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REGISTERED NUMBER: 07477792 (England and Wales)















Group Strategic Report, Report of the Directors and

Consolidated Financial Statements for the Year Ended 31 December 2023

for

Purico Speciality Paper Company Limited

Purico Speciality Paper Company Limited (Registered number: 07477792)






Contents of the Consolidated Financial Statements
for the Year Ended 31 December 2023




Page

Company Information 1

Group Strategic Report 2

Report of the Directors 3

Report of the Independent Auditors 4

Consolidated Income Statement 8

Consolidated Other Comprehensive Income 9

Consolidated Balance Sheet 10

Company Balance Sheet 11

Consolidated Statement of Changes in Equity 12

Company Statement of Changes in Equity 13

Consolidated Cash Flow Statement 14

Notes to the Consolidated Cash Flow Statement 15

Notes to the Consolidated Financial Statements 16


Purico Speciality Paper Company Limited

Company Information
for the Year Ended 31 December 2023







DIRECTORS: S A Young
K Z Drazdzewska





SECRETARY: M. M. Secretariat Limited





REGISTERED OFFICE: Environment House
1 St. Marks Street
Nottingham
Nottinghamshire
NG3 1DE





REGISTERED NUMBER: 07477792 (England and Wales)





AUDITORS: Torr Waterfield Limited
Statutory Auditor
Park House
37 Clarence Street
Leicester
Leicestershire
LE1 3RW

Purico Speciality Paper Company Limited (Registered number: 07477792)

Group Strategic Report
for the Year Ended 31 December 2023

The directors present their strategic report of the company and the group for the year ended 31 December 2023.

The Group produces a range of specialist paper products, including casing, tea, coffee and overlay papers. The Group's business strategy is market focussed and includes investment in developing new products to meet the changing needs of its customers.

REVIEW OF BUSINESS
Results for 2023 were in line with expectations given the challenging conditions continuing to be felt throughout the world, including raw material price increases, high energy costs and increases in packaging and distribution costs. This is testament to the stability of the core business in Devon Valley Limited.

Turnover in total for the Group decreased from £28.6m to £25.0m. Gross margin percentage decreased from 21.5% to 20.5%. Demand for the Group's products remain strong providing confidence in the future prospects for the company.

PRINCIPAL RISKS AND UNCERTAINTIES
The business and financial performance may be adversely affected by down turns in the target markets that the Group serves. Demand for the Group's products is driven by consumption of those products which is often affected by general economic conditions. However, despite challenging economic conditions, demand for the product remained strong during 2023.

The industry in which the Group operates remains highly competitive. Further increases in capacity will lead to increased competition without increased market demand for products. Increased competition could reduce the Group's sales and profitability. To counter this impact, the Group continues to expand the product base.

The cost of raw materials and energy used to manufacture our products could increase, or the availability of key raw materials could be more constrained. As a result, the Group is subject to risks in terms of raw materials and energy cost fluctuation. This is mitigated where possible by placing forward orders at fixed prices for raw materials and energy. In addition, the Group works continuously to improve its carbon footprint to mitigate energy price rises that have been unprecedented since the last quarter of 2021.

The impact of foreign exchange movements can have significant impacts on the Group's results particularly as the Group trades significantly in overseas markets. The Group mitigates these risks using forward exchange contracts.

KEY PERFORMANCE INDICATORS
The Group uses several key performance indicators to track performance which include turnover, gross margin and net profit before tax. Movements in these indicators have been discussed in the business review above.

ON BEHALF OF THE BOARD:





K Z Drazdzewska - Director


24 January 2025

Purico Speciality Paper Company Limited (Registered number: 07477792)

Report of the Directors
for the Year Ended 31 December 2023

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

PRINCIPAL ACTIVITY
The principal activity of the group in the year under review was that of a manufacturer of speciality papers for the tea and coffee industry and overlay products.

DIVIDENDS
The directors did not recommend the payment of any dividends on the ordinary shares during the year (2022 - £nil).

The A preference shares carry rights to fixed dividends each year and as such £500 (2022 - £500) has been accrued as dividends payable on these shares.

DIRECTORS
S A Young has held office during the whole of the period from 1 January 2023 to the date of this report.

Other changes in directors holding office are as follows:

R S Mochor - resigned 22 June 2023
K Z Drazdzewska - appointed 21 June 2023

STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Group Strategic Report, the Report of the Directors 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 company and the group and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

- select suitable accounting policies and then apply them consistently;
- make judgements and accounting estimates that are reasonable and prudent;
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

ON BEHALF OF THE BOARD:





K Z Drazdzewska - Director


24 January 2025

Report of the Independent Auditors to the Members of
Purico Speciality Paper Company Limited

Opinion
We have audited the financial statements of Purico Speciality Paper Company Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, 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 of the parent company 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 Auditors' 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.

Material uncertainty relating to going concern
We draw attention to note 2 in the financial statements, which indicates that if the the ultimate parent company of Clary Limited and the wider group were to withdraw its support, the Group would be unlikely to be able to discharge its liabilities. As stated in note 2, these events or conditions, indicate that a material uncertainty exists that may cast significant doubt on the Company's and Group's ability to continue as a going concern. Our opinion is not modified in respect of this matter.

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. Our evaluation of the directors' assessment of the Group and Company's ability to continue to adopt the going concern basis of accounting included obtaining confirmation from Clary Limited that it will continue to support the Company and Group and that repayment of the amounts owed to it and its' group undertakings will not be demanded in a manner that would be detrimental to the financial stability of the Group and Company.

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 in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors 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 this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Report of the Independent Auditors to the Members of
Purico Speciality Paper Company Limited


Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the Group Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Group Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Directors.

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 three, 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 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.

Report of the Independent Auditors to the Members of
Purico Speciality Paper Company Limited


Auditors' responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors 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.

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:

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

The capability to detect irregularities is based on the auditor identifying and assessing the risks of material misstatement of the financial statements, whether due to fraud or error, and then designing and performing audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.

a) Identifying and assessing potential risks related to irregularities

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, the following approach was taken:

- Understanding the nature of the industry and sector, control environment and business performance;
- Consideration of the results of our enquiries of management and those charged with governance
about their own identification and assessment of the risks of irregularities;
- Understanding the group's policies and procedures on compliance with laws and regulations and
management of fraud risk, including documentation of instances of non-compliance of laws and
regulations and instances of actual, suspected or alleged fraud;
- Consideration of matters discussed among the audit engagement team regarding how and where
fraud might occur in the financial statements and any potential indicators of fraud;
- Understanding the legal and regulatory frameworks that the Group operates in through enquiry of
management and those charged with governance and understanding the group's industry and sector.
The key laws and regulations that were considered to have an effect on material amounts and
disclosures in the financial statements included the Companies Act and tax legislation.

b) Audit response to risks identified

Based on this understanding, the following audit procedures were designed and performed to respond to the risks identified:

- Reviewing the financial statement disclosures and testing to supporting documentation to assess
compliance with applicable laws and regulations described as having a direct effect on the financial
statement;
- Enquiring of management, those charged with governance and, where applicable, the group's
solicitors concerning actual and potential litigation and claims;
- Performing analytical procedures to identify any unusual or unexpected relationships that may
indicate risks of material misstatement due to fraud;
- Reviewing minutes of meetings of those charged with governance and, where applicable,
correspondence with regulators;
- Performing audit work over the risk of management override of controls, including testing of journal
entries and other adjustments for appropriateness and evaluating the business rationale of significant
transactions outside the normal course of business;
- Communication of potential fraud risks to all engagement team members and remaining alert to any
indications of fraud or non-compliance with laws and regulations throughout the audit.


Report of the Independent Auditors to the Members of
Purico Speciality Paper Company Limited

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

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

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 a Report of the Auditors 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.




Peter Morris FCA (Senior Statutory Auditor)
for and on behalf of Torr Waterfield Limited
Statutory Auditor
Park House
37 Clarence Street
Leicester
Leicestershire
LE1 3RW

28 January 2025

Purico Speciality Paper Company Limited (Registered number: 07477792)

Consolidated
Income Statement
for the Year Ended 31 December 2023

31.12.23 31.12.22
Notes £    £   

TURNOVER 4 25,027,586 28,652,274

Cost of sales (19,884,942 ) (22,495,484 )
GROSS PROFIT 5,142,644 6,156,790

Distribution costs (1,233,609 ) (2,613,023 )
Administrative expenses (3,348,403 ) (4,381,904 )
560,632 (838,137 )

Other operating income 346,232 284,909
OPERATING PROFIT/(LOSS) 6 906,864 (553,228 )

Interest receivable and similar income 17,405 7,971
924,269 (545,257 )

Interest payable and similar expenses 7 (474,850 ) (299,155 )
PROFIT/(LOSS) BEFORE TAXATION 449,419 (844,412 )

Tax on profit/(loss) 8 (227,963 ) (265,823 )
PROFIT/(LOSS) FOR THE FINANCIAL
YEAR

221,456

(1,110,235

)
Profit/(loss) attributable to:
Owners of the parent 221,456 (1,110,235 )

Purico Speciality Paper Company Limited (Registered number: 07477792)

Consolidated
Other Comprehensive Income
for the Year Ended 31 December 2023

31.12.23 31.12.22
Notes £    £   

PROFIT/(LOSS) FOR THE YEAR 221,456 (1,110,235 )


OTHER COMPREHENSIVE INCOME
Revaluation of plant & machinery - 491,985
Retranslation of overseas operation (16,877 ) (59,394 )
Income tax relating to components of
other comprehensive income

-

(109,760

)
OTHER COMPREHENSIVE INCOME
FOR THE YEAR, NET OF INCOME TAX

(16,877

)

322,831
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR

204,579
Prior year adjustment 190,740
TOTAL COMPREHENSIVE INCOME
SINCE LAST ANNUAL REPORT

(596,664

)

Total comprehensive income attributable to:
Owners of the parent 204,579 (596,664 )

Purico Speciality Paper Company Limited (Registered number: 07477792)

Consolidated Balance Sheet
31 December 2023

31.12.23 31.12.22
Notes £    £   
FIXED ASSETS
Intangible assets 11 7,681,490 8,230,245
Tangible assets 12 2,493,297 2,626,188
Investments 13 - -
10,174,787 10,856,433

CURRENT ASSETS
Stocks 14 6,120,777 6,529,270
Debtors 15 4,040,067 5,460,088
Cash at bank and in hand 515,702 481,584
10,676,546 12,470,942
CREDITORS
Amounts falling due within one year 16 (6,683,418 ) (8,739,758 )
NET CURRENT ASSETS 3,993,128 3,731,184
TOTAL ASSETS LESS CURRENT
LIABILITIES

14,167,915

14,587,617

CREDITORS
Amounts falling due after more than one
year

17

(18,636,595

)

(19,175,865

)

PROVISIONS FOR LIABILITIES 20 (455,454 ) (539,965 )
NET LIABILITIES (4,924,134 ) (5,128,213 )

CAPITAL AND RESERVES
Called up share capital 21 14,000,000 14,000,000
Revaluation reserve 22 382,225 382,225
Foreign exchange reserve 22 6,943 (55,154 )
Retained earnings 22 (19,313,302 ) (19,455,284 )
(4,924,134 ) (5,128,213 )

The financial statements were approved by the Board of Directors and authorised for issue on 24 January 2025 and were signed on its behalf by:





K Z Drazdzewska - Director


Purico Speciality Paper Company Limited (Registered number: 07477792)

Company Balance Sheet
31 December 2023

31.12.23 31.12.22
Notes £    £   
FIXED ASSETS
Intangible assets 11 - -
Tangible assets 12 - -
Investments 13 15,833,148 15,833,148
15,833,148 15,833,148

CURRENT ASSETS
Debtors 15 1,571,253 643,489
Cash at bank 157,490 139,078
1,728,743 782,567
CREDITORS
Amounts falling due within one year 16 (623,556 ) (435,304 )
NET CURRENT ASSETS 1,105,187 347,263
TOTAL ASSETS LESS CURRENT
LIABILITIES

16,938,335

16,180,411

CREDITORS
Amounts falling due after more than one
year

17

(18,345,677

)

(18,893,514

)
NET LIABILITIES (1,407,342 ) (2,713,103 )

CAPITAL AND RESERVES
Called up share capital 21 14,000,000 14,000,000
Retained earnings 22 (15,407,342 ) (16,713,103 )
(1,407,342 ) (2,713,103 )

Company's profit/(loss) for the financial
year

1,306,261

(921,705

)

The financial statements were approved by the Board of Directors and authorised for issue on 24 January 2025 and were signed on its behalf by:





K Z Drazdzewska - Director


Purico Speciality Paper Company Limited (Registered number: 07477792)

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

Called up Foreign
share Retained Revaluation exchange Total
capital earnings reserve reserve equity
£    £    £    £    £   
Balance at 1 January 2022 14,000,000 (19,829,956 ) 1,294,667 4,240 (4,531,049 )
Prior year adjustment - 190,740 - - 190,740
As restated 14,000,000 (19,639,216 ) 1,294,667 4,240 (4,340,309 )

Changes in equity
Disposal of subsidiary - 1,294,667 (1,294,667 ) - -
Dividends - (500 ) - - (500 )
Total comprehensive income - (1,110,235 ) 382,225 (59,394 ) (787,404 )
Balance at 31 December 2022 14,000,000 (19,455,284 ) 382,225 (55,154 ) (5,128,213 )

Changes in equity
Dividends - (500 ) - - (500 )
Total comprehensive income - 142,482 - 62,097 204,579
Balance at 31 December 2023 14,000,000 (19,313,302 ) 382,225 6,943 (4,924,134 )

Purico Speciality Paper Company Limited (Registered number: 07477792)

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

Called up
share Retained Total
capital earnings equity
£    £    £   
Balance at 1 January 2022 14,000,000 (15,793,440 ) (1,793,440 )
Prior year adjustment - 2,542 2,542
As restated 14,000,000 (15,790,898 ) (1,790,898 )

Changes in equity
Dividends - (500 ) (500 )
Total comprehensive income - (921,705 ) (921,705 )
Balance at 31 December 2022 14,000,000 (16,713,103 ) (2,713,103 )

Changes in equity
Dividends - (500 ) (500 )
Total comprehensive income - 1,306,261 1,306,261
Balance at 31 December 2023 14,000,000 (15,407,342 ) (1,407,342 )

Purico Speciality Paper Company Limited (Registered number: 07477792)

Consolidated Cash Flow Statement
for the Year Ended 31 December 2023

31.12.23 31.12.22
Notes £    £   
Cash flows from operating activities
Cash generated from operations 1 969,340 568,964
Interest paid (474,850 ) (299,155 )
Tax paid (293,493 ) (194,793 )
Net cash from operating activities 200,997 75,016

Cash flows from investing activities
Purchase of tangible fixed assets (294,185 ) (258,844 )
Sale of tangible fixed assets 17,500 -
Disposal of subsidiary - (287,891 )
Interest received 17,405 7,971
Net cash from investing activities (259,280 ) (538,764 )

Cash flows from financing activities
Equity dividends paid (500 ) -
Net cash from financing activities (500 ) -

Decrease in cash and cash equivalents (58,783 ) (463,748 )
Cash and cash equivalents at
beginning of year

2

481,584

945,332

Cash and cash equivalents at end of
year

2

422,801

481,584

Purico Speciality Paper Company Limited (Registered number: 07477792)

Notes to the Consolidated Cash Flow Statement
for the Year Ended 31 December 2023

1. RECONCILIATION OF PROFIT/(LOSS) BEFORE TAXATION TO CASH GENERATED FROM
OPERATIONS

31.12.23 31.12.22
£    £   
Profit/(loss) before taxation 449,419 (844,412 )
Depreciation charges 975,830 942,038
Profit on disposal of fixed assets (17,500 ) -
Increase in provisions (92,887 ) -
Related party loan provision - 85,575
Finance costs 474,850 299,155
Finance income (17,405 ) (7,971 )
1,772,307 474,385
Decrease in stocks 408,493 1,447,835
Decrease in trade and other debtors 1,420,021 2,578,148
Decrease in trade and other creditors (2,631,481 ) (3,931,404 )
Cash generated from operations 969,340 568,964

2. CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 December 2023
31.12.23 1.1.23
£    £   
Cash and cash equivalents 515,702 481,584
Bank overdrafts (92,901 ) -
422,801 481,584
Year ended 31 December 2022
31.12.22 1.1.22
£    £   
Cash and cash equivalents 481,584 945,332


3. ANALYSIS OF CHANGES IN NET FUNDS

At 1.1.23 Cash flow At 31.12.23
£    £    £   
Net cash
Cash at bank and in hand 481,584 34,118 515,702
Bank overdrafts - (92,901 ) (92,901 )
481,584 (58,783 ) 422,801
Total 481,584 (58,783 ) 422,801

Purico Speciality Paper Company Limited (Registered number: 07477792)

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

1. STATUTORY INFORMATION

Purico Speciality Paper Company Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the General Information page.

The presentation currency of the financial statements is the Pound Sterling (£).


2. ACCOUNTING POLICIES

Basis of preparing the financial statements
These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.

Going Concern
The financial statements of the Group and Company have been prepared on a going concern basis. Whilst both the Group and Company show net liabilities as at 31 December 2023, this has arisen due to the attributable loss to the Company and the Group of the administration and liquidation of one of its subsidiary companies, Union Papertech Limited. Of the liabilities £20.3m are liabilities owed to Clary Limited, the Group's ultimate parent company, and other companies also ultimately owned and controlled by Clary Limited.

As such, the Group is reliant upon the support of Clary Limited, it's ultimate parent company. Clary Limited have confirmed that it will continue to support the Group for the foreseeable future. In order to help the Company and Group, after the period end, the company issued a further £6,000,000 ordinary shares to Clary Limited in exchange for a reduction of a like amount of debt due to Clary Limited,

Clary Limited has also confirmed to the Group that repayments of the remainder of the amounts owed to it and its' subsidiaries will not be demanded in a manner that would be detrimental to the financial stability of the Group and Company. Taking into account this support, the directors have concluded that the going concern basis for the Group and Company is appropriate.

Basis of consolidation
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.

The consolidated financial statements incorporate the results of the business combination using the purchase method. In the Balance Sheet, the acquirees' identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The combined results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.

Turnover
Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Goodwill
Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer's interest in the fair value of the group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight line basis to the Consolidated Profit and Loss Account over its useful economic life of 20 years.

Intangible assets
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Purico Speciality Paper Company Limited (Registered number: 07477792)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

2. ACCOUNTING POLICIES - continued

Tangible fixed assets
Tangible assets are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes the original purchase price and costs directly attributable to bringing the asset to its working condition for its intended use.

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life:

Improvements to property- 20% on cost
Plant and machinery- 10-33% on cost
Motor vehicles- 33% on cost
Computer equipment- 33% on cost
Motor vehicles- 16.67% on cost

The expected useful lives of assets are reviewed and adjusted, if appropriate, at the end of each reporting period. The effect of any change is accounted for prospectively.

Revaluation of tangible fixed assets
The group has adopted the revaluation model for plant and machinery which are held at fair value less any subsequent depreciation or impairment. Fair value is assessed as the estimated market value at the reporting date, Revaluation gains and losses are recognised in Other Comprehensive Income and accumulate in the Revaluation Reserve.

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

Cost is calculated using a first-in, first-out method and includes all purchase, transport and handling costs in bringing stocks to their present location and condition.

Financial instruments
The group only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors.

Taxation
Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

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

Purico Speciality Paper Company Limited (Registered number: 07477792)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

2. ACCOUNTING POLICIES - continued

Research and development
Expenditure on research and development is written off in the year in which it is incurred.


Foreign currencies
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

On consolidation, the results of overseas operations are translated into sterling at rates approximating to those ruling when the transactions took place. All assets and liabilities of overseas operations are translated at the rate ruling at the reporting date. Exchange differences arising on translating the opening net assets at closing rate are recognised in other comprehensive income.

Pension costs and other post-retirement benefits
The group operates a defined contribution pension scheme. Contributions payable to the group's pension scheme are charged to profit or loss in the period to which they relate.

Dividends
Equity dividends are recognised when they become legally payable.

Preference dividends (whether the underlying shares are classified as liability or equity) are recognised when they become legally payable in accordance with the rights attaching to the shares. In the event of insufficient reserves for the dividend to be distributed, the dividends are accrued until such point where there are sufficient available profits for the dividend to be lawfully paid.

3. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

Many of the amounts included in the financial statements involve the use of judgement and/or estimation. These judgements and estimates are based on management's best knowledge of the relevant factors and circumstances, having regards to prior experience, but actual results may differ form the the amounts included in the financial statements. Information about such judgements and estimation is contained in the accounting policies and/or notes to the financial statements. The key areas are summarised below:

Sources of estimation uncertainty:
- Depreciation rates are based on estimates of the useful lives and residual values of the assets involved;
- Bad debt provisions are based in the likely recovery of the debtor balances.

4. TURNOVER

The turnover and profit (2022 - loss) before taxation are attributable to the one principal activity of the group.

An analysis of turnover by geographical market is given below:

31.12.23 31.12.22
£    £   
United Kingdom 187,929 328,543
Rest of the world 24,839,657 28,323,731
25,027,586 28,652,274

Purico Speciality Paper Company Limited (Registered number: 07477792)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

5. EMPLOYEES AND DIRECTORS
31.12.23 31.12.22
£    £   
Wages and salaries 2,124,412 2,007,378
Social security costs 166,160 162,371
Other pension costs 121,185 123,274
2,411,757 2,293,023

The average number of employees during the year was as follows:
31.12.23 31.12.22

Manufacturing and production 49 50
Sales and distribution 2 2
Administration 7 7
58 59

31.12.23 31.12.22
£    £   
Directors' remuneration - -

6. OPERATING PROFIT/(LOSS)

The operating profit (2022 - operating loss) is stated after charging/(crediting):

31.12.23 31.12.22
£    £   
Depreciation - owned assets 427,075 393,282
Profit on disposal of fixed assets (17,500 ) -
Goodwill amortisation 548,755 548,755
Auditors' remuneration 27,149 27,298
Auditors' remuneration for non audit work 3,000 2,275
Foreign exchange differences (14,595 ) 20,177

7. INTEREST PAYABLE AND SIMILAR EXPENSES
31.12.23 31.12.22
£    £   
Bank interest 162,257 75,606
Other loan interest 312,593 223,549
474,850 299,155

Purico Speciality Paper Company Limited (Registered number: 07477792)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

8. TAXATION

Analysis of the tax charge
The tax charge on the profit for the year was as follows:
31.12.23 31.12.22
£    £   
Current tax:
UK corporation tax (28,359 ) 122,146
Group relief 255,619 146,553
Adjustments in respect of prior periods (7,673 ) -
Total current tax 219,587 268,699

Deferred tax 8,376 (2,876 )
Tax on profit/(loss) 227,963 265,823

UK corporation tax has been charged at 23.52 % (2022 - 19 %).

Reconciliation of total tax charge included in profit and loss
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

31.12.23 31.12.22
£    £   
Profit/(loss) before tax 449,419 (844,412 )
Profit/(loss) multiplied by the standard rate of corporation tax in the
UK of 23.521 % (2022 - 19 %)

105,708

(160,438

)

Effects of:
Expenses not deductible for tax purposes 147,376 392,149
Depreciation in excess of capital allowances - 10,059
Adjustments to tax charge in respect of previous periods (5,798 ) 24,053
charge in respect of prior
Foreign taxation (12,270 ) -
Remeasurement of deferred tax for changes in tax rates 496 -
Enhanced allowances (7,549 ) -
Total tax charge 227,963 265,823

Tax effects relating to effects of other comprehensive income

31.12.23
Gross Tax Net
£    £    £   
Revaluation of plant & machinery
Retranslation of overseas operation (16,877 ) - (16,877 )
(16,877 ) - (16,877 )


Purico Speciality Paper Company Limited (Registered number: 07477792)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

8. TAXATION - continued
31.12.22
Gross Tax Net
£    £    £   
Revaluation of plant & machinery 491,985 (109,760 ) 382,225
Retranslation of overseas operation (59,394 ) - (59,394 )
432,591 (109,760 ) 322,831

9. INDIVIDUAL INCOME STATEMENT

As permitted by Section 408 of the Companies Act 2006, the Income Statement of the parent company is not presented as part of these financial statements.


10. DIVIDENDS

31.12.23 31.12.22
Shares classified as equity
£ £
Class A Preference Shares 500 500

11. INTANGIBLE FIXED ASSETS

Group
Goodwill
£   
COST
At 1 January 2023
and 31 December 2023 11,276,000
AMORTISATION
At 1 January 2023 3,045,755
Amortisation for year 548,755
At 31 December 2023 3,594,510
NET BOOK VALUE
At 31 December 2023 7,681,490
At 31 December 2022 8,230,245

Purico Speciality Paper Company Limited (Registered number: 07477792)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

12. TANGIBLE FIXED ASSETS

Group
Improvements
to Plant and Motor Computer
property machinery vehicles equipment Totals
£    £    £    £    £   
COST OR VALUATION
At 1 January 2023 295,298 2,518,222 6,666 175,121 2,995,307
Additions - 294,185 - - 294,185
Exchange differences - (1,797 ) - - (1,797 )
At 31 December 2023 295,298 2,810,610 6,666 175,121 3,287,695
DEPRECIATION
At 1 January 2023 156,581 35,854 6,666 170,018 369,119
Charge for year 35,994 387,106 - 3,975 427,075
Exchange differences - (1,796 ) - - (1,796 )
At 31 December 2023 192,575 421,164 6,666 173,993 794,398
NET BOOK VALUE
At 31 December 2023 102,723 2,389,446 - 1,128 2,493,297
At 31 December 2022 138,717 2,482,368 - 5,103 2,626,188

Cost or valuation at 31 December 2023 is represented by:

Improvements
to Plant and Motor Computer
property machinery vehicles equipment Totals
£    £    £    £    £   
Valuation in 2022 - (1,162,423 ) - - (1,162,423 )
Cost 295,298 3,973,033 6,666 175,121 4,450,118
295,298 2,810,610 6,666 175,121 3,287,695

Purico Speciality Paper Company Limited (Registered number: 07477792)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

13. FIXED ASSET INVESTMENTS

Company
Shares in
group
undertakings
£   
COST
At 1 January 2023 41,633,148
Disposals (25,800,000 )
At 31 December 2023 15,833,148
PROVISIONS
At 1 January 2023 25,800,000

Eliminated on disposal (25,800,000 )
At 31 December 2023 -
NET BOOK VALUE
At 31 December 2023 15,833,148
At 31 December 2022 15,833,148

The group or the company's investments at the Balance Sheet date in the share capital of companies include the following:

Subsidiaries

Purico Paper Company Ltd
Registered office: Environment House, 1 St. Marks Street, Nottingham, NG3 1DE
Nature of business: Non trading
%
Class of shares: holding
Ordinary 100.00

Purico USA Limited
Registered office: Environment House, 1 St. Marks Street, Nottingham, NG3 1DE
Nature of business: Sales agent
%
Class of shares: holding
Ordinary 100.00

Devon Valley Limited
Registered office: Environment House, 1 St. Marks Street, Nottingham, NG3 1DE
Nature of business: Production of specialist paper products
%
Class of shares: holding
Ordinary 100.00


Following a very difficult period of trading, Union Papertech Limited was moved into Administration. Full provision of £25,800,000 was made in December 2021 against the investment in Union Papertech Limited. As a consequence of the loss of control Union Papertech Limited was deconsolidated from 1 January 2022 and is not included in the consolidated figures for the year ended 31 December 2023 or 31 December 2022. Union Papertech Limited entered liquidation during the year ended 31 December 2023 and as a result has been disposed of in these financial statements.

Purico Speciality Paper Company Limited (Registered number: 07477792)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

14. STOCKS

Group
31.12.23 31.12.22
£    £   
Raw materials 4,218,456 3,508,474
Goods in transit 588,312 1,136,159
Work-in-progress 782,116 737,640
Finished goods 531,893 1,146,997
6,120,777 6,529,270

Stock recognised in cost of sales during the year as an expense was £14,885,676 (2022 - £15,655,833).

15. DEBTORS

Group Company
31.12.23 31.12.22 31.12.23 31.12.22
£    £    £    £   
Amounts falling due within one year:
Trade debtors 2,399,751 4,410,438 - -
Amounts owed by group undertakings 263,409 184,259 551,166 271,350
Other debtors 934,296 524,544 491,302 359,217
Taxation and social security - - 15,863 -
Corporation tax recoverable 12,922 12,922 12,922 12,922
Prepayments and accrued income 429,689 327,925 - -
4,040,067 5,460,088 1,071,253 643,489

Amounts falling due after more than one year:
Amounts owed by group undertakings - - 500,000 -

Aggregate amounts 4,040,067 5,460,088 1,571,253 643,489

16. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group Company
31.12.23 31.12.22 31.12.23 31.12.22
£    £    £    £   
Bank loans and overdrafts (see note 18) 92,901 - - -
Trade creditors 2,276,571 3,887,604 - -
Amounts owed to group undertakings 1,646,149 354,187 392,193 164,891
Corporation tax 46,000 119,906 46,000 119,906
Social security and other taxes 58,024 168,601 - 39,994
Other creditors 1,831,171 3,714,597 164,941 92,759
Accruals and deferred income 732,602 494,863 20,422 17,754
6,683,418 8,739,758 623,556 435,304

Purico Speciality Paper Company Limited (Registered number: 07477792)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

16. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR - continued

Included within other creditors is £554,463 (2022 - £3,607,025) relating to monies forwarded against trade debtors by RBS Invoice Finance Limited. This loan is secured by way of a fixed and floating charge over the assets of the company.

Disclosure of the terms and conditions attached to the non-equity shares is made in note 21.

17. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE
YEAR

Group Company
31.12.23 31.12.22 31.12.23 31.12.22
£    £    £    £   
Amounts owed to group undertakings 18,636,595 19,175,865 18,345,677 18,893,514

18. LOANS

An analysis of the maturity of loans is given below:

Group
31.12.23 31.12.22
£    £   
Amounts falling due within one year or on demand:
Bank overdrafts 92,901 -

19. LEASING AGREEMENTS

Minimum lease payments fall due as follows:

Group
Non-cancellable operating leases
31.12.23 31.12.22
£    £   
Within one year 232,965 244,811
Between one and five years 1,473,006 1,706,196
1,705,971 1,951,007

Purico Speciality Paper Company Limited (Registered number: 07477792)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

20. PROVISIONS FOR LIABILITIES

Group
31.12.23 31.12.22
£    £   
Deferred tax
Accelerated capital allowances 10,466 2,090
Other timing differences 444,988 444,988
455,454 447,078

Other provisions - 92,887

Aggregate amounts 455,454 539,965

Group
Deferred Other
tax provisions
£    £   
Balance at 1 January 2023 447,078 92,887
Charge/(credit) to Income Statement during year 8,376 (92,887 )
Balance at 31 December 2023 455,454 -

Other provisions relates to the net assets of Union Papertech Limited as at December 2021. Union Papertech Ltd has been deconsolidated from the group at 1 January 2022. The provision has been utilised against the loss arising from the disposal of the subsidiary in the group.

21. CALLED UP SHARE CAPITAL

Shares classed as equity

Allotted, issued and fully paid:
Nominal 31.12.23 31.12.22
Number: Class: value: £ £
1,000,000 Ordinary Shares £1 1,000,000 1,000,000
5,000,000 Class A Preference Shares £1 5,000,000 5,000,000
8,000,000 Class B Preference Shares £1 8,000,000 8,000,000
14,000,000 14,000,000

Ordinary Shares carry full voting rights with no restrictions and have no restrictions on the repayment of capital.

Class A Preference Shares carry a right to £0.001 per annum fixed dividend, payable cumulatively should distributable profits be insufficient on the due date. They have no voting rights or right to participate in any capital distribution, return of assets or reduction in capital, save in respect of the redemption at the company's option.

Class B Preference Shares carry a right to 3% discretionary dividend. They have no voting rights or right to participate in any capital distribution, return of assets or reduction in capital, save in respect of the redemption at the company's option.

Purico Speciality Paper Company Limited (Registered number: 07477792)

Notes to the Consolidated Financial Statements - continued
for the Year Ended 31 December 2023

22. RESERVES

Revaluation reserve
The revaluation reserve includes all previous upwards revaluations in this and previous years.

Foreign exchange reserve
The foreign exchange reserve represents the movement in foreign exchange rates for the reporting of Purico USA Limited.

Retained earnings
Retained earnings includes all current and prior year retained profits and losses.

23. ULTIMATE PARENT COMPANY

Clary Limited (incorporated in Isle of Man ) is regarded by the directors as being the company's ultimate parent company.

24. RELATED PARTY DISCLOSURES

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

Transactions between group entities which have been eliminated on consolidation are not disclosed within the financial statements.

Entities with control, joint control or significant influence over the entity

Included within amounts owed to group undertakings is £13,902,809 (2022 - £13,893,743) owed to the parent company, Clary Limited. £13,611,892 (2022 - £13,611,392) of this relates to zero rated loan notes repayable over 15 years to Clary Limited. This loan is secured by a fixed and floating charge over the assets of the company.

The Group issued a further 6,000,000 ordinary shares to Clary Limited after the period end in exchange for a like for like reduction of the debt due to Clary Limited.

Key management personnel of the entity or its parent (in the aggregate)

Key management personnel are considered to be the directors of the group and the directors of the subsidiary companies. Total remuneration paid to these individuals during the year was £189,995 (2022 - £140,958).

Other related parties
31.12.23 31.12.22
£    £   
Rent paid 200,000 200,000