Registered number: 13135567
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Company information
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Contents
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Group strategic report
Year ended 29 February 2024
The directors present their strategic report for the year ended 29 February 2024 in respect of Project Galaxy UK Topco Limited (‘the company’) and its subsidiaries (collectively known as 'the group' or 'Mandata group’).
The group produces software that helps transport businesses improve operational efficiency and benefit from greater visibility over their business activities.
The company itself does not participate in any trading activity; its primary activity has been to raise equity financing for the purpose of enabling its indirectly held subsidiary Project Galaxy UK Bidco Limited to acquire the Mandata group of companies in 2021.
The definitions of key performance indicators referred to in this section are explained in the Financial Key Performance Indicators section later in this document.
The group performed well during the year, reporting turnover of £14,323k. This compares to £12,958k in the year ended 28 February 2023. Total adjusted EBITDA for the year was £4,986k, an increase of £699k on the prior year adjusted EBITDA of £4,287k. FY24 was a year of product focus for Mandata group, it successfully integrated Information Systems Limited (‘Eureka’) into the group and rationalised its existing UK product base. FY24 was the first full year including Eureka which was acquired in FY24, being a transport management software provider sold in Republic of Ireland and has grown 200 customers, increasing the market size beyond the UK borders. The Mandata group of companies has developed a strategic plan which will grow the business over the coming years, where the focus will be to drive progress in the following areas: • Acquisition of new customers to the the group across both emerging and established customer segments within the UK and Ireland; • Transitioning customers into modern, cloud based solutions that are easier to support and evolve which establish closer subscription based relations; • Net retention growth through the development of our feature offerings both in our market leading transport management software and through accompanying services; • Increasing the breadth and depth of product adoption amongst existing customers.
Investment and execution of the group’s strategy will continue into the next financial year and beyond. The group is focused on delivering best-in-class haulage software, with investment centred on product enhancements, and developing strategic partnerships, that will grow our market offering across both the UK and Ireland.
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Group strategic report (continued)
Year ended 29 February 2024
The group provides business critical IT services to its customers, who in turn operate in the transport and logistics sector. This sector provides services that are critical to the infrastructure of the territories where they operate. Cyber and information security is therefore of heightened importance and a source of risk to the group.
The group’s activities also expose it to a number of financial risks including liquidity risk, credit risk, interest rate risk and foreign currency risk which are set out below: Liquidity risk Liquidity risk is the risk that the group could not meet its short term financial obligations. This is mitigated through forecasts and careful cash flow management of debtors and creditors. Credit risk Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. Credit risk largely applies to trade debtors. Through active debtor management and monitoring the group is able to minimise such risks and historical losses in this area are minimal. Interest rate risk The group has debt in the form of loan notes owed to shareholders and external bank debt. Interest on the loan notes is fixed and therefore the group is not subject to the risk of rising interest rates on these loan notes. An interest rate fix on external bank debt expires in November 2024, at which point the group will be subject to the risk of rising interest rates, which will bring some short term benefit due to falling interest rates. Foreign currency risk Foreign currency risk arises when there are exchange rate movements between the case currency the group transacts in its home market and overseas transactions in local currencies. The group has customers in Europe and South Africa but these represent a small proportion of overall revenues and as such does not currently hedge any exposures to these markets. The situation is reviewed annually. Operational risk The business must maintain high levels of technical expertise within its staff. The risk is mitigated through low staff turnover, training, cross-skilling and knowledge transfer. As with any technology company, the group must ensure that it is at the forefront of the industry in its product offering. The risk is mitigated through continued investment in research and development and evolution of its product set. Cyber risk The group provides business critical IT services to its customers, who in turn operate in the transport and logistics sector. This sector provides services that are critical to the infrastructure of the territories where they operate. Cyber and information security is therefore of heightened importance and a source of risk to the group. The business manages cyber risks through an on-going routine of critical reviews and assessments across all areas to safeguard the business for the future. The business manages key risks by engaging with a range of leading software, hardware and cloud vendors as well as being committed to a culture of continuous training, personal development and gaining valuable accreditations, to ensure the group is at the forefront of risk.
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Group strategic report (continued)
Year ended 29 February 2024
The group consider the following as key performance indicators:
Adjusted EBITDA Adjusted EBITDA is operating profit excluding depreciation, amortisation and exceptional items. Exceptional items, for the purpose of the analysis of adjusted EBITDA below, are costs that are non-recurring or non-operational. The definition of exceptional items used in the analysis of adjusted EBITDA below is not the statutory definition and therefore does not match the face of the profit and loss account. The directors use adjusted EBITDA to measure the underlying trading performance of the business as this measure excludes: • Depreciation and amortisation as they are non-cash accounting charges; • Costs of servicing the group’s funding structure, particularly bank and loan note interest; • One-off and temporary costs that should not feature in the group’s long-term maintainable trading profitability. Examples would include redundancy and restructuring costs. Bonuses are also excluded as these are not included in the measurement of profitability used by the group’s senior debt lenders in calculating banking covenants.
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Group strategic report (continued)
Year ended 29 February 2024
Last 12 months adjusted EBITDA (“LTM adjusted EBITDA”)
LTM adjusted EBITDA is a 12 month look-back at any given month end reporting date of the adjusted EBITDA performance of the group. This measure eliminates any month-to-month fluctuations in profitability by viewing performance on a trailing annual basis, and is an effective way of understanding the progress the business is making in growing profitability, particularly when comparing consecutive measures and versus the same month in the previous year. Recurring revenue Revenue generated from the provision of ongoing services to customers, primarily: • Software licences sold on a subscription basis • Subscriptions for related services, for example over-the-air vehicle tracking • Software and hardware support services Ongoing services are defined as those where the customer pays for those services on a recurring basis as part of a fixed term or rolling contract. Recurring revenue is an important measure because it drives a higher quality of earnings and gives the directors better visibility over future revenue, profit and cash generation. Annualised recurring revenue (“ARR”) ARR is recurring revenue for a month at any given month end reporting date multiplied by 12. This measure give the directors an indication of recurring revenue performance of the business over the next 12 months excluding any future churn.
This report was approved by the board on 27 November 2024 and signed on its behalf by:
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Directors' report
Year ended 29 February 2024
The directors present their report and the financial statements for the year ended 29 February 2024.
The loss for the year, after taxation, amounted to £65,122,000 (2023: loss £16,340,000).
The directors do not recommend the payment of a final dividend.
The directors who served during the year and up to the date of signing the financial statements were:
N Duffy (appointed 3 October 2024)
A English (appointed 24 October 2024)
The following information, which would otherwise be disclosed in the directors' report is instead disclosed in the
strategic report, as permitted by section 414c(11) of the Companies Act 2006: - financial risk management objectives and policies - future developments
There have been no significant events affecting the Group or company since the year end.
Pursuant to section 487 of the Companies Act 2006 the auditor shall be deemed to be reappointed and UNW
LLP will therefore continue in office.
This report was approved by the board on
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Directors' responsibilities statement
Year ended 29 February 2024
The directors are responsible for preparing the group strategic report, the directors' report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 Group 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 then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group 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 the Group and to 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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Independent auditor's report to the members of Project Galaxy UK Topco Limited
We have audited the financial statements of Project Galaxy UK Topco Limited (the 'parent company') and its subsidiaries (the 'Group') for the year ended 29 February 2024, which comprise the consolidated statement of comprehensive income, the consolidated balance sheets and company balance sheets, the consolidated statement of changes in equity and company statement of changes in equity, the consolidated statement of cash flows, the consolidated analysis of net debt and the related notes, 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).
We conducted our audit in accordance with International Standards on Auditing (UK) ('ISAs (UK)') and applicable law. Our responsibilities under those standards are further described in the 'Auditor's responsibilities for the audit of the financial statements' section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.
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 or the parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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Independent auditor's report to the members of Project Galaxy UK Topco Limited (continued)
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.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the group 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 group 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 its environment obtained in the course of the audit, we have not identified material misstatements in the group strategic report or the directors' report.
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Independent auditor's report to the members of Project Galaxy UK Topco Limited (continued)
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 Group 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 identified areas of law and regulations that could reasonably be expected to have a material effect on the financial statements from our sector experience and through discussions with the directors and other management (as required by Auditing Standards) and from inspection of the group's legal correspondence and we discussed with the directors and other management the policies and procedures in place regarding compliance with laws and regulations. We communicated identified laws and regulations throughout our audit team and remained alert to any indications of non-compliance throughout the audit. Firstly, the group is subject to laws and regulations that directly affect the financial statements including financial reporting legislation (including related companies legislation), distributable profits legislation and taxation legislation and we assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items. Secondly the group is subject to many other laws and regulations where the consequences of non compliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines or litigation. We identified the following areas as those most likely to have such an effect; health and safety, employment law and certain aspects of company legislation, recognising the nature of the group's activities. Auditing Standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the directors and other management and inspection of regulatory and legal correspondence, if any. Through these procedures, we did not become aware of any actual or suspected non-compliance material to the financial statements. Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
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Independent auditor's report to the members of Project Galaxy UK Topco Limited (continued)
This report is made solely to the group'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 group'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 group and the group's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of UNW LLP, Statutory Auditor
Chartered Accountants
Newcastle upon Tyne
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Consolidated statement of comprehensive income
Year ended 29 February 2024
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Consolidated balance sheet
At
The financial statements were approved and authorised for issue by the board and were signed on its behalf on 27 November 2024.
The notes on pages 19 to 38 form part of these financial statements.
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Company balance sheet
At
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
Company registered number: 13135567
The notes on pages 19 to 38 form part of these financial statements.
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Consolidated statement of changes in equity
Year ended 29 February 2024
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Company statement of changes in equity
Year ended 29 February 2024
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Consolidated statement of cash flows
Year ended 29 February 2024
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Consolidated statement of cash flows (continued)
Year ended 29 February 2024
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Consolidated analysis of net debt
Year ended 29 February 2024
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Notes to the financial statements
Year ended 29 February 2024
Project Galaxy UK Topco Limited ("the company") is a private company, limited by shares, registered in England and Wales and incorporated in the United Kingdom under the Companies Act 2006. The address of the registered office is given on the company information page of these financial statements. The nature of the company's operations and principal activities are disclosed in the strategic report.
The financial statements have been prepared in accordance with United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and the Republic of Ireland' ('FRS 102') and the Companies Act 2006.
3.Accounting policies
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all periods presented, unless otherwise stated.
These financial statements comprise the consolidated (group) financial statements and the company's separate financial statements. However, as permitted by section 408 of the Companies Act 2006, the separate profit and loss account of the company is not presented.
The financial statements are prepared on a going concern basis, under the historical cost convention, as modified by the measurement of certain financial assets and liabilities at fair value. They are presented in pounds sterling, which is the functional currency of the company, and rounded to the nearest £'000. The preparation of financial statements under FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in the process of applying the group's and company's accounting policies. The areas involving higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in note 4. Reduced disclosure FRS 102 allows a qualifying entity certain disclosure exemptions. The company meets the definition of a qualifying entity in respect of its separate (non-group) financial statements and has taken advantage of the exemption relating to the preparation of a cash flow statement, analysis of net debt, and key management personnel compensation disclosures. The equivalent disclosures, on a consolidated basis, are included in the group financial statements, presented herein alongside the company financial statements.
The group financial statements consolidate the financial statements of the company and its subsidiary undertakings as if they formed a single entity. Intercompany transactions and balances are therefore eliminated in full.
The results of subsidiaries acquired or sold are consolidated for the periods from or to the date on which control passes. Business combinations are accounted for under the purchase method, under which the acquiree's identifiable assets (including intangible assets), liabilities and contingent liabilities are recognised initially in the consolidated balance sheet at fair value.
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Notes to the financial statements
Year ended 29 February 2024
3.Accounting policies (continued)
At the time of approving these financial statements, the directors have a reasonable expectation that the group and company has adequate resources to continue in existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparation of these financial statements.
The directors note that the group has net liabilities of £85,787,000. This is as a result of the financing of the acquisition of Mandata Group Limited. The acquisition has brought £102,274,000 of debt onto the balance sheet, which includes £64,895,000 of loan notes, £20,000,000 of bank debt and £17,379,000 of accrued interest. With respect to the total outstanding loans there is no obligation to make payments until 2027, when the loan notes and external bank debt matures. The directors note that the group has made a loss before tax of £65,193,000, however included in this figure is £57,738,000 of goodwill impairment and amortisation, a non-cash item. The group generated positive operating cash flows of £2,039,000 to 29 February 2024. The company and the wider group have prepared detailed financial forecasts which demonstrate that the group has the means to pay the ongoing liabilities as they fall due for the foreseeable 12 month period from the date of approval of these financial statements. Sale of goods Turnover from the sale of equipment is recognised on delivery to the customer. Rendering of services Turnover from rendering of services is recognised in the period in which the service is provided. Payments received in advance are initially recorded as deferred income (within creditors) and released to the profit and loss account in future periods, as the service is provided. Short-term benefits, including holiday pay and other similar non-monetary benefits are recognised as an expense in the period in which the service is received. Defined contribution pension plan The group operates a defined contribution pension plan for its employees. Contributions are recognised as an expense when they fall due. Amounts due but not yet paid are included within creditors on the balance sheet. The assets of the plan are held separately from the group in independently administered funds.
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Notes to the financial statements
Year ended 29 February 2024
3.Accounting policies (continued)
The group provides share based payments to certain employees.
Equity-settled arrangements are measured at fair value (excluding the effect of non-market based vesting conditions) at the date of the grant. The fair value is expensed on a straight-line basis over the vesting period. The amount recognised as an expense is adjusted to reflect the actual number of shares or options that will vest.
The company and group's functional currency is the pound sterling. Transactions in foreign currencies are translated into sterling using the spot exchange rates at the dates of the transactions. At each period end, foreign currency monetary assets and liabilities are translated using the closing rate. All foreign exchange gains and losses are recognised in the statement of comprehensive income.
- it is technically feasible to complete the software so that it will be available for use; - management intends to complete the software and use or sell it; - there is an ability to use or sell the software; - it can be demonstrated how the software will generate probable future economic benefits; - adequate, technical, financial and other resources to complete the development and to use or sell the software are available; and - the expenditure attributable to the software during its development can be reliably measured. Development expenditure capitalised is amortised on a straight line basis to £nil over the expected useful life of the specific software product, which is 5 years for each of the software products currently being amortised. Other development expenditures that do not meet the above criteria are written off to the profit and loss account as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period. The useful lives and residual values of software intangibles are reviewed at the end of each reporting period, and adjusted if appropriate. The effect of any change is accounted for prospectively.
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Notes to the financial statements
Year ended 29 February 2024
3.Accounting policies (continued)
Exceptional items are transactions that fall within the ordinary activities of the group but are presented separately due to their size or incidence.
Current tax is the amount of tax payable in respect of the taxable profit for the current or past reporting periods. It is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date. Deferred tax represents the future tax consequences of transactions and events recognised in the financial statements of current and previous periods, and arises from ‘timing differences’ (where transactions or events are included in the financial statements in periods different from those in which they are assessed for tax). Deferred tax is recognised in respect of all timing differences, except that unrelieved tax losses and other deferred tax assets are recognised only 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 balance sheet date that are expected to apply to the reversal of the timing differences.
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Notes to the financial statements
Year ended 29 February 2024
3.Accounting policies (continued)
Goodwill
Purchased goodwill (representing the excess of the fair value of the consideration given over the fair value of the identifiable net assets acquired) arising on business combinations (acquisitions) is capitalised and then amortised down to £nil on a straight line basis over the period of expected benefit, which is adjusted if necessary as circumstances change. The effect of any change in amortisation period is accounted for prospectively. The carrying amount of goodwill is reviewed for impairment when events or changes in circumstances indicate that the carrying amount of the goodwill may not be recoverable. If any such indication exists, the asset's recoverable amount is estimated and an impairment loss recognised whenever the carrying amount of the asset or its income generating unit exceeds its recoverable amount. Impairment losses are recognised in the profit and loss account. Other intangible assets Intangible assets are stated at cost less accumulated amortisation and accumulated impairment losses. Amortisation is provided on all intangible assets so as to write off the cost of an asset over its estimated useful lives as follows: Goodwill - 10 years straight line Development costs - 5 years straight line Asset residual values and useful lives are reviewed at the end of each reporting period, and adjusted if appropriate. The effect of any change is accounted for prospectively.
Tangible fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes the original purchase price plus any further costs directly attributable to bringing the asset to its working condition for its intended use.
Depreciation is provided on all tangible fixed assets at rates calculated to write off the cost, less their estimated residual value, over their estimated useful lives as follows: Leasehold Improvements - straight line over the life of the lease Motor vehicles - 3 - 5 years straight line Office equipment - 3 - 10 years straight line Computer equipment - 2 - 5 years straight line Asset residual values and useful lives are reviewed at the end of each reporting period, and adjusted if appropriate. The effect of any change is accounted for prospectively.
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Notes to the financial statements
Year ended 29 February 2024
3.Accounting policies (continued)
Assets held under finance leases and hire purchase contracts, which confer rights and obligations on the company similar to those attached to owned assets, are capitalised as tangible fixed assets at the fair value of the leased asset (or, if lower, the present value of the minimum lease payments as determined at the inception of the lease) and are depreciated over the shorter of the lease term and their useful lives. The capital elements of future lease obligations are recorded as liabilities, and the interest elements are charge to the profit and loss account over the period of the leases to produce a constant periodic rate of charge on the remaining balance of the liability.
Leases that do not confer rights and obligations approximating to ownership are classified as operating leases. Rental payments under operating leases are charged to the profit and loss account on a straight-line basis over the lease term, even if payments are not made on such a basis. accumulated impairment losses. Provision is made as necessary for damaged, obsolete or slow-moving items.
Basic debt instruments
The group enters into financial instruments transactions that result in the recognition of basic debt financial assets and liabilities like trade and other accounts receivable and payable, cash and bank balances, bank loans and loans to or from related parties, including fellow group companies. Debt instruments due within one year are measured, initially and subsequently at the transaction price. Debt instruments due after one year are measured initially at the transaction price and subsequently at amortised cost using the effective interest method. At the end of each reporting period debt financial assets are assessed for impairment, and their carrying value reduced if necessary. Any impairment charge is recognised in the profit and loss
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Notes to the financial statements
Year ended 29 February 2024
3.Accounting policies (continued)
account.
Derivative financial instruments Derivative financial instruments, comprising interest rate swaps, are initially recognised at fair value at the date the contract is entered into and are subsequently remeasured to their fair value at each reporting date. Changes in fair value are recognised in the profit and loss account within administrative expenses. factors, including expectations of future events that are believed to be reasonable under the circumstances. Significant judgments in applying the group's accounting policies In preparing these financial statements, the directors do not consider there to have been any significant judgments that were required in the process of applying the group's accounting policies. Key sources of estimation uncertainty Intangible assets Certain costs incurred in the development phase of an internal project, which include databases, internal use software and internally generated software, are capitalised as intangible assets if several criteria are met. Management has made judgments and assumptions when assessing whether a project meets these criteria, and on measuring the costs and economic life attributed to such projects. The carrying value of development costs at the balance sheet date was £1,493,000 as set out in note 13. Impairment of goodwill Determining whether goodwill is impaired requires estimation of the value in use of the cash generating unit to which the assets relates. The value in use calculation requires the entity to estimate the value and timing of future cash flows expected to arise from each cash generating unit and apply a suitable discount rate, in order to calculate the present value of those future cash flows. The carrying value of goodwill at the balance sheet date was £17,339,000 as set out in note 13. Other estimates included within these financial statements include depreciation and amortisation charges and asset impairments (for example provisions against debtors and carrying value of investments). None of the estimates made in the preparation of these financial statements are considered to carry significant estimation uncertainty, nor to bear significant risk of causing material adjustment to the carrying amount of assets and liabilities within the next financial year.
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Notes to the financial statements
Year ended 29 February 2024
Analysis of turnover by country of destination:
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Notes to the financial statements
Year ended 29 February 2024
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Notes to the financial statements
Year ended 29 February 2024
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Notes to the financial statements
Year ended 29 February 2024
11.Taxation (continued)
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Notes to the financial statements
Year ended 29 February 2024
11.Taxation (continued)
In the Spring Budget 2021 it was announced that the main UK corporation tax rate would increase from
19% to 25% from 1 April 2023. This rate increase was substantively enacted as part of the Finance Act 2021 on 24 May 2021 and has now taken effect. Accordingly, the group's profits are taxed at an effective rate of 24.49% for the year ended 29 February 2024 (19% for the year ended 28 February 2023), and future profits will be taxed at a rate of 25%. Deferred tax at the balance sheet date has been calculated at 25% (2023: 25%), as this was the tax rate substantively enacted at the year end.
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Notes to the financial statements
Year ended 29 February 2024
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Notes to the financial statements
Year ended 29 February 2024
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Notes to the financial statements
Year ended 29 February 2024
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Notes to the financial statements
Year ended 29 February 2024
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Notes to the financial statements
Year ended 29 February 2024
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Notes to the financial statements
Year ended 29 February 2024
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Notes to the financial statements
Year ended 29 February 2024
Share premium account
Profit and loss account
The group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the group in an independently administered fund. The pension cost charge represents contributions payable by the group to the fund and amounted to £118,000 (2023: £126,000). Contributions totalling £31,000 (2023: £30,000) were payable to the fund at the balance sheet date and are included in creditors.
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Notes to the financial statements
Year ended 29 February 2024
The ultimate controlling party is Tenzing PE LI GP LLP, a company incorporated in Scotland whose registered office is 50 Lothian Road, Festival Square, Edinburgh, Scotland, EH3 9WJ.
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