Company Registration No. SC244691 (Scotland)
BANCON DEVELOPMENTS HOLDINGS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
BANCON DEVELOPMENTS HOLDINGS LIMITED
COMPANY INFORMATION
Directors
Executive Directors
K J McColgan
A H Tweedie
Non-Executive Directors
J C A Burnett of Leys
A J A Burnett of Leys
R McAlpine
Company number
SC244691
Registered office
Burnett House
Burn O'Bennie Road
Banchory
Aberdeenshire
AB31 5ZU
Auditor
Johnston Carmichael LLP
Bishop's Court
29 Albyn Place
Aberdeen
AB10 1YL
BANCON DEVELOPMENTS HOLDINGS LIMITED
CONTENTS
Page
Strategic report
1 - 7
Directors' report
8 - 9
Directors' responsibilities statement
10
Independent auditor's report
11 – 14
Group statement of income and retained earnings
15
Group balance sheet
16
Company balance sheet
17
Company statement of changes in equity
18
Group statement of cash flows and analysis of debt
19
Notes to the financial statements
20 - 38
BANCON DEVELOPMENTS HOLDINGS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
The directors present the strategic report and financial statements for the year ended 31 March 2024. These financial statements represent the consolidated results of Bancon Developments Holdings Limited (“the Company”) and its subsidiaries (collectively known as "the Group").
Principal activities
The Company is a holding company and the principal activities of the Group and its subsidiaries during the year were housebuilding ("the Homes business"), the supply of construction services and refurbishment of social housing ("the Construction business") and the design, manufacture and supply of timberframe structures ("the Timberframe business").
Strategic review
2023/24 has proven to be a challenging year for the UK housebuilding and construction sectors in general. However the balanced portfolio of business streams across the Group and the underlying strength of each of our businesses has allowed the Group to weather the headwinds experienced in the year and produce a resilient financial performance. We have a robust business that is able to remain profitable even through challenging periods. It is particularly pleasing that in the face of reduced Turnover in the year, the Group has shown an improvement in Gross Margin performance and has also reduced Overhead levels in response to the prevailing market conditions.
The market volatility experienced in the year to 31 March 2024 resulted in Turnover across our Homes and Timberframe businesses being down on the prior year. The Construction business also reported reduced Turnover as a result of the strategy of focusing on better margin workstreams and securing longer-term contracts with an acceptable risk profile. The Group therefore reported a 26% reduction in Turnover in the year, to £97.7m (2023: £132.0m). A strong Gross Margin performance and tight Overhead control across all three businesses drove an Operating Profit of £3.8m (2023: £4.6m). Profit Before Tax of £1.3m (2023: £1.8m) was in line with Management's expectations given the trading environment in the year and demonstrates strength of the underlying fundamentals now in place across the Group. As economic stability and market conditions improve the business is therefore well placed to deliver activity and profitability growth going forward.
The Group has also made significant progress through 2023/24 across key areas of its strategic plan. In September, the Group transitioned to the stewardship of incoming Chief Executive Officer, Kevin McColgan as John Irvine retired from the business. We are indebted to John for his contribution to the Group over the past eight years and for the underlying strength of the business and growth potential that Kevin has inherited.
In the period since September the Group has performed a strategic review whilst continuing to deliver on key objectives already in place. The Homes business secured three new sites in the year enabling it to continue its growth agenda. We have continued our programme of investment into the Timberframe business, with automation, capacity and welfare enhancements across both our manufacturing facilities. We also continue our de-risking strategy in the Construction business and are pleased to have launched our two Partnerships businesses, Retrofit and Land Led Affordable Housing. Moving forward the Group's four key business streams of Private Housing, Land Led Affordable Housing, Retrofit and Timberframe provide a balanced portfolio of activity streams across an appropriate range of sectors, all with strong market dynamics.
A positive start to the 2024/25 year, combined with strong forward order books across all the Group's businesses and more favourable market conditions give confidence that the Group will deliver a markedly improved performance in the year we are now in. Further, the underlying strength of our business, spread of risk and positioning within the markets in which we operate, gives the directors confidence over the growth prospects for the Group going forward.
The directors are therefore satisfied that the result for the year and future prospects of the Group support the current strategies in operation across the three businesses. Our businesses also continue to work collaboratively within the overall Group structure in order to deliver operational synergies and the best quality solutions and products to our customers.
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BANCON DEVELOPMENTS HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
Fair review of the business and future developments
The Homes business maintained activity at the same level as it's record year in 2022/23, albeit this was weighted more towards affordable housing activity in response to the tougher market conditions for private home sales. Whilst demand for newbuild residential properties remained robust in the first half of the year, the cumulative effects of high inflation, increased interest and mortgage rates, and unpredictable mortgage availability combined to impact consumer confidence in the second half of the year in particular. Encouragingly, private reservation rates in the Homes business picked up significantly over the final quarter of the year and this momentum has been maintained into the new financial year giving a strong start to 2024/25.
The Homes business is also proud to have achieved a Gold award for customer satisfaction from Inhouse Research for the seventh consecutive year. This level of consistency over that time period is testament to the quality of our product, in attractive locations, and a genuine focus on the customer experience. The business also secured three new developments across our Grampian and Central Belt operations, further underpinning the business's planned unit delivery as it continues to drive its growth agenda.
The Timberframe business has, again, produced another successful performance in the year, particularly given the contraction of activity through the period as UK housebuilders typically reported volume reductions in the region of 30% to 35%. A shift to an increased proportion of internal work (not included in the consolidated Group turnover figure) and a focus on margin, productivity and overhead control drove a strong trading result in the year. The increase in activity levels since the final quarter in 2023/24 experienced in the Homes business has also been mirrored in the Timberframe business, as the wider housebuilding and construction sectors across the UK start to increase build rates again.
The Timberframe business has also progressed key strategic initiatives which will increase operational capacity and facilitate the delivery of its forward growth plans. Further investment has also been committed to the business in order to enhance facilities and production efficiency going forward.
The Construction business produced a satisfactory result in the year. Turnover was slightly below the previous year, although this was planned as the business continues to drive activity in the key areas of Land Led Affordable Housing and Retrofit, whilst reducing the earnings volatility and risk associated with more traditional main contracting type work. Operating profit was at its highest level since 2007, albeit Profit Before Tax was dampened by one-off costs in relation to a loss making contract and restructuring costs as the business implements its strategy of increasing focus on Land Led Affordable Housing and Retrofit going forward. The business has a strong order book, with Turnover in excess of £39m secured coming into the new financial year.
Looking at the overall Group results for the full year, Turnover was down 26% on the prior year, at £97.7m (2023: £132.0m). The business has managed the reduced activity in the year well with Gross Profit of £15.6m only 6% down on the previous year (2023: £16.6m). The Homes business offset reduced activity in private homes sales with increased activity in affordable housing and continues to operate from sites procured under recent market conditions which therefore deliver favourable margins. The Timberframe business has focused on margin and productivity improvement, and this has been aided by some relative stability in raw materials prices in the year. The reduced Turnover in the Construction business was anticipated and planned for as part of the de-risking strategy within this business. Current contracts also continue to perform well and at strong margins.
Administrative expenses were marginally less in the year, as the business took steps where possible to offset recent inflationary pressures. Operating profit of £3.8m was broadly in line with the prior year (2023: £4.6m).
Exceptional costs of £1.2m (2023: £1.9m) were incurred in relation to restructuring costs and a loss making contract in the Construction business. Interest costs increased to £1.2m in the year (2023: £0.9m) as base rate increases impacted the Group's cost of borrowing.
Profit Before Tax for the year was therefore £1.3m (2023: £1.8m) which represents a positive result for the Group in light of the challenges faced in the year. After the tax charge the retained profit for the year was £1.1m (2023: £1.7m). This profit was transferred to reserves.
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BANCON DEVELOPMENTS HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
Fair review of the business and future developments (continued)
Group net debt increased, as anticipated, from its exceptionally low level in the prior year and was £13.5m at year-end (2023: £5.3m) due to planned reinvestment in land and WIP through the year. The group continues to enjoy a positive relationship with its funders and successfully renewed its banking facilities for a further 3 years, to December 2026 in the year. Group net assets at 31 March 2024 were £19m (2023: £18.0m).
Employees
Underpinning the forward plans of the Group is a focus on development of our people and the systems that allow them to function effectively. Our core values continue to underpin everything we do as a Group.
The Bancon Core values are:
One Team
As a Group we work collaboratively with all stakeholders to achieve the best in all that we do.
We Care
We Care about the work we do. We value our people and take pride in the projects we deliver and the legacy we leave.
We Trust
We trust our people to take responsibility, act with integrity and do the right thing.
Sustainability
Building a long-term business with a positive impact on our people, communities, and planet.
Development
Developing our people and products is key to creating longer term value.
Building on the above, the Group has embedded enhanced benefits and welfare packages across all our employees and is focusing on enhanced appraisals and targeted development going forward.
Principal risks and uncertainties
The management of the business and the execution of the Group's strategy are subject to a number of risks. Risks are formally reviewed by the Group and company boards and appropriate business processes are in place to monitor and mitigate them.
Key business risks and uncertainties affecting the Group are considered to relate to the planning process, housing market confidence, the availability of funds to house purchasers, a reduction in capital projects and reducing opportunities for Construction and Timberframe, volatility in raw material prices and supply, and potential business disruption from the likes of the Covid-19 pandemic.
Delays in the planning process could impact on the timing of new developments with a subsequent impact on profits and cash-flows and therefore to mitigate this risk we have our own in-house planning team, with the requisite experience and skills to manage our planning requirements.
Housing market confidence could impact overall activity levels and profitability and the business constantly assesses the latest market and economic data to ensure our product and service offerings reflect the current market conditions and remain competitive in mitigation of this risk.
A lack of available funds for purchasers and recent interest rate rises could affect sales rates which would impact profits and cash-flows. The Homes business provides the support of independent financial advisers to help prospective house purchasers in mitigation of this risk.
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BANCON DEVELOPMENTS HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
Principal risks and uncertainties (continued)
Reduced spend on and availability of capital projects could impact overall activity levels and profitability. The Group constantly assesses the latest market and economic data to ensure our product and service offerings reflect the current market conditions and remain competitive in mitigation of this risk. In further mitigation the Group has developed a significantly more flexible cost base which better suits the current environment.
Price increases and the availability of raw materials and key components could impact margins. To mitigate this risk the Group adopts a number of strategies including forward purchasing raw materials, seeking to agree price increases from customers, and entering fixed price supply contracts.
Regarding the risk of pandemic, or similar disruption, the business has appropriate health and safety precautions in place to mitigate against the risk of infection across our premises and sites. Contingency plans have also been prepared and tested in order to mitigate against potential disruptions to activities.
Key performance indicators
The directors of Bancon Developments Holdings Limited (“the Board”) manage operations on a Group basis. The Board reviews in detail the performance of each of the businesses through their monthly management accounts and contract/development reports. The Board reviews enquiry and sales levels, order book, contract performance, turnover, manpower levels, gross and net margins achieved, overhead levels and cash flows. The most significant key performance indicators it considers are profitability and debt levels which are discussed in the financial performance review section above. These are reviewed together with non-financial KPI's of customer satisfaction (100%) and health and safety scores (an average of 4.0 against a target of 4.0 across the key divisions).
Section 172 (1) Statement
As directors of the Group and the Company we have acted, and continue to act, in a way that we consider to be most likely to promote the continuing success of the Group and the Company for the benefit of its members. In doing so we have had regard, amongst other matters, to:
The likely consequences of any decision in the long term;
The interests of the Group's and the Company's employees;
The need to foster the Group and the Company's business relationships with suppliers, customers, and others;
The impact of the Group's and the Company's operations on the community and environment;
The desirability of the Group and the Company maintaining a reputation for high standards of business conduct; and
The need to act fairly as between members of the Company.
The following are some examples as to how the directors have had regard to the matters set out above when discharging our section 172 duties:
The key strategic objective is to build a sustainable business for the benefit of current and future stakeholders. This involves us taking decisions both for the present and future benefit of the business. The executive directors work within the business on a daily basis, ensuring that key internal and external relationships are maintained directly and employees, suppliers and customers have appropriate access to us. Our management structure and reporting and communication lines are also organised in such a way that the impact and implications of key decisions are well understood throughout the organisation, with the appropriate level of input at all levels throughout the structure.
The Group's employees are critical to the continued success of the business and it is key we effectively engage with them. Examples of how this is achieved include:
Concerted focus on appraisal and personal development process;
Regular business updates through various channels;
Offering the opportunity for professional and career development through relevant training;
Linking an element of employee reward to the financial success of the Group and the Company; and
Having appropriate whistleblowing procedures.
We also ensure there is a wider understanding of, and alignment on, the Group's key strategic objectives through regular formal and informal communication forums.
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BANCON DEVELOPMENTS HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
We maintain strong relationships with our suppliers and customers through the following practices:
Regular contact and meetings with our key suppliers;
Encouraging our customers and suppliers to raise any issues or concerns they have regarding their relationship with the Group;
Continuing to focus on the qualities that appeal to our customer base and differentiate us from our competitors; and
Offering dedicated points of contact within our team to promote the building of long-term relationships with our customers and suppliers.
We are committed to supporting the communities that we work in and being environmentally responsible. Corporate Social Responsibility is a key area of management focus and is reported on at a Board level. We undertake various initiatives to improve the Group's contributions to these communities and promote the effective use of resources to avoid the unnecessary generation of waste and pollution, with a focus on sustainability and compliance with environmental standards and targets.
We are also committed to conducting our business in an ethical manner. Our core values are engrained in the Group's culture and encompass our commitment to ensure the highest standard of ethical conduct in the way we conduct our business.
The Group's and the Company's ultimate controlling party is J C A Burnett of Leys and his family and as such no conflicts exist between shareholders in relation to the Company.
Streamlined energy and carbon reporting
The Group aims to operate in an environmentally responsible manner and Sustainability, defined as “building a long-term business with a positive impact on our people, communities, and planet” is one of its five Core Values. We acknowledge our responsibility to mitigate the impact of our business activities on climate change and the Group is committed to a reduction in emissions going forward.
The Group has now been accurately recording Scope 1 and 2 emissions for two consecutive years, along with additional Scope 3 areas of measurement, specifically in the area of site and factory waste. During the current year the Group engaged with a Carbon Emissions Consultant to assist with our continued drive towards net zero and we continue to work with this expertise to improve processes and systems going forward.
Across the Group, there are numerous projects in place to improve energy efficiency some of which are noted in the Energy Efficiency Action Taken section below.
The information presented in the Table 1 represents data collected from the Bancon Group of companies, namely:
Bancon Developments Holdings Limited;
Bancon Group Limited;
Bancon Homes Limited;
Deeside Timberframe Limited;
Bancon Construction Limited; and
Bancon Aspire Limited
Energy and carbon data for Deeside Timberframe Limited, Bancon Construction Limited and Bancon Aspire Limited has been voluntary included in order to better capture the full activities of the Group.
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BANCON DEVELOPMENTS HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
Streamlined energy and carbon reporting (continued)
Table1. Energy use and greenhouse gas emissions (The Group)
Year ended 31 March 2024
Year ended 31 March 2023
Energy Use
Tonnes
Energy Use
Tonnes
mWh
CO₂e
mWh
CO₂e
Scope 1 energy use and emissions from stationery combustion gas and generator construction site fuel use
804
190
1,119
266
Scope 1 energy use and emissions from mobile combustion, transport and plant construction site fuel use
2,860
675
2,215
526
Scope 2 energy use and emissions from electricity use
776
157
841
161
Scope 3 energy use and emissions from business mileage from staff's own vehicles
646
153
854
203
Scope 3 energy use and emissions from waste (site, factory and general)
3,344
519
2,559
750
Total measured energy use and greenhouse gas emissions
8,430
1,694
7,588
1,906
Total greenhouse gas emissions per million pounds of revenue
17.3
14.4
It is pleasing to note that the measures taken by the Group and continued focus in this area has resulted in an 11.1% reduction in emissions in the year. The KPI of emissions per million pounds of revenue has increased in the year due to the reduction in revenues as a result of the challenging trading environment during the year. Activity levels were relatively constant year-on-year, with an actual increase in units handed over across both the private and affordable revenue streams.
Methodology
Scope 1, 2 and 3 energy use and greenhouse gas emissions data was collated from the relevant Group companies and from suppliers to identify the amount of energy used. Where actual emissions for the financial year are not available by the reporting date, estimates are used. Energy consumption is calculated for showhomes, plots, site offices and factories based on actual usage incurred. For business travel, fuel card usage, mileage information, expense claims and fuel invoices are used to establish the level of scope 1 emissions. Train travel by employees is not considered to be material and as such this is not reported within the emissions data. For site diesel, usage is based on a calculation of litres delivered to site within the financial period. For site and factory waste, emissions are calculated using the tonnage data provided in relation to skip collections.
Greenhouse gas (GHG) emissions are calculated in line with GHG Reporting Protocol – Corporate Standard and reported in line with the UK Government's guidance on Streamlined Energy and Carbon Reporting and mandatory GHG reporting guidance.
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BANCON DEVELOPMENTS HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
Energy efficiency action taken
The Group has always embraced materials with low embodied carbon in its business processes, particularly timber and timberframe based construction. Timber in itself offers substantial environmental benefits due to its high thermal performance and overall favourable environmental impact compared to more traditional build methods. All the Group's timber based materials are sustainably and ethically sourced with a formalised procurement and ethics policy in place. Having our own Timberframe business in the Group facilitates collaborative working across our businesses to deliver energy efficient solutions to projects undertaken within our Homes and Construction businesses.
Our Homes business seeks to maximise the environmental benefit from a combination of energy generation from Low and Zero Carbon Generating Technologies (LZCGTs), and a reduction in energy demand over the life of the Home through quality design and construction. Our homes utilise high performance timber-based building fabric specifications in order to reduce heating demand and incorporate PV solar panels in order to generate low carbon power for self-consumption or export to the grid. We are also phasing out the use of gas boilers in our homes utilising Air Source Heat Pump technology with sites in Aberdeenshire and Lothian already adopting this strategy. In response to the recent amendment to the building regulations, and in addition to the installation of electric vehicle (EV) charging points, the building fabric of our homes will also be improved in future projects which will also further reduce the heat loss through the building envelope.
A number of our developments utilise a District Heating system to heat their homes. This system uses locally sourced and sustainable zero carbon biomass to heat the network, providing significant carbon emissions savings compared to fossil fuels. We are also involved with a major social housing project for the provision of 536 homes in Aberdeen City. The design specification for the project is the industry recognised Gold Standard and requires energy efficient technologies, that make homes greener and cheaper to run, enhanced space standards, and increased natural light.
Our Timberframe business has installed an energy efficient, wood fuelled, heating system and has a policy of zero waste to landfill, with the majority of timber offcuts being utilised to heat the factory premises. The business is also Chain of Custody PEFC (Programme for the Endorsement of Forest Certification) registered which assures the sustainable purchasing of materials.
Across the Group the following measures are also in place:
Introduction of LED lights to key premises and site offices.
EV charging at all office locations and this is available free of charge to employees.
Provision of enhanced car allowances to employees who wish to purchase EV or Hybrid vehicles and also offer a salary sacrifice scheme for the lease of EV's.
A Cycle to Work scheme to encourage employees to reduce emissions as well as promoting physical and mental health.
A formal Hybrid working policy is in place which will reduce commuter emissions and the energy used to heat/light offices.
Policy of segregating waste on site, with this being recycled where possible, along with a continual drive to reduce volumes.
The business has also increased its level of community engagement in recent years and we report on Corporate Social Responsibility at Board level each month. We ensure our Homes developments have as much green space as possible and place an emphasis on attractive place-making to enhance the environment around our homes.
A programme of information sharing and education is embedded across the Group to increase awareness of climate change as well as the Group's energy use and associate carbon emissions.
On behalf of the board
.........................
A H Tweedie
Director
12/07/2024
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BANCON DEVELOPMENTS HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024
The directors present the directors' report and financial statements for the year ended 31 March 2024. These financial statements represent the consolidated results of Bancon Developments Holdings Limited (“the Company”) and its subsidiaries (collectively known as "the Group").
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
K J McColgan (appointed 29 September 2023)
A H Tweedie
J C A Burnett of Leys
A J A Burnett of Leys
R McAlpine
J C Irvine
(resigned 29 September 2023)
A J Clow
(resigned 4 July 2023)
Dividends
The results for the year are set out on page 15. The directors do not recommend payment of a dividend (2023: nil).
Financial risk management
The Group's operations expose it to a variety of financial risks that include the effects of changes in market prices, credit risk and liquidity risks.
The Group has in place a risk review process that seeks to limit the adverse effects on its financial performance by monitoring levels of debt finance and the related finance costs. Regular forecasting of the Group's short and long term forward liquidity needs are carried out and reviewed by each company and the Group's Board.
The policies set by the Group's Board of Directors are implemented by the Group's Finance Team and key senior managers.
Price risk
The Group can be exposed to commodity price risk as a result of its operations. To mitigate this risk the Group will forward buy an appropriate level of raw material and will also protect itself against significant commodity price increases, where appropriate, in its pricing to customers.
Liquidity risk
In order to maintain liquidity to ensure that sufficient funds are available for ongoing operations and future operations, the Group has access to bank funding facilities which are agreed on a group wide basis and matched to the Group's existing and forecast funding needs. These debt facilities would typically be linked to the base rate which will present no significant interest rate risk to the business.
Credit risk
The Group has implemented policies that require appropriate credit checks on potential customers before contracts are agreed. Where the directors believe that customers may prove a problem, up-front payments will be enforced. During the course of projects, credit control procedures are in place to minimise any credit risk to the business.
Disabled persons
Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the Group continues and that the appropriate training is arranged. It is the policy of the Group that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.
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BANCON DEVELOPMENTS HOLDINGS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
Employee involvement
The Group believes that continued development and training of their staff is a key factor in achieving the skills, quality and motivation within the workforce for the future success of the business.
Through the use of our inhouse Group newsletter, communications, intranet and employee presentations within each company, we continue to inform all staff of decisions that may affect their interests and they also give the employees the platform on which they can make suggestions to improve the financial performance of the Group.
Strategic report
The Group has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the Group's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of future developments.
As noted within the Strategic Report, section 172 requirements including engagement with employees, suppliers, customers, and others, have been disclosed on a group basis. Energy usage and greenhouse gas emissions are also detailed in the Strategic Report. As such this information is not reported here although this note serves as a cross-reference to the Strategic Report.
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 auditor of the company 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 auditor of the company is aware of that information.
On behalf of the board
A H Tweedie
Director
………………
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BANCON DEVELOPMENTS HOLDINGS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2024
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 Group and company, and of the profit or loss of the Group for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and 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; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group's and company's transactions and disclose with reasonable accuracy at any time the financial position of the Group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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BANCON DEVELOPMENTS HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BANCON DEVELOPMENTS HOLDINGS LIMITED
Opinion
We have audited the financial statements of Bancon Developments Holdings Limited (‘the parent company') and its subsidiaries (‘the group') for the year ended 31 March 2024, which comprise the Group Statement of Income and Retained Earnings, Group Balance Sheet, Company Balance Sheet, Company Statement of Changes in Equity, Group Statement of Cash Flows and Analysis of Debt and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland Framework (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
•
Give a true and fair view of the state of the group's and of the parent company's affairs as at 31 March 2024 and of the group's 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 responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the 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 or 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.
Other information
The other information comprises the information included in the Annual Report other than the financial statements and our auditor's report thereon. The Directors are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of 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.
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BANCON DEVELOPMENTS HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BANCON DEVELOPMENTS HOLDINGS LIMITED
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
•
Adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
•
The parent company financial statements are not in agreement with the accounting records and returns; or
•
Certain disclosures of Directors' remuneration specified by law are not made; or
•
We have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the Directors' Responsibilities Statement set out on page 10, 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 group's and parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the group or parent company or to cease operations, or have no realistic alternative but to do so.
Auditor responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Extent to which the audit is considered capable of detecting irregularities, including fraud
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 assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations by considering their experience, past performance and support available.
All engagement team members were briefed on relevant identified laws and regulations and potential fraud risks at the planning stage of the audit. Engagement team members were reminded to remain alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
- 12 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BANCON DEVELOPMENTS HOLDINGS LIMITED
Extent to which the audit is considered capable of detecting irregularities, including fraud (continued)
We obtained an understanding of the legal and regulatory frameworks that are applicable to the group and the parent company and the sector in which they operate, focusing on those provisions that had a direct effect on the determination of material amounts and disclosures in the financial statements. The most relevant frameworks we identified include:
•
Companies Act 2006;
•
UK Corporate Tax legislation;
UK Generally Accepted Accounting Practice;
•
Health and Safety legislation
•
We gained an understanding of how the group and the parent company are complying with these laws and regulations by making enquiries of management and those charged with governance. We corroborated these enquiries through our review of submitted returns, external inspections, relevant correspondence with regulatory bodies and board meeting minutes.
We assessed the susceptibility of the group's and parent company's financial statements to material misstatement, including how fraud might occur, by meeting with management and those charged with governance to understand where it was considered there was susceptibility to fraud. This evaluation also considered how management and those charged with governance were remunerated and whether this provided an incentive for fraudulent activity. We considered the overall control environment and how management and those charged with governance oversee the implementation and operation of controls. In areas of the financial statements where the risks were considered to be higher, we performed procedures to address each identified risk. We identified a heightened fraud risk in relation to:
Management override of controls
•
Margin recognition on developments and contracts
•
Revenue recognition
•
In addition to the above, the following procedures were performed to provide reasonable assurance that the financial statements were free of material fraud or error:
Reviewing minutes of meetings of those charged with governance for reference to: breaches of laws and regulation or for any indication of any potential litigation and claims; and events or conditions that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud;
•
•
For total house sales, we reconciled the number of sales recorded in the year with external third party confirmations and for a sample of house sales confirmed sales value recorded to missives;
For a sample of construction contracts, we verified work completed to date and appropriateness of revenue raised in line with contract progress;
•
For product sales, we tested a sample of sales from point of initiation through to recording on the sales ledger;
•
•
For a sample of development and construction contract margins, we verified costs and revenue to source documentation to confirm actual margins achieved and for a sample of developments and construction contracts across the year end, we enquired with management as to their outlook and reviewed post-year end financial performance to ensure no erosion of margin recognised;
Review of internal Health & Safety register for evidence of incidents or potential and actual litigation
•
Reviewing the level of and reasoning behind the group's and parent company's procurement of legal and professional services
•
Performing audit procedures over the risk of management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing judgements made by management in their calculation of accounting estimates for potential management bias;
•
•
Completion of appropriate checklists and use of our experience to assess the group's and parent company's compliance with the Companies Act 2006; and
•
Agreement of the financial statement disclosures to supporting documentation.
- 13 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BANCON DEVELOPMENTS HOLDINGS LIMITED
Extent to which the audit is considered capable of detecting irregularities, including fraud (continued)
Our audit procedures were designed to respond to the risk of material misstatements in the financial statements, 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 intentional concealment, forgery, collusion, omission or misrepresentation. There are inherent limitations in the audit procedures performed 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.
Use of our report
This report is made solely to the parent 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 parent 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 parent company and the parent company's members as a body, for our audit work, for this report, or for the opinions we have formed.
Stephen McIlwaine (Senior Statutory Auditor)
…………………..
for and on behalf of Johnston Carmichael LLP
Chartered Accountants
Statutory Auditor
Bishop's Court
29 Albyn Place
ABERDEEN
AB10 1YL
- 14 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
GROUP STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 MARCH 2024
2024
2023
Notes
£'000
£'000
Turnover
3
97,732
131,967
Cost of sales
(82,166)
(115,370)
Gross profit
15,566
16,597
Administrative expenses
(11,808)
(11,992)
Other operating income
4
-
1
Operating profit
3,758
4,606
Exceptional items
9
(1,234)
(1,884)
Interest payable and similar expenses
10
(1,204)
(888)
Profit before taxation
5
1,320
1,834
Taxation
11
(249)
(144)
Profit and total comprehensive income for
1,071
1,690
the financial year
Retained earnings at 1 April
17,960
16,270
Retained earnings at 31 March
19,031
17,960
The Group Statement of Income and Retained earnings has been prepared on the basis that all operations are continuing.
There are no recognised gains and losses other than those passing through the group statement of comprehensive income and retained earnings and as such no separate group statement of comprehensive income is presented.
Profit and total comprehensive income for the financial year is attributable to the shareholders.
- 15 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
GROUP BALANCE SHEET
AS AT
31 MARCH 2024
31 March 2024
2024
2023
Notes
£'000
£'000
£'000
£'000
Fixed assets
Tangible assets
12
1,354
990
Investments
13
-
-
1,354
990
Current assets
Stocks
16
48,204
37,034
Debtors
17
12,748
17,635
60,952
54,669
Creditors: amounts falling due within one year
18
(41,920)
(36,227)
Net current assets
19,032
18,442
Total assets less current liabilities
20,386
19,432
Creditors: amounts falling due after more than one year
19
(1,354)
(1,471)
Net assets
19,032
17,961
Capital and reserves
Called up share capital
23
1
1
Profit and loss reserves
24
19,031
17,960
Total equity
19,032
17,961
-
The financial statements were approved by the board of directors and authorised for issue on
and are signed on its behalf by:
……………….
……………….
K J McColgan
A H Tweedie
Director
Director
- 16 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
COMPANY BALANCE SHEET
AS AT 31 MARCH 2024
2024
2023
Notes
£'000
£'000
£'000
£'000
Fixed assets
Tangible assets
12
122
174
Investments
13
1
1
123
175
Current assets
Debtors
17
16,969
13,008
16,969
13,008
Creditors: amounts falling due within one year
18
(11,632)
(8,801)
Net current assets
5,337
4,207
Total assets less current liabilities
5,460
4,382
Creditors: amounts falling due after
more than one year 19
-
(8)
Net assets
5,460
4,374
Capital and reserves
Called up share capital
23
1
1
Profit and loss reserves
24
5,459
4,373
Total equity
5,460
4,374
As permitted by s.408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company's profit for the year was £1.1m (2023: £1.8m).
The financial statements were approved by the board of directors and authorised for issue on 12/07/2024 and are signed on its behalf by:
……………….
……………….
K J McColgan
A H Tweedie
Director
Director
Company Registration No. SC244691
- 17 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
AS AT 31 MARCH 2024
Share capital
Profit and loss reserves
Total
£'000
£'000
£'000
Balance at 1 April 2022
1
2,583
2,584
Year ended 31 March 2023:
Profit and total comprehensive income for the year
-
1,790
1,790
Balance at 31 March 2023
1
4,373
4,374
Year ended 31 March 2024:
Profit and total comprehensive income for the year
-
1,086
1,086
Balance at 31 March 2024
1
5,459
5,460
- 18 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
GROUP STATEMENT OF CASHFLOWS AND ANALYSIS OF DEBT
FOR THE YEAR ENDED 31 MARCH 2024
2024
2023
Notes
£'000
£'000
£'000
£'000
Cashflows from operating activities
Cash (absorbed by)/generated from operations
27
(6,290)
8,333
Interest paid
(1,204)
(888)
Income taxes paid
(23)
(345)
Net cash (outflow) / inflow from operating activities
7,100
(7,517)
Investing activities
Purchase of tangible fixed assets
12
(764)
(547)
Proceeds on disposal of tangible fixed assets
79
10
Net cash used in investing activities
(685)
(537)
Net cash with respect to financing activities
-
-
Net (decrease)/ increase in cash and cash equivalents
(8,202)
6,563
Cash and cash equivalents at beginning of year
(5,336)
(11,899)
Cash and cash equivalents at end of year 20
(13,538)
(5,336)
Analysis of changes in debt (note 20)
At 01 Apr 2023
Cashflows
At 31 March 2024
£'000
£'000
£'000
Cash and cash equivalents
Cash at bank and in hand
7,382
(410)
6,972
Bank overdrafts
(1,718)
(792)
(2,510)
5,664
(1,202)
4,462
Borrowings
Bank revolving credit facility
(11,000)
(7,000)
(18,000)
(11,000)
(7,000)
(18,000)
Total
(5,336)
(8,202)
(13,538)
- 19 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
Company information
Bancon Developments Holdings Limited (“the company”) is a private company limited by shares, incorporated and domiciled in Scotland. The principal activities of the company and its subsidiaries (collectively known as "the Group") and the nature of the Group's operations are set out in the Strategic Report on pages 1 – 7. The company's trading address is Burnett House, Burn O'Bennie Road, Banchory, AB31 5ZU.
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 are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest thousand pounds, unless otherwise indicated.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The directors have chosen to present the net position of cash at bank and in hand and bank borrowings rather than the gross position. The directors monitor the Group's net debt position as part of their day to day management of the Group and as such it is deemed appropriate to present the net debt figure in the financial statements. The directors believe showing the net facility allows them to present a true and fair view of the Group's financial position, financial performance and cashflows.
FRS 102 reduced disclosure framework - parent company
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the ultimate parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements under FRS102:
The requirements of Section 7 Statement of Cash flows and Section 3 Financial Statement Presentation paragraph 3.17 (d);
The requirement of Section 11 Basic Financial Instruments paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c); and
The requirement of Section 33 Related Party Disclosures paragraph 33.7.
1.2
Basis of consolidation
In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date.
- 20 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies (continued)
1.2
Basis of consolidation (continued)
The consolidated financial statements incorporate those of Bancon Developments Holdings Limited and all of its subsidiaries (i.e. entities that the Group controls through its power to govern the financial and operating policies so as to obtain economic benefits). Subsidiaries acquired during the year are consolidated using the purchase method. Their results are incorporated from the date that control passes.
All financial statements are made up to 31 March 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the Group.
All intra-group transactions, balances and unrealised gains on transactions between Group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Entities in which the Group holds an interest and which are jointly controlled by the Group and one or more other ventures under a contractual arrangement are treated as joint ventures. In the Group financial statements, joint ventures are accounted for using the equity method.
1.3
Going concern
At the time of approving the financial statements, the directors have a reasonable expectation that the Group and company have adequate resources to continue in operational existence for the foreseeable future. This incorporates consideration of the Group's future trading forecasts coupled with renewed banking facilities for 3 years. Thus, the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.4
Turnover
Turnover represents amounts receivable for goods and services net of VAT and trade discounts. It derives turnover from three principal sources: Timberframe supplies, construction contracts and housebuilding.
Timberframe supplies
Turnover can arise primarily from either the supply of timberframe structures or the supply and build of the timberframe structures. The former is treated as a supply of goods and turnover is recognised when the structure is physically delivered to the customer. The latter is treated as a construction contract and turnover is recognised as per a construction contract.
Revenue received in relation to timberframe contract retentions are recognised when it is probable that the economic benefits associated with the transaction will flow to the company.
Construction contracts
Turnover is only recognised on a construction contract where the outcome can be estimated reliably. Variations to, and claims arising in respect of, construction contracts are included in revenue to the extent that they have been agreed with the customer. Turnover and costs are recognised by reference to the stage of completion of contract activity at the balance sheet date. This is normally measured by surveys of work performed to date. An estimate of the profit attributable to work completed is recognised once the outcome of the contract can be assessed with reasonable certainty. Contracts are only treated as construction contracts when they have been specifically negotiated for the construction of a development or property. When it is probable that the total costs on a construction contract will exceed total contract revenue, the expected loss is recognised as an expense in the profit and loss account immediately.
Amounts recoverable on construction contracts are included in trade receivables and stated at cost plus attributable profit less any foreseeable losses. The costs on contracts not yet taken to the profit and loss account less related foreseeable losses and payments on account are shown in stocks are work in progress. Payments received in excess of amounts recoverable on construction contracts are included in payments on account within creditors.
- 21 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies (continued)
1.4
Turnover (continued)
Housebuilding
Turnover is recognised at legal completion in respect of the total proceeds from selling private residential homes. Turnover is measured at the fair value of consideration received or receivable and represents the amounts receivable for the property, net of discounts and VAT. The sale proceeds of part-exchange properties are included as an adjustment within cost of sales for any margin realised, as the directors view these transactions as a means of conducting the original new build house sale.
Turnover and costs on an affordable housing contract are recognised by reference to the stage of completion of contact activity at the balance sheet date. This is normally measured by surveys of work performed to date. An estimate of the profit attributable to work completed is recognised once the outcome of the contract can be assessed with reasonable certainty. When it is probable that the total costs on an affordable housing contract will exceed total contract revenue, the expected loss is recognised as an expense in the profit and loss account immediately.
1.5
Government Grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received. A grant received before the recognition criteria are satisfied is recognised as a liability.
1.6
Intangible fixed assets other than goodwill
Trade licenses owned at the balance sheet date are included at cost less provision for diminution in value. No provision for amortisation has been made in the financial statements as the estimated residual value is greater than the net carrying value.
1.7
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost, 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
20 years
Tenant's improvements
10 years
Plant and machinery
7 years
Fixtures, fittings & equipment
7 years
Motor vehicles
4 years
IT
4 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 recognised in the profit and loss account.
Expenditure incurred after the asset is put to use, such as repairs and maintenance costs, are expenses in the period incurred, while other expenses that are expected to generate future economic benefits are capitalised.
- 22 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies (continued)
1.8
Fixed asset investments
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
1.9
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) by comparing this to the asset's carrying value. The recoverable amount of the asset is the higher of the fair value less costs to sell and value in use. Value in use is defined as the present value of future cash flows before interest and tax, obtained as a result of the asset's continued use.
1.10
Stock and work in progress
Stock and work in progress, including land, is stated at the lower of cost and net realisable value. Cost comprises raw materials, consumables and direct labour plus attributable overheads based on a normal level of activity. Net realisable value is based on estimated selling price less anticipated costs to completion and disposal. Provision is made for all foreseeable losses.
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 the profit and loss account.
1.11
Land options
Land options are included within work in progress at cost. If, or when, it becomes apparent that an option on land relating to a potential development site will not receive the necessary approvals the option will be charged in full to profit or loss.
1.12
Construction contracts
Amounts recoverable on construction contracts, which are included in debtors, are stated at the net sales value of the work done after provision for contingencies and anticipated future losses on contracts, less amounts received as progress payments on contracts, less amounts received as progress payments on account.
The “percentage of completion method” is used to determine the appropriate amount to recognise in a given period. The stage of completion is measured by the proportion of contract costs incurred for work performed to date compared to the estimated total contract costs. Costs incurred in the year in connection with future activity on a contract are excluded from contract costs in determining the stage of completion. These costs are presented as stocks, prepayments or other assets depending on their nature, and provided it is probable they will be recovered.
1.13
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, 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.
- 23 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies (continued)
1.14
Financial instruments
The Group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments' and Section 12 ‘Other Financial Instruments Issues' of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the Group's balance sheet when the Group becomes party to the contractual provisions of the instrument.
Basic financial assets
Basic financial assets, which include trade and other receivables, amounts due from Group undertakings at a parent company level and participating interests 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. The effective interest rate is the rate that exactly discounts estimated future cash receipts/payments through the expected life of the investment to the net carrying amount on initial recognition. Financial assets classified as receivable within one year are not amortised.
Impairment of financial assets
Financial assets 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.
Basic financial liabilities
Basic financial liabilities, including trade and other payables and amounts due to Group undertakings at a parent company level 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.
Basic financial instruments are subsequently carried at amortised cost, using the effective interest rate method.
- 24 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies (continued)
1.15
Shared equity interests
The loans are discounted to reflect the time value of money and unwound over the term of the loan. They are also reviewed regularly and provisions are recorded for any amounts not deemed recoverable.
1.16
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Group's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax is provided, using the full liability method, on temporary differences arising between the tax base of assets and liabilities and their carrying amounts in the financial statements. The deferred tax position is calculated using the rates enacted or substantially enacted at the balance sheet date. Tax losses are surrendered or claimed in the form of Group relief with consideration being received or paid accordingly. The Group relief amount is recorded separately within the debtors and creditors amounts in the balance sheet, as applicable, and is calculated by applying the tax rate enacted or substantively enacted at the balance sheet date to the loss amount.
Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilised.
1.17
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.
1.18
Retirement benefits
The Group operates a defined contribution scheme for the benefit of its employees. Contributions payable are charged to profit or loss in the year they are payable.
Differences between contributions payable in the year and contributions actually paid are shown as either accruals or prepayments in the balance sheet.
- 25 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies (continued)
1.19
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to income 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 lease asset are consumed.
1.20
Exceptional items
Exceptional items comprise costs which the directors consider as material to the statement of comprehensive income and retained earnings, that their separate disclosure is necessary for an appropriate understanding of the group's financial performance.
2
Judgements and key sources of estimation uncertainty
In the application of the Group'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.
The following are considered to be either judgements that have had the most significant effect on amounts recognised in the financial statements, or estimates that are dependent upon the assumptions which could change in the next financial year and have a material effect on the carrying amounts of assets and liabilities recognised at the balance sheet date:
Stock and work in progress - housebuilding
Stock and work in progress (including land) of £48,204k (2023: £37,034k) is a material asset on the Balance Sheet. Monitoring of carrying values is carried out on a site by site basis throughout the year to identify any impairments or reversals of previous impairments. Judgement is required when monitoring the carrying values as this includes estimating cost to complete and future selling prices, which are dependent on housing market conditions. Where impairment is identified a provision is created to write work in progress down to its recoverable amount being the lower or cost and net realisable value.
- 26 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
2
Judgements and key sources of estimation uncertainty (continued)
Recognition of retention revenue - timberframe supplies
Management consider the recoverability of construction contract retentions in relation to timberframe supplies to be fundamentally uncertain and as such these are recognised when it is deemed that it is probable that the economic benefits associated with the transaction will flow to the company rather than as part of construction contract revenue as the job progresses. Management consider this treatment to be appropriate on the basis that the company generally acts as subcontractor on contracts and is normally beholding to the main contractor, which creates significant uncertainty around the receipt of retentions.
Deferred tax asset
The recognition of deferred tax assets is dependent upon estimation of future taxable profits that will be available against which carried forward trading losses can be utilised, the directors and management are therefore required to assess the timing of the utilisation of provisions for tax purposes and whether sufficient taxable profits will be available to enable the asset to be recovered. In the event that actual taxable profits are different, such differences may impact the carrying value of such deferred tax assets in future years. At 31 March 2024 the directors and management are satisfied with the recoverability of the deferred tax asset recognised, considering estimated future taxable profits and their predicted utilisation.
Long term contracts - construction contracts
Long term contract accounting impacts a number of significant account balances within the Group's financial statements. Turnover, cost and ultimately profit recognition in respect of construction contracts require the directors and management to make estimations on the outcome of long-term contracts which require assessments and judgements to be made. These include the stage of completion of the individual construction contracts based on percentage of completion methodology, the recoverability of construction costs, any variations in the construction contract, any changes in contract costs and the level of recoverability of retentions. All of the factors have been considered by the directors and management in concluding on the appropriate profit and loss presentation of long-term contracts for the year ended 31 March 2024.
The recoverability of amounts recoverable on construction contracts and other receivables, including retentions, are regularly reviewed in light of available economic information specific to each receivable and provisions are recognised for balances considered to be irrecoverable. At 31 March 2024, the directors and management concluded their reviews and are satisfied that amounts recoverable on construction contracts and other receivables are appropriately stated within the financial statements.
With respect to stock and work in progress, key judgements and estimates in determining the appropriateness of its carrying value are:
An estimation of costs to complete; and
An estimation of the remaining revenues.
The assessments include a degree of uncertainty and therefore if the key judgements and estimates charge unfavourably, write-downs of stock and work in progress may be necessary. At 31 March 2024, the directors and management concluded their reviews and are satisfied that the stock and work in progress are appropriately stated within the financial statements.
The directors consider that there are no other judgements, estimates and underlying assumptions which have a significant risk of causing material adjustment to the carrying amounts of the assets and liabilities.
- 27 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
3
Turnover
An analysis of the Group's turnover is as follows:
2024
2023
£'000
£'000
Turnover
Housebuilding
65,634
68,427
Timberframe
11,042
27,995
Construction
21,056
35,545
97,732
131,967
All Group turnover is generated within the United Kingdom.
4
Other operating income
2024
2023
£'000
£'000
Other operating income
-
1
5
Profit before taxation
2024
2023
£'000
£'000
Profit before taxation for the year is stated after charging:
Depreciation of owned tangible fixed assets
315
240
Loss on disposal of fixed asset
3
99
Operating lease charges
695
289
- 28 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
6
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£'000
£'000
For audit services
Audit of the financial statements of the Group and company
23
15
Audit of the financial statements of the company's subsidiaries
62
50
85
65
For other services
Corporate tax services
15
20
7
Directors' remuneration
2024
2023
£'000
£'000
Remuneration for qualifying services
2,617
2,887
Company pension contributions to defined contribution schemes
194
124
2,811
3,011
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 12 (2023: 9).
Remuneration disclosed above includes £575k paid to the highest paid director (2023: £951k). This includes a performance related bonus.
8
Employees
The average monthly number of persons (including directors) employed by the Group during the year was:
2024
2023
Number
Number
Directors and management
48
56
Administration
83
86
Weekly paid production
110
119
241
261
Their aggregate remuneration comprised:
2024
2023
£'000
£'000
Wages and salaries
12,528
12,352
Social security costs
1,363
1,449
Pension costs
752
575
14,643
14,376
- 29 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
9
Exceptional Items
2024
2023
£'000
£'000
Restructuring costs
491
-
Loss on contract
743
-
Impairment of a long-held development
-
1,884
1,234
1,884
Restructuring costs in the year relate to restructuring across the Group in order to align the Groups structure with its forward strategy.
Loss on contract in the year represents the loss and reversal of previous profits recognised on a Construction contract entered into at the point of peak cost inflation and of a type that is not part of the businesses forward strategy.
The impairment of a long-held development in the prior year represents an impairment of work in progress to ensure the carrying value of asset is recorded at our best estimate and is separately disclosed due to its quantum.
10
Interest payable and similar expenses
2024
2023
£'000
£'000
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
1,204
888
11
Taxation
2024
2023
£'000
£'000
Current tax
UK corporation tax charge
283
113
Adjustments in respect of prior periods
2
(54)
Total current tax
285
59
Deferred tax
Origination and reversal of timing differences
(36)
85
Total tax charge recognised in the year
249
144
- 30 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
11
Taxation (continued)
The actual charge for the year can be reconciled to the expected charge based on the profit or loss and the standard rate of tax as follows:
2024
2023
£'000
£'000
Profit before taxation
1,320
1,834
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
330
348
Fixed asset differences
(6)
(6)
Tax effect of expenses that are not deductible in determining taxable profit
26
7
Utilisation of brought forward tax losses
(103)
(202)
Adjustments in respect of prior periods
2
(54)
Effects of changes in tax rates and laws
-
51
Taxation charge for the year
249
144
- 31 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
12
Tangible fixed assets
Land and buildings freehold
Tenant's improvements
Plant and machinery
Group
FFE & IT
Motor vehicles
Total
£'000
£'000
£'000
£'000
£'000
£'000
Cost
At 1 April 2023
147
514
1,701
272
169
2,803
Additions
-
179
582
-
3
764
- -
Disposals
-
(82)
-
(3)
(85)
At 31 March 2024
147
693
2,201
272
169
3,482
Depreciation and impairment
At 1 April 2023
116
204
1,117
222
154
1,813
Depreciation charged in the year
14
72
14
4
315
211
Eliminated in respect of disposals
-
-
-
-
-
-
At 31 March 2024
130
276
1,328
236
158
2,128
Carrying amount
At 31 March 2024
17
417
873
36
11
1,354
At 31 March 2023
31
310
584
50
15
990
Plant and machinery
Fixtures, fittings & equipment
Company
Total
£'000
£'000
£'000
Cost
At 1 April 2023
313
34
347
Additions
3
-
3
At 31 March 2024
316
34
350
Depreciation and impairment
At 1 April 2023
171
2
173
Depreciation charged in the year
51
4
55
At 31 March 2024
222
6
228
Carrying amount
At 31 March 2024
94
28
122
At 31 March 2023
142
32
174
- 32 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
13
Fixed asset investments
Group
Company
2024
2023
2024
2023
£
£
£
£
Investments in subsidiaries (see note 14)
50
50
666
666
Movements in fixed asset investments
Group
Shares
£
Cost or valuation
At 1 April 2023 & 31 March 2024
50
Carrying amount
At 31 March 2024
50
At 31 March 2023
50
The fixed asset investment held by the Group is Ringlink (Scotland) Limited, a company incorporated in Scotland. The company owns 50 ordinary £1 shares in the investment (no controlling interest) and its principal activity is the provision of temporary labour.
The directors consider that the carrying value of the investment is supported by their underlying net assets.
Movements in fixed asset investments
Company
Shares
£
Cost or valuation
At 1 April 2023 & 31 March 2024
666
Carrying amount
At 31 March 2024
666
At 31 March 2023
666
In the opinion of the directors, the aggregate value of the company's investment in subsidiary undertakings is not less than the amount included in the Balance Sheet.
- 33 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
14
Subsidiaries
Details of the company's subsidiaries at 31 March 2024 are as follows:
Name of undertaking and country of
Nature of business
Class of
% Held
incorporation or residency
shareholding
Direct
Bancon Aspire Limited (1)
Scotland
Housebuilder
1 ordinary £1 share
100.00
Bancon Construction Limited (2)*
Scotland
Building and contracting
200 ordinary 50p shares
100.00
Bancon Group Limited (1)
Scotland
Building and contracting
665 ordinary £1 shares
100.00
Bancon Homes (Deeside) Limited (1)*
Scotland
Housebuilder (non-trading)
100 ordinary £1 shares
100.00
Bancon Homes (Donside) Limited (1)*
Scotland
Housebuilder (non-trading)
100 ordinary £1 shares
100.00
Bancon Homes Limited (1)*
Scotland
Housebuilder
100 ordinary £1 shares
100.00
Deeside Timberframe Limited (2)*
Scotland
Timberframe manufacture
1 ordinary £1 share
100.00
Deeside Homes Limited (2)*
Scotland
Dormant
1 ordinary £1 share
100.00
*The shares in these companies are held by Bancon Group Limited.
The registered offices for each subsidiary are listed below:
(1) Burnett House, Burn O'Bennie Road, Banchory, Aberdeenshire, Scotland, AB31 5ZU;
(2) Banchory Business Centre, Burn O'Bennie Road, Banchory, Aberdeenshire, Scotland, AB31 5ZU.
15
Joint ventures
The Group has invested in a joint venture, Leys Business Services Limited, a company registered in Scotland. Leys Business Services Limited's principal activity is the provision of support services and Bancon Developments Holdings Limited owns 50% of the ordinary share capital of that company. No share of operating result from Leys Business Services Limited has been included within the Group's results for the year on the grounds that this is immaterial and the company is in liquidation to start winding up. The company has a nil Net Book Value.
- 34 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
16
Stocks
Group
Company
2024
2023
2024
2023
£'000
£'000
£'000
£'000
Raw materials and consumables
928
891
-
-
Work in progress
43,813
33,181
-
-
Part-exchange properties
2,962
3,463
-
-
48,204
37,034
-
-
17
Debtors
Group
Company
2024
2023
2024
2023
Amounts falling due within one year:
£'000
£'000
£'000
£'000
Trade debtors
-
5,251
6,063
-
Amounts recoverable on contracts
1,810
6,818
-
-
Amounts due from Group undertakings
-
-
16,625
12,882
Other debtors
2,511
1,727
-
-
Prepayments and accrued income
2,225
2,055
334
126
11,797
16,663
16,959
13,008
Amounts falling due after more than one year:
Trade debtors retentions
627
627
-
-
Amounts due from joint venture undertakings
-
57
-
-
627
684
-
-
Deferred tax asset (see note 22)
324
288
10
-
951
972
10
-
Total debtors
12,748
17,635
16,969
13,008
Amounts due from Group and Joint Venture undertakings to the parent company have no specific repayment terms and do not bear interest.
- 35 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
18
Creditors: amounts falling due within one year
Group
Company
2024
2023
2024
2023
£'000
£'000
£'000
£'000
Bank loans and overdrafts (see note 20)
13,538
5,336
1,979
1,452
Payments received on account
4,124
3,823
-
-
Trade creditors
11,542
12,996
113
23
Amounts due to Group undertakings
-
-
8,533
6,504
Other taxation and social security
665
602
-
-
Corporation tax
285
60
9
-
Other creditors
1,154
1,986
-
-
Accruals and deferred income
10,612
11,424
998
822
41,920
36,227
11,632
8,801
Amounts due to Group undertakings by the parent company have no fixed repayment terms and do not bear interest.
19
Creditors: amounts falling due after more than one year
Group
Company
2024
2023
2024
2023
£'000
£'000
£'000
£'000
Trade creditors retentions
1,163
1,262
-
-
Other creditors
111
129
-
-
Deferred tax provision
-
-
-
8
Dilapidations provision
80
80
-
-
1,354
1,471
-
8
20
Bank loans and overdrafts
Group
Company
2024
2023
2024
2023
£'000
£'000
£'000
£'000
Bank revolving credit facility
18,000
11,000
-
-
Bank overdrafts
2,510
1,718
1,979
1,452
Cash at bank and in hand
(6,972)
(7,382)
-
-
13,538
5,336
1,979
1,452
Payable within one year
13,538
5,336
1,979
1,452
- 36 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
20
Bank loans and overdrafts (continued)
At the year end the company had drawn down funds against the revolving credit facility available to the Bancon Developments Holdings Limited Group (“the Group”). This facility is secured by a floating charge on the Group's assets and certain specific fixed charges over development land.
On 8th December 2023, the Group entered a revised three-year facility which is subject to a variable interest rate facility based on SONIA plus an applicable margin.
21
Deferred taxation
Deferred tax assets and liabilities are offset where the Group or company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
2024
2023
Assets
Assets
Group
£'000
£'000
(Accelerated) / decelerated capital allowances
(46)
28
Trading losses
370
260
324
288
The increase in deferred tax of £36k (2023: £85k) is recorded as part of the group tax charge within note 11.
Company
The company has a deferred tax asset of £10k (2023: liability of £8k).
22
Retirement benefit schemes
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund as per note 8. At the balance sheet date £77k (2023: £77k) was payable to the fund and is included within creditors.
23
Share capital
Group and company
2024
2023
Ordinary share capital
£
£
Issued and fully paid
665 ordinary shares of £1 each
665
665
The share capital account records the nominal value of shares issued. The ordinary shares carry equal voting rights and no right to fixed income.
24
Reserves
The company's profit and loss reserve represent the cumulative historic profits and losses, net of dividends and other adjustments.
- 37 -
BANCON DEVELOPMENTS HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
25
Operating lease commitments
Lessee
At the reporting end date, the Group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
Group
Company
2024
2023
2024
2023
£'000
£'000
£'000
£'000
Within one year
610
338
274
6
Between two and five years
728
714
92
-
1,338
1,052
367
6
26
Capital commitments
The Group has a commitment in relation to capital expenditure of £875k (2023: £nil) that is payable by the
end of January 2025.
27
Cash generated from Group operations
2024
2023
£'000
£'000
Profit for the financial year
1,071
1,690
Adjustments for:
Taxation charged
249
144
Finance costs
1,204
888
Gain on disposal of tangible fixed assets
3
(4)
Depreciation and impairment of tangible fixed assets
315
240
Movements in working capital:
(Increase)/decrease in stocks and work in progress
(11,170)
651
Decrease/(increase) in debtors
4,886
(1,918)
(Decrease)/increase in creditors
(2,848)
6,642
Cash (absorbed by)/generated from operations
(6,290)
8,333
28
Related party transactions
The Directors are considered to be Key Management Personnel and their remuneration is disclosed in note 7.
29
Control
The Directors regard J C A Burnett of Leys and his family as the ultimate controlling party by virtue of their individual shareholdings.
- 38 -
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