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Registration number: 00958135

Sovrin Plastics Ltd

Annual Report and Consolidated Financial Statements

for the Year Ended 31 December 2023

 

Sovrin Plastics Ltd

Contents

Company Information

1

Strategic Report

2

Directors' Report

3 to 4

Statement of Directors' Responsibilities

5

Independent Auditor's Report

6 to 10

Consolidated Profit and Loss Account

11

Consolidated Profit and Loss Account and Statement of Retained Earnings

12

Consolidated Statement of Comprehensive Income

13

Consolidated Balance Sheet

14

Balance Sheet

15

Consolidated Statement of Changes in Equity

16

Statement of Changes in Equity

17

Consolidated Statement of Cash Flows

18

Notes to the Financial Statements

19 to 34

 

Sovrin Plastics Ltd

Company Information

Directors

Mr A J Rankin

Mr K Rawlinson

Mr J P Joiner

Registered office

705 Stirling Road
Trading Estate
Slough
Berkshire
SL1 4ST

Auditors

Xeinadin Audit Limited
Chartered Accountants and Statutory Auditors
8th Floor
Becket House
36 Old Jewry
London
EC2R 8DD

 

Sovrin Plastics Ltd

Strategic Report for the Year Ended 31 December 2023

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

Principal activity

The principal activity of the group is is that of design and development of mould tools and associated processes. The manufacture and assembly of injection moulded plastic materials for pharmaceutical components and medical devices under controlled conditions.

Fair review of the business

The group is continuing to follow a strategy of developing and improving the business and to deliver sustainable and profitable growth. The directors feel that the group is well placed to meet the challenges in the coming years and are pleased with the financial performance of the business in the year to 31 December 2023.

The key performance indicators for the year were as follows:-

Turnover increased by £788K or 7.63%.
Gross profit percentage return 18% (2022 - 15%).
Operating profit for the year £653K (2022 - £253K).
Net profit for the year £733K (2022 - £297K).

The underlying core business continues to generate ongoing profits, with the future prospects significantly enhanced as a result of the investments made in moving to the new factory and new plant and machinery and from enhanced and expanded marketing and promotional activities.

The directors feel that the group is now well placed to exploit market opportunities as they arise or are created, and thereby improve revenues and, hence profitability going forward.

Principal risks and uncertainties

The principal risks relate to market demand, although there are no indicators to suggest that future demand will diminish and is in fact expected to expand because of the expected growth in the economy in the United Kingdom.

The group considers working capital management, particularly cash flow to be the key management of the group. By monitoring cash flow as part of its day to day control procedures, we are confident that no liquidity risk should arise based on regular operations.

Approved and authorised by the Board on 12 December 2024 and signed on its behalf by:
 

.........................................
Mr A J Rankin
Director

 

Sovrin Plastics Ltd

Directors' Report for the Year Ended 31 December 2023

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

Directors of the group

The directors who held office during the year were as follows:

Mr A J Rankin

Mr K Rawlinson

Mr J P Joiner

Financial instruments

Objectives and policies

The group's operations exposes it to a variety of financial risks that includes the effects of changes in credit risks, liquidity risks and interest rates risks.

The group has in place a risk management programme that seeks to limit the possible adverse effects on the financial performance by monitoring levels of cash. The monitoring of financial risk management is the responsibility of the Board of Directors.

Price risk, credit risk, liquidity risk and cash flow risk

Price risk

Expenditure incurred by the group is authorised by management in order to ensure that the goods and services are not obtained at a higher price than necessary.

Credit risk

The group has implemented policies that require appropriate credit checks on potential customers before new accounts are accepted and continually monitors the credit arrangements of existing customers.

Liquidity cash flow risk

The group maintains large credit balances on its bank accounts to ensure that there are sufficient funds for operations.

Interest rate risk

The group has interest bearing assets. Interest bearing assets include cash balances that earn interest at floating rates and investments in Limited Liability Partnerships that earn a share of the profits at a fixed rate.

Disclosure of information to the auditor

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditor is unaware.

 

Sovrin Plastics Ltd

Directors' Report for the Year Ended 31 December 2023

Approved and authorised by the Board on 12 December 2024 and signed on its behalf by:
 

.........................................
Mr A J Rankin
Director

 

Sovrin Plastics Ltd

Statement of Directors' Responsibilities

The directors acknowledge their responsibilities 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 the company and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

select suitable accounting policies and apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

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

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

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

 

Sovrin Plastics Ltd

Independent Auditor's Report to the Members of Sovrin Plastics Ltd

Opinion

We have audited the financial statements of Sovrin Plastics Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023, which comprise the Consolidated Profit and Loss Account, Consolidated Profit and Loss Account and Statement of Retained Earnings, Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Balance Sheet, Consolidated Statement of Changes in Equity, Statement of Changes in Equity, Consolidated Statement of Cash Flows, and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including 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 group's and the parent company's affairs as at 31 December 2023 and of the group's profit for the year then ended;

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

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

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the director's 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 ability to continue as a going concern for a period of at least twelve months from when the original financial statements were 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 directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

 

Sovrin Plastics Ltd

Independent Auditor's Report to the Members of Sovrin Plastics Ltd

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinion on other matter 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 Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

the Strategic Report and 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 our 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 and the Directors' Report.

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

adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

the parent company financial statements are not in agreement with the accounting records and returns; or

certain disclosures of directors' remuneration specified by law are not made; or

we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities [set out on page 5], the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

Auditor 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.

 

Sovrin Plastics Ltd

Independent Auditor's Report to the Members of Sovrin Plastics Ltd

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

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

We identify and assess the risks of material misstatements of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.

In identifying and assessing risks of material misstatements in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the fol

the nature of the industries and sectors, control environments and business performances, including the identification of related party transactions, and matters which could potentially impact on the group's continuation as a going concern.

results of our enquires of management and assessment of the risks of irregularities.

any matters we identified having obtained and reviewed the group's documentation of their policies and procedures relating to:- identifying, evaluating, and complying with the laws and regulations and whether they were aware of any instances of non-compliance:- detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud:- the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations.

the matters discussed among the audit engagement team, including how and where fraud might occur in the financial statements and any potential indications of fraud.

 

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 relation to revenue recognition. In common with all audits ISAs (UK), we are required to perform specific procedures to respond to the risk of management override.

We also obtained an understanding of the legal and regulatory frameworks that the group operates in, focusing 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, UK Corporate Governance Code and local tax legislation.

In addition, we considered provisions of other laws and regulations and potential fraud risks to all engagement team members, and remained alert to any indicators of fraud or non-compliance with laws and regulations throughout the audit.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members, and remained alert to any indicators of fraud or non-compliance with laws and regulations throughout the audit.

As part of an audit in accordance with ISAs (UK), we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

 

Sovrin Plastics Ltd

Independent Auditor's Report to the Members of Sovrin Plastics Ltd

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the group’s internal control.

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.

Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the group’s or the parent company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the group or the parent company to cease to continue as a going concern.

Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

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.

 

Sovrin Plastics Ltd

Independent Auditor's Report to the Members of Sovrin Plastics Ltd

......................................
John David Lee BA FCA (Senior Statutory Auditor)
For and on behalf of Xeinadin Audit Limited, Statutory Auditor

Chartered Accountants and Statutory Auditors
8th Floor
Becket House
36 Old Jewry
London
EC2R 8DD

12 December 2024

 

Sovrin Plastics Ltd

Consolidated Profit and Loss Account for the Year Ended 31 December 2023

Note

2023
£

2022
£

Turnover

3

11,123,697

10,334,709

Cost of sales

 

(9,145,628)

(8,784,535)

Gross profit

 

1,978,069

1,550,174

Distribution costs

 

(184,258)

(214,652)

Administrative expenses

 

(1,140,341)

(1,052,567)

Operating profit

4

653,470

282,955

Other interest receivable and similar income

5

94,775

14,211

Profit before tax

 

748,245

297,166

Tax on profit

9

(172,597)

(46,081)

Profit for the financial year

 

575,648

251,085

Profit/(loss) attributable to:

 

Owners of the company

 

575,648

251,085

The group has no recognised gains or losses for the year other than the results above.

 

Sovrin Plastics Ltd

Consolidated Profit and Loss Account and Statement of Retained Earnings for the Year Ended 31 December 2023

Note

2023
£

2022
£

Turnover

3

11,123,697

10,334,709

Cost of sales

 

(9,145,628)

(8,784,535)

Gross profit

 

1,978,069

1,550,174

Distribution costs

 

(184,258)

(214,652)

Administrative expenses

 

(1,140,341)

(1,052,567)

Operating profit

4

653,470

282,955

Other interest receivable and similar income

5

94,775

14,211

 

94,775

14,211

Profit before tax

 

748,245

297,166

Taxation

9

(172,597)

(46,081)

Profit for the financial year

 

575,648

251,085

Profit/(loss) attributable to:

 

Owners of the company

 

575,648

251,085

Retained earnings brought forward

 

11,608,115

11,357,030

Retained earnings carried forward

 

12,183,763

11,608,115

 

Sovrin Plastics Ltd

Consolidated Statement of Comprehensive Income for the Year Ended 31 December 2023

2023
£

2022
£

Profit for the year

575,648

251,085

Total comprehensive income for the year

575,648

251,085

Total comprehensive income attributable to:

Owners of the company

575,648

251,085

 

Sovrin Plastics Ltd

(Registration number: 00958135)
Consolidated Balance Sheet as at 31 December 2023

Note

2023
£

2022
£

Fixed assets

 

Tangible assets

10

4,517,661

4,150,522

Other financial assets

12

4,126,826

-

 

8,644,487

4,150,522

Current assets

 

Stocks

13

1,469,797

1,536,575

Debtors

14

1,544,693

1,730,488

Cash at bank and in hand

 

2,135,191

5,335,218

 

5,149,681

8,602,281

Creditors: Amounts falling due within one year

16

(925,262)

(629,153)

Net current assets

 

4,224,419

7,973,128

Total assets less current liabilities

 

12,868,906

12,123,650

Provisions for liabilities

17

(682,468)

(512,860)

Net assets

 

12,186,438

11,610,790

Capital and reserves

 

Called up share capital

19

2,550

2,550

Capital redemption reserve

125

125

Retained earnings

12,183,763

11,608,115

Equity attributable to owners of the company

 

12,186,438

11,610,790

Shareholders' funds

 

12,186,438

11,610,790

Approved and authorised by the Board on 12 December 2024 and signed on its behalf by:
 

.........................................
Mr J P Joiner
Director

 

Sovrin Plastics Ltd

(Registration number: 00958135)
Balance Sheet as at 31 December 2023

Note

2023
£

2022
£

Fixed assets

 

Tangible assets

10

4,517,661

4,150,522

Investments

11

1,374,750

-

Other financial assets

12

2,792,826

-

 

8,685,237

4,150,522

Current assets

 

Stocks

13

1,469,797

1,536,575

Debtors

14

1,530,505

1,730,488

Cash at bank and in hand

 

2,092,899

5,335,218

 

5,093,201

8,602,281

Creditors: Amounts falling due within one year

16

(922,273)

(629,153)

Net current assets

 

4,170,928

7,973,128

Total assets less current liabilities

 

12,856,165

12,123,650

Provisions for liabilities

17

(682,468)

(512,860)

Net assets

 

12,173,697

11,610,790

Capital and reserves

 

Called up share capital

19

2,550

2,550

Capital redemption reserve

125

125

Retained earnings

12,171,022

11,608,115

Shareholders' funds

 

12,173,697

11,610,790

The company made a profit after tax for the financial year of £562,907 (2022 - profit of £251,085).

Approved and authorised by the Board on 12 December 2024 and signed on its behalf by:
 

.........................................
Mr J P Joiner
Director

 

Sovrin Plastics Ltd

Consolidated Statement of Changes in Equity for the Year Ended 31 December 2023
Equity attributable to the parent company

Share capital
£

Capital redemption reserve
£

Retained earnings
£

Total
£

At 1 January 2023

2,550

125

11,608,115

11,610,790

Profit for the year

-

-

575,648

575,648

At 31 December 2023

2,550

125

12,183,763

12,186,438

Total equity
£

At 1 January 2023

11,610,790

Profit for the year

575,648

At 31 December 2023

12,186,438

Share capital
£

Capital redemption reserve
£

Retained earnings
£

Total
£

At 1 January 2022

2,550

125

11,357,030

11,359,705

Profit for the year

-

-

251,085

251,085

At 31 December 2022

2,550

125

11,608,115

11,610,790

Total equity
£

At 1 January 2022

11,359,705

Profit for the year

251,085

At 31 December 2022

11,610,790

 

Sovrin Plastics Ltd

Statement of Changes in Equity for the Year Ended 31 December 2023

Share capital
£

Capital redemption reserve
£

Retained earnings
£

Total
£

At 1 January 2023

2,550

125

11,608,115

11,610,790

Profit for the year

-

-

562,907

562,907

At 31 December 2023

2,550

125

12,171,022

12,173,697

Share capital
£

Capital redemption reserve
£

Retained earnings
£

Total
£

At 1 January 2022

2,550

125

11,357,030

11,359,705

Profit for the year

-

-

251,085

251,085

At 31 December 2022

2,550

125

11,608,115

11,610,790

 

Sovrin Plastics Ltd

Consolidated Statement of Cash Flows for the Year Ended 31 December 2023

Note

2023
£

2022
£

Cash flows from operating activities

Profit for the year

 

575,648

251,085

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

4

460,466

398,858

Profit on disposal of tangible assets

(13,600)

(7,250)

Finance income

5

(94,775)

(14,211)

Income tax expense

9

172,597

46,081

 

1,100,336

674,563

Working capital adjustments

 

Decrease in stocks

13

66,778

1,356,571

Decrease in trade debtors

14

185,795

762,782

Increase/(decrease) in trade creditors

16

293,120

(1,210,015)

Net cash flow from operating activities

 

1,646,029

1,583,901

Cash flows from investing activities

 

Interest received

94,775

14,211

Acquisitions of tangible assets

(827,605)

(444,955)

Proceeds from sale of tangible assets

 

13,600

7,250

Acquisition of financial investments other than trading investments

 

(4,126,826)

-

Net cash flows from investing activities

 

(4,846,056)

(423,494)

Net (decrease)/increase in cash and cash equivalents

 

(3,200,027)

1,160,407

Cash and cash equivalents at 1 January

 

5,335,218

11,896,870

Cash and cash equivalents at 31 December

 

2,135,191

13,057,277

Out of balance to Cash and cash equivalents category (adjusted for overdrafts)

 

-

7,722,059

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

1

General information

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office is:
705 Stirling Road
Trading Estate
Slough
Berkshire
SL1 4ST

These financial statements were authorised for issue by the Board on 12 December 2024.

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.

Basis of preparation

These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.

Functional currency
The financial statements are prepared in sterling £, which is the functional currency of the group.

Summary of disclosure exemptions

The company has taken advantage of the following disclosure exemptions in preparing these
financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK
and Republic of Ireland":
• the requirements of Section 7 Statement of Cash Flows;
• the requirement of paragraph 3.17(d);
• the requirements of paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b)
and 11.48(c);
• the requirements of paragraphs 12.26, 12.27, 12.29(a), 12.29(b) and 12.29A;
• the requirements of paragraphs 26.18(b), 26.19 to 26.21 and 26.23;
• the requirements of paragraphs 29.28(b) and 29.29;
• the requirement of paragraph 33.7;
• the requirements of paragraph 24(b) of IFRS 6..

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

Basis of consolidation

The consolidated financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 31 December 2023.

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

The results of subsidiaries acquired or disposed of during the year are included in the Profit and Loss Account from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the group.

The purchase method of accounting is used to account for business combinations that result in the acquisition of subsidiaries by the group. The cost of a business combination is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the business combination. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Any excess of the cost of the business combination over the acquirer’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised is recorded as goodwill.

Inter-company transactions, balances and unrealised gains on transactions between the company and its subsidiaries, which are related parties, are eliminated in full.

Intra-group losses are also eliminated but may indicate an impairment that requires recognition in the consolidated financial statements.

Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group. Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the group’s equity therein. Non-controlling interests consist of the amount of those interests at the date of the original business combination and the non-controlling shareholder’s share of changes in equity since the date of the combination.

Where subsidiaries have non co-terminus year ends, suitable management accounts have been consolidated.

Going concern

After reviewing the group's forecast and projections, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. The group therefore continues to adopt the going concern basis in preparing the financial statements.

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

Judgements

Key sources of estimation uncertainty

The preparation of the financial statements of the group 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.

Revenue recognition

Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the group’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts and after eliminating sales within the group.

The group recognises revenue when:
The amount of revenue can be reliably measured;
it is probable that future economic benefits will flow to the entity;
and specific criteria have been met for each of the group's activities.

Foreign currency transactions and balances

Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rate on the date when the fair value is re-measured.

Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.

Tax

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

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 group operates and generates taxable income.

Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the consolidated financial statements.

Unrelieved tax losses and other deferred tax assets are recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference.

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

Tangible assets

Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Impairment of fixed assets

At each reporting date fixed assets are reviewed to determine whether there is any indication that those assets have suffered an impairment loss, if there is an indication of possible impairment, the recoverable of any affected asset is estimated and compared with the carrying value. If the estimated recoverable amount is lower, the carrying amount is reduced to its estimated recoverable amount, and an impairment loss is recognised immediately in the profit and loss account.

If an impairment loss subsequently reverses, the carrying amount of the assets is increased to the revised estimate of the recoverable amount, but not in excess of the amount of the amount that would have been determined had no impairment loss been recognised for the assets in prior years. A reversal of an impairment loss is recognised immediately in the profit and loss account.



Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class

Depreciation method and rate

Short Leasehold

15 and 25 years - over periods of the leases

Plant and machinery

20% on cost

Furniture and equipment

computers 25% on cost and others 10% of cost

Motor vehicles

25% on cost

Factory costs

4% on cost

Business combinations

Business combinations are accounted for using the purchase method. The consideration for each acquisition is measured at the aggregate of the fair values at acquisition date of assets given, liabilities incurred or assumed, and equity instruments issued by the group in exchange for control of the acquired, plus any costs directly attributable to the business combination. When a business combination agreement provides for an adjustment to the cost of the combination contingent on future events, the group includes the estimated amount of that adjustment in the cost of the combination at the acquisition date if the adjustment is probable and can be measured reliably.

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

Investments

Investments in equity shares which are publicly traded or where the fair value can be measured reliably are initially measured at fair value, with changes in fair value recognised in profit or loss. Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.


Interest income on debt securities, where applicable, is recognised in income using the effective interest method. Dividends on equity securities are recognised in income when receivable.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Trade debtors

Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the group will not be able to collect all amounts due according to the original terms of the receivables.

Stocks

Stocks are stated at the lower of cost and net realisable value after making due allowance for obsolete and slow moving items.























 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the group does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the group has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

3

Turnover

The analysis of the group's Turnover for the year from continuing operations is as follows:

2023
£

2022
£

Sale of goods

11,123,697

10,334,709

The analysis of the group's Turnover for the year by market is as follows:

2023
£

2022
£

UK

7,388,490

6,320,982

Europe

3,735,207

4,013,727

11,123,697

10,334,709

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

4

Operating profit

Arrived at after charging/(crediting)

2023
£

2022
£

Depreciation expense

460,466

398,858

Foreign exchange gains

(9,551)

(4,665)

Profit on disposal of property, plant and equipment

(13,600)

(7,250)

5

Other interest receivable and similar income

2023
£

2022
£

Interest income on financial assets

21,514

-

Interest income on bank deposits

71,719

14,211

Other finance income

1,542

-

94,775

14,211

6

Staff costs

The aggregate payroll costs (including directors' remuneration) were as follows:

2023
£

2022
£

Wages and salaries

3,620,234

3,548,538

Social security costs

384,403

390,362

Pension costs, defined contribution scheme

280,980

222,444

Other employee expense

13,439

16,216

4,299,056

4,177,560

The average number of persons employed by the group (including directors) during the year, analysed by category was as follows:

2023
No.

2022
No.

Production

91

94

Administration and support

5

5

96

99

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

7

Directors' remuneration

The directors' remuneration for the year was as follows:

2023
£

2022
£

Remuneration

312,015

348,340

Contributions paid to money purchase schemes

141,453

71,556

453,468

419,896

In respect of the highest paid director:

2023
£

2022
£

Remuneration

147,906

147,839

Company contributions to money purchase pension schemes

81,865

31,380

8

Auditors' remuneration

2023
£

2022
£

Audit of these financial statements

16,500

10,500

Other fees to auditors

All other non-audit services

10,500

15,700


 

9

Taxation

Tax charged/(credited) in the consolidated profit and loss account

2023
£

2022
£

Current taxation

UK corporation tax

2,989

-

Deferred taxation

Arising from origination and reversal of timing differences

169,608

46,081

Tax expense in the income statement

172,597

46,081

The tax on profit before tax for the year is the same as the standard rate of corporation tax in the UK (2022 - the same as the standard rate of corporation tax in the UK) of 23.5% (2022 - 19%).

The differences are reconciled below:

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

2023
£

2022
£

Profit before tax

748,245

297,166

Corporation tax at standard rate

175,838

56,462

Tax decrease from effect of capital allowances and depreciation

(117,882)

(79,182)

Tax increase from other short-term timing differences

169,608

46,081

Effect of tax losses

(21,296)

-

Tax increase from effect of unrelieved tax losses carried forward

-

22,720

Further item of tax decrease

(33,671)

-

Total tax charge

172,597

46,081

10

Tangible assets

Group

Land and buildings
£

Furniture, fittings and equipment
 £

Motor vehicles
 £

Total
£

Cost or valuation

At 1 January 2023

92,374

12,279,897

316,691

12,688,962

Additions

-

827,605

-

827,605

Disposals

-

-

(93,255)

(93,255)

At 31 December 2023

92,374

13,107,502

223,436

13,423,312

Depreciation

At 1 January 2023

32,640

8,233,911

271,889

8,538,440

Charge for the year

4,722

440,810

14,934

460,466

Eliminated on disposal

-

-

(93,255)

(93,255)

At 31 December 2023

37,362

8,674,721

193,568

8,905,651

Carrying amount

At 31 December 2023

55,012

4,432,781

29,868

4,517,661

At 31 December 2022

59,734

4,045,986

44,802

4,150,522

Included within the net book value of land and buildings above is £55,012 (2022 - £59,734) in respect of short leasehold land and buildings.
 

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

Company

Land and buildings
£

Furniture, fittings and equipment
 £

Motor vehicles
 £

Total
£

Cost or valuation

At 1 January 2023

92,374

12,279,897

316,691

12,688,962

Additions

-

827,605

-

827,605

Disposals

-

-

(93,255)

(93,255)

At 31 December 2023

92,374

13,107,502

223,436

13,423,312

Depreciation

At 1 January 2023

32,640

8,233,911

271,889

8,538,440

Charge for the year

4,722

440,810

14,934

460,466

Eliminated on disposal

-

-

(93,255)

(93,255)

At 31 December 2023

37,362

8,674,721

193,568

8,905,651

Carrying amount

At 31 December 2023

55,012

4,432,781

29,868

4,517,661

At 31 December 2022

59,734

4,045,986

44,802

4,150,522

Included within the net book value of land and buildings above is £55,012 (2022 - £59,734) in respect of short leasehold land and buildings.
 

11

Investments

Group

Details of undertakings

Details of the investments (including principal place of business of unincorporated entities) in which the group holds 20% or more of the nominal value of any class of share capital are as follows:

Undertaking

Registered office

Holding

Proportion of voting rights and shares held

2023

2022

Subsidiary undertakings

Sovrin Plastics Investments Trading Limited *

8th Floor
338 Euston Road
NW1 3BG
England

Ordinary

100%

0%

England

* indicates direct investment of the company

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

Subsidiary undertakings

Sovrin Plastics Investments Trading Limited

The principal activity of Sovrin Plastics Investments Trading Limited is investment. Its financial period end is 30 September.

Company

2023
£

2022
£

Investments in subsidiaries

1,374,750

-

Subsidiaries

£

Cost or valuation

Additions

1,374,750

Provision

Carrying amount

At 31 December 2023

1,374,750

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

12

Other financial assets

Group

Financial assets at cost less impairment
£

Total
£

Non-current financial assets

Cost or valuation

Additions

4,126,826

4,126,826

At 31 December 2023

4,126,826

4,126,826

Impairment

Carrying amount

At 31 December 2023

4,126,826

4,126,826

Company

Financial assets at cost less impairment
£

Total
£

Non-current financial assets

Cost or valuation

Additions

2,792,826

2,792,826

At 31 December 2023

2,792,826

2,792,826

Impairment

Carrying amount

At 31 December 2023

2,792,826

2,792,826

13

Stocks

 

Group

Company

2023
£

2022
£

2023
£

2022
£

Raw materials and consumables

815,169

1,035,457

815,169

1,035,457

Finished goods and goods for resale

654,628

501,118

654,628

501,118

1,469,797

1,536,575

1,469,797

1,536,575

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

14

Debtors

 

Group

Company

Current

2023
£

2022
£

2023
£

2022
£

Trade debtors

1,297,474

1,464,645

1,297,474

1,464,645

Other debtors

46,167

59,111

31,979

59,111

Prepayments

201,052

206,732

201,052

206,732

 

1,544,693

1,730,488

1,530,505

1,730,488

15

Cash and cash equivalents

 

Group

Company

2023
£

2022
£

2023
£

2022
£

Cash on hand

649

649

649

649

Cash at bank

142,454

65,513

100,162

65,513

Short-term deposits

1,992,088

5,269,056

1,992,088

5,269,056

2,135,191

5,335,218

2,092,899

5,335,218

16

Creditors

   

Group

Company

Note

2023
£

2022
£

2023
£

2022
£

Due within one year

 

Trade creditors

 

412,122

302,876

412,122

302,876

Amounts due to related parties

21

13,360

6,367

13,360

6,367

Social security and other taxes

 

176,967

140,126

176,967

140,126

Outstanding defined contribution pension costs

 

6,744

6,235

6,744

6,235

Accruals

 

313,080

173,549

313,080

173,549

Income tax liability

9

2,989

-

-

-

 

925,262

629,153

922,273

629,153

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

17

Provisions for liabilities

Group

Deferred tax
£

Total
£

At 1 January 2023

512,860

512,860

Increase (decrease) in existing provisions

169,608

169,608

At 31 December 2023

682,468

682,468

Company

Deferred tax
£

Total
£

At 1 January 2023

512,860

512,860

Increase (decrease) in existing provisions

169,608

169,608

At 31 December 2023

682,468

682,468

18

Pension and other schemes

Defined contribution pension scheme

The group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the group to the scheme and amounted to £280,980 (2022 - £222,444).

Contributions totalling £6,744 (2022 - £6,235) were payable to the scheme at the end of the year and are included in creditors.

19

Share capital

Allotted, called up and fully paid shares

2023

2022

No.

£

No.

£

Ordinary of £1 each

2,500

2,500

2,500

2,500

Non-voting of £1 each

50

50

50

50

2,550

2,550

2,550

2,550

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

20

Obligations under leases and hire purchase contracts

Group

Operating leases

The total of future minimum lease payments is as follows:

2023
£

2022
£

Not later than one year

801,966

681,470

Later than one year and not later than five years

3,207,864

2,645,880

Later than five years

6,415,728

7,937,640

10,425,558

11,264,990

Company

Operating leases

The total of future minimum lease payments is as follows:

2023
£

2022
£

Not later than one year

801,966

661,470

Later than one year and not later than five years

3,207,864

2,645,880

Later than five years

6,415,728

7,937,640

10,425,558

11,244,990

 

Sovrin Plastics Ltd

Notes to the Financial Statements for the Year Ended 31 December 2023

21

Related party transactions

Group

Loans to related parties

Loans from related parties

2023

Other related parties
£

Total
£

At start of period

6,066

6,066

Advanced

7,565

7,565

At end of period

13,631

13,631

Terms of loans from related parties

The loans from other related parties include amounts owed to the director Mr A J Rankin. The above transactions relate to both the group and company.