Company registration number 14315266 (England and Wales)
HEDIN AUTOMOTIVE LTD
ANNUAL REPORT AND CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
HEDIN AUTOMOTIVE LTD
COMPANY INFORMATION
Directors
K Kibsgaard
(Appointed 23 February 2023)
A Hedin
H Hedin
(Appointed 23 February 2023)
T Finn
(Appointed 24 February 2023)
Company number
14315266
Registered office
Mercedes Benz of Brooklands
Brooklands Drive
Weybridge
KT13 0SL
Auditor
Cooper Parry Group Limited
St James Building
79 Oxford Street
Manchester
M1 6HT
Bankers
ABN AMRO Bank N.V.
UK Branch
5 Aldermanbury Square
London
EC2V 7HR
HEDIN AUTOMOTIVE LTD
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 6
Independent auditor's report
7 - 9
Group statement of comprehensive income
10
Group balance sheet
11
Company balance sheet
12
Group statement of changes in equity
13
Company statement of changes in equity
14
Group statement of cash flows
15
Notes to the financial statements
16 - 36
HEDIN AUTOMOTIVE LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -

The Directors present their strategic report for the year ended 31 December 2023.

 

Business Strategy

The Group acquired the trade and assets of four Mercedes Benz businesses on 1 April 2023 from Mercedes-Benz Retail Group UK Limited.

 

On 25 August 2023 the Group purchased the entire share capital of Stephen James Alliance Limited, the holding company for a BMW retailer group.

 

The Group’s strategy is to build a premium brand United Kingdom based motor retail business that focuses on strong employee retention delivering high levels of customer service.

Business Strategy

The initial trading period of the Group was loss making due to:

 

 

As we enter 2024 there remains significant economic uncertainty from continued international conflict, high inflation, high interest rates and an uncertain recovery from recession.

 

In the initial 2024 trading period, the Group reports stronger sales volumes in all areas and has completed a full cost review which will significantly reduce the Group’s cost base moving forward.

 

Whist there will be initial costs of implementing the cost base realignment we expect to be trading profitably by the end of 2024.

Principal risks and uncertainties

All businesses have an element of risk and the Board maintains a policy of reviewing those risks which may cause the Group’s results to underperform against those of similar sized companies. The main risks are highlighted below:

 

1. Manufacturer Relationships

We have a close relationship with our manufacturer partners and seek to ensure that our respective goals are communicated, understood and aligned to deliver mutually acceptable level of performance.

 

2. Finance & Treasury

The Group relies on manufacturer funding lines to fund the purchase of new and used vehicles and these are expected to continue for the foreseeable future. As at 31 December 2023, vehicle funding facilities amounted to £48.5M.

 

ABN Amro Bank N.V. provides funding facilities totalling £43,425,000 as at the year end.

 

3. Economic conditions

The UK entered a recession in the second half of 2023, and the Group experienced a reduction in demand as a result.

 

Trading conditions continue to be subdued in 2024. The Group expects to report a trading profit for the 2024 year following cost reductions.

HEDIN AUTOMOTIVE LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Principal risks and uncertainties (cont.)

4. Regulatory risks

The Group’s insurance and finance activities are regulated by the Financial Conduct Authority. In February 2024 the Finance Conduct Authority requested the suspension of the sale of GAP insurance product to retail customers. This has not had a material impact on the Group’s profitability.

 

Future developments

The Group continues to invest in its facilities to meet the demands of the consumer and manufacturer.

 

During 2024 it started an upgrade of its BMW and MINI Ruxley facility which is scheduled for completion in September 2025.

 

The Board has regular reviews of the risks within each of the above categories and they consider the potential impact these would have on the business. The existing internal controls and accounting practises are deemed to be sufficient to deal with these issues should they arise.

Key performance indicators

The key financial and other performance indicators during the period were as follows:

£'000

2023

Turnover

211,556

Gross profit

31,608

Operating profit / (loss)

(4,055)

EBITDA

(1,424)

Profit / (loss) before taxation

(7,568)

Net assets

4,706

Average number of employees

564

Section 172(1) statement

The Board of Directors is accountable to shareholders for the management, performance and long-term success of the Group. The Board consider, both individually and together, that they have acted in the way most likely to promote the success of the Group for the benefit of its employees as a whole, whilst having regard to the wider stakeholders and matters set out in section 172 (1) (a) to (f) of the Companies Act 2006 in the decisions taken during the year ended 31 December 2023.

 

Consequences of long term decisions

The Board is aware that its strategic decisions have long term implications for the business and all of its stakeholders and these implications are carefully assessed.

 

Employee interests

The Board recognises that the long-term success of the Group is dependent on understanding and respecting the views of its employees, and we aim to be a responsible employer in our approach to the pay and benefits that our employees receive. The health, safety and well-being of our employees are one of our primary considerations in the way we conduct business.

 

Employee engagement

Our employees are central to our business and we strive to create a culture of diversity and inclusion. We provide a workplace with attractive benefits and opportunities for career progression within the Group.

 

The Board continues to be regularly updated on employee-related matters, including staff retention rates, numbers, disciplinary, health, safety and wellbeing issues.

HEDIN AUTOMOTIVE LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -

Ethical employment

It is the Group’s policy to offer equal opportunities to disabled persons applying to vacancies and provide them with the same opportunities as all other employees, within the limitations of their aptitude and abilities. In the event of any staff member becoming disabled, every effort is made to ensure that their employment with the Group continues.

 

Employment with the Group is based upon the person’s ability to work and not on the basis of race, individual characteristics, creed or political opinion.

 

Equality of opportunity

We are an equal opportunity employer and we aim to ensure our employees achieve their full potential and all employment decisions are taken without reference to discriminating criteria throughout the whole employment process.

 

Business relationships

Engagement with suppliers and customers is key to our success.

 

Suppliers - Throughout the year the Board was briefed on any contract negotiations with its two brand partners with regards to volume aspirations, targets and facility development issues. The Board seeks to balance the benefits of maintaining strong relationships with other key suppliers alongside the need to obtain value for money for the business.

 

Customers - As a large retail business, customer satisfaction can be seen in the Group’s underlying sales performance figures, which the Board reviews regularly. The Executive Directors provide updates to the Board on consumer satisfaction and the market performance.

 

Finance facility providers - The Chief Financial Officer, in conjunction with the Group Treasurer, is responsible for managing the relationships with our banks, Mercedes-Benz Financial Services UK Ltd and BMW Financial Services (GB) Limited for the Group’s financing activities.

 

Our community and the environment

Community - As a retail business, we have a tangible presence in the many communities our businesses serve. Our retail businesses also engage with local communities, contributing to their local areas in a variety of ways. The Group supports and encourages these activities and we welcome the opportunities they present for team building within our businesses, engagement with the communities they serve and recognition of charitable causes with whom our team members and their families have connections.

 

Environment - The Board recognises that its activities have an impact on the environment and is therefore keen to promote and support initiatives that minimize the effect of such activities. We continue to monitor the areas of our business that may impact on the environment including contamination, asbestos, waste oil, and waste recycling together with energy, water and fuel efficiency. The Group are introducing further measures to reduce our carbon footprint.

 

Political donations

No donations were made for political purposes (2022: £nil).

On behalf of the board

A Hedin
Director
8 January 2025
HEDIN AUTOMOTIVE LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -

The directors present their annual report and financial statements for the year ended 31 December 2023.

Principal activities

The principal activity of the company and group continued to be that of motor car retailers and repairers.

Results and dividends

The results for the year are set out on page 10.

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

K Kibsgaard
(Appointed 23 February 2023)
A Hedin
H Hedin
(Appointed 23 February 2023)
T Finn
(Appointed 24 February 2023)
A Joersjö
(Appointed 23 February 2023 and resigned 10 September 2024)
Qualifying third party indemnity provisions

The company has made qualifying third party indemnity provisions for the benefit of its directors during the year. These provisions remain in force at the reporting date.

Financial instruments

The group’s financial instruments comprise cash and liquid resources, loans and various items such as trade debtors and trade creditors that arise directly from operations. The main risks arising from the group’s financial instruments are cash flow risk, liquidity risk and interest rate risk. The group has procedures in place for managing cash and liquidity risks, including the review of cash projections on a quarterly basis by the board. The group continually reviews such risks and takes action as deemed necessary. Interest rate risk is managed by seeking to utilise low fixed interest rates where possible.

Auditor

UHY Hacker Young Manchester LLP was initially appointed as auditor to the group. The audit business of UHY Hacker Young Manchester LLP was acquired by Cooper Parry Group Limited on 30 September 2024. UHY Hacker Young Manchester LLP resigned as auditor and Cooper Parry Group Limited has been appointed in its place.

 

In accordance with section 485 of the Companies Act 2006, a resolution proposing that Cooper Parry Group Limited be re-appointed will be put at a General Meeting.

Energy and carbon report

This section includes our mandatory reporting of energy and greenhouse gas emissions for the period 1 April 2023 to 31 December 2023, pursuant to the Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018, implementing the government’s Streamlined Energy and Carbon Reporting (SECR) policy.

2023
2022
Energy consumption
kWh
kWh
Aggregate of energy consumption in the year
4,547,893
-
HEDIN AUTOMOTIVE LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 5 -
2023
2022
Emissions of CO2 equivalent
metric tonnes
metric tonnes
Scope 1 - direct emissions
- Gas combustion
322.70
-
- Fuel consumed for owned transport
251.80
-
574.50
-
Scope 2 - indirect emissions
- Electricity purchased
564.40
-
Scope 3 - other indirect emissions
- Fuel consumed for transport not owned by the group
13.80
-
Total gross emissions
1,152.70
-
Intensity ratio
Turnover (tCO2e / £m)
5.45
Quantification and reporting methodology

Our methodology to calculate our greenhouse gas emissions is based on the 'Environmental Reporting Guidelines: Including streamlined energy and carbon reporting guidance (March 2019)’, using DESNZ's 2022 and 2023 conversion factors as applicable. In some cases, consumption has been extrapolated from available data or direct comparison made to a comparable period.

 

We report using a financial control approach to define our organisational boundary. We have reported all material emission sources required by the regulations for which we deem ourselves to be responsible and have maintained records of all source data and calculations.

Intensity measurement

The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per £million of turnover, the recommended ratio for the sector.

Measures taken to improve energy efficiency

As this is our first period of operation, we have not yet implemented any specific energy efficiency actions.

HEDIN AUTOMOTIVE LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 6 -
Statement of directors' responsibilities

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the 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:

 

 

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.

Matters addressed within the strategic report

The truegroup 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 the employment of disabled persons, employee consultation and future developments.

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 Hedin
Director
8 January 2025
HEDIN AUTOMOTIVE LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HEDIN AUTOMOTIVE LTD
- 7 -
Opinion

We have audited the financial statements of Hedin Automotive Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the 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 (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and 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 our audit:

HEDIN AUTOMOTIVE LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HEDIN AUTOMOTIVE LTD
- 8 -
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:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the parent company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Extent to which the audit was 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.

Identifying and assessing potential risks related to irregularities

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, we considered the following:

HEDIN AUTOMOTIVE LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HEDIN AUTOMOTIVE LTD
- 9 -

As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas: valuation of used vehicle stocks and recognition of supplier incentives. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.

 

We also obtained an understanding of the legal and regulatory frameworks the group operates in, focussing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act and tax legislation.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the group’s ability to operate or to avoid a material penalty. These included the group’s FCA regulatory requirements.

 

Our procedures to respond to risks identified included the following:

There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Paul Daly BEng FCA (Senior Statutory Auditor)
For and on behalf of Cooper Parry Group Limited
8 January 2025
Statutory Auditor
St James Building
79 Oxford Street
Manchester
M1 6HT
HEDIN AUTOMOTIVE LTD
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
Year
Period
ended
ended
31 December
31 December
2023
2022
Notes
£
£
Turnover
3
211,556,119
-
Cost of sales
(179,947,996)
-
0
Gross profit
31,608,123
-
Distribution costs
(18,710)
-
0
Administrative expenses
(36,700,144)
-
0
Other operating income
1,055,243
-
Operating loss
4
(4,055,488)
-
Interest receivable and similar income
8
10,828
-
0
Interest payable and similar expenses
9
(3,523,529)
-
0
Loss before taxation
(7,568,189)
-
Tax on loss
10
273,929
-
0
Loss for the financial year
24
(7,294,260)
-
0
(Loss)/profit for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.

The Statement of Comprehensive Income has been prepared on the basis that all operations are continuing operations.

HEDIN AUTOMOTIVE LTD
GROUP BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 11 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
11
35,023,295
-
0
Other intangible assets
11
755,624
-
0
Total intangible assets
35,778,919
-
Tangible assets
12
8,582,375
-
0
44,361,294
-
Current assets
Stocks
15
62,103,588
-
Debtors
16
17,405,727
-
Cash at bank and in hand
8,929,602
1
88,438,917
1
Creditors: amounts falling due within one year
17
(94,179,906)
-
Net current (liabilities)/assets
(5,740,989)
1
Total assets less current liabilities
38,620,305
1
Creditors: amounts falling due after more than one year
18
(33,793,738)
-
Provisions for liabilities
Deferred tax liability
20
120,826
-
0
(120,826)
-
Net assets
4,705,741
1
Capital and reserves
Called up share capital
23
3
1
Share premium account
24
11,999,998
-
0
Profit and loss reserves
24
(7,294,260)
-
Total equity
4,705,741
1
The financial statements were approved by the board of directors and authorised for issue on 8 January 2025 and are signed on its behalf by:
08 January 2025
A Hedin
Director
Company registration number 14315266 (England and Wales)
HEDIN AUTOMOTIVE LTD
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 12 -
2023
2022
Notes
£
£
£
£
Fixed assets
Investments
13
40,182,193
-
0
Current assets
Debtors
16
20,611,063
-
0
Cash at bank and in hand
2,920,266
1
23,531,329
1
Creditors: amounts falling due within one year
17
(24,919,021)
-
Net current (liabilities)/assets
(1,387,692)
1
Total assets less current liabilities
38,794,501
1
Creditors: amounts falling due after more than one year
18
(28,525,000)
-
Provisions for liabilities
Deferred tax liability
20
75,418
-
0
(75,418)
-
Net assets
10,194,083
1
Capital and reserves
Called up share capital
23
3
1
Share premium account
24
11,999,998
-
0
Profit and loss reserves
24
(1,805,918)
-
Total equity
10,194,083
1

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s loss for the year was £1,805,918 (2022 - £0 profit).

The financial statements were approved by the board of directors and authorised for issue on 8 January 2025 and are signed on its behalf by:
08 January 2025
A Hedin
Director
Company registration number 14315266 (England and Wales)
HEDIN AUTOMOTIVE LTD
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 24 August 2022
-
0
-
0
-
0
-
Period ended 31 December 2022:
Profit and total comprehensive income
-
-
-
-
Issue of share capital
23
1
-
0
-
1
Balance at 31 December 2022
1
-
0
-
0
1
Year ended 31 December 2023:
Loss and total comprehensive income
-
-
(7,294,260)
(7,294,260)
Issue of share capital
23
2
11,999,998
-
12,000,000
Balance at 31 December 2023
3
11,999,998
(7,294,260)
4,705,741
HEDIN AUTOMOTIVE LTD
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 24 August 2022
-
0
-
0
-
0
-
Period ended 31 December 2022:
Profit and total comprehensive income for the period
-
-
-
-
0
Issue of share capital
23
1
-
0
-
1
Balance at 31 December 2022
1
-
0
-
0
1
Year ended 31 December 2023:
Profit and total comprehensive income
-
-
(1,805,918)
(1,805,918)
Issue of share capital
23
2
11,999,998
-
12,000,000
Balance at 31 December 2023
3
11,999,998
(1,805,918)
10,194,083
HEDIN AUTOMOTIVE LTD
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 15 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
31
24,884,560
-
0
Interest paid
(3,523,529)
-
0
Income taxes paid
(161,114)
-
0
Net cash inflow/(outflow) from operating activities
21,199,917
-
Investing activities
Purchase of business
(67,278,101)
-
Purchase of intangible assets
(805,627)
-
Purchase of tangible fixed assets
(1,362,779)
-
Interest received
10,828
-
0
Net cash used in investing activities
(69,435,679)
-
Financing activities
Proceeds from issue of shares
12,000,000
1
Proceeds from group borrowings
1,621,424
-
Proceeds from new bank loans
45,000,000
-
Repayment of bank loans
(1,807,456)
-
Net cash generated from financing activities
56,813,968
1
Net increase in cash and cash equivalents
8,578,206
1
Cash and cash equivalents at beginning of year
1
-
0
Cash and cash equivalents at end of year
8,578,207
1
Relating to:
Cash at bank and in hand
8,929,602
1
Bank overdrafts included in creditors payable within one year
(351,395)
-
HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
1
Accounting policies
Company information

Hedin Automotive Ltd (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Mercedes Benz of Brooklands, Brooklands Drive, Weybridge, KT13 0SL.

 

The group consists of Hedin Automotive Ltd and all of its subsidiaries.

1.1
Reporting period

The company was incorporated on 24 August 2022 and commenced trading on 1 April 2023. The reporting period covers 9 months of trade during the year and, as this is the first period of trade, there are no comparable trading periods.

1.2
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 £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

 

1.3
Business combinations

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. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
1.4
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Hedin Automotive Ltd together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 31 December 2023. 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.

1.5
Going concern

At 31 December 2023 the group had net current liabilities of £5,740,989 and was loss making.

 

This was the initial year of trading for the group and it incurred significant start up and other one off costs. Further appropriate measures have been put in place to reduce the cost base of the group and provide the foundation for a profitable business in the future. Additionally, to improve the group's balance sheet and liquidity, one ordinary share was issued at a premium of £14,999,999 to the parent company, Hedin Mobility Group, subsequent to the year end.

 

The group’s borrowing arrangements are subject to financial covenants and forecasts have been prepared through 2025 demonstrating that these covenants will be met. Sensitivity analysis has been performed and a realistic downside scenario indicates the possibility that one of the covenants will be breached. However, in such a scenario, the directors are confident that further support will be provided from within the wider Hedin group to enable the group’s borrowing requirements to continue to be met.

 

The actions taken together with the share issue means that the business has sufficient cash resources to continue to operate for the foreseeable future and to enable the business to continue to meet its debts as they fall due.

 

Based on the aforementioned assessment the directors believe that it remains appropriate to prepare the financial statements on a going concern basis.

1.6
Turnover

Turnover represents the value of goods and services, excluding value added tax, invoiced to third parties. Income is recognised when vehicles are delivered or paid for in full, when parts have been supplied and services have been provided. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

Revenue from commissions receivable is recognised when the amount can be reliably measured and it is probable that the company will receive the consideration.

HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -
1.7
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

1.8
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

 

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Software
Up to 5 years on a straight line basis
Intangible lease costs
Straight line over the term of the lease
Website
Up to 10 years on a straight line basis
1.9
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Freehold land and buildings
50 years straight line
Leasehold land and buildings
Over the lease term
Leasehold improvements
Over the lease term
Plant and equipment
7% to 20% straight line
Fixtures and fittings
10% to 33% straight line
Computers
20% to 33% straight line
Motor vehicles
20% straight line

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.

HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 19 -
1.10
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

1.11
Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

1.12
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell, after making due allowance for obsolete and slow moving items.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

Vehicles on consignment are recognised within the balance sheet when the vehicles are in substance an asset of the group. This is determined by reference to whether the principal risks and rewards of ownership have been transferred to the group. The corresponding liability is included under creditors: amounts falling due within one year.

1.13
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within creditors: amounts falling due within one year.

1.14
Financial instruments

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 20 -
Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Derecognition of financial liabilities

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 21 -
1.15
Equity instruments

Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.

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 liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

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.

 

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

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.19
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant.

Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.

HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
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.

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Consignment stocks

Consignment vehicles are recognised on the balance sheet when the significant risks and rewards of ownership have passed to the company even though legal title has not yet passed. The corresponding liability is included within creditors: amounts falling due within one year.

Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Useful economic lives of tangible and intangible fixed assets

The annual depreciation change for tangible and intangible assets is sensitive to changes in the estimated useful economics lives and residual values of assets. The useful economic lives and residual values are re-assessed annually. They are amended where necessary to reflect current estimates.

Realisable value of vehicle stocks

Stocks are stated at the lower of cost and net realisable value. The value of all used cars as well as the provision for obsolete, slow moving or defective stock can have a significant influence on the stock valuation in the financial statements. A comprehensive review of the stock held is carried out with reference to independent market valuation data.

3
Turnover and other revenue

All of the group's turnover arose within the UK.

2023
2022
£
£
Turnover analysed by class of business
Sale of goods
172,446,191
-
Provision of services
29,001,452
-
Commissions receivable
6,068,366
-
Agency commission
4,040,110
-
211,556,119
-
HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
3
Turnover and other revenue
(Continued)
- 23 -
2023
2022
£
£
Other revenue
Interest income
10,828
-
4
Operating loss
2023
2022
£
£
Operating loss for the year is stated after charging/(crediting):
Exchange gains
(797)
-
Depreciation of owned tangible fixed assets
673,998
-
Amortisation of intangible assets
1,957,563
-
Operating lease charges
4,621,218
-
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
10,000
-
Audit of the financial statements of the company's subsidiaries
99,000
-
109,000
-
6
Employees

The average monthly number of persons (including directors) employed by the group and company during the year was:

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Sales
168
-
-
-
Aftersales
318
-
-
-
Administration
78
-
-
-
Total
564
-
-
0
-
0
HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
6
Employees
(Continued)
- 24 -

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
19,842,285
-
0
-
0
-
0
Social security costs
1,957,644
-
-
-
Pension costs
641,488
-
0
-
0
-
0
22,441,417
-
0
-
0
-
0
7
Directors' remuneration

No remuneration was paid to the directors.

8
Interest receivable and similar income
2023
2022
£
£
Interest income
Other interest income
10,828
-
9
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
155,705
-
Interest payable to group undertakings
1,849,994
-
0
Other interest on financial liabilities
305,978
-
Other interest
1,211,852
-
Total finance costs
3,523,529
-
0
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
(209,323)
-
0
Deferred tax
Origination and reversal of timing differences
(64,606)
-
0
Total tax credit
(273,929)
-
0
HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
10
Taxation
(Continued)
- 25 -

The actual (credit)/charge for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Loss before taxation
(7,568,189)
-
Expected tax credit based on the standard rate of corporation tax in the UK of 24.83% (2022: 0%)
(1,879,181)
-
Tax effect of expenses that are not deductible in determining taxable profit
443,490
-
0
Unutilised tax losses carried forward
865,651
-
0
Permanent capital allowances in excess of depreciation
(630)
-
0
Depreciation on assets not qualifying for tax allowances
83,006
-
0
Amortisation on assets not qualifying for tax allowances
306,116
-
0
Deferred tax adjustments in respect of prior years
8,950
-
0
Difference between current and deferred tax rates
(2,958)
-
0
Deferred tax not recognised
11,534
-
0
Other adjustments
(132,888)
-
0
Difference between group relief surrendered and average rate
22,981
-
0
Taxation credit
(273,929)
-
11
Intangible fixed assets
Group
Goodwill
Software
Intangible lease costs
Website
Total
£
£
£
£
£
Cost
At 1 January 2023
-
0
-
0
-
0
-
0
-
0
Additions - separately acquired
16,000,000
214,825
590,802
-
0
16,805,627
Additions - business combinations
20,911,864
16,602
-
0
2,389
20,930,855
At 31 December 2023
36,911,864
231,427
590,802
2,389
37,736,482
Amortisation and impairment
At 1 January 2023
-
0
-
0
-
0
-
0
-
0
Amortisation charged for the year
1,888,569
36,102
32,848
44
1,957,563
At 31 December 2023
1,888,569
36,102
32,848
44
1,957,563
Carrying amount
At 31 December 2023
35,023,295
195,325
557,954
2,345
35,778,919
At 31 December 2022
-
0
-
0
-
0
-
0
-
0
The company had no intangible fixed assets at 31 December 2023 or 31 December 2022.
HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 26 -
12
Tangible fixed assets
Group
Freehold land and buildings
Leasehold land and buildings
Leasehold improvements
Assets under construction
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
£
£
£
£
Cost
At 1 January 2023
-
0
-
0
-
0
-
0
-
0
-
0
-
0
-
0
-
0
Additions
-
0
435,985
46,536
24,296
679,101
1,114,108
610,115
-
0
2,910,141
Business combinations
2,607,961
1,750,191
-
0
-
0
1,256,967
415,085
155,170
160,858
6,346,232
At 31 December 2023
2,607,961
2,186,176
46,536
24,296
1,936,068
1,529,193
765,285
160,858
9,256,373
Depreciation and impairment
At 1 January 2023
-
0
-
0
-
0
-
0
-
0
-
0
-
0
-
0
-
0
Depreciation charged in the year
2,366
137,926
416
-
0
161,040
224,456
134,493
13,301
673,998
At 31 December 2023
2,366
137,926
416
-
0
161,040
224,456
134,493
13,301
673,998
Carrying amount
At 31 December 2023
2,605,595
2,048,250
46,120
24,296
1,775,028
1,304,737
630,792
147,557
8,582,375
The company had no tangible fixed assets at 31 December 2023 or 31 December 2022.
HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 27 -
13
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
14
-
0
-
0
40,182,193
-
0
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 January 2023
-
Additions
40,182,193
At 31 December 2023
40,182,193
Carrying amount
At 31 December 2023
40,182,193
At 31 December 2022
-
14
Subsidiaries

Details of the company's subsidiaries at 31 December 2023 are as follows:

Name of undertaking
Class of
% Held
shares held
Direct
Indirect
Hedin Automotive London Ltd
Ordinary
100.00
-
Hedin Automotive London 2 Ltd
Ordinary
100.00
-
Stephen James Alliance Limited
Ordinary
100.00
-
Stephen James (Automotive) Limited
Ordinary
-
100.00
DC Management Services Limited
Ordinary
-
100.00
Hedin Financial Services Ltd
Ordinary
100.00
-
RRT (UK) Limited
Ordinary
100.00
-
Wheel City Limited
Ordinary
-
100.00

 

RRT (UK) Limited, company number 06998870, is entitled to and has taken advantage of the exemption from audit available under s479A of the Companies Act 2006. Hedin Automotive Limited guarantees the liabilities of the company under s479C of the Companies Act 2006 in respect of the year ended 31 December 2023.

HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 28 -
15
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Consignment stock
13,142,638
-
-
-
Vehicle stock
45,577,301
-
-
-
Parts and other stock
3,383,649
-
0
-
0
-
0
62,103,588
-
-
-

Stock is stated net of provisions of £2,607,666.

16
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
10,474,373
-
0
-
0
-
0
Amounts owed by group undertakings
-
-
20,364,333
-
Other debtors
137,320
-
117,595
-
0
Prepayments and accrued income
6,794,034
-
0
129,135
-
0
17,405,727
-
20,611,063
-

Trade debtors are stated net of provisions of £2,019,748.

17
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
19
15,251,395
-
0
14,901,814
-
0
Other borrowings
19
2,317,916
-
0
1,621,424
-
0
Trade creditors
65,746,377
-
0
-
0
-
0
Amounts owed to group undertakings
-
0
-
0
6,419,000
-
0
Corporation tax payable
298,254
-
0
-
0
-
0
Other taxation and social security
1,467,819
-
-
-
Other creditors
1,555,587
-
0
-
0
-
0
Accruals and deferred income
7,542,558
-
0
1,976,783
-
0
94,179,906
-
24,919,021
-
0

Vehicle stock finance loans within trade creditors totalling £48,523,466 are secured by a fixed and floating charge over the vehicle stocks of the group.

HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 29 -
18
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
19
28,525,000
-
0
28,525,000
-
0
Other borrowings
19
3,963,831
-
0
-
0
-
0
Deferred income
21
1,304,907
-
0
-
0
-
0
33,793,738
-
28,525,000
-
Amounts included above which fall due after five years are as follows:
Payable by instalments
1,034,088
-
-
-
19
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
43,425,000
-
0
43,425,000
-
0
Bank overdrafts
351,395
-
0
1,814
-
0
Loans from group undertakings
1,621,424
-
0
1,621,424
-
0
Manufacturer loans
4,660,323
-
0
-
0
-
0
50,058,142
-
45,048,238
-
Payable within one year
17,569,311
-
0
16,523,238
-
0
Payable after one year
32,488,831
-
0
28,525,000
-
0

The long-term loans are secured by fixed and floating charges over the assets of the group.

Bank loans are made up of one senior term loan amounting to £35,000,000 and a revolving overdraft facility amounting to £10,000,000. The rate of interest payable on the senior term loan is at the RFR compounded central bank interest rate + 2.25% margin. The loan is secured against assets of the group and guaranteed by a director.

 

The loan is repayable by quarterly equal instalments of £1,225,000 and is due to be repaid by March 2028. The revolving overdraft facility is due to be repaid by March 2028.

 

The manufacturer loan consists of two term loans due to BMW Financial Services (GB) Limited.

 

One term loan with monthly repayments of £42,373 commenced in 2019 with a final payment of £2,500,000 due in January 2025.

 

The second term loan with monthly repayments of £15,668 commenced in July 2022 with a final payment due in June 2032. Interest is payable at a rate of 2.45% above BMW base rate. The loan is secured against the freehold property at Tylney Road, Bromley.

HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 30 -
20
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

Liabilities
Liabilities
2023
2022
Group
£
£
Accelerated capital allowances
805,970
-
Tax losses
(499,495)
-
Other
(139,089)
-
Short term timing differences
(46,560)
-
120,826
-
Liabilities
Liabilities
2023
2022
Company
£
£
Other
75,418
-
Group
Company
2023
2023
Movements in the year:
£
£
Asset at 1 January 2023
-
-
(Credit)/charge to profit or loss
(64,606)
75,418
Deferred tax at acquisition
185,432
-
Liability at 31 December 2023
120,826
75,418
21
Deferred income
Group
Company
2023
2022
2023
2022
£
£
£
£
Deferred lease incentive
1,304,907
-
-
-

The deferred lease incentive is released over the property lease term of 25 years to June 2047.

HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 31 -
22
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
641,488
-

The group operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

23
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
3
1
3
1

On incorporation on 24 August 2022 there was 1 ordinary £1 share issued, allotted and fully paid for the consideration of £1.

 

On 22 May 2023 a further 1 ordinary £1 share was issued, allotted and fully paid for the consideration of £10,000,000.

 

On 13 October 2023 a further 1 ordinary £1 share was issued, allotted and fully paid for the consideration of £2,000,000.

 

At the year end there were 3 ordinary £1 shares in issue. All shares have full voting, dividend and capital distribution (including on winding up) rights; they do not confer any rights of redemption.

 

24
Reserves

Share premium

Includes any premiums received on the issue of share capital above its par value.

 

Other reserves

Other reserves contain the reduction in equity that arises as part of a compound instrument being classified as debt.

 

Profit and loss reserves

The profit and loss reserve includes all current and prior year retained profit and losses.

HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 32 -
25
Acquisition of a business

On 24 March 2023 the group acquired the trade and assets of various Mercedes-Benz dealerships in the South of London from Mercedes-Benz Retail Group UK Limited.

Book Value
Adjustments
Fair Value
Net assets acquired
£
£
£
Property, plant and equipment
1,547,362
-
1,547,362
Inventories
19,886,431
-
19,886,431
Trade and other receivables
5,669,644
-
5,669,644
Trade and other payables
(375,838)
-
(375,838)
Total identifiable net assets
26,727,599
-
26,727,599
Goodwill
16,000,000
Total consideration
42,727,599
The consideration was satisfied by:
£
Cash
42,727,599
Contribution by the acquired business for the reporting period included in the group statement of comprehensive income since acquisition:
£
Turnover
126,961,531
Loss after tax
(4,829,130)
HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
25
Acquisition of a business
(Continued)
- 33 -

On 25 August 2023 the group acquired 100% of the issued capital of Stephen James Alliance Limited.

Book Value
Adjustments
Fair Value
Net assets acquired
£
£
£
Intangible assets
16,602
-
16,602
Property, plant and equipment
5,965,521
-
5,965,521
Inventories
41,720,717
-
41,720,717
Trade and other receivables
2,397,824
-
2,397,824
Cash and cash equivalents
5,477,248
-
5,477,248
Borrowings
(4,892,779)
-
(4,892,779)
Trade and other payables
(39,116,636)
-
(39,116,636)
Tax liabilities
(1,035,454)
-
(1,035,454)
Provisions
(1,324,216)
-
(1,324,216)
Deferred tax
(65,905)
-
(65,905)
Total identifiable net assets
9,142,922
-
9,142,922
Goodwill
20,657,078
Total consideration
29,800,000
The consideration was satisfied by:
£
Cash
27,550,000
Deferred consideration
2,250,000
29,800,000
Contribution by the acquired business for the reporting period included in the group statement of comprehensive income since acquisition:
£
Turnover
84,789,687
Profit after tax
162,226
HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
25
Acquisition of a business
(Continued)
- 34 -

On 1 December 2023 the group acquired 100% of the issued capital of RRT (UK) Limited.

Book Value
Adjustments
Fair Value
Net assets acquired
£
£
£
Intangible assets
2,389
-
2,389
Property, plant and equipment
380,713
-
380,713
Investments
100
-
100
Inventories
159,195
-
159,195
Trade and other receivables
315,771
-
315,771
Cash and cash equivalents
5,383
-
5,383
Trade and other payables
(810,359)
-
(810,359)
Deferred tax
(74,846)
-
(74,846)
Total identifiable net assets
(21,654)
-
(21,654)
Goodwill
254,787
Total consideration
233,133
The consideration was satisfied by:
£
Cash
233,133
Contribution by the acquired business for the reporting period included in the group statement of comprehensive income since acquisition:
£
Turnover
79,355
Loss after tax
(51,858)
26
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
2023
2022
2023
2022
£
£
£
£
Within one year
7,919,446
-
-
-
Between two and five years
28,742,540
-
-
-
In over five years
68,047,884
-
-
-
104,709,870
-
-
-
HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 35 -
27
Capital commitments

Amounts contracted for but not provided in the financial statements:

Group
Company
2023
2022
2023
2022
£
£
£
£
Acquisition of tangible fixed assets
86,722
-
-
-
28
Events after the reporting date

One ordinary share was issued at a premium of £14,999,999 to the parent company, Hedin Mobility Group, on 20 December 2024.

29
Related party transactions

During the period rent paid and other expenses totalling £1,388,752 was charged by Balder Dalston 1 Limited, a company with common shareholdership.

 

The company is exempt from disclosing related party transactions with companies that are wholly owned within the group.

30
Controlling party

The ultimate parent company is Hedin Mobility Group AB. The ultimate controlling party is considered to be A Hedin by virtue of his majority voting rights in the ultimate parent company.

31
Cash generated from/(absorbed by) group operations
2023
2022
£
£
Loss for the year after tax
(7,294,260)
-
Adjustments for:
Taxation credited
(273,929)
-
0
Finance costs
3,523,529
-
0
Investment income
(10,828)
-
0
Amortisation and impairment of intangible assets
1,957,563
-
Depreciation and impairment of tangible fixed assets
673,998
-
Movements in working capital:
Increase in stocks
(337,245)
-
Increase in debtors
(9,022,488)
-
Increase in creditors
35,687,529
-
Decrease in deferred income
(19,309)
-
Cash generated from/(absorbed by) operations
24,884,560
-
HEDIN AUTOMOTIVE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 36 -
32
Analysis of changes in net funds/(debt) - group
1 January 2023
Cash flows
Acquisitions and disposals
31 December 2023
£
£
£
£
Cash at bank and in hand
1
8,929,601
-
8,929,602
Bank overdrafts
-
0
(351,395)
-
(351,395)
1
8,578,206
-
8,578,207
Borrowings excluding overdrafts
-
(44,813,968)
(4,892,779)
(49,706,747)
1
(36,235,762)
(4,892,779)
(41,128,540)
2023-12-312023-01-01falsefalseCCH SoftwareCCH Accounts Production 2024.310K KibsgaardA HedinH HedinT FinnA Joersjöfalse14315266bus:Consolidated2023-01-012023-12-31143152662023-01-012023-12-3114315266bus:Director12023-01-012023-12-3114315266bus:Director22023-01-012023-12-3114315266bus:Director32023-01-012023-12-3114315266bus:Director42023-01-012023-12-3114315266bus:Director52023-01-012023-12-3114315266bus:RegisteredOffice2023-01-012023-12-3114315266bus:Agent12023-01-012023-12-31143152662023-12-3114315266bus:Consolidated2022-08-242022-12-31143152662022-08-242022-12-3114315266bus:Consolidated2023-12-3114315266core:Goodwillbus:Consolidated2023-12-3114315266core:Goodwillbus:Consolidated2022-12-3114315266core:OtherResidualIntangibleAssetsbus:Consolidated2023-12-3114315266core:OtherResidualIntangibleAssetsbus:Consolidated2022-12-3114315266core:ComputerSoftwarebus:Consolidated2023-12-3114315266core:Non-standardIntangibleAssetClass1ComponentIntangibleAssetsOtherThanGoodwillbus:Consolidated2023-12-3114315266core:Non-standardIntangibleAssetClass2ComponentIntangibleAssetsOtherThanGoodwillbus:Consolidated2023-12-3114315266core:ComputerSoftwarebus:Consolidated2022-12-3114315266core:Non-standardIntangibleAssetClass1ComponentIntangibleAssetsOtherThanGoodwillbus:Consolidated2022-12-3114315266core:Non-standardIntangibleAssetClass2ComponentIntangibleAssetsOtherThanGoodwillbus:Consolidated2022-12-3114315266bus:Consolidated2022-12-3114315266core:LandBuildingscore:OwnedOrFreeholdAssetsbus:Consolidated2023-12-3114315266core:LandBuildingscore:LeasedAssetsHeldAsLesseebus:Consolidated2023-12-3114315266core:LeaseholdImprovementsbus:Consolidated2023-12-3114315266core:ConstructionInProgressAssetsUnderConstructionbus:Consolidated2023-12-3114315266core:PlantMachinerybus:Consolidated2023-12-3114315266core:FurnitureFittingsbus:Consolidated2023-12-3114315266core:ComputerEquipmentbus:Consolidated2023-12-3114315266core:MotorVehiclesbus:Consolidated2023-12-31143152662022-12-3114315266core:ShareCapitalbus:Consolidated2023-12-3114315266core:ShareCapitalbus:Consolidated2022-12-3114315266core:SharePremiumbus:Consolidated2023-12-3114315266core:SharePremiumbus:Consolidated2022-12-3114315266core:ShareCapital2023-12-3114315266core:ShareCapital2022-12-3114315266core:SharePremium2023-12-3114315266core:SharePremium2022-12-3114315266core:RetainedEarningsAccumulatedLosses2023-12-3114315266core:ShareCapitalbus:Consolidated2022-08-2314315266core:SharePremiumbus:Consolidated2022-08-2314315266core:RetainedEarningsAccumulatedLossesbus:Consolidated2022-08-2314315266core:RetainedEarningsAccumulatedLossesbus:Consolidated2022-12-3114315266core:RetainedEarningsAccumulatedLossesbus:Consolidated2023-12-3114315266core:ShareCapital2022-08-2314315266core:SharePremium2022-08-2314315266core:RetainedEarningsAccumulatedLosses2022-08-2314315266core:RetainedEarningsAccumulatedLosses2022-12-3114315266core:ShareCapitalbus:Consolidated2022-08-242022-12-3114315266core:SharePremiumbus:Consolidated2022-08-242022-12-3114315266core:ShareCapitalbus:Consolidated2023-01-012023-12-3114315266core:SharePremiumbus:Consolidated2023-01-012023-12-3114315266core:ShareCapital2022-08-242022-12-3114315266core:SharePremium2022-08-242022-12-3114315266core:ShareCapital2023-01-012023-12-3114315266core:SharePremium2023-01-012023-12-3114315266bus:Consolidated2022-08-2314315266core:Goodwill2023-01-012023-12-3114315266core:IntangibleAssetsOtherThanGoodwill2023-01-012023-12-3114315266core:ComputerSoftware2023-01-012023-12-3114315266core:Non-standardIntangibleAssetClass1ComponentIntangibleAssetsOtherThanGoodwill2023-01-012023-12-3114315266core:Non-standardIntangibleAssetClass2ComponentIntangibleAssetsOtherThanGoodwill2023-01-012023-12-3114315266core:LandBuildingscore:OwnedOrFreeholdAssets2023-01-012023-12-3114315266core:LandBuildingscore:LongLeaseholdAssets2023-01-012023-12-3114315266core:LeaseholdImprovements2023-01-012023-12-3114315266core:PlantMachinery2023-01-012023-12-3114315266core:FurnitureFittings2023-01-012023-12-3114315266core:ComputerEquipment2023-01-012023-12-3114315266core:MotorVehicles2023-01-012023-12-3114315266core:UKTaxbus:Consolidated2023-01-012023-12-3114315266core:UKTaxbus:Consolidated2022-08-242022-12-3114315266bus:Consolidated12023-01-012023-12-3114315266bus:Consolidated12022-08-242022-12-3114315266bus:Consolidated22023-01-012023-12-3114315266bus:Consolidated22022-08-242022-12-3114315266bus:Consolidated32023-01-012023-12-3114315266bus:Consolidated32022-08-242022-12-3114315266bus:Consolidated42023-01-012023-12-3114315266bus:Consolidated42022-08-242022-12-3114315266bus:Consolidated52023-01-012023-12-3114315266bus:Consolidated52022-08-242022-12-3114315266core:Goodwillbus:Consolidated2022-12-3114315266core:ComputerSoftwarebus:Consolidated2022-12-3114315266core:Non-standardIntangibleAssetClass1ComponentIntangibleAssetsOtherThanGoodwillbus:Consolidated2022-12-3114315266core:Non-standardIntangibleAssetClass2ComponentIntangibleAssetsOtherThanGoodwillbus:Consolidated2022-12-3114315266bus:Consolidated2022-12-3114315266core:Goodwillcore:ExternallyAcquiredIntangibleAssetsbus:Consolidated2023-01-012023-12-3114315266core:ComputerSoftwarecore:ExternallyAcquiredIntangibleAssetsbus:Consolidated2023-01-012023-12-3114315266core:Non-standardIntangibleAssetClass1ComponentIntangibleAssetsOtherThanGoodwillcore:ExternallyAcquiredIntangibleAssetsbus:Consolidated2023-01-012023-12-3114315266core:Non-standardIntangibleAssetClass2ComponentIntangibleAssetsOtherThanGoodwillcore:ExternallyAcquiredIntangibleAssetsbus:Consolidated2023-01-012023-12-3114315266core:ExternallyAcquiredIntangibleAssetsbus:Consolidated2023-01-012023-12-3114315266core:Goodwillbus:Consolidated2023-01-012023-12-3114315266core:ComputerSoftwarebus:Consolidated2023-01-012023-12-3114315266core:Non-standardIntangibleAssetClass1ComponentIntangibleAssetsOtherThanGoodwillbus:Consolidated2023-01-012023-12-3114315266core:Non-standardIntangibleAssetClass2ComponentIntangibleAssetsOtherThanGoodwillbus:Consolidated2023-01-012023-12-3114315266core:LandBuildingscore:OwnedOrFreeholdAssetsbus:Consolidated2022-12-3114315266core:LandBuildingscore:LeasedAssetsHeldAsLesseebus:Consolidated2022-12-3114315266core:LeaseholdImprovementsbus:Consolidated2022-12-3114315266core:ConstructionInProgressAssetsUnderConstructionbus:Consolidated2022-12-3114315266core:PlantMachinerybus:Consolidated2022-12-3114315266core:FurnitureFittingsbus:Consolidated2022-12-3114315266core:ComputerEquipmentbus:Consolidated2022-12-3114315266core:MotorVehiclesbus:Consolidated2022-12-3114315266core:LandBuildingscore:OwnedOrFreeholdAssetsbus:Consolidated2023-01-012023-12-3114315266core:LandBuildingscore:LeasedAssetsHeldAsLesseebus:Consolidated2023-01-012023-12-3114315266core:LeaseholdImprovementsbus:Consolidated2023-01-012023-12-3114315266core:ConstructionInProgressAssetsUnderConstructionbus:Consolidated2023-01-012023-12-3114315266core:PlantMachinerybus:Consolidated2023-01-012023-12-3114315266core:FurnitureFittingsbus:Consolidated2023-01-012023-12-3114315266core:ComputerEquipmentbus:Consolidated2023-01-012023-12-3114315266core:MotorVehiclesbus:Consolidated2023-01-012023-12-3114315266core:CurrentFinancialInstruments2023-12-3114315266core:CurrentFinancialInstruments2022-12-3114315266core:CurrentFinancialInstrumentsbus:Consolidated2023-12-3114315266core:CurrentFinancialInstrumentsbus:Consolidated2022-12-3114315266core:WithinOneYearbus:Consolidated2023-12-3114315266core:WithinOneYearbus:Consolidated2022-12-3114315266core:CurrentFinancialInstrumentscore:WithinOneYear2023-12-3114315266core:CurrentFinancialInstrumentscore:WithinOneYear2022-12-3114315266core:Non-currentFinancialInstrumentscore:AfterOneYearbus:Consolidated2023-12-3114315266core:Non-currentFinancialInstrumentscore:AfterOneYearbus:Consolidated2022-12-3114315266core:Non-currentFinancialInstrumentscore:AfterOneYear2023-12-3114315266core:Non-currentFinancialInstrumentscore:AfterOneYear2022-12-3114315266core:Non-currentFinancialInstrumentsbus:Consolidated2023-12-3114315266core:Non-currentFinancialInstrumentsbus:Consolidated2022-12-3114315266core:Non-currentFinancialInstruments2023-12-3114315266core:Non-currentFinancialInstruments2022-12-3114315266core:CurrentFinancialInstrumentscore:WithinOneYearbus:Consolidated2023-12-3114315266core:CurrentFinancialInstrumentscore:WithinOneYearbus:Consolidated2022-12-3114315266bus:PrivateLimitedCompanyLtd2023-01-012023-12-3114315266bus:FRS1022023-01-012023-12-3114315266bus:Audited2023-01-012023-12-3114315266bus:ConsolidatedGroupCompanyAccounts2023-01-012023-12-3114315266bus:FullAccounts2023-01-012023-12-31xbrli:purexbrli:sharesiso4217:GBP