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Company registration number: 00946573
Destec Engineering Ltd
Financial statements
28 February 2024
Just Audit Limited
Chartered Accountants and Statutory Auditors
Strelley Hall
Main Street
Strelley
Nottingham
NG8 6PE
Destec Engineering Ltd
Contents
Directors and other information
Strategic report
Directors report
Independent auditor's report to the members
Statement of comprehensive income
Statement of financial position
Statement of changes in equity
Statement of cash flows
Notes to the financial statements
Destec Engineering Ltd
Directors and other information
Directors J A S Maclachlan
B Porter
K Andrews
Company number 00946573
Registered office Five Mile Lane
Washingborough
Lincoln
Lincolnshire
LN4 1AF
Business address Five Mile Lane
Washingborough
Lincoln
Lincolnshire
LN4 1AF
Auditor Just Audit Limited
Strelley Hall
Main Street
Strelley
Nottingham
NG8 6PE
Accountants Coulter & Co (Accountants) Ltd
Pera Business Park
M03 Tower Building
Nottingham Road
Melton Mowbray
LE13 0PB
Destec Engineering Ltd
Strategic report
Year ended 28 February 2024
The Directors present their strategic report for the year ended 28th February 2024
Principal activity
The principal activity of the Company is the supply of high pressure containment equipment, portable machine tools and on-site machining services to a global market. The principal markets served are the oil, chemical and petrochemical related industries, power generation, steel, marine, and others. These activities have not changed materially during the year.
Fair review of the business
The Directors consider the state of the Company's affairs to be satisfactory and have continued to invest in new high tech machinery production software together with workshop methods to remain ahead in a competitive market. The strong statement of financial position has allowed this investment without relying on any external borrowing. Following a slow start to the year we recovered and have had a healthy turnover of
£10,347,407. Although the level of profit has decreased we are confident that it will improve next year as we ended the year with a full order book and will be able to benefit from training with the new software and equipment. The Company's key financial performance indicators during the year were as follows:-
Unit 2024 2023
Turnover £ 10,347,407 14,774,473
Turnover (Reduction)/Growth % (30) 106
Gross Margin % 31 45
Profit before tax £ 761,038 4,293,341
Stocks £ 3,208,813 2,869,611
Amounts owed by customers on construction contracts £ 2,609,864 3,631,080
Trade Debtors £ 1,630,748 2,456,878
Trade Creditors £ 1,674,944 729,752
Cash at bank £ 3,796,142 1,904,457
Principal risks and uncertainties
The design and manufacturing side of the Company is dependent on the conditions within the oil industry. In particular the global price of oil. The risk is mitigated by a strong order book. The Company is investing heavily in the latest technology and production systems to be competitive in new markets, particularly nuclear. The on site machining and maintenance sections are increasing in size and are widening their scope of work despite closures of the coal fired power stations which were a major client.
The risks to the business are managed through the extensive use of ISO registered procedures audited by Lloyds. The business has a history of generating profit and business development is funded from cashflow which will continue.
As in any business debt default is a concern, but careful attention to customer credit rating and constant communication with them has minimized the risk.
We have been able to minimize some of the supply chain issues successfully by changing manufacturing procedures.
Development and Performance
The Company continues to refine and develop our standard products to the extent that we are able to significantly extend the size range.
At the end of the year the Company retained a strong statement of financial position and will be investing in improvements to premises, new high technology machinery and production software.
This report was approved by the board of directors on 26 November 2024 and signed on behalf of the board by:
B Porter
Director
Destec Engineering Ltd
Directors report
Year ended 28 February 2024
The directors present their report and the financial statements of the company for the year ended 28 February 2024.
Directors
The directors who served the company during the year were as follows:
J A S Maclachlan
B Porter
K Andrews
Dividends
The directors do not recommend the payment of a dividend.
Financial instruments
The business’s principal financial instruments comprise bank balances, trade debtors and trade creditors and loans owed by a related party.
The main purpose of these instruments is to finance the business's operations.
In respect of bank balances, the liquidity risk is managed by maintaining a sufficient cash reserve at the bank to allow for short term net cash outflows. The firm’s cash is held in accounts that pay interest.
Trade debtors are managed in respect of credit and cash flow risk through the Terms & Conditions agreed with the customer, and through the regular monitoring of amounts outstanding for both time and credit limits.
Trade creditors’ liquidity risk is managed by ensuring sufficient funds are available to meet liabilities when they fall due.
Related party loans are managed in respect of credit and cash flow risk through the Facility Agreement agreed with the related party - see note 21.
Directors responsibilities statement
The directors are responsible for preparing the strategic report, directors report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and the profit or loss of the company for that period.
In preparing these financial statements, the directors are required to:
- select suitable accounting policies and then apply them consistently;
- make judgments and accounting estimates that are reasonable and prudent; and
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Auditor
Each of the persons who is a director at the date of approval of this report confirms that:
- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.
The auditor is deemed to have been re-appointed in accordance with section 487 of the Companies Act 2006.
This report was approved by the board of directors on 26 November 2024 and signed on behalf of the board by:
B Porter
Director
Destec Engineering Ltd
Independent auditor's report to the members of
Destec Engineering Ltd
Year ended 28 February 2024
Opinion
We have audited the financial statements of Destec Engineering Ltd (the 'company') for the year ended 28 February 2024 which comprise the statement of comprehensive income, statement of financial position, statement of changes in equity, 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 FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion, the financial statements: - give a true and fair view of the state of the company's affairs as at 28 February 2024 and of its profit for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and - have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other Information
The other information comprises the information included in the strategic report and the directors' report, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information. 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 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 the 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.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report. We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: - adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or - the financial statements are not in agreement with the accounting records and the 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 directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. 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: We gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates and considered the risk of acts by the company that were contrary to applicable laws and regulations, including fraud. We designed audit procedures to respond to the risk, recognising that 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. We focused on laws and regulations which could give rise to a material misstatement in the financial statements, including, but not limited to, the Companies Act 2006, ISO 9001 regulation, recognising the regulated nature of the company's activities, and UK tax legislation. Our tests included agreeing the financial statement disclosures to underlying supporting documentation and enquiries with management. 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. We did not identify any key audit matters relating to irregularities, including fraud. As in all our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. we also: - Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. - Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control. - Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. - Conclude on the appropriateness of the directors use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern. - Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. (i.e give a true and fair view) We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
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 auditors 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.
David Fletcher BA BFP FCA (Senior Statutory Auditor)
For and on behalf of
Just Audit Limited
Chartered Accountants and Statutory Auditors
Strelley Hall
Main Street
Strelley
Nottingham
NG8 6PE
26 November 2024
Destec Engineering Ltd
Statement of comprehensive income
Year ended 28 February 2024
2024 2023
Note £ £
Turnover 4 10,347,407 14,774,473
Cost of sales ( 7,126,861) ( 8,138,695)
_______ _______
Gross profit 3,220,546 6,635,778
Administrative expenses ( 2,588,270) ( 2,342,719)
_______ _______
Operating profit 5 632,276 4,293,059
Other interest receivable and similar income 9 128,762 282
Profit before taxation 761,038 4,293,341
Tax on profit 10 30,581 ( 759,215)
_______ _______
Profit for the financial year and total comprehensive income 791,619 3,534,126
_______ _______
All the activities of the company are from continuing operations.
Destec Engineering Ltd
Statement of financial position
28 February 2024
2024 2023
Note £ £ £ £
Fixed assets
Tangible assets 11 4,401,233 4,120,172
Investments 12 424,358 100
_______ _______
4,825,591 4,120,272
Current assets
Stocks 13 3,208,813 2,869,611
Debtors:
Amounts falling due after more than one year 14 1,261,921 -
Amounts falling due within one year 14 6,432,208 9,304,283
Cash at bank and in hand 3,796,142 1,904,457
_______ _______
14,699,084 14,078,351
Creditors: amounts falling due
within one year 15 ( 2,362,808) ( 1,915,808)
_______ _______
Net current assets 12,336,276 12,162,543
_______ _______
Total assets less current liabilities 17,161,867 16,282,815
Provisions for liabilities 16 ( 637,513) ( 550,080)
_______ _______
Net assets 16,524,354 15,732,735
_______ _______
Capital and reserves
Called up share capital 19 25,000 25,000
Profit and loss account 16,499,354 15,707,735
_______ _______
Shareholders funds 16,524,354 15,732,735
_______ _______
These financial statements were approved by the board of directors and authorised for issue on 26 November 2024 , and are signed on behalf of the board by:
B Porter
Director
Company registration number: 00946573
Destec Engineering Ltd
Statement of changes in equity
Year ended 28 February 2024
Called up share capital Profit and loss account Total
£ £ £
At 1 March 2022 25,000 12,173,609 12,198,609
Profit for the year 3,534,126 3,534,126
_______ _______ _______
Total comprehensive income for the year - 3,534,126 3,534,126
_______ _______ _______
At 28 February 2023 and 1 March 2023 25,000 15,707,735 15,732,735
Profit for the year 791,619 791,619
_______ _______ _______
Total comprehensive income for the year - 791,619 791,619
_______ _______ _______
At 28 February 2024 25,000 16,499,354 16,524,354
_______ _______ _______
Destec Engineering Ltd
Statement of cash flows
Year ended 28 February 2024
2024 2023
£ £
Cash flows from operating activities
Profit for the financial year 791,619 3,534,126
Adjustments for:
Depreciation of tangible assets 558,258 507,849
Other interest receivable and similar income ( 128,762) ( 282)
Gain on disposal of tangible assets ( 35,799) ( 1,788)
Tax on profit ( 30,581) 759,215
_______ _______
1,154,735 4,799,120
Changes in:
Stocks ( 339,202) ( 6,063)
Trade and other debtors 1,749,607 (3,109,417)
Trade and other creditors 934,838 321,715
_______ _______
Cash generated from operations 3,499,978 2,005,355
Interest received 128,762 282
Tax (paid)/refunded (291,760) 21,565
_______ _______
Net cash (used in)/from operating activities 3,336,980 2,027,202
_______ _______
Cash flows from investing activities
Purchase of tangible assets (870,233) ( 954,653)
Proceeds from sale of tangible assets 53,000 11,500
Loan advances to related party ( 550,000) ( 1,300,000)
Loan repayments from related party - 1,343,441
_______ _______
Net cash used in investing activities (1,367,233) (899,712)
_______ _______
Cash flows from financing activities
Repayments to directors (78,062) -
_______ _______
Net cash used in financing activities (78,062) -
_______ _______
Net increase/(decrease) in cash and cash equivalents 1,891,685 1,127,490
Cash and cash equivalents at beginning of year 1,904,457 776,967
_______ _______
Cash and cash equivalents at end of year 3,796,142 1,904,457
_______ _______
Additions in respect of investments contain a non-cash movement of £424,258 (2023 - £nil) - see note 21.
Destec Engineering Ltd
Notes to the financial statements
Year ended 28 February 2024
1. General information
The company is a private company limited by shares, registered in England and Wales. The address of the registered office is Five Mile Lane, Washingborough, Lincoln, Lincolnshire, LN4 1AF.
2. Statement of compliance
These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' and the Companies Act 2006.
3. Accounting policies
Basis of preparation
The financial statements have been prepared on the historical cost basis. The financial statements are prepared in sterling, which is the functional currency of the entity
Going concern
At the time of approving the financial statements the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financialstatements.
Turnover
Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably.
When the outcome of a transaction involving the rendering of services can be reliably estimated, revenue from the rendering of services is measured by reference to the stage of completion of the service transaction at the end of the reporting period.
When the outcome of a transaction involving the rendering of services cannot be reliably estimated, revenue is recognised only to the extent that it is probable the expenses recognised will be recovered.
Taxation
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in the statement of comprehensive income, except to the extent that it relates to items recognised in other comprehensive income or directly in capital and reserves. In this case, tax is recognised in other comprehensive income or directly in capital and reserves, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.
Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other 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. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.
Foreign currencies
Foreign currency transactions are initially recorded in the functional currency, by applying the spot exchange rate as at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate ruling at the reporting date, with any gains or losses being taken to profit or loss.
Tangible assets
tangible assets are initially recorded at cost, and are subsequently stated at cost less any accumulated depreciation and impairment losses.
Depreciation
Depreciation is calculated so as to write off the cost of an asset, less its residual value, over the useful economic life of that asset as follows:
Freehold property - 2% straight line
Plant and machinery - 15 % reducing balance
Fittings fixtures and equipment - 10 % reducing balance
Motor vehicles - 25 % reducing balance
Computer equipment - 25 % reducing balance
No depreciation is charged on freehold land or plant in the course of construction
If there is an indication that there has been a significant change in depreciation rate, useful life or residual value of tangible assets, the depreciation is revised prospectively to reflect the new estimates.
Fixed asset investments
Fixed asset investments are initially recorded at cost, and subsequently stated at cost less any accumulated impairment losses.
Stocks
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell.
Cost is determined using the first-in, first-out (FIFO) method. The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. At each reporting date, stocks are assessed for impairment. If stocks are impaired, the carrying amount is reduced to its selling price less costs to complete and sell; the impairment loss is recognised immediately in profit or loss. Amounts recoverable on contracts, which are included in debtors, are stated at the sales value of work done.
Construction contracts
Where the outcome of construction contracts can be reliably estimated, contract revenue and contract costs are recognised by reference to the stage of completion of the contract activity as at the period end. Where the outcome of construction contracts cannot be estimated reliably, revenue is recognised to the extent of contract costs incurred that it is probable will be recoverable, and contract costs are recognised as an expense in the period in which they are incurred. The entity uses the percentage of completion method to determine the amounts to be recognised in the period. The stage of completion is measured by reference to the contract costs incurred up to the end of the reporting period as a percentage of total estimated costs for each contract. Costs incurred for work performed to date do not include costs relating to future activity, such as for materials or prepayments.
Financial instruments
A financial asset or a financial liability is recognised only when the company becomes a party to the contractual provisions of the instrument.
Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.
Debt instruments are subsequently measured at amortised cost.
Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately.
Any reversals of impairment are recognised in profit or loss immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised.
Defined contribution plans
Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund. When contributions are not expected to be settled wholly within 12 months of the end of the reporting date in which the employees render the related service, the liability is measured on a discounted present value basis. The unwinding of the discount is recognised in finance costs in profit or loss in the period in which it arises.
Accounting policy judgements and key sources of estimation uncertainty
In the preparation of these financial statements the directors have made the following judgements: a) Estimated cost of labour and overheads which have been incurred in manufactured stock and work in progress in order to correctly reflect the value of these in the accounts at the year end b) Estimation in respect of the various stages of completion of contract and service work in progress. The basis for this estimate depends on passing certain key milestones and determines the income, the estimated cost and therefore profit to be recognised at each stage of completion. c) Determined whether there are factors of impairment of the company's tangible assets and investments. Factors taken into consideration in reaching such a decision include the economic conditions and estimated market value of these assets. d) Estimation of provision for slow moving stock based on an assessment of expected ability to profitably use the item in the foreseeable future.
Other key sources of estimation uncertainty
Tangible assets are depreciated over their anticipated useful lives taking into account residual values where appropriate. The useful lives of the assets and residual values are assessed annually, and may vary depending on a number of factors. In reassessing asset lives, factors such as technological innovation and product life cycles are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values
4. Turnover
Turnover arises from:
2024 2023
£ £
Sale of goods 9,226,744 13,923,207
Rendering of services 1,120,663 851,266
_______ _______
10,347,407 14,774,473
_______ _______
The turnover is attributable to the one principal activity of the company. An analysis of turnover by the geographical markets that substantially differ from each other is given below:
2024 2023
£ £
UK 3,783,064 2,701,387
Europe 6,519,996 9,443,852
Rest of the World 44,347 2,629,234
_______ _______
10,347,407 14,774,473
_______ _______
During the year, 63% of the Company's turnover related to exports (2023 - 82%)
5. Operating profit
Operating profit is stated after charging/(crediting):
2024 2023
£ £
Depreciation of tangible assets 558,258 507,849
(Gain)/loss on disposal of tangible assets ( 35,799) ( 1,788)
Foreign exchange differences ( 17,357) ( 97,796)
_______ _______
6. Auditors remuneration
2024 2023
£ £
Fees payable to the company's auditor for:
Audit of the financial statements 22,000 22,000
_______ _______
7. Staff costs
The average number of persons employed by the company during the year, including the directors, amounted to:
2024 2023
Production staff 61 64
Administration and support 15 16
Sales 9 8
_______ _______
85 88
_______ _______
The aggregate payroll costs incurred during the year were:
2024 2023
£ £
Wages and salaries 4,047,655 3,911,241
Social security costs 442,877 433,057
Other pension costs 115,084 101,061
_______ _______
4,605,616 4,445,359
_______ _______
8. Directors remuneration
The directors aggregate remuneration in respect of qualifying services was:
2024 2023
£ £
Remuneration 471,056 513,986
Company contributions to pension schemes in respect of qualifying services 7,889 7,236
_______ _______
478,945 521,222
_______ _______
The number of directors who accrued benefits under company pension plans was as follows:
2024 2023
Number Number
Defined contribution plans 1 1
_______ _______
Remuneration of the highest paid director in respect of qualifying services:
2024 2023
£ £
Aggregate remuneration 237,420 258,729
_______ _______
237,420 258,729
_______ _______
9. Other interest receivable and similar income
2024 2023
£ £
Bank deposits 128,762 282
_______ _______
10. Tax on profit
Major components of tax (credit)/expense
2024 2023
£ £
Current tax:
UK current tax expense 111,929 521,705
Adjustments in respect of previous periods ( 229,943) 5,816
_______ _______
Deferred tax:
Origination and reversal of timing differences 87,433 231,694
_______ _______
Tax on profit ( 30,581) 759,215
_______ _______
Reconciliation of tax (credit)/expense
The tax assessed on the profit for the year is lower than (2023: lower than) the standard rate of corporation tax in the UK of 24.49% (2023: 19.00%).
2024 2023
£ £
Profit before taxation 761,038 4,293,341
_______ | _______ |
Profit multiplied by rate of tax 186,378 815,735
Effect of capital allowances and depreciation 11,985
Utilisation of tax losses - ( 204,241 )
Effect of super deduction
999
( 39,354 )
Effect of change in tax rate -
132,019
Adjustments in respect of prior periods (229,943) 55,056
_______ | _______ |
Tax on profit (30,581) 759,215
_______ | _______ |
From 1 April 2023, the corporation tax main rate for non-ring-fenced profits has been increased from 19% to 25%, applying to profits over £250,000.
11. Tangible assets
Freehold property Plant and machinery Fixtures, fittings and equipment Motor vehicles Plant and machinery under construction Total
£ £ £ £ £ £
Cost
At 1 March 2023 2,090,432 7,564,424 910,173 261,147 13,711 10,839,887
Additions 83,387 669,506 22,193 81,435 - 856,521
Disposals - ( 279,390) - ( 54,015) - ( 333,405)
Transfers 13,711 - - - ( 13,711) -
_______ _______ _______ _______ _______ _______
At 28 February 2024 2,187,530 7,954,540 932,366 288,567 - 11,363,003
_______ _______ _______ _______ _______ _______
Depreciation
At 1 March 2023 539,595 5,236,879 771,665 171,577 - 6,719,716
Charge for the year 43,751 447,895 25,389 41,223 - 558,258
Disposals - ( 268,304) - ( 47,900) - ( 316,204)
_______ _______ _______ _______ _______ _______
At 28 February 2024 583,346 5,416,470 797,054 164,900 - 6,961,770
_______ _______ _______ _______ _______ _______
Carrying amount
At 28 February 2024 1,604,184 2,538,070 135,312 123,667 - 4,401,233
_______ _______ _______ _______ _______ _______
At 28 February 2023 1,550,837 2,327,545 138,508 89,570 13,711 4,120,171
_______ _______ _______ _______ _______ _______
The cost of land included within land and buildings above is insignificant, in the opinion of the directors.
At the year end, the Company had entered into a commitment in respect of building work with a cost of £Nil (2023 - £13,711).
12. Investments
Other investments Total
£ £
Cost
At 1 March 2023 100 100
Additions - see note 21 424,258 424,258
_______ _______
At 28 February 2024 424,358 424,358
_______ _______
Impairment
At 1 March 2023 and 28 February 2024 - -
_______ _______
Carrying amount
At 28 February 2024 424,358 424,358
_______ _______
At 28 February 2023 100 100
_______ _______
Investments
Registered office Class of share Percentage of shares held
Other significant holdings
Nettleham Developments Limited Studio One Deepdale Enterprise Park, Nettleham, Lincoln, England, LN2 2LL Ordinary A 50
Aggregate of share capital and reserves at 31/08/2023 - £(71,152)
Profit/(Loss) generated for the year ended 31/08/2023 - £(155,281)
13. Stocks
2024 2023
£ £
Raw materials and consumables 1,758,216 1,682,684
Work in progress 122,616 108,441
Finished goods and goods for resale 1,327,981 1,078,486
_______ _______
3,208,813 2,869,611
_______ _______
14. Debtors
Debtors falling due within one year are as follows:
2024 2023
£ £
Trade debtors 1,630,748 2,456,878
Amounts owed by related parties 1,877,915 3,000,383
Amounts owed by customers on construction contracts 2,609,864 3,631,080
Prepayments and accrued income 72,212 39,852
Other debtors 241,469 176,090
_______ _______
6,432,208 9,304,283
_______ _______
Debtors falling due after one year are as follows:
2024 2023
£ £
Amounts owed by related parties 1,261,921 -
_______ _______
During the year £1,686,179 of the loan totalling £3,564,094 owed by a related party was secured - for further details see note 21.
15. Creditors: amounts falling due within one year
2024 2023
£ £
Trade creditors 1,674,944 729,752
Accruals and deferred income 117,394 83,653
Corporation tax 111,929 521,705
Social security and other taxes 207,934 252,029
Director loan accounts 250,607 328,669
_______ _______
2,362,808 1,915,808
_______ _______
16. Provisions
Deferred tax (note 17)
£
At 1 March 2023 550,080
Movement on provisions 87,433
_______
At 28 February 2024 637,513
_______
17. Deferred tax
The deferred tax included in the statement of financial position is as follows:
2024 2023
£ £
Included in provisions (note 16) 637,513 550,080
_______ _______
18. Employee benefits
The amount recognised in profit or loss in relation to defined contribution plans was £ 115,084 (2023: £ 101,061 ).
19. Called up share capital
Issued and called up and fully paid
2024 2023
No £ No £
Ordinary shares of £1 each 25,000 25,000 25,000 25,000
_______ _______ _______ _______
20. Controlling party
The controlling party is Mr B Porter .
21. Related party transactions
Creditors includes an amount of £250,607 (2023 - £328,669) payable to the directors. The amounts are payable on demand and there is no interest on these amounts. During the year the company advanced £550,000 (2023 - £1,300,000) to an associated company and received repayments of £0 (2023 - £1,327,290) from the associated company. During 2023 this company also carried out building work on behalf of Destec Engineering Limited (included in fixed asset additions). Debtors includes £3,139,836 (2023 - £3,000,383) in respect of this debt (see note 14).
£1,261,921 (2023 - £nil) of this debt is discounted with £424,258 (2023 - £nil) being recognised in Investments (see note 12), in accordance with FRS102.
The present value of the secured loan is £1,261,921. The term of the secured loan is 10 years and on 14/02/2034 the £1,686,179 is repayable in full.
The unsecured amount of the loan, totalling £1,877,915 (2023 - £3,000,383), is repayable on demand. The interest rate for the whole loan is 3% per annum (2023 - 3% per annum), paid quarterly in arrears.