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Company registration number: 01362650







ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED
31 DECEMBER 2023


HARVEY WATER SOFTENERS LIMITED






































img0d9a.png                        

 


HARVEY WATER SOFTENERS LIMITED
 


 
COMPANY INFORMATION


Directors
S J Boyd 
A D Jones 
J C Kent 




Registered number
01362650



Registered office
Fourth Floor Abbots House
Abbey Street

Reading

Berkshire

RG1 3BD




Trading Address
Hipley Street
Old Woking

Surrey

GU22 9LQ






Independent auditors
Menzies LLP
Chartered Accountants & Statutory Auditor

1st Floor

Midas House

62 Goldsworth Road

Woking

Surrey

GU21 6LQ





 


HARVEY WATER SOFTENERS LIMITED
 



CONTENTS



Page
Strategic Report
1 - 5
Directors' Report
6 - 8
Independent Auditors' Report
9 - 12
Statement of Income and Retained Earnings
13
Statement of Financial Position
14
Notes to the Financial Statements
15 - 32


 


HARVEY WATER SOFTENERS LIMITED
 


 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Introduction
 
The directors present their Strategic report on the company for the year ended 31 December 2023.

Business review
 
2023 represented the third continuous period of growth for the company with revenues increasing to £48,347,725 (2022: £41,885,342). This growth has been achieved despite ongoing challenges and uncertainty in the market and is representative of the strong market position and perception of the company. Throughout the year the company has developed both organically and through the ongoing consolidation of the company’s distribution and installation base through acquisitions.  
In  spite of the challenging market conditions the company has been able to grow whilst maintaining gross profit margin at 30.28% (2022: 24.08%), however the acquisitions and continued investment in customer services, products and the company support functions have suppressed the overall financial performance resulting in a loss before tax of £288,196 (2022: a loss of £2,430,671).  The directors however consider that the expenses incurred through improving customer services, customer experience and the company’s support functions are essential in ensuring the long-term profitability of the company. 
EBITDA in the year increased to £2,311,854 (2022: -£294,986) as a result of the improved underlying and operational performance of the company.

Principal risks and uncertainties

The directors of the company consider that the key business risks and uncertainties affecting the company continues to relate to the economic environment, specifically inflation, overall employment numbers and consumer disposable income.  In mitigation the company continues to invest in improving the energy efficiency, cost effectiveness and range of products being provided into the commercial and household drinking water market.  Costs are routinely monitored with specific teams performing rolling reviews on energy consumption, utilisation and general overhead costs.
a) Financial risk
The company's operations expose it to a variety of financial risks that include liquidity risk, foreign exchange risk, credit risk, interest rate risk and price risk. The company has a risk management programme in place that seeks to limit any adverse effects on the financial performance of the company.
Liquidity risk
Liquidity risk is managed by monitoring and retaining sufficient cash and access to borrowings, to ensure the company has sufficient available funds for operations and planned expansion.
Foreign exchange risk
Foreign exchange risk arises from cash flows associated with contracting operations in overseas territories. The company does not use derivative financial instruments to manage foreign currency transactions and as such, no hedge accounting is applied. The directors will revisit the appropriateness of this policy should the company's operations change in size or nature.

Page 1

 


HARVEY WATER SOFTENERS LIMITED
 



STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Financial risk (continued)

Credit risk
Credit risk arising from transactions with third party customers. The company has policies which require appropriate credit checks on potential customers and regularly reviews the utilisation of individual customer credit limits.
b) Operations
The company's ability to successfully deliver what their customers require is material to its continued growth and development. The directors continue to enhance the customer experience by assessing and monitoring customer focused initiatives to ensure continual improvement.
c) Health and safety
Health and safety are of prime importance to the company and its business, and the company is committed to continual improvement of its performance. The company maintains a compliant integrated Health, Safety and Environmental management system, which through its operation, aims to ensure a safe and healthy environment for our employees, customers, suppliers, communities, and all those affected by our activities.

Financial key performance indicators
 
The directors consider the key performance indicators (KPIs) for the business to be:
i) Sales revenue – indicates sales growth being £48,347,725 (2022: £41,885,342).
ii) Gross margin – indicates sales profitability before administrative costs are deducted being £14,638,353 (2022: £10,086,555).
iii) EBITDA – indicates profitability being £2,311,854 (2022:  -£294,986).
iv) Headcount – indicates return on investment in people being 248 (2022: 251).
These KPIs provide information on growth and profitability and have been reported in the review of the business section above. The directors regularly review these KPIs along with more detailed information on the company’s performance and positions.


Page 2

 


HARVEY WATER SOFTENERS LIMITED
 



STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Streamlined Energy and Carbon Reporting
 
Following the creation of a group wide energy and carbon reporting team in 2022, the group “Culligan” continues to invest in internal resourcing and skill sets to monitor, improve and oversee changes to support the group’s policy of reducing our carbon foot print and environmental impact.  The carbon inventory was prepared using the principals of Greenhouse Gas Protocol (GHG Protocol), the widely recognised standard of global monitoring and reporting of Greenhouse Gasses.  In certain circumstances modelling has been used by date or utilised areas of shared premises.  The company leverages Emitwise, a carbon accounting technology company, to help calculate and report its GHG emissions. Emitwise combines AI technology with a proprietary set of Emission Factor (EF) databases to deliver accurate, auditable, and actionable results. Emitwise benefits from a team of expert carbon accountants that review classifications to ensure the most accurate EF has been selected. Final results are quality assured and can be confidently relied on to make reduction decisions and for public reporting.
We have identified and reported based on the principal of legal entity to define the organisational boundary.  We have reported all material emission sources required by the regulations for which we deem ourselves responsible and have maintained records of all source data and calculations.
The company and group remains committed to carbon reduction and has begun the implementation of the 2022 carbon mitigation plan, the plan remains dynamic seeking to constantly incorporate additional technologies, best practice and renewable sources as options arise.  Despite the ongoing implementation of the carbon mitigation plan total energy consumption increased in the year, although predominantly driven by higher sales and resulting activity there has been an underling increase in intensity, due to increased staff presence and occupancy as all locations returned to maximum capacity in the year after several years of extensive working from home.  The ongoing introduction of electric vehicles has helped to offset the increase in fuel consumption arising through increased activity but has yet to make its impact fully felt. The table below includes total energy consumption (reported as kWh) and greenhouse gas emissions for the sources required by the regulations, along with our intensity ratio:

2023
2022
        £
        £
Total Energy Consumption (kWh)



2,516,115
 
2,547,410
 
Purchased Electricity Emissions (tCO2e)



106.5
 
6.3
 
Vehicle Fuel Combustion Emissions (tCO2e)



760.16
 
769.03
 
Total Gross Reported Emissions (tCO2e)



866.6
 
775.3
 
Turnover (£'000)



48,347.73
 
41,885.34
 
Intensity Ratio: Turnover (tCO2e/£ million)



0.02
 
0.02
 

2023 saw continued focus by Culligan to report on and understand its global carbon emissions. Despite the ongoing implementation of the carbon mitigation plan total energy consumption increased in the year, although predominantly driven by higher sales and resulting activity there has been an underlying increase in intensity, due to increased staff presence and occupancy as all company locations returned to maximum capacity in the year after several years of extensive working from home. The ongoing introduction of electric vehicles has helped to offset the increase in fuel consumption arising through the growth of the company but has yet to make its impact fully felt.

Our ambition is to perform a full, detailed survey of all premises and vehicle fleets in 2024, which will allow us not only to produce timely and accurate reports on an ongoing basis, but also create a clearly defined and prioritised roadmap for decarbonisation.

Whilst not included in the SECR Reporting our efforts are expanding into Scope 3 emissions, as we seek to develop products which not only have smaller upstream emission footprints, but are also more sustainable during their use phase.

Page 3

 


HARVEY WATER SOFTENERS LIMITED
 



STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Section 172(1) Statement
 
During 2023 the Board of Directors (‘The Board’) made a number of key strategic decisions to the improve the performance of the company in both the near and long term.  The principal decision of the Board is set out below under “Principal Decision”.
In compliance with section 172 of the Companies Act, the background to the above decisions is set out below.

The board is fully aware of its duty to promote the success of the company pursuant to Section 172 of the Companies Act 2016.  Consequently, each director must act in a way that is considered, in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to:

The likely consequences of any decision in the long term;
The interests of the Company’s employees;
The needs to fosters the Company’s business relationships with suppliers, customers and others and the impact of the Company’s operations on the community and the environment.  
The desirability of the Company maintaining a reputation for high standards of business conduct and through this the requirement of all employees to conduct businesses honestly, fairly, legally and ethically.
The need to act fairly as between members of the company.

a) Stakeholder Engagement
Investors
The ultimate parent is BDT & MSD Partners (BDT Capital Partners LLC).  The company is a subsidiary of the Culligan Group (‘Culligan’), within BDT’s diverse portfolio, which will only continue to remain attractive to investors if we demonstrate consistent and robust growth with profitable performance.
Strategic alignment is discussed on a monthly basis with regional and global Culligan leadership, with a clear mandate and set of values cascaded from the group.
Employees
The company’s continued success is predicated by a committed, dynamic, and importantly safe workforce that are driven by success and adherence to our Culligan values. Overall employee numbers increased in the year, reflecting the increased reach and operations of the company.  Operational and sales employees continued to increase supporting the growth in sales and operations of the company.
Workforce engagement is managed through several initiatives, including a structured personal performance review cycle, online learning and skills management, and feedback inputs from employee questionnaires and ENPS (employee net promotor score) tracking. 
Furthermore, health and safety are core to our working practices with recordable injury frequency rates, and near misses, highlighted within company KPI dashboards and seen as a priority agenda point in wider company communications. 
Customers
The company is a premium brand in the sector in which it operates, with it needing to demonstrate this in the continued high quality of products and aftersales services it provides. Customer engagement, the value derived from the water solutions the company provides, and the ability to be receptive and adapt to changing customer needs and trends, are fundamental to the continued success of the business. 
NPS (net promotor score) is continuously tracked through automated requests for customer feedback, reviewed and actioned upon with a clear strategy and focus on the customer experience and how this can be continuously improved. We continue to invest in both technology and training (in both our office and field-based teams) to improve the customer journey, both in terms of quality and efficiency. 

 
Page 4

 


HARVEY WATER SOFTENERS LIMITED
 



STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Section 172(1) Statement
Suppliers
The company buys from a range of both international suppliers and local UK businesses - the compliance, quality, speed of supply, continuous innovation, and environmental credentials, of which are key to us being able to meet the needs of our customers and operate a lean working capital position.
The company’s supply chain works closely with suppliers, specifically our larger product manufacturers, on supply planning, product development, and any other ongoing considerations as they arise. This secures robust, timely supply and mutually beneficial alignment of product innovation.
Community and Environment
The company operates throughout the United Kingdom and has several bases of operations within the country.  The directors, where possible, review all development plans and current operations in order to promote the welfare of local communities, through the provision of local training and employment opportunities and minimise any disruption created through the business activities of the company.  Local engagement is encouraged for all development plans and careful consideration is taken of any local recommendations made.  
Promotion of the success of the company
Through decisions and actions taken in the year, the directors have actively sought to promote the success of the company and ensure their obligations to all stakeholders are met.  The directors have acted in a manner and made decisions that upholds the integrity, reputation and values of the company and have considered, with due care, the long term consequences of the key decisions being made.  The directors have had regard to the requirements and expectations of all stakeholders and have sought to ensure that all decisions being made reflect the needs and benefits of the stakeholders as a whole, through acting in fairness to all stakeholders.
b) Principal Decision
During the year Harvey Water Softeners continued and expanded on the policy of the acquisition of water softener dealers.  The policy has allowed the company to directly expand into new geographical regions.  The direct acquisition and control has also allowed the company to streamline customer support and experience ensuring that all customers are provided with a consistent high level of service.  In addition, through reducing the reliance on a secondary sales market the company has been able to prevent significant price rises for end customers even whilst input prices have increased sharply and offers a greater value to the end customer.  The directors believe that increasing direct sales, standardising customer experience and streamlining the customer interactive experience provides the company with the necessary quality, market reach and level of service needed to ensure longer term growth and a strong customer base.


This report was approved by the board and signed on its behalf.



................................................
J C Kent
Director

Date: 9 January 2025

Page 5

 


HARVEY WATER SOFTENERS LIMITED
 


 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

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

Directors

The directors who served during the year were:

S J Boyd 
A D Jones 
J C Kent 
M Taylor (resigned 1 July 2024)
S A Williams (resigned 25 October 2024)

Principal activity

The principal activity of the Company continued to be the sale and leasing of water softening devices.

Results and dividends

The loss for the year, after taxation, amounted to £185,802 (2022 - loss £2,296,164).

During the year the directors did not recommend a payment of dividend (2022 - £NIL).

Directors' responsibilities statement

The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.
 
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.

 In preparing these financial statements, the directors are required to:


select suitable accounting policies for the Company's financial statements and then apply them consistently;

make judgments and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the Companies Act 2006They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements and other information included in Directors' Reports may differ from legislation in other jurisdictions.

Page 6

 


HARVEY WATER SOFTENERS LIMITED
 


 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Future developments

The company continues to invest in both new products and improved product ranges and in it’s distribution and client service functions. 2024 and 2025 are considered to be periods of organic growth, capitalising on the acquisitions and increased product ranges introduced whilst maintaining investment in products, manufacturing and quality control to ensure and support mid and long term development and growth.

Engagement with employees

To the extent allowable by commercial confidentiality, financial information is provided and disseminated to all staff members where such information is of interest or importance to them as employees.

Disabled employees

The aim of our Equal opportunities policy is to ensure that no job applicant or team member receives less favourable treatment on the grounds of their “Protected Characteristics”, as defined by the Equality Act (2010).
Recruitment and employment decisions will be made based on fair and objective criteria. We are committed to ensuring that all team members and applicants for employment are protected from unlawful discrimination during their employment. 
In line with the Equality Act 2010, the Company is committed to ensuring that equal opportunities exist for all team members. Training and career development programs are available to all employees and include development programs outside of their current job roles. No exceptions, or restrictions are taken based on disabilities or “Protected Characteristics”, as defined by the Equality Act (2010).

Qualifying third party indemnity provisions

Qualifying third party indemnity arrangements (as defined in section 234 of the Companies Act 2006) were in force for the benefit of the Directors of the company during the period and remain in place at the date of approval of this report.

Greenhouse gas emissions, energy consumption and energy efficiency action

The directors consider carbon emissions and environmental policy to be strategic given the central consideration environmental impact is given to the performance of the company, products and services.  Accordingly, the directors have elected to include the Streamlined Energy and Carbon Reporting within the Strategic Report of the company.

Matters covered in the Strategic Report

In accordance with Section 414C(11) of the Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013 and the Strategic Report preceding the Directors' Report includes information that would formerly have been included in the business review and the principal risk and uncertainties sections of the Directors' report.

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

Post balance sheet events

There have been no significant events affecting the Company since the year end.

Page 7

 


HARVEY WATER SOFTENERS LIMITED
 


 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023


Auditors

Under section 487(2) of the Companies Act 2006Menzies LLP will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.

This report was approved by the board and signed on its behalf.
 





................................................
J C Kent
Director

Date: 9 January 2025

Page 8

 


HARVEY WATER SOFTENERS LIMITED
 


 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HARVEY WATER SOFTENERS LIMITED

Opinion


We have audited the financial statements of Harvey Water Softeners Limited (the 'Company') for the year ended 31 December 2023, which comprise the Statement of Income and Retained Earnings, the Statement of Financial Position and the related notes, including a summary of significant accounting policiesThe 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:


give a true and fair view of the state of the Company's affairs as at 31 December 2023 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


Conclusions relating to going concern


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


Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.


Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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.


Page 9

 


HARVEY WATER SOFTENERS LIMITED


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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HARVEY WATER SOFTENERS LIMITED (CONTINUED)

Opinion on other matters prescribed by the Companies Act 2006
 

In our opinion, based on the work undertaken in the course of the audit:


the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.


Matters on which we are required to report by exception
 

In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.


We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:


adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of 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 6, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.


In preparing the financial statements, the directors are responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.


Page 10

 


HARVEY WATER SOFTENERS LIMITED


img068d.png
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HARVEY WATER SOFTENERS LIMITED (CONTINUED)

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


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

The Company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation. We determined that the following laws and regulations were most significant:

The Companies Act 2006;
Financial Reporting Standards 102;
UK employment legislation;
General Data Protection Regulations; and
UK tax legislations.

We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.
 
We understood how the parent company and the Company is complying with those legal and regulatory frameworks by, making inquiries to management, those responsible for legal and compliance procedures and the company secretary.
 
The engagement partner assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations. The assessment did not identify any issues in this area.

We assessed the susceptibility of the Company’s financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the engagement team included:
Identifying and assessing the design effectiveness of controls management has in place to prevent and detect fraud;
Understanding how those charged with governance considered and addressed the potential for override of controls or other inappropriate influence over the financial reporting process;
Challenging assumptions and judgments made by management in its significant accounting estimates; and
Identifying and testing journal entries, in particular any journal entries posted with unusual account combinations.

As a result of the above 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:
Timing of revenue recognition;
The use of management override to post unusual journals or complex transactions; and
Judgements and estimates in respect of stock, warranty and bad debt provisions to show a more favourable result.


Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' Report.


Page 11

 


HARVEY WATER SOFTENERS LIMITED


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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HARVEY WATER SOFTENERS LIMITED (CONTINUED)

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 2006Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.





Tom Woods FCA (Senior Statutory Auditor)
  
for and on behalf of
Menzies LLP
 
Chartered Accountants
Statutory Auditor
  
1st Floor
Midas House
62 Goldsworth Road
Woking
Surrey
GU21 6LQ

9 January 2025
Page 12

 


HARVEY WATER SOFTENERS LIMITED
 


 
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
48,347,725
41,885,342

Cost of sales
  
(33,709,372)
(31,798,787)

Gross profit
  
14,638,353
10,086,555

Administrative expenses
  
(14,574,458)
(12,700,161)

Operating profit/(loss)
 5 
63,895
(2,613,606)

Income from fixed assets investments
 9 
271,169
358,201

Loss from disposal of investments
 15 
(196,570)
-

Interest receivable and similar income
 10 
49,140
19,685

Interest payable and similar expenses
 11 
(475,830)
(194,951)

Loss before tax
  
(288,196)
(2,430,671)

Tax on loss
 12 
102,394
134,507

Loss after tax
  
(185,802)
(2,296,164)

  

  

Retained earnings at the beginning of the year
  
6,024,133
8,320,297

  
6,024,133
8,320,297

Loss for the year
  
(185,802)
(2,296,164)

Retained earnings at the end of the year
  
5,838,331
6,024,133
The notes on pages 15 to 32 form part of these financial statements.

Page 13

 


HARVEY WATER SOFTENERS LIMITED
REGISTERED NUMBER:01362650



STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Intangible assets
 13 
6,803,268
7,293,208

Tangible assets
 14 
1,488,715
1,421,396

Investments
 15 
2,249,043
473,047

  
10,541,026
9,187,651

Current assets
  

Stocks
 16 
4,926,944
5,950,686

Debtors: amounts falling due after more than one year
 17 
550,000
550,000

Debtors: amounts falling due within one year
 17 
11,750,241
11,384,212

Bank and cash balances
  
21,918
54,832

  
17,249,103
17,939,730

Creditors: amounts falling due within one year
 18 
(21,352,019)
(20,495,444)

Net current liabilities
  
 
 
(4,102,916)
 
 
(2,555,714)

Total assets less current liabilities
  
6,438,110
6,631,937

Provisions for liabilities
  

Other provisions
 20 
(499,777)
(507,802)

  
 
 
(499,777)
 
 
(507,802)

Net assets
  
5,938,333
6,124,135


Capital and reserves
  

Called up share capital 
 21 
100,002
100,002

Profit and loss account
 22 
5,838,331
6,024,133

  
5,938,333
6,124,135


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




................................................
J C Kent
Director

Date: 9 January 2025

The notes on pages 15 to 32 form part of these financial statements.

Page 14

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

Harvey Water Softeners Limited is a private company limited by shares, incorporated in the United Kingdom under the Companies Act 2006 and is registered in England and Wales. The address of the Company's registered office is different from it's principal place of business, and both are shown on the Company Information page.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).

 
2.2

Financial Reporting Standard 102 - reduced disclosure exemptions

The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
 
the requirements of Section 7 Statement of Cash Flows;
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of Osmosis Holdings LP as at 31 December 2023 and these financial statements may be obtained from Companies House under Culligan Shared Services (UK) Limited, company number: 11540567.

 
2.3

Exemption from preparing consolidated financial statements

The Company is a parent company that is also a subsidiary included in the consolidated financial statements of a larger group by a parent undertaking established under the law of a state other than the United Kingdom and is therefore exempt from the requirement to prepare consolidated financial statements under section 401 of the Companies Act 2006.

 
2.4

Going concern

The Company has net current liabilities of £4,102,916 (2022: £2,555,714).
The Company has ongoing support from the parent company Osmosis Buyer Ltd covering the group creditor balance of £16,286,130 (2022: £16,678,436), which if removed would leave net current assets (excluding debtor and creditor group balances as shown in notes 17 and 18) of £6,668,576 (2022: £13,921,546). 
As a result of the points described above, the directors are confident that the business can continue as a going concern.

Page 15

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.5

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

 
2.6

Revenue

The turnover shown in the Statement of Income and Retained Earnings represents amounts receivable for goods and services provided during the year in the normal course of the business net of trade discounts, VAT and other sales and related taxes.
Turnover from the sale of goods is recognised when the risks and rewards of ownership have significantly passed to the customer. This is usually after the "money back guarantee trial period" has concluded. 
Turnover from services is recognised as it is performed.
Rental income received from water softeners is recognised in the Statement of Income and Retained Earnings  on a monthly basis.

 
2.7

Operating leases: the Company as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.8

Research and development

In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight-line basis over their useful economic lives, which range from 3 to 6 years.
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.

Page 16

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.9

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
 
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

 
2.10

Intangible assets

Goodwill

Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised over its useful economic life of 10 years to the Statement of Income and Retained Earnings.

Other intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

All intangible assets are considered to have a finite useful life. The Company has estimated the useful life between 5 and 10 years. 

 
2.11

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Page 17

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.11
Tangible fixed assets (continued)

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Long-term leasehold property
-
Over the term of the lease
Plant and machinery
-
10 - 25% straight line
Motor vehicles
-
10 - 25% straight line
Office equipment
-
10 - 25% straight line
Other fixed assets
-
10 - 25% straight line

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.12

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Investments in unlisted Company shares, whose market value can be reliably determined, are remeasured to market value at each reporting date. Gains and losses on remeasurement are recognised in the Statement of Income and Retained Earnings for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment.

Investments in listed company shares are remeasured to market value at each reporting date. Gains and losses on remeasurement are recognised in profit or loss for the period.

  
2.13

Provisions

Provisions are made where an event has taken place that gives the company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimat can be made of the amount of the obligation.
Provisions are charged as an expense to the Statement of Income and Retained Earnings in the year that the company becomes aware of the obligation, and are measured at the best estimate at the Statement of Financial Position date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Statement of Financial Position.

 
2.14

Associates and joint ventures

Associates and Joint Ventures are held at cost less impairment.

Page 18

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.15

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

 
2.16

Financial instruments

The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.

  
2.17

Defined contribution plans

The company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company has no further payment obligations.
The contributions are recognised as an expense in the Statement of Income and Retained Earnings when they fall due. Amounts not paid are shown in accurals as a liability in the Statement of Financial Position. The assets of the plan are held seperately from the company in independently administered funds.

Page 19

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

3.


Judgments in applying accounting policies and key sources of estimation uncertainty

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
A summary of key sources of estimation taken in the preparation of the financial statements is detailed below:
Capitalised rental softeners
The value at which capitalised rental softeners are carried in the balance sheet is based upon management's best estimate of the age of the softeners held and the depreciation that would have been charged.
A summary of significant judgements taken in the preparation of the financial statements is detailed below:
Warranty service provision
The provision for warranties held at year end is based on management's best estimate of future liabilities arising on those warranty contracts still outstanding as at the year end. The liability is calculated based on a historical warranty service call profile which is inclusive of management's estimation in respect of: 
       a. Production risk for each yearly batch.
       b. Labour and parts cost in respect of each service call.
       c. Expectation of the number of breakdowns.
Stock provision
The provision is calculated on the following basis:
50% of the initial cost of stock where no movement has occurred since 2022.
10% of the initial cost of stock where items have been sold, but others in the same stock line have been held for over 1,000 days.
Bad debt provision
The provision for bad debts on trade debtors unrecovered by the year end is considered by management who undertake an annual review of whether balances are recoverable, this includes a retrospective review.
 
In the prior year, the following measurements were considered in respect of trade debtor recoverability:
Trade debtors before change in system in July 2021 – based on historic cash collections received.
Other trade debtors over 90 days – 20% provision based on management estimate on recovery.
Rental credit note provision – 15% provision based on identified rate of credits issued.

In the current year the following measurements were considered on trade debtor recoverability:

Management have assessed the trade debtors as at 31 December 2023 and deemed for any balances aged over 1 year, these are to be provided for in full. The value of this additional provision is £1,195,932.
 
Related parties receivable 
Due to the delayed repayment of loans receivable from related parties of £599,140 (2022: £560,640) management have specifically assessed the recoverability of these loans and the expected time frames of revised repayment.  In doing so, management have analysed and considered the reasons for the delay in repayment and whether these reasons will continue to impact the related party going forward.  Management have obtained, reviewed and considered the likely forecasts of the related party and determined that these are reasonable and in line with expectations.  These forecasts confirm that the related party will be in a position to repay the loans within a foreseeable and achievable timeframe.  Principal repayment of £300,000 is expected by end of March 2026 with the residual balance being repaid within an additional calendar year. Therefore no provision has been made in respect of £599,140 due to the company from related parties.
 
Page 20

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

3.Judgments in applying accounting policies (continued)

Impairment of investments in Joint Ventures
Due to the delays in bringing a Joint Venture into operation the returns which were expected to have been enjoyed by the year end, have not been achieved.  Accordingly management have specifically reviewed the carrying value of the Joint Venture of £150,000 (2022: £150,000) to determine whether impairment is required. In doing so management have analysed and considered the reasons for the delay in starting operations and whether these reasons will continue to impact the related party going forward.  Management have obtained, reviewed and considered the likely forecasts of the related party and determined that these are reasonable and in line with expectations.  These forecasts confirm that the Joint Venture will achieve results that justify the carrying value of the investment and no impairment is required.


4.


Turnover

An analysis of turnover by class of business is as follows:


2023
2022
£
£

Sale of goods
46,603,715
40,187,058

Income from rental of softeners
1,744,010
1,698,284

48,347,725
41,885,342


Analysis of turnover by country of destination:

2023
2022
£
£

United Kingdom
45,630,771
39,313,953

Rest of Europe
2,716,954
2,571,389

48,347,725
41,885,342



5.


Operating profit/(loss)

The operating profit/(loss) is stated after charging:

2023
2022
£
£

Research & development charged as an expense
108,879
138,651

Exchange differences
(27,768)
204,494

Other operating lease rentals
1,409,158
1,368,532

Depreciation of tangible fixed assets
611,083
506,402

Amortisation of intangible fixed assets
1,562,227
1,477,125

Page 21

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

6.


Auditors' remuneration

During the year, the Company obtained the following services from the Company's auditors and their associates:


2023
2022
£
£

Fees payable to the Company's auditors and their associates for the audit of the Company's financial statements
44,625
36,875


7.


Employees

Staff costs, including directors' remuneration, were as follows:


2023
2022
£
£

Wages and salaries
8,866,350
8,406,218

Social security costs
906,007
915,431

Cost of defined contribution scheme
563,124
316,504

10,335,481
9,638,153


The average monthly number of employees, including the directors, during the year was as follows:


        2023
        2022
            No.
            No.







Admin
72
106



Sales
45
10



Production, warehousing and installation
131
135

248
251


8.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
185,299
185,767

Company contributions to defined contribution pension schemes
1,321
2,372

186,620
188,139


During the year retirement benefits were accruing to 1 director (2022 - 1) in respect of defined contribution pension schemes.

Page 22

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

9.


Income from investments

2023
2022
£
£



Dividends received from unlisted investments
271,169
358,201

271,169
358,201



10.


Interest receivable

2023
2022
£
£


Other interest receivable
49,140
19,685

49,140
19,685


11.


Interest payable and similar expenses

2023
2022
£
£


Loans from group undertakings
475,830
194,951

475,830
194,951

Page 23

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

12.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
339,134
-

Adjustments in respect of previous periods
(8,483)
-


330,651
-


Total current tax
330,651
-

Deferred tax


Origination and reversal of timing differences
(433,045)
(134,507)

Total deferred tax
(433,045)
(134,507)


Tax on loss
(102,394)
(134,507)
Page 24

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
12.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is lower than (2022 - higher than) the standard rate of corporation tax in the UK of 23.5% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Loss on ordinary activities before tax
(288,196)
(2,430,671)


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 23.5% (2022 - 19%)
(67,726)
(461,827)

Effects of:


Expenses not deductible for tax purposes
387,850
120,566

Capital allowances for year in excess of depreciation
-
42,923

Income that is exempt from taxation
(63,725)
(89,550)

Adjustments to tax charge in respect of prior periods - deferred tax
(308,625)
-

Patent box movement
-
19,964

Unrelieved tax losses carried forward
-
233,417

Adjustment to tax charge in respect of previous periods
(8,483)
-

Adjust closing deferred tax to average rate of 25.00%
(41,685)
-

Total tax charge for the year
(102,394)
(134,507)


Factors that may affect future tax charges

There were no factors that may affect future tax charges.

Pillar II - Multinational top-up tax and domestic top-up tax:
Harvey Water Softeners Limited is part of a group that operates in a number of jurisdictions. The effective tax rate of the Group for the financial year 2023 was 23.5% (2022: 19%). 
For periods commencing on or after 1 January 2024, new tax legislation will apply to ensure the effective tax rate of the UK companies within the group will be at least 15%, subject to various complex calculations. This is in line with the minimum taxation rules announced by the G7 and progressed by the OECD Inclusive Framework on Base Erosion and Profit Shifting. These rules have been implemented in the UK including Domestic Top Up Tax legislation during the year.
Historically Harvey Water Softeners Limited’s effective rate has been above 15% and the company has assessed its future exposure to Domestic Top Up Tax to be immaterial based on the group structure at the reporting date. In addition, the temporary exemption has been taken in relation to recognising any deferred tax assets or liabilities in relation to the OECD pillar two income taxes.

Page 25

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

13.


Intangible assets




Development expenditure
Computer software
Goodwill
Total

£
£
£
£



Cost


At 1 January 2023
884,908
6,004,775
2,758,752
9,648,435


Additions
136,919
482,225
453,193
1,072,337



At 31 December 2023

1,021,827
6,487,000
3,211,945
10,720,772



Amortisation


At 1 January 2023
181,454
1,736,140
437,633
2,355,227


Charge for the year on owned assets
125,158
1,138,803
298,316
1,562,277



At 31 December 2023

306,612
2,874,943
735,949
3,917,504



Net book value



At 31 December 2023
715,215
3,612,057
2,475,996
6,803,268



At 31 December 2022
703,454
4,268,635
2,321,119
7,293,208



Page 26

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

14.


Tangible fixed assets





Long-term leasehold property
Plant and machinery
Motor vehicles
Office equipment
Other fixed assets
Total

£
£
£
£
£
£



Cost or valuation


At 1 January 2023
43,636
5,715,957
78,256
873,764
267,992
6,979,605


Additions
-
497,450
-
-
180,952
678,402



At 31 December 2023

43,636
6,213,407
78,256
873,764
448,944
7,658,007



Depreciation


At 1 January 2023
43,636
4,636,834
6,363
795,537
75,839
5,558,209


Charge for the year on owned assets
-
352,282
13,452
70,817
174,532
611,083



At 31 December 2023

43,636
4,989,116
19,815
866,354
250,371
6,169,292



Net book value



At 31 December 2023
-
1,224,291
58,441
7,410
198,573
1,488,715



At 31 December 2022
-
1,079,123
71,893
78,227
192,153
1,421,396

Page 27

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

15.


Fixed asset investments





Investments in subsidiary companies
Investment in joint ventures
Total

£
£
£



Cost or valuation


At 1 January 2023
205,357
267,690
473,047


Additions
1,972,566
-
1,972,566


Disposals
(196,570)
-
(196,570)



At 31 December 2023
1,981,353
267,690
2,249,043










Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Registered office

Class of shares

Holding

Harvey's Finance Limited
Fourth Floor Abbots House, Abbey Street, Reading, Berkshire, RG1 3BD
Ordinary
100%
Heat-a-Home Limited
Fourth Floor Abbots House, Abbey Street, Reading, Berkshire, RG1 3BD
Ordinary
100%
North East Water Softeners Limited
Fourth Floor Abbots House, Abbey Street, Reading, Berkshire, RG1 3BD
Ordinary
100%
Tide Brazil Holdings LLC
1209 Orange Street, Wilmington, Delaware, 19801, USA
Ordinary
100%







Joint Ventures


The investment in Joint Ventures relates to the following entities:
Halutec (SA), a company registered in Belgium.
The Block Salt Company Limited, a company registered in the United Kingdom.

Page 28

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

16.


Stocks

2023
2022
£
£

Raw materials and consumables
4,579,489
4,495,440

Work in progress
85,716
65,969

Finished goods and goods for resale
261,739
1,389,277

4,926,944
5,950,686



17.


Debtors

2023
2022
£
£

Due after more than one year

Amounts owed by joint ventures and associated undertakings
550,000
550,000

550,000
550,000


2023
2022
£
£

Due within one year

Trade debtors
4,800,803
9,422,444

Amounts owed by group undertakings
5,514,638
201,203

Amounts owed by joint ventures and associated undertakings
49,140
-

Other debtors
44,209
641,990

Prepayments and accrued income
507,887
718,056

Deferred taxation
833,564
400,519

11,750,241
11,384,212


Interest on the amounts owed by joint ventures and associated undertakings is accrued at 2% plus LIBOR.

Page 29

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

18.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
2,990,099
1,200,673

Amounts owed to group undertakings
16,286,130
16,678,463

Corporation tax
315,918
314,920

Other taxation and social security
628,990
920,628

Other creditors
171,478
93,774

Accruals and deferred income
959,404
1,286,986

21,352,019
20,495,444


Interest on the amounts owed by group undertakings is accrued at rates between 4% and 7.2%.


19.


Deferred taxation




2023


£






At beginning of year
400,519


Charged to profit or loss
433,045



At end of year
833,564

The deferred tax asset is made up as follows:

2023
2022
£
£


Accelerated capital allowances
(10,897)
(608,835)

Tax losses carried forward
(247,964)
(99,195)

Short term timing differences
1,092,425
1,108,549

833,564
400,519

Page 30

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

20.


Provisions




Warranty provision

£





At 1 January 2023
507,802


Charged to profit or loss
(8,025)



At 31 December 2023
499,777


21.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



100,002 (2022 - 100,002) Ordinary shares of £1.00 each
100,002
100,002



22.


Reserves

Profit and loss account

This reserve records the sum of retained earnings and accumulated losses.


23.


Commitments under operating leases

At 31 December 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than 1 year
815,002
749,762

Later than 1 year and not later than 5 years
1,549,387
729,846

Later than 5 years
396,249
42,243

2,760,638
1,521,851

Page 31

 


HARVEY WATER SOFTENERS LIMITED
 


 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

24.


Related party transactions

The Company has taken advantage of the exemption available under FRS 102 not to disclose transactions with wholly owned members of the same group.
In the year ended 31 December 2023, total sales of £4,408,619 (2022 - £3,633,641) were made to an associate company.


25.


Financial guarantee

On 31 July 2021 the company became a guarantor, alongside other group companies, of a credit agreement dated 30 July 2021 entered into by a parent company. The maximum balance outstanding under this agreement was USD 3,910,295,303 (2022: USD 2,906,949,063).


26.


Controlling party

The Company's immediate parent company is HWS Holdings Limited. The parent company of the largest and smallest group in which the Company's results are consolidated is Osmosis Holdings LP. The registered office is 103 South Church Street, PO Box 10240, Grand Cayman, KY1-1002, Cayman Islands. The consolidated accounts are available from Companies House under Culligan Shared Services (UK) Limited.
The ultimate parent company and controlling party is BDT Capital Partners LLC, which is incorporated in the United States. 

 
Page 32