Company Registration No. 00794214 (England and Wales)
DESCH PLANTPAK LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
DESCH PLANTPAK LIMITED
COMPANY INFORMATION
Directors
JW Wieringa
EG Martin
(Appointed 8 June 2023)
Secretary
D Thomas
Company number
00794214
Registered office
Burnham Road
Mundon
Maldon
Essex
CM9 6NT
Auditor
Rickard Luckin Limited
1st Floor
County House
100 New London Road
Chelmsford
Essex
CM2 0RG
DESCH PLANTPAK LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 24
DESCH PLANTPAK LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Fair review of the business
The principal activity of the company continued to be that of the manufacture of thermoformed trays and injection moulded pots for the professional horticulture market.
The results for the year are set out on page 9. The directors note the performance of the company under challenging circumstances this year with the company generating a net loss of £872K. The company experienced a challenging, competitive market especially due to cost-of-living pressures experienced in the UK and Europe.
The company continues to see the benefits of the investments made in the new plant and machinery in recent years with increased efficiency and production capacity which has delivered the gross profit margin.
The company continues to receive financial support from fellow group companies to enable it to continue to trade and the directors have plans to improve efficiencies and net profit in the coming year. Cost inflationary pressures have been challenging during 2023.
The balance sheet as detailed on page 10, shows a small negative net asset position this year, the parent company is fully committed to the future of the UK operation.
The key performance indicators are set out below:
2023 2022
Turnover £7.9m £11.1m
Gross profit % 36.0% 43.8%
Current ratio 0.54 1.91
DESCH PLANTPAK LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Principal risks and uncertainties
Treasury Operations and Financial Instruments
The company operates a treasury function which is responsible for managing the liquidity, interest and foreign currency risks associated with the company's activities.
The company manages interest rate risks on bank overdrafts and has access to group bank loan facilities, the main purpose of which is to raise finance for the company's operations. In addition, the company has various other financial assets and liabilities such as trade debtors and creditors arising directly from operations.
Liquidity Risk
The company manages cash and borrowing requirements in order to minimise interest expense, whilst ensuring the company has sufficient liquid resources to meet the operating needs of the business, by drawing down on group loan facilities.
Interest Rate Risk
The company is exposed to fair value interest rate risk on its borrowings and cash flow interest rate risk on bank overdrafts.
Foreign Currency Risk
The company's principal foreign currency exposure arises from loans on group borrowings and trading with overseas companies. The company policy permits but does not demand that these exposures may be hedged in order to fix the cost in sterling.
Credit Risk
All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are reviewed on a regular basis and provision is made for doubtful debts when necessary.
EG Martin
27 November 2024
Director
DESCH PLANTPAK LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Results and dividends
The results for the year are set out on page 9.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
JW Wieringa
MF Shields
(Resigned 30 June 2023)
EG Martin
(Appointed 8 June 2023)
Auditor
In accordance with the company's articles, a resolution proposing that Rickard Luckin Limited be reappointed as auditor of the company will be put at a General Meeting.
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the 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 of 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 judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
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.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
DESCH PLANTPAK LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
On behalf of the board
EG Martin
Director
27 November 2024
DESCH PLANTPAK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF DESCH PLANTPAK LIMITED
- 5 -
Opinion
We have audited the financial statements of Desch Plantpak Limited (the 'company') for the year ended 31 December 2023 which comprise the Profit and Loss Account, the Balance Sheet, the Statement of Changes in Equity 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 31 December 2023 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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.
Material uncertainty related to going concern
We draw your attention to note 1.2 in the financial statements, which states that the company relies on support from other group companies and had net liabilities of £273,568 as at the year end. As stated in note 1.2, this condition, along with the other matters as set forth in note 1.2, indicate that a material uncertainty exists that may cast significant doubt on the company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.
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. Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
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.
DESCH PLANTPAK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF DESCH PLANTPAK LIMITED
- 6 -
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 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, 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 returns; or
certain disclosures of 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.
Capability of the audit in detecting irregularity, including fraud
We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our: general commercial and sector experience; through verbal and written communications with those charged with governance and other management; through communications with other group auditors and via inspection of the company’s regulatory and legal correspondence.
We discussed with those charged with governance and other management the policies and procedures regarding compliance with laws and regulations.
We communicated identified laws and regulations to our team and remained alert to any indicators of non-compliance throughout the audit, we also specifically considered where and how fraud may occur within the company.
The potential effect of these laws and regulations on the financial statements varies considerably.
Firstly, the company is subject to laws and regulations that directly affect the financial statements, including: the company’s constitution, relevant financial reporting standards; company law; tax legislation and distributable profits legislation and we assess the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.
DESCH PLANTPAK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF DESCH PLANTPAK LIMITED
- 7 -
Secondly the company is subject to many other laws and regulations where the consequences of non-compliance could have a material effect on the amounts or disclosures in the financial statements, for instance through the imposition of fines and penalties, or through losses arising from litigations. We identified the following areas as those most likely to have such an affect: employment legislation; health and safety legislation; trade and export legislation; data protection legislation; anti-bribery and anti-corruption legislation; reporting of injuries, diseases and dangerous occurrences regulations (RIDDOR) and Factories Act.
ISAs (UK) limit the required procedures to identify non-compliance with these laws and regulations, and no procedures over and above those already noted are required. These limited procedures did not identify any actual or suspected non-compliance with laws and regulations that could have a material impact on the financial statements.
In relation to fraud, we performed the following specific procedures in addition to those already noted:
Challenging assumptions made by management in its significant accounting estimates in particular: overhead absorption costs into closing stock and depreciation;
Identifying and testing journal entries, in particular any entries posted with unusual nominal ledger account combinations, journal entries crediting any revenue account and journal entries posted by senior management and the accounts team;
Performing analytical procedures to identify unexpected movements in account balances which may be indicative of fraud;
Ensuring that testing undertaken on both the performance statement, and the Balance Sheet includes a number of items selected on a random basis; and
Discussions with management.
These procedures did not identify any actual or suspected fraudulent irregularity that could have a material impact on the financial statements.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with ISAs (UK). For example, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely the procedures that we are required to undertake would identify it. In addition, as with any audit, there remains a high risk of non-detection of irregularities, as these might involve collusion, forgery, intentional omissions, misrepresentation, or the override of internal controls. We are not responsible for preventing non-compliance with laws and regulations or fraud, and cannot be expected to detect non-compliance with all laws and regulations or every incidence of fraud.
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.
DESCH PLANTPAK LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF DESCH PLANTPAK LIMITED
- 8 -
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.
Joanna Southon
Senior Statutory Auditor
For and on behalf of Rickard Luckin Limited
29 November 2024
Chartered Accountants
Statutory Auditor
1st Floor
County House
100 New London Road
Chelmsford
Essex
CM2 0RG
DESCH PLANTPAK LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
Notes
£
£
Turnover
3
7,918,537
11,097,906
Cost of sales
(5,070,354)
(6,242,891)
Gross profit
2,848,183
4,855,015
Administrative expenses
(3,538,522)
(4,533,518)
Operating (loss)/profit
4
(690,339)
321,497
Interest payable and similar expenses
7
(181,382)
(133,400)
Exceptional item
8
-
678,218
(Loss)/profit before taxation
(871,721)
866,315
Tax on (loss)/profit
9
(Loss)/profit for the financial year
(871,721)
866,315
The profit and loss account has been prepared on the basis that all operations are continuing operations.
DESCH PLANTPAK LIMITED
BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
10
40,718
54,775
Tangible assets
11
2,155,481
2,276,809
Investments
12
1
1
2,196,200
2,331,585
Current assets
Stocks
14
1,641,536
2,379,179
Debtors
15
1,310,184
1,789,203
Cash at bank and in hand
53
2,139
2,951,773
4,170,521
Creditors: amounts falling due within one year
16
(5,421,541)
(2,179,920)
Net current (liabilities)/assets
(2,469,768)
1,990,601
Total assets less current liabilities
(273,568)
4,322,186
Creditors: amounts falling due after more than one year
17
-
3,724,033
Capital and reserves
Called up share capital
20
1,000,001
1,000,001
Share premium account
19,905,409
19,905,409
Profit and loss reserves
(21,178,978)
(20,307,257)
Total equity
(273,568)
598,153
(273,568)
4,322,186
The financial statements were approved by the board of directors and authorised for issue on 27 November 2024 and are signed on its behalf by:
EG Martin
Director
Company Registration No. 00794214
DESCH PLANTPAK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Share premium account
Profit and loss reserves
Total
£
£
£
£
Balance at 1 January 2022
1,000,001
19,905,409
(21,173,572)
(268,162)
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
866,315
866,315
Balance at 31 December 2022
1,000,001
19,905,409
(20,307,257)
598,153
Year ended 31 December 2023:
Loss and total comprehensive income for the year
-
-
(871,721)
(871,721)
Balance at 31 December 2023
1,000,001
19,905,409
(21,178,978)
(273,568)
DESCH PLANTPAK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
1
Accounting policies
Company information
Desch Plantpak Limited is a private company limited by shares incorporated in England and Wales. The registered office is Burnham Road, Mundon, Maldon, Essex, CM9 6NT.
1.1
Accounting convention
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 have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The financial statements present information about the company as an individual undertaking and not about its group. The company has not prepared group accounts as it is exempt from the requirement to do so by section 400 of the Companies Act 2006 as it is a subsidiary undertaking of Desch Holding BV, a company incorporated in the Netherlands, and is included in the consolidated accounts of that company.
This 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:
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 each category of financial instrument; 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.
1.2
Going concern
The financial statements have been prepared on the going concern basis. At the year end the company had net liabilities of £273,568.true
The company meets its day to day working capital requirements through financial support provided by other group companies. The directors have received assurances that other group companies will continue to provide financial support for at least the next twelve months from the date of approval of the financial statements. There has also been no indication that the bank facilities with the parent company's bankers will not remain in place.
It is on this basis that the directors consider it appropriate to prepare the financial statements on the going concern basis.
1.3
Turnover
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.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
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.
DESCH PLANTPAK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
1.4
Intangible fixed assets
Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Software
3 years
1.5
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Land and buildings freehold
3 to 10 years and 40 years
Plant and machinery
3 to 10 years
Fixtures, fittings & equipment
3 to 10 years
Motor vehicles
5 years
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 credited or charged to profit or loss.
1.6
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.7
Impairment of fixed assets
At each reporting period end date, the company 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.
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.
DESCH PLANTPAK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
1.8
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
In determining the cost of raw materials, consumables and the cost of goods for resale, the weighted average purchase price is used. For work in progress and finished goods manufactured by the company, cost is taken as production costs, which include an appropriate proportion of attributable overheads.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.9
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.10
Financial instruments
The company 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 company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with 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
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.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
DESCH PLANTPAK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Impairment of financial assets
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.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company 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.
Classification of financial liabilities
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 company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, and loans from fellow group companies, 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.
Other financial liabilities
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value though profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.11
Equity instruments
Equity instruments issued by the company 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 company.
DESCH PLANTPAK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
1.12
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of 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.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
Leases
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 leases asset are consumed.
1.15
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Going concern
The company made a loss during the year and had net liabilities as at the year end. The financial statements have been prepared on a going concern basis based on the reasons set out in note 1.2. If financial support were to be withdrawn by fellow group companies, the company would cease to be a going concern and the financial statements would need to be prepared on a break up basis.
DESCH PLANTPAK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
2
Judgements and key sources of estimation uncertainty
(Continued)
- 17 -
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Depreciation
Depreciation is provided for on tangible fixed assets. Depreciation rates used are the management's best estimates of the useful economic life of these assets. There is an element of uncertainty in estimating the life of an asset and therefore the depreciation rates to be used.
Overhead absorption in stock
In accordance with FRS 102, a proportion of direct overheads relating to the production of stock is included in the cost of stock. This involves a certain amount of estimation in calculating the level of overheads to be included in the cost.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by class of business
Income from sale of goods
7,918,537
11,097,906
2023
2022
£
£
Turnover analysed by geographical market
UK
7,093,969
9,825,489
EU
821,260
1,268,917
Rest of World
3,308
3,500
7,918,537
11,097,906
4
Operating (loss)/profit
2023
2022
Operating (loss)/profit for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(80,244)
200,661
Fees payable to the company's auditor for the audit of the company's financial statements
50,150
37,500
Depreciation of owned tangible fixed assets
514,484
519,839
Profit on disposal of tangible fixed assets
-
(1,577)
Amortisation of intangible assets
20,577
3,662
Operating lease charges
234,394
227,886
DESCH PLANTPAK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Production and sales
39
50
Office and administration
3
4
Total
42
54
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
1,194,722
1,401,342
Social security costs
109,435
128,320
Pension costs
54,421
46,679
1,358,578
1,576,341
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
87,408
91,480
Company pension contributions to defined contribution schemes
2,105
2,142
89,513
93,622
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2022 - 1).
During the year compensation for loss of office totalled £15,000 (2022: £nil).
7
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
53,313
8,409
Interest payable to group undertakings
128,069
124,991
181,382
133,400
8
Exceptional item
During the prior year there was an exceptional item totalling £678,218 relating to the partial write off of a loan from a group member. There were no such items in the current year.
DESCH PLANTPAK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
9
Taxation
The actual charge for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
(Loss)/profit before taxation
(871,721)
866,315
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 25.00% (2022: 19.00%)
(217,930)
164,600
Tax effect of expenses that are not deductible in determining taxable profit
592
254
Tax effect of income not taxable in determining taxable profit
(128,861)
Change in unrecognised deferred tax assets
207,664
(33,823)
Effect of change in corporation tax rate
8,117
Depreciation on assets not qualifying for tax allowances
10,102
7,940
Permanent capital allowances in excess of depreciation
(428)
(18,227)
Taxation charge for the year
-
-
The company has estimated losses of £15,470,000 (2022: £14,559,000) available for carry forward against future trading profits and capital losses carried forward of £255,000 (2022: £255,000).
The company has a deferred tax asset which it has not provided in the accounts amounting to £3,717,000 (2022: £3,509,000). The company has a history of losses and therefore it is not certain that the timing difference will reverse. For this reason, no provision has been made for the deferred tax asset.
10
Intangible fixed assets
Software
£
Cost
At 1 January 2023
58,437
Additions
6,520
At 31 December 2023
64,957
Amortisation and impairment
At 1 January 2023
3,662
Amortisation charged for the year
20,577
At 31 December 2023
24,239
Carrying amount
At 31 December 2023
40,718
At 31 December 2022
54,775
DESCH PLANTPAK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
11
Tangible fixed assets
Land and buildings freehold
Plant and machinery
Fixtures, fittings & equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2023
1,639,847
4,711,286
3,233,923
13,150
9,598,206
Additions
5,000
242,272
145,884
393,156
Disposals
(508,888)
(551,953)
(1,060,841)
At 31 December 2023
1,644,847
4,444,670
2,827,854
13,150
8,930,521
Depreciation and impairment
At 1 January 2023
1,064,477
3,243,726
3,000,044
13,150
7,321,397
Depreciation charged in the year
44,067
367,037
103,380
514,484
Eliminated in respect of disposals
(508,888)
(551,953)
(1,060,841)
At 31 December 2023
1,108,544
3,101,875
2,551,471
13,150
6,775,040
Carrying amount
At 31 December 2023
536,303
1,342,795
276,383
2,155,481
At 31 December 2022
575,370
1,467,560
233,879
2,276,809
Included within plant & machinery is a total of £nil (2022: £31,003) and included within fixtures, fittings and equipment is a total of £nil (2022: £53,299) relating to assets under construction.
12
Fixed asset investments
2023
2022
Notes
£
£
Investments in subsidiaries
13
1
1
13
Subsidiaries
These financial statements are separate company financial statements for Desch Plantpak Limited.
Details of the company's subsidiaries at 31 December 2023 are as follows:
Name of undertaking and country of
Nature of business
Class of
% Held
incorporation or residency
shareholding
Direct
Indirect
Plantpak Limited
UK
Dormant
Ordinary
100.00
0
DESCH PLANTPAK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
13
Subsidiaries
(Continued)
- 21 -
The aggregate capital and reserves and the result for the year of subsidiaries excluded from consolidation was as follows:
Name of undertaking
Profit/(Loss)
Capital and Reserves
£
£
Plantpak Limited
1
The investment in the company's subsidiary is stated at cost.
14
Stocks
2023
2022
£
£
Raw materials and consumables
242,352
591,107
Work in progress
178,797
139,665
Finished goods and goods for resale
1,220,387
1,648,407
1,641,536
2,379,179
At the year end a provision for obsolete and damaged stock of £43,791 was made (2022: £63,329). The net decrease of £19,538 was credited to cost of sales in the profit and loss account.
Stock includes raw materials and finished goods that are subject to reservation of title until they have been fully paid for.
15
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
1,201,328
1,690,432
Other debtors
300
300
Prepayments and accrued income
108,556
98,471
1,310,184
1,789,203
DESCH PLANTPAK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
16
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans and overdrafts
18
822,029
682,424
Other borrowings from group companies
18
4,028,376
124,868
Trade creditors
223,825
840,829
Taxation and social security
146,400
142,225
Other creditors
11,565
11,976
Accruals and deferred income
189,346
377,598
5,421,541
2,179,920
The bank overdraft relates to an invoice discounting facility which is secured against the corresponding sales invoices.
17
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Other borrowings from group companies
18
3,724,033
18
Loans and overdrafts
2023
2022
£
£
Bank overdrafts
822,029
682,424
Loans from group undertakings
4,028,376
3,848,901
4,850,405
4,531,325
Payable within one year
4,850,405
807,292
Payable after one year
3,724,033
As described in note 22 the terms on some of the loans from group undertakings have been extended and become non-current after the year end.
19
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
54,421
46,679
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
DESCH PLANTPAK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
19
Retirement benefit schemes
(Continued)
- 23 -
The defined benefit contributions payable to the fund at the year end and included in creditors is £7,396 (2022: £8,298).
20
Share capital
2023
2022
£
£
Issued and fully paid
100,000,101 Ordinary shares of 1p each
1,000,001
1,000,001
There is a single class of ordinary shares. The shares have full voting rights and there are no restrictions on the distribution of dividends and the repayment of capital.
21
Financial commitments, guarantees and contingent liabilities
ING Commercial Finance BV have a fixed and floating charge over all current and future assets of the company.
22
Events after the reporting date
After the year end a term of a loan agreement with a group company was amended. The loan was originally repayable on 19th May 2024 but has now been extended to 19th May 2026. The effect this has on the financial statements is £3,467,200 will move from current liabilities to non-current liabilities next year.
23
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
64,596
64,596
Between two and five years
124,510
158,447
189,106
223,043
24
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel is as follows.
2023
2022
£
£
Aggregate compensation
181,531
216,470
DESCH PLANTPAK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
24
Related party transactions
(Continued)
- 24 -
Transactions with related parties
The company has taken advantage of the exemption available in FRS 102 from the requirement to disclose transactions with group companies on the grounds that consolidated financial statements are prepared by the ultimate parent company,
As at 31 December 2023, the company owed £4,028,376 (2022: £3,848,901) to group and related companies under common control.
As at 31 December 2023, the company was owed £107,247 (2022: £47,589) by group and related companies under common control.
During the prior year some of the group loans were reorganised and this resulted in a partial write off of a loan from a group member totalling £678,218. This credit was shown as an exceptional item in the profit and loss account.
25
Ultimate controlling party
The company is a wholly owned subsidiary of Desch Holding BV, the immediate parent undertaking, a company registered in the Netherlands.
The results of the company and its parent are consolidated in the financial statements of Desch HC (Netherlands) BV which are available to the public and may be obtained from the Company Secretary, Desch HC (Netherlands) BV, PO Box 76, Ijzerwerf 14, 4870 AB, Beuningen, The Netherlands.
The ultimate parent company during the current and prior year was Lincolnshire Equity Fund III, LP, a company registered in the United States.
There is no ultimate controlling party.
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