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Registration number: 03931065

The Traffic Group Limited

Annual Report and Consolidated Financial Statements

for the Year Ended 30 April 2024

 

The Traffic Group Limited

Contents

Company Information

1

Strategic Report

2

Directors' Report

3 to 4

Statement of Directors' Responsibilities

5

Independent Auditor's Report

6 to 8

Consolidated Profit and Loss Account

9

Consolidated Statement of Comprehensive Income

10

Consolidated Balance Sheet

11

Balance Sheet

12

Consolidated Statement of Changes in Equity

13

Statement of Changes in Equity

14

Consolidated Statement of Cash Flows

15 to 16

Notes to the Financial Statements

17 to 37

 

The Traffic Group Limited

Company Information

Directors

M R Hutchinson

M Hutchinson

Company secretary

D Woodward

Registered office

White Lion House
Gloucester Road
Staverton
Cheltenham
Gloucestershire
GL51 0TF

Auditors

Hazlewoods LLP
Staverton Court
Staverton
Cheltenham
GL51 0UX

 

The Traffic Group Limited

Strategic Report for the Year Ended 30 April 2024

The directors present their strategic report for the year ended 30 April 2024.

Principal activity

The principal activity of the group is that of the design, development and manufacture of detection equipment to meet the requirements of the traffic management industry and its users, the provision of associated services, the manufacture and dealing in traffic signalling devices and surveillance cameras. The principal activity of the company is an investment holding company.

Fair review of the business

The results for the year which are set out in the profit and loss account show turnover of £34,730,834 (2023 - £31,104,715) and an operating profit of £4,563,387 (2023 - £3,417,846). At 30 April 2024, the group had net assets of £33,190,814 (2023 - £30,759,362). The directors consider the performance for the year and the financial position at the year end to be satisfactory.

The group's key financial and other performance indicators during the year were as follows:

Financial KPIs

Unit

2024

2023

Turnover

£'000

34,731

31,105

Operating profit

£'000

4,563

3,418

Profit before tax

£'000

4,648

3,429

Net assets

£'000

33,191

30,759

The directors anticipate that the business environment will remain competitive, but believe that the group is in a strong financial position and with the technological development and investment which has been made in recent years, they remain confident that the group will continue to grow.

Principal risks and uncertainties

The directors recognise that the company derives almost all of its income from its subsidiary undertakings, in the form of management charges and dividends. The principal risk facing the company is the failure of its subsidiary undertakings. The principal risks facing the subsidiary companies are in respect of supply chain disruption, competition, government policies, advances in technological development and the current economic climate. The directors are aware of these risks, and through strategy reviews and investment in research and development, ensure they are mitigated as far as possible.

Electronic and other manufacturing commodity supplies are showing signs of scarcity within the market. The directors plan to continue to mitigate the effect by investing the group's cash reserves to forward buy stock as required.

Approved by the Board on 16 January 2025 and signed on its behalf by:


M Hutchinson
Director

 

The Traffic Group Limited

Directors' Report for the Year Ended 30 April 2024

The directors present their report and the for the year ended 30 April 2024.

Directors of the company

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

M R Hutchinson

M Hutchinson

P M Hutchinson (deceased 30 May 2024)

Financial instruments

Objectives and policies

The group's financial instruments comprise cash and liquid resources, and various other items such as trade debtors, trade creditors etc. that arise directly from its operations. The main purpose of these financial instruments is to finance the operations of the group.

The group's business environment and risks, together with the details of mitigation and monitoring undertaken by the directors, are dealt with elsewhere in the Strategic Report. The directors believe the group is well placed to successfully manage risks given the current economic outlook.

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

Liquidity risk
The directors constantly monitor cash flows to ensure that the group has sufficient liquid resources to meet its operational requirements.

Credit risk
The group makes sales on credit terms to a number of its customers. However, before such terms are agreed an assessment of the customer's credit rating is undertaken to ensure that the customers does not represent a major credit risk to the group. Credit limits are then set accordingly, therefore reducing the group's exposure to credit risk.

The group is also exposed to credit risk through holding significant balances of cash at bank. The holdings and counterparty are monitored to ensure the risk is managed.

Price risk
Through careful monitoring of the group's market place and competitors the group's exposure to price risk is kept to a minimum.

Interest rate risk
At the year end, the group holds no external loans leading to minimal exposure to interest rate risk.

Future developments

The group continue to seek opportunities to diversify through investment opportunities.

Research and development

The group continue to invest significant funds into research and development.

Going concern

The directors have prepared forecast information which covers a period of at least 12 months from the date of approval of these financial statements. After reviewing these forecasts, the directors have a reasonable expectation that the company and the group have sufficient resources to continue in operational existence for the foreseeable future. On this basis, the directors consider it appropriate to prepare the financial statements on a going concern basis.

 

The Traffic Group Limited

Directors' Report for the Year Ended 30 April 2024

Disclosure of information to the auditor

Each director has taken the 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.

Reappointment of auditors

Hazlewoods LLP have expressed their willingness to continue in office.

Approved by the Board on 16 January 2025 and signed on its behalf by:


M Hutchinson
Director

 

The Traffic Group Limited

Statement of Directors' Responsibilities

The directors are responsible for preparing the Strategic Report, 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

select suitable accounting policies and 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.

 

The Traffic Group Limited

Independent Auditor's Report to the Members of The Traffic Group Limited

Opinion

We have audited the financial statements of The Traffic Group Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 April 2024, which comprise the Consolidated Profit and Loss Account, 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 30 April 2024 and of the group's profit for the year then ended;

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

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

Basis for opinion

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

Conclusions relating to going concern

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

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

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.

 

The Traffic Group Limited

Independent Auditor's Report to the Members of The Traffic Group Limited

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 group’s and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

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

Extent to which the audit was capable of detecting irregularities, including fraud

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

We considered the nature of the group’s industry and its control environment and reviewed the group’s documentation of their policies and procedures relating to fraud and compliance with laws and regulations. We also enquired of management about their own identification and assessment of the risks of irregularities.

We obtained an understanding of the legal and regulatory framework that the group operates in and identified the key laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements, including the UK Companies Act and tax legislation, and, those that do not have a direct effect on the financial statements but compliance with which may be fundamental to the group’s ability to operate or to avoid a material penalty.

We discussed among the audit engagement team regarding the opportunities and incentives that may exist within the organisation for fraud and how and where fraud might occur in the financial statements.

In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override of controls. In addressing the risk of fraud through management override of controls, we tested the appropriateness of journal entries and other adjustments; assessed whether the judgments made in accounting estimates are indicative of a potential bias; and evaluated the business rationale of any significant transactions that are unusual or outside the normal course of business.

In addition to the above, our procedures to respond to the risks identified included the following:

reviewing financial statement disclosures by testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;

performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatements due to fraud;

 

The Traffic Group Limited

Independent Auditor's Report to the Members of The Traffic Group Limited

enquiring of management concerning actual and potential litigation and claims and instances of non-compliance with laws and regulations; and

reading minutes of meetings of those charged with governance.

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

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

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





Paul Fussell (Senior Statutory Auditor)
For and on behalf of Hazlewoods LLP, Statutory Auditor

Staverton Court
Staverton
Cheltenham
GL51 0UX

16 January 2025

 

The Traffic Group Limited

Consolidated Profit and Loss Account for the Year Ended 30 April 2024

Note

2024
£

2023
£

Turnover

3

34,730,834

31,104,715

Cost of sales

 

(18,578,395)

(17,046,349)

Gross profit

 

16,152,439

14,058,366

Distribution costs

 

(810,305)

(646,996)

Administrative expenses

 

(10,785,062)

(9,993,524)

Other operating income

6,315

-

Operating profit

4

4,563,387

3,417,846

Other interest receivable and similar income

5

95,567

11,723

Interest payable and similar expenses

6

(10,538)

(96)

Profit before tax

 

4,648,416

3,429,473

Tax on profit

10

(1,205,700)

(482,493)

Profit for the financial year

 

3,442,716

2,946,980

Profit attributable to:

 

Owners of the company

 

3,442,716

2,946,980

The above results were derived from continuing operations.

 

The Traffic Group Limited

Consolidated Statement of Comprehensive Income for the Year Ended 30 April 2024

2024
£

2023
£

Profit for the year

3,442,716

2,946,980

Foreign currency translation losses

(11,264)

(16,250)

Total comprehensive income for the year

3,431,452

2,930,730

Total comprehensive income attributable to:

Owners of the company

3,431,452

2,930,730

 

The Traffic Group Limited

(Registration number: 03931065)
Consolidated Balance Sheet as at 30 April 2024

Note

2024
 £

2023
 £

Fixed assets

 

Intangible assets

11

1,759,620

2,501,596

Tangible assets

12

7,164,704

5,154,343

 

8,924,324

7,655,939

Current assets

 

Stocks

14

11,388,949

10,229,090

Debtors

15

6,986,257

6,675,494

Cash at bank and in hand

16

12,589,222

12,006,890

 

30,964,428

28,911,474

Creditors: Amounts falling due within one year

17

(5,959,604)

(5,297,255)

Net current assets

 

25,004,824

23,614,219

Total assets less current liabilities

 

33,929,148

31,270,158

Creditors: Amounts falling due after more than one year

17

(40,310)

-

Provisions for liabilities

19

(698,024)

(510,796)

Net assets

 

33,190,814

30,759,362

Capital and reserves

 

Called up share capital

21, 22

6,620

6,620

Share premium reserve

22

817,365

817,365

Capital redemption reserve

22

3,382

3,382

Profit and loss account

22

32,363,447

29,931,995

Equity attributable to owners of the company

 

33,190,814

30,759,362

Total equity

 

33,190,814

30,759,362

Approved and authorised by the Board on 16 January 2025 and signed on its behalf by:
 

M Hutchinson
Director

 

The Traffic Group Limited

(Registration number: 03931065)
Balance Sheet as at 30 April 2024

Note

2024
£

2023
£

Fixed assets

 

Tangible assets

12

3,777,290

2,663,256

Investments

13

13,260,239

13,260,238

 

17,037,529

15,923,494

Current assets

 

Debtors

15

1,956,584

789,355

Cash at bank and in hand

 

4,216,321

3,314,111

 

6,172,905

4,103,466

Creditors: Amounts falling due within one year

17

(269,671)

(289,273)

Net current assets

 

5,903,234

3,814,193

Total assets less current liabilities

 

22,940,763

19,737,687

Provisions for liabilities

19

(19,980)

(24,884)

Net assets

 

22,920,783

19,712,803

Capital and reserves

 

Called up share capital

21

6,620

6,620

Share premium reserve

817,365

817,365

Capital redemption reserve

3,382

3,382

Retained earnings

22,093,416

18,885,436

Total equity

 

22,920,783

19,712,803

The company made a profit after tax for the financial year of £4,207,980 (2023 - profit of £4,212,438).

Approved and authorised by the Board on 16 January 2025 and signed on its behalf by:
 

M Hutchinson
Director

 

The Traffic Group Limited

Consolidated Statement of Changes in Equity for the Year Ended 30 April 2024
Equity attributable to the parent company

Share capital
£

Share premium
£

Capital redemption reserve
£

Profit and loss account
£

Total equity
£

At 1 May 2023

6,620

817,365

3,382

29,931,995

30,759,362

Profit for the year

-

-

-

3,442,716

3,442,716

Other comprehensive income

-

-

-

(11,264)

(11,264)

Total comprehensive income

-

-

-

3,431,452

3,431,452

Dividends

-

-

-

(1,000,000)

(1,000,000)

At 30 April 2024

6,620

817,365

3,382

32,363,447

33,190,814

Share capital
£

Share premium
£

Capital redemption reserve
£

Profit and loss account
£

Total equity
£

At 1 May 2022

6,620

817,365

3,382

28,001,265

28,828,632

Profit for the year

-

-

-

2,946,980

2,946,980

Other comprehensive income

-

-

-

(16,250)

(16,250)

Total comprehensive income

-

-

-

2,930,730

2,930,730

Dividends

-

-

-

(1,000,000)

(1,000,000)

At 30 April 2023

6,620

817,365

3,382

29,931,995

30,759,362

 

The Traffic Group Limited

Statement of Changes in Equity for the Year Ended 30 April 2024

Share capital
£

Share premium
£

Capital redemption reserve
£

Profit and loss account
£

Total
£

At 1 May 2023

6,620

817,365

3,382

18,885,436

19,712,803

Profit for the year

-

-

-

4,207,980

4,207,980

Dividends

-

-

-

(1,000,000)

(1,000,000)

At 30 April 2024

6,620

817,365

3,382

22,093,416

22,920,783

Share capital
£

Share premium
£

Capital redemption reserve
£

Profit and loss account
£

Total
£

At 1 May 2022

6,620

817,365

3,382

15,672,998

16,500,365

Profit for the year

-

-

-

4,212,438

4,212,438

Dividends

-

-

-

(1,000,000)

(1,000,000)

At 30 April 2023

6,620

817,365

3,382

18,885,436

19,712,803

 

The Traffic Group Limited

Consolidated Statement of Cash Flows for the Year Ended 30 April 2024

Note

2024
£

2023
£

Cash flows from operating activities

Profit for the year

 

3,442,716

2,946,980

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

4

2,515,680

2,166,829

Profit on disposal of tangible assets

(147,176)

(55,510)

Finance income

5

(95,567)

(11,723)

Finance costs

6

10,538

96

Income tax expense

10

1,205,700

482,493

Foreign exchange gains/losses

 

(9,837)

(11,506)

 

6,922,054

5,517,659

Working capital adjustments

 

Increase in stocks

14

(1,159,859)

(2,193,325)

Increase in trade debtors

15

(396,459)

(643,149)

Increase in trade creditors

17

391,594

341,516

Increase in provisions

19

181,098

22,110

Cash generated from operations

 

5,938,428

3,044,811

Income taxes paid

10

(873,342)

(563,049)

Net cash flow from operating activities

 

5,065,086

2,481,762

Cash flows from investing activities

 

Interest received

95,567

11,723

Acquisitions of tangible assets

(3,117,230)

(1,451,811)

Proceeds from sale of tangible assets

 

199,933

85,063

Acquisition of intangible assets

11

(79,142)

(70,858)

Acquisition of subsidiary net of cash acquired

 

(538,500)

-

Net cash flows from investing activities

 

(3,439,372)

(1,425,883)

Cash flows from financing activities

 

Interest paid

6

(10,538)

(96)

Payments to finance lease creditors

 

(32,844)

(8,612)

Dividends paid

(1,000,000)

(1,000,000)

Net cash flows from financing activities

 

(1,043,382)

(1,008,708)

Net increase in cash and cash equivalents

 

582,332

47,171

Cash and cash equivalents at 1 May

 

12,006,890

11,959,719

Cash and cash equivalents at 30 April

 

12,589,222

12,006,890

 

The Traffic Group Limited

Consolidated Statement of Cash Flows for the Year Ended 30 April 2024

 

Analysis of net debt

At 1 May 2023

Cash flow

Other non-cash changes*

At 30 April 2024

£

£

£

£

Cash at bank and in hand

12,006,890

582,332

-

12,589,222

Finance lease and hire purchase contract

(20,425)

32,844

(103,483)

(91,064)

Net debt

11,986,465

615,176

(103,483)

12,498,158

* Other non-cash changes relate to finance leases obtained on the acquisition of LTM Design Ltd.

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

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:
White Lion House
Gloucester Road
Staverton
Cheltenham
Gloucestershire
GL51 0TF

 

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 for, where disclosed in these accounting policies, certain items that are shown at fair value.

The presentational currency of the financial statements is Pounds Sterling, being the functional currency of the primary economic environment in which the company operates. Monetary amounts in these financial statements are rounded to the nearest Pound.

Summary of disclosure exemptions

The Traffic Group Limited meets the definition of a qualifying entity under FRS 102 and has therefore taken advantage of the disclosure exemptions available to it in respect of its financial statements. Exemptions have been taken in relation to presentation of the Company statement of cash flows and Company financial instruments.

Basis of consolidation

The group financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 30 April 2024.

No Profit and Loss Account is presented for the company as permitted by section 408 of the Companies Act 2006. The company made a profit after tax for the financial year of £4,208,145 (2023 - £4,212,438).

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.

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

2

Accounting policies (continued)

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.

Going concern

The directors have prepared forecast information which covers a period of at least 12 months from the date of approval of these financial statements. After reviewing these forecasts, the directors have a reasonable expectation that the group and parent company have sufficient resources to continue in operational existence for the foreseeable future. On this basis, the directors consider it appropriate to prepare the financial statements on a going concern basis.

Critical accounting judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
 

Judgements

No significant judgements have been made by management in preparing these financial statements.

Key sources of estimation uncertainty

Key sources of estimation uncertainty relate to the group's warranty and stock provisions. The carrying value of the provisions at the balance sheet date are £175,124 (2023 - £298,740) and £353,679 (2023 - £332,548) respectively.

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.

Government grants

Government grants are recognised based on the accrual model and are measured at the fair value of the asset received or receivable. Grants are classified as relating either to revenue or to assets. Grants relating to revenue are recognised in income over the period in which the related costs are recognised. Grants relating to assets are recognised over the expected useful life of the asset. Where part of a grant relating to an asset is deferred, it is recognised as deferred income.

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 rates prevailing on the initial transaction dates.

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

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

2

Accounting policies (continued)

Tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in the profit and loss account, except that a charge 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 income tax is recognised on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements and on unused tax losses or tax credits in the group. Deferred income tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

The carrying amount of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amount equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.

Research and development costs
Costs in relation to research and development are expensed to the profit and loss account as incurred.

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.

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

Freehold land and buildings

2% on cost per annum

Short leasehold land and buildings

Over the remaining term of the lease

Leasehold improvements

10-25% on cost per annum

Plant and machinery

10-33% on cost per annum

Furniture, fittings and equipment

5-33%% on cost per annum and 15-25% reducing balance

Motor vehicles

25-33% on cost per annum

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.

Goodwill

Goodwill is amortised over its useful life, which shall not exceed ten years if a reliable estimate of the useful life cannot be made.

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

2

Accounting policies (continued)

Intangible assets

Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is held in the currency of the acquired entity and revalued to the closing rate at each reporting period date.

Negative goodwill arising on an acquisition is recognised on the face of the balance sheet on the acquisition date and subsequently the excess up to the fair value of non-monetary assets acquired is recognised in profit or loss in the periods in which the non-monetary assets are recovered.

Amortisation

Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:

Asset class

Amortisation method and rate

Goodwill

10% on cost per annum

Software

20% on cost per annum

Intellectual property

Units-of-production basis up to February 2024

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.

Debtors

Trade debtors are amounts due from customers for goods 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.

Inventories

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.

The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. At each reporting date, stocks are assessed for impairment. If stocks are 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.

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

2

Accounting policies (continued)

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 all are repayable within one year and hence are included at the undiscounted amount of cash expected to be paid.

Borrowings

Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the profit and loss account over the period of the relevant borrowing.

Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.

Borrowings are classified as current liabilities unless the group has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

Provisions

Provisions are recognised when the group has an obligation at the reporting date as a result of a past event, it is probable that the group will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

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.

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee.

Assets held under finance leases are recognised at the lower of their fair value at inception of the lease and the present value of the minimum lease payments. These assets are depreciated on a straight-line basis over the shorter of the useful life of the asset and the lease term. The corresponding liability to the lessor is included in the Balance Sheet as a finance lease obligation.

Lease payments are apportioned between finance costs in the Profit and Loss Account and reduction of the lease obligation so as to achieve a constant periodic rate of interest on the remaining balance of the liability.

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.

Dividends

Dividend distribution to the company’s shareholders is recognised as a liability in the financial statements in the reporting period in which the dividends are declared.

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.

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

2

Accounting policies (continued)

Financial instruments


Classification
Financial instruments are classified and accounted for according to the substance of the contractual arrangement, as financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities. Where shares are issued, any component that creates a financial liability of the group is presented as a liability on the balance sheet. The corresponding dividends relating to the liability component are charged as interest expenses in the profit and loss account.

 Recognition and measurement
All financial assets and liabilities are initially measured at transaction price (including transaction costs), except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value (which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a financing transaction. If an arrangement constitutes a financing transaction, the financial asset or financial liability is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

 Impairment
Assets, other than those measured at fair value, are assessed for indicators of impairment at each balance sheet date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss as described below.

A non financial asset is impaired where there is objective evidence that, as a result of one or more events that occurred after initial recognition, the estimated recoverable value of the asset has been reduced. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use.

The recoverable amount of goodwill is derived from measurement of the present value of the future cash flows of the cash-generating units ('CGUs') of which the goodwill is a part. Any impairment loss in respect of a CGU is allocated first to the goodwill attached to that CGU, and then to other assets within that CGU on a pro-rata basis.

Where indicators exist for a decrease in impairment loss, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised. Where a reversal of impairment occurs in respect of a CGU, the reversal is applied first to the assets (other than goodwill) of the CGU on a pro-rata basis and then to any goodwill allocated to that CGU.

For financial assets carried at amortised cost, the amount of an impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.

For financial assets carried at cost less impairment, the impairment loss is the difference between the asset’s carrying amount and the best estimate of the amount that would be received for the asset if it were to be sold at the reporting date.

Where indicators exist for a decrease in impairment loss, and the decrease can be related objectively to an event occurring after the impairment was recognised, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired financial asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised.

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

3

Turnover

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

2024
£

2023
£

Sale of goods

31,076,852

29,012,289

Rendering of services

3,653,982

2,092,426

34,730,834

31,104,715

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

2024
£

2023
£

UK

30,653,832

26,720,811

Overseas

4,077,002

4,383,904

34,730,834

31,104,715

 

4

Operating profit

Arrived at after charging/(crediting)

2024
 £

2023
 £

Depreciation expense

1,155,202

925,652

Amortisation expense (included in administration expenses)

857,075

1,241,177

Goodwill impairment (included in administration expenses)

503,403

-

Research and development cost

413,112

576,412

Foreign exchange (gains)/losses

(60)

9,370

Operating lease expense

521,804

478,335

Profit on disposal of property, plant and equipment

(147,176)

(55,510)

 

5

Other interest receivable and similar income

2024
£

2023
£

Other interest income

5,691

246

Interest income on bank deposits

89,876

11,477

95,567

11,723

 

6

Interest payable and similar expenses

2024
£

2023
£

Interest on bank overdrafts and borrowings

5,757

96

Other interest expense

4,781

-

10,538

96

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

7

Staff costs

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

2024
 £

2023
 £

Wages and salaries

6,240,425

5,873,804

Social security costs

660,145

634,361

Pension costs, defined contribution scheme

613,828

455,895

7,514,398

6,964,060

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

2024
No.

2023
No.

Production

44

40

Administration and support

91

89

135

129

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

2024
 £

2023
 £

Wages and salaries

382,477

366,414

Social security costs

53,384

40,485

Pension costs, defined contribution scheme

13,778

13,248

449,639

420,147

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

2024
 No.

2023
 No.

Administration and support

3

3

 

8

Directors' remuneration

The directors' remuneration for the year was as follows:

2024
£

2023
£

Remuneration

385,726

369,154

Contributions paid to money purchase schemes

13,778

37,824

399,504

406,978

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

8

Directors' remuneration (continued)

During the year the number of directors who were receiving benefits was as follows:

2024
No.

2023
No.

Accruing benefits under money purchase pension scheme

3

3

In respect of the highest paid director:

2024
£

2023
£

Remuneration

141,028

135,220

Company contributions to money purchase pension schemes

13,778

13,248

 

9

Auditors' remuneration

2024
£

2023
£

Audit of these financial statements

70,100

57,175


 

Included within the total of auditor's remuneration of the statutory accounts is £10,533 (2022 - £10,030) relating to the audit of the company.

 

10

Taxation

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

2024
£

2023
£

Current taxation

UK corporation tax

950,239

452,677

UK corporation tax adjustment to prior periods

(55,384)

779

894,855

453,456

Deferred taxation

Arising from origination and reversal of timing differences

202,674

21,920

Arising from changes in tax rates and laws

-

7,117

Arising from previously unrecognised tax loss, tax credit or temporary difference of prior periods

108,171

-

Total deferred taxation

310,845

29,037

Tax expense in the consolidated profit and loss account

1,205,700

482,493

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

10

Taxation (continued)

The tax on profit before tax for the year is higher than the standard rate of corporation tax in the UK (2023 - lower than the standard rate of corporation tax in the UK) of 25% (2023 - 19.5%).

The differences are reconciled below:

2024
£

2023
£

Profit before tax

4,648,416

3,429,473

Corporation tax at standard rate

1,162,104

668,747

Decrease due to marginal relief

(220)

-

Effect of expense not deductible in determining taxable profit (tax loss)

322,994

192,379

UK deferred tax expense relating to changes in tax rates or laws

-

7,117

Patent box additional deduction

(134,363)

(97,158)

Increase/(decrease) in UK and foreign current tax from unrecognised temporary difference from a prior period

25,630

(3,273)

Deferred tax expense from unrecognised temporary difference from a prior period

82,542

-

(Decrease)/increase in UK and foreign current tax from adjustment for prior periods

(55,353)

779

Tax increase from effect of capital allowances and depreciation

24,714

8,069

Tax increase arising from overseas tax suffered/expensed

3,402

2,739

Tax decrease from effect of adjustment in research and development tax credit

(225,727)

(297,287)

Other tax adjustments, reliefs and transfers

(23)

381

Total tax charge

1,205,700

482,493

Deferred tax

Group

Deferred tax assets and liabilities

2024

Liability
£

Fixed asset timing differences

582,983

Short term timing differences

(66,213)

516,770

2023

Liability
£

Fixed asset timing differences

414,061

Losses and other deductions

(123,831)

Short term timing differences

(78,174)

212,056

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

10

Taxation (continued)

Company

Deferred tax assets and liabilities

2024

Liability
£

Fixed asset timing differences

26,737

Short term timing differences

(6,757)

19,980

2023

Liability
£

Fixed asset timing differences

28,196

Short term timing differences

(3,312)

24,884

The corporation tax rate increase from 19% to 25% from 1 April 2023 was substantively enacted on 24 May 2021. Accordingly, at the balance sheet dates deferred tax is calculated at 25%.

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

11

Intangible assets

Group

Goodwill
 £

Software
 £

Intellectual property
£

Total
£

Cost

At 1 May 2023

9,639,941

315,440

64,832

10,020,213

Additions acquired separately

-

79,142

-

79,142

Acquired through business combinations

539,360

-

-

539,360

At 30 April 2024

10,179,301

394,582

64,832

10,638,715

Amortisation

At 1 May 2023

7,250,197

203,588

64,832

7,518,617

Impairment charge

503,403

-

-

503,403

Amortisation charge for the year

820,310

36,765

-

857,075

At 30 April 2024

8,573,910

240,353

64,832

8,879,095

Carrying amount

At 30 April 2024

1,605,391

154,229

-

1,759,620

At 30 April 2023

2,389,744

111,852

-

2,501,596

At 30 April 2024, the remaining amortisation periods for goodwill with carrying values of £1,593,612, £11,779 and £361,536 were 3 years and 9 months, 1 month and 9 years and 4 months respectively.

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

12

Tangible assets

Group

Land and buildings
£

Leasehold improvements
£

Plant and machinery
 £

Furniture, fittings and equipment
 £

Motor vehicles
 £

Properties under construction
 £

Total
£

Cost

At 1 May 2023

3,109,505

192,557

3,715,716

1,119,862

662,169

85,772

8,885,581

Additions

-

67,424

1,399,650

99,227

374,569

1,176,360

3,117,230

Acquired through business combinations

-

-

-

4,421

98,096

-

102,517

Disposals

-

-

(119,161)

(14,517)

(43,768)

-

(177,446)

Foreign exchange movements

-

(490)

(1,629)

-

(847)

-

(2,966)

At 30 April 2024

3,109,505

259,491

4,994,576

1,208,993

1,090,219

1,262,132

11,924,916

Depreciation

At 1 May 2023

532,021

113,361

1,942,351

824,523

318,982

-

3,731,238

Charge for the year

63,780

34,807

655,830

223,497

177,288

-

1,155,202

Eliminated on disposal

-

-

(74,289)

(11,639)

(38,761)

-

(124,689)

Foreign exchange movements

-

(7)

(976)

-

(556)

-

(1,539)

At 30 April 2024

595,801

148,161

2,522,916

1,036,381

456,953

-

4,760,212

Carrying amount

At 30 April 2024

2,513,704

111,330

2,471,660

172,612

633,266

1,262,132

7,164,704

At 30 April 2023

2,577,484

79,196

1,773,365

295,339

343,187

85,772

5,154,343

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

12

Tangible assets (continued)

Included within the net book value of land and buildings above is £2,513,704 (2023 - £2,577,484) in respect of freehold land and buildings.
 

Assets held under finance leases and hire purchase contracts

The net carrying amount of tangible assets includes the following amounts in respect of assets held under finance leases and hire purchase contracts:

2024
£

2023
£

Motor vehicles

15,174

20,425

   

Restriction on title and pledged as security

Motor vehicles with a carrying amount of £15,174 (2023 - £20,425) has been pledged as security for associated hire purchase liabilities.

Company

Land and buildings
£

Furniture, fittings and equipment
 £

Properties under construction
 £

Total
£

Cost

At 1 May 2023

3,109,505

2,441

85,772

3,197,718

Additions

-

1,495

1,176,360

1,177,855

Disposals

-

(1,836)

-

(1,836)

At 30 April 2024

3,109,505

2,100

1,262,132

4,373,737

Depreciation

At 1 May 2023

532,021

2,441

-

534,462

Charge for the year

63,780

41

-

63,821

Eliminated on disposal

-

(1,836)

-

(1,836)

At 30 April 2024

595,801

646

-

596,447

Carrying amount

At 30 April 2024

2,513,704

1,454

1,262,132

3,777,290

At 30 April 2023

2,577,484

-

85,772

2,663,256

Included within the net book value of land and buildings above is £2,513,704 (2023 - £2,577,484) in respect of freehold land and buildings.
 

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

13

Investments

Company

2024
£

2023
£

Investments in subsidiaries

13,260,239

13,260,238

Subsidiaries

£

Cost

At 1 May 2023 and at 30 April 2024

13,260,239

Carrying amount

At 30 April 2024

13,260,239

At 30 April 2023

13,260,238

Details of undertakings

Details of the investments (including principal place of business of unincorporated entities) in which the company 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

     

2024

2023

Subsidiary undertakings

AGD Systems Limited

White Lion House, Gloucester
Road, Staverton, Cheltenham,
GL51 0TF

England and Wales

Ordinary

100%

100%

AGD Systems PTY Ltd

Suite 18, 6-8 Old Castle Hill
Road, Castle Hill, NSW 2154

Australia

Ordinary

100%

100%

Arkon Services Limited

1 Bourton Industrial Park,
Bourton-On-The-Water,
Cheltenham, GL54 2HQ

England and Wales

Ordinary

100%

100%

Hollco Limited

1 Hawthorne Court, Bourton
Business Park, Bourton-On-
The-Water, Cheltenham,
GL51 2HQ

England and Wales

Ordinary

100%

100%

Traffic Group Signals Limited

White Lion House, Gloucester
Road, Staverton, Cheltenham,
GL51 0TF

England and Wales

Ordinary

100%

100%

Pike Signals Limited

Units 7, 9 & 11, Phoenix
Business Park, Avenue
Road, Aston, Birmingham,
B7 4NU

England and Wales

Ordinary

100%

100%

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

13

Investments (continued)

Undertaking

Registered office

Holding

Proportion of voting rights and shares held

Safe Lite (UK) Limited

Units 7, 9 & 11, Phoenix
Business Park, Avenue
Road, Aston, Birmingham,
B7 4NU

England and Wales

Ordinary

100%

100%

Walker Henfield Limited

White Lion House, Gloucester
Road, Staverton, Cheltenham,
GL51 0TF

England and Wales

Ordinary

100%

100%

MAV Systems Limited

White Lion House, Gloucester
Road, Staverton, Cheltenham,
GL51 0TF

England and Wales

Ordinary

100%

100%

Radix Traffic Limited

White Lion House, Gloucester
Road, Staverton, Cheltenham,
GL51 0TF

England and Wales

Ordinary

100%

100%

Lean TM Limited

White Lion House,
Gloucester Road, Staverton,
Cheltenham, GL51 0TF

England & Wales

Ordinary

100%

100%

LTM Design Ltd

Unit 7 Apex Park, Fraserfields Way, Leighton Buzzard, LU7 3RE

England & Wales

Ordinary

100%

0%

 

14

Stocks

 

Group

Company

2024
£

2023
£

2024
£

2023
£

Raw materials and consumables

10,716,196

9,383,030

-

-

Finished goods and goods for resale

672,753

846,060

-

-

11,388,949

10,229,090

-

-

 

15

Debtors

 

Group

Company

2024
£

2023
£

2024
£

2023
£

Trade debtors

6,049,395

5,892,119

-

-

Amounts owed by group undertakings

-

-

1,817,437

769,053

Other debtors

320,903

149,892

119,876

-

Prepayments

615,959

547,787

19,271

20,302

Corporation tax asset

-

85,696

-

-

6,986,257

6,675,494

1,956,584

789,355

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

16

Cash and cash equivalents

 

Group

Company

2024
£

2023
£

2024
£

2023
£

Cash on hand

330

12

-

-

Cash at bank

12,588,892

12,006,878

4,216,321

3,314,111

12,589,222

12,006,890

4,216,321

3,314,111

 

17

Creditors

   

Group

Company

Note

2024
 £

2023
 £

2024
 £

2023
 £

Due within one year

 

Loans and borrowings

18

50,754

20,425

-

-

Trade creditors

 

2,970,559

2,352,849

27,146

23,704

Amount due to group undertakings

-

-

152,855

107,449

Social security and other taxes

 

778,959

981,104

-

37,208

Outstanding defined contribution pension costs

 

18,595

15,745

-

-

Other creditors

 

295,829

110,225

13,171

11,671

Accrued expenses

 

912,783

1,042,927

52,810

38,866

Corporation tax liability

 

401,506

160,974

23,689

70,375

Deferred income

 

530,619

613,006

-

-

 

5,959,604

5,297,255

269,671

289,273

Due after one year

 

Loans and borrowings

18

40,310

-

-

-

 

18

Loans and borrowings

 

Group

Company

2024
£

2023
£

2024
£

2023
£

Current loans and borrowings

Finance lease liabilities

50,754

20,425

-

-

 

Group

Company

2024
£

2023
£

2024
£

2023
£

Non-current loans and borrowings

Finance lease liabilities

40,310

-

-

-


Finance leases
Obligations under finance leases are secured upon the assets to which they relate.

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

19

Deferred tax and other provisions

Group

Deferred tax
£

Warranties
£

Total
£

At 1 May 2023

212,056

298,740

510,796

Increase / (decrease) in existing provisions

304,714

(123,616)

181,098

At 30 April 2024

516,770

175,124

691,894

Company

Deferred tax
£

Total
£

At 1 May 2023

24,884

24,884

Decrease in existing provisions

(4,904)

(4,904)

At 30 April 2024

19,980

19,980

 

20

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 £613,828 (2023 - £455,895).

Contributions totalling £18,595 (2023 - £15,745) were payable to the scheme at the end of the year and are included in creditors.

 

21

Share capital

Allotted, called up and fully paid shares

2024

2023

No.

£

No.

£

Ordinary shares of £1 each

6,620

6,620

6,620

6,620

       
 

22

Reserves

Group and Company

Called up share capital
This represents the nominal value of the issued share capital.

Share premium reserve
This contains the premium arising on the issue of share capital, net of issue expenses.

Capital redemption reserve
This represents paid up share capital from the buy back of shares by the company. These are undistributable reserves.

Profit and loss account
This represents the cumulative profits or losses, net of dividends and other adjustments.

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

23

Obligations under leases and hire purchase contracts

Group

Finance leases

The total of future minimum lease payments is as follows:

2024
£

2023
£

Not later than one year

50,754

20,425

Later than one year and not later than five years

40,310

-

91,064

20,425

Operating leases

The total of future minimum lease payments is as follows:

2024
£

2023
£

Not later than one year

433,747

321,733

Later than one year and not later than five years

937,217

604,054

Later than five years

94,000

191,667

1,464,964

1,117,454

The amount of non-cancellable operating lease payments recognised as an expense during the year was £521,804 (2023 - £478,335).

Company

Operating leases

The total of future minimum lease payments is as follows:

2024
£

2023
£

Not later than one year

28,500

38,000

Later than one year and not later than five years

-

28,500

28,500

66,500

The amount of non-cancellable operating lease payments recognised as an expense during the year was £38,000 (2023 - £38,000).

 

24

Dividends

2024
 £

2023
 £

Dividends paid

1,000,000

1,000,000

The dividends set out above were paid to certain directors of the company.

 

25

Capital commitments

Group and company

At the balance sheet date the group and company were committed to capital expenditure of £1,314,000 (2023 - £nil) in respect of construction of a new freehold building.

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

26

Financial instruments

Group

Items of income, expense, gains or losses

2024

Income
£

Expense
£

Net gains
£

Net losses
£

Financial assets measured at amortised cost

-

-

-

10,562

Financial liabilities measured at amortised cost

-

976

-

-

-

976

-

10,562

2023

Income
£

Expense
£

Net gains
£

Net losses
£

Financial assets measured at amortised cost

-

-

-

31,322

Financial liabilities measured at amortised cost

-

96

-

-

-

96

-

31,322

The total interest expense for financial liabilities not measured at fair value through profit or loss is £976 (2023 - £96).

 

27

Business combinations

On 23 August 2023, Traffic Group Signals Limited acquired 100% of the issued share capital of LTM Design Ltd.

LTM Design Ltd contributed £736,552 revenue and £(54,655) to the group's profit for the period between the date of acquisition and the Balance Sheet date.

The amounts recognised in respect of the identifiable assets acquired and liabilities assumed are as set out in the table below:
 

Book value
2024
£

Fair value
2024
£

Assets and liabilities acquired

Financial assets

214,662

214,662

Stocks

30,000

30,000

Tangible assets

102,517

102,517

Financial liabilities

(204,039)

(204,039)

Total identifiable assets

143,140

143,140

Goodwill

539,360

539,360

Total consideration

682,500

682,500

Satisfied by:

Cash

530,500

530,500

Deferred consideration

152,000

152,000

Total consideration transferred

682,500

682,500

 

The Traffic Group Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

 

27

Business combinations (continued)

The useful life of goodwill is 10 years. Subsequent to the identifying the useful economic life, the goodwill was identified as being impaired in full. An impairment charge has been recognised in note 11 to these financial statements.

 

28

Control

The directors do not consider there to be a single controlling party.