following securities have been granted by Web Pharmacy Limited: The Bank of Scotland Plc hold a legal charges dated 10th October 2014 over all property and undertakings of the company. The Bank of Scotland Plc also holds various standard securities over the heritable property owned by the company. Unity Bank hold legal charges dated 19 March 2024 and 26 March 2024 over some of the heritable properties owned by the company.
The company has several fixed interest and variable interest term loans which attract fixed interest at rates of between 3.64%-3.80% and variable interest rates of 2.0%-2.1% over base rate.
Web Pharmacy Limited has term loans on which interest is charged at 2-4% over base rate payable monthly in arrears.
RMP2 Limited has a term loan on which interest is charged at 3.9% over base rate payable monthly in arrears. Unity Trust Bank Plc hold a bond and floating charge dated 8 September 2022 over all of the assets of the company.
WebAlt Limited has granted Unity Trust Bank Plc a bond and floating charge dated 23 June 2024 over over all property and undertakings of the company.
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
Share capital account - This reserve records the nominal value of shares that have been issued.
Profit and loss account - This reserve records retained earnings and accumulated losses. This reserve also includes a revaluation reserve of £70,691 which is non-distributable.
Capital redemption reserve - This reserve records the nominal value of shares repurchased by the company.
On 20 June 2023 the group acquired 100% of the issued share capital of LP North Nine Limited.
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
At the reporting end date the group had contracted with tenants for the following minimum lease payments:
Group
At 28 February 2024 the group owed £138,729 (2023: £138,333) to Cross Healthcare Limited a company which owns a minority interest in Web Pharmacy Limited.
Company
During the year the company sold goods amounting to £1,377,178 (2023: £527,065) and made purchases of £832,278 (2023: £222,070) from Web Pharmacy Limited. The company charged a management fee of £225,363 (2023: £196,156) to Web Pharmacy Limited. At 28 February 2024 the company was owed £677,449 (2023: £136,483).
During the year the company sold goods amounting to £53,219 (2023: £28,919) and made purchases of £39,815 (2023: £21,000) from RMP2 Limited. The company charged a management fee of £17,018 (2023: £8,276) to RMP2 Limited. At 28 February 2024 the company was owed £425,038 (2023: £425,940).
During the year the company sold goods amounting to £77,690 (2023: £Nil) and made purchases of £7,468 (2023: £Nil) from WebAlt Limited. The company charged a management fee of £22,545 (2023: £Nil) to WebAlt Limited. At 28 February 2024 the company was owed £30,072 (2023: £Nil).
Dividends totalling £247,500 (2023 - £427,500) were paid in the year in respect of shares held by the company's directors.