Company registration number 12886694 (England and Wales)
HEAT HOLDCO LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
PAGES FOR FILING WITH REGISTRAR
HEAT HOLDCO LIMITED
CONTENTS
Page
Balance sheet
1
Notes to the financial statements
2 - 6
HEAT HOLDCO LIMITED
BALANCE SHEET
AS AT
30 APRIL 2024
30 April 2024
- 1 -
2024
2023
Notes
£
£
£
£
Fixed assets
Investments
5
1,865,323
1,865,323
Current assets
Debtors
6
6,886,287
6,586,089
Cash at bank and in hand
353,455
353,526
7,239,742
6,939,615
Creditors: amounts falling due within one year
7
(4,702,696)
(2,188,841)
Net current assets
2,537,046
4,750,774
Total assets less current liabilities
4,402,369
6,616,097
Creditors: amounts falling due after more than one year
8
(8,490,844)
(8,490,844)
Net liabilities
(4,088,475)
(1,874,747)
Capital and reserves
Called up share capital
1,000
1,000
Share premium account
79,960
79,960
Profit and loss reserves
(4,169,435)
(1,955,707)
Total equity
(4,088,475)
(1,874,747)
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The directors of the company have elected not to include a copy of the trueincome statement within the financial statements.
The financial statements were approved by the board of directors and authorised for issue on 28 January 2025 and are signed on its behalf by:
Mr D Spencer
Director
Company registration number 12886694 (England and Wales)
HEAT HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
- 2 -
1
Accounting policies
Company information
Heat Holdco Limited is a private company limited by shares incorporated in England and Wales. The registered office is 80 Cheapside, London, EC2V 6EE.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The company has taken advantage of the exemption under section 399 of the Companies Act 2006 not to prepare consolidated accounts, on the basis that the group of which this is the parent qualifies as a small group. The financial statements present information about the company as an individual entity and not about its group.
1.2
Going concern
The accounts have been prepared on a going concern basis. Although the company generated a loss for the year of £true2,213,728(2023: £829,299) and has net liabilities of £4,088,475 (2023: £1,874,747) at 30 April 2024, it has net current assets of £2,537,046 (2023: £4,750,774) together with cash reserves of £353,455 (2023: £353,526) at that date.
December 2024 has seen the refinance of the business with a working capital injection from the investors of £950k. Alongside this, the group has also renewed the financial agreement with Shawbrook Bank which sees the loan agreement extended for an additional 2 years to November 2027. The covenants attached to the financial agreement have also been revised.
Preparation of accounts on a going concern basis assumes that the company will have sufficient funds to continue to pay its debts as and when they fall due and thus continue to operate. The directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future based on its forecasts and projections. The directors have prepared financial forecasts which include the impact of the working capital injection and the renewed and extended financial agreement which demonstrate that the business should have the facilities it requires to trade and will be able to meet the revised financial covenants.
1.3
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.4
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
HEAT HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 3 -
1.5
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans and loans from fellow group companies, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire, are discharged or are cancelled.
1.6
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
HEAT HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 4 -
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
2
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Total
4
3
The service contracts of the directors (where relevant) are held by Heat Holdco Limited. Directors' remuneration is met by the subsidiary company, Inciner8 Limited.
3
Interest receivable and similar income
2024
2023
£
£
Interest receivable and similar income includes the following:
Unwinding of discount on debt owed by group undertakings
308,921
288,313
4
Interest payable and similar expenses
2024
2023
£
£
Interest payable and similar expenses includes the following:
Other loan interest payable
2,460,078
1,091,126
5
Fixed asset investments
2024
2023
£
£
Shares in group undertakings
Capital contribution (Note 6)
1,865,323
1,865,323
HEAT HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 5 -
6
Debtors
2024
2023
Amounts falling due within one year:
£
£
Tax recoverable
13,000
13,000
Amounts owed by group undertakings
2,189,948
2,198,671
Other debtors
52,450
52,450
2,255,398
2,264,121
2024
2023
Amounts falling due after more than one year:
£
£
Amounts owed by group undertakings
4,630,889
4,321,968
Total debtors
6,886,287
6,586,089
Amounts owed by group undertakings falling due in less than one year include a balance of £2,189,948 (2023: £2,198,671) which is interest free and payable on demand, and a balance of £4,630,889 (2023: £4,321,968) falling due in more than one year which constitutes a financing loan, where the transaction is measured at the present value of future receipts discounted at a market rate of interest. The discount is recognised as a capital contribution within investments. The loan is payable in full on 31 October 2026.
Note 9 to the financial statements provides details on guarantees and security.
7
Creditors: amounts falling due within one year
2024
2023
£
£
Trade creditors
3,623
Other creditors
4,702,696
2,185,218
4,702,696
2,188,841
Other creditors include accrued loan interest payable of £4,525,133 (2023: £2,112,707) to the nominee shareholder of the company.
8
Creditors: amounts falling due after more than one year
2024
2023
£
£
Other borrowings
8,490,844
8,490,844
HEAT HOLDCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
8
Creditors: amounts falling due after more than one year
(Continued)
- 6 -
Included within other loans are loan notes falling due in more than one year of £8,490,844 comprising:
- £7,042,665 Secured A Loan Stock 2026;
- £1,200,000 Secured B Loan Stock 2026; and
- £248,179 Secured C Loan Stock 2026.
All loan notes are due for redemption on 4 May 2026 and are secured by way of the composite guarantee and debenture detailed in note 9 to the financial statements.
9
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006.
The auditor's report is unqualified and includes the following:
Opinion
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 30 April 2024 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We draw attention to note 1.2 of the financial statements, which describes management’s overview of the going concern basis for the company and the post year-end refinance that has taken place. Our opinion is not modified in respect of this matter.
Senior Statutory Auditor:
Andrew Moss BA FCA
Statutory Auditor:
DSG Audit
Date of audit report:
28 January 2025
10
Financial commitments, guarantees and contingent liabilities
The company has granted a debenture to Chiltern Capital Nominees (Heat) Limited (the security trustee for the "Secured Parties": Chiltern Capital Nominees (Heat) Limited, the company and each of the group companies listed below, and the holders of the loan notes issued by the company) to secure a composite guarantee given under an intercreditor deed in respect of borrowings owed to the Secured Parties due from the company, Inciner8 Limited, Inciner8 Holdings Limited, Heat Midco Limited, and Heat Midco 2 Limited.
11
Related party transactions
At 30 April 2024, the company was owed £52,450 (2023: £52,450) by the nominee shareholder.
Other than transactions disclosed directly within the notes to the financial statements, no further transactions with related parties were undertaken such as are required to be disclosed.