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Registration number: 06069955

Biscuiteer Baking Company Limited

Annual Report and Financial Statements

for the Year Ended 30 April 2024

 

Biscuiteer Baking Company Limited

Contents

Company Information

1

Strategic Report

2 to 3

Directors' Report

4 to 5

Statement of Directors' Responsibilities

6

Independent Auditor's Report

7 to 9

Profit and Loss Account

10

Balance Sheet

11

Statement of Changes in Equity

12

Statement of Cash Flows

13

Notes to the Financial Statements

14 to 27

 

Biscuiteer Baking Company Limited

Company Information

Directors

W R Barlow

S C Congdon

S H Hastings

E P Jackson

J T Jensen

J H Kilpatrick

Misland Capital Limited

Registered office

Unit 2 Greenlea Park
Prince George's Road
Colliers Wood
London
SW19 2JD

Auditors

Hazlewoods LLP
Staverton Court
Staverton
Cheltenham
GL51 0UX

 

Biscuiteer Baking Company 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 company is the manufacture of biscuits, rusks, preserved pastry goods and cakes.

Fair review of the business

The results for the year which are set out in the profit and loss account show turnover of £11,139,034 (2023 - £10,403,042) and an operating loss of £809,937 (2023 - £369,515). At 30 April 2024, the company had net liabilities of £189,155 (2023 - net assets of £896,525).

This financial year, Biscuiteers’ generated the highest annual turnover to date securing £11,139,034 of gross revenue. This was 7% growth versus last year adding £735,992 revenue to the topline (£10,403,042 in 2023 compared to £11,139,034 in 2024).

The strongest revenue growth was an increase of 28% in our Corporate channel, followed by a 23% increase for the Icing Cafes, 8% increase for Wholesale and flat year-on-year for Online. Given that the gifting market saw a 12.5% decline over the same period (IMRG), this is a positive outcome, particularly with more efficient spending and a tightly controlled discounting strategy.

Whilst revenue growth was strong, the Gross Profit Margin (excluding revenue charged for deliveries) decreased by 1.52% (57.23% in 2023 compared to 55.71% in 2024). This was negatively impacted by the rise in labour costs in April 2023 which makes up 75% of the Cost of Goods and the increasing proportion of Wholesale in the sales mix that delivers a lower margin than the other channels. The actual Gross Profit Margin decreased from 52.65% in 2023 to 51.04% in 2024.

The marketing spend was circa £205,000 higher than last year. The cost of marketing has increased whilst customer demand has reduced so overall, we have had to spend more to deliver the same revenue this year. Administrative staff costs increased by 7% as we invested in our headcount including a new Marketing Director, Finance Director and key hires for the Corporate team.

Looking ahead, the focus for next year is to further expand in the UK, increase brand awareness and business in the US, deliver operational efficiencies across production and become a B Corp certified company. All of which will help deliver a positive earnings before interest, tax, depreciation and amortisation (EBITDA) position for next year.

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

Financial KPIs

Unit

2024

2023

Turnover

£

11,139,034

10,403,042

Gross profit margin (excluding revenue charged for deliveries)

%

56

57

Gross profit margin

%

51

53

Operating loss

£

809,937

369,515

Loss before tax

£

975,284

498,219

Net (liabilities) / assets

£

(189,155)

896,525

Principal risks and uncertainties

The company's operations expose it to a variety of financial and commercial risks, the major ones being rising raw material costs, competition, international expansion and global and political uncertainties. A risk management policy has been established and the directors are closely involved in running the business and are proactive in identifying and responding to relevant risks:

Raw Material Costs:
The rising cost of ingredients and packaging could impact the company’s profit margins and lead to price increases on products which in turn, could reduce customer demand. The company aims to maintain strong relationships with suppliers, conduct regular pricing reviews and negotiate on key contract terms to remain cost efficient and to ensure the impact on customers is minimised.

Competition:
Increased competition or changes in customer preferences may reduce demand for the company’s products. The company maintains its market position in the luxury, personalised gifting sector and believe that our unique positioning and product offering gives us a competitive advantage in this sector.

 

Biscuiteer Baking Company Limited

Strategic Report for the Year Ended 30 April 2024

International Expansion:
Operating in new territories can be complex and costly. The plans to expand in the US will rely on our existing supply chain rather than opening a new manufacturing base overseas. We intend to keep marketing costs to a minimum and instead, leverage corporate and wholesale opportunities to increase brand awareness.

Global and political uncertainties:
A downturn in the macro-economy may change consumer behaviour and changes in government policy may increase costs such as minimum wage laws, taxation and other legislation.

Approved by the Board on 18 December 2024 and signed on its behalf by:


S C Congdon
Director

 

Biscuiteer Baking Company Limited

Directors' Report for the Year Ended 30 April 2024

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

Directors of the company

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

W R Barlow

S C Congdon

S H Hastings

E P Jackson (appointed 4 December 2023)

J H Kilpatrick

Misland Capital Limited

W J Kernan (resigned 9 May 2024)

The following director was appointed after the year end:

J T Jensen (appointed 29 July 2024)

Future developments

The focus for next year is to further expand in the UK, increase brand awareness and business in the US, deliver operational efficiencies across production and become a B Corp certified company. All of which will help deliver a positive EBITDA position for next year.

Financial instruments

Objectives and policies

The company’s financial statements comprise cash and liquid resources, and various other items such as trade debtors, trade creditors that arise directly from operations. The main purpose of these financial instruments is to finance the operations of the company. The main risks arising from the company financial instruments are set out below:

Price risk, credit risk and liquidity risk

Price risk:
Price risk is the risk that price changes will cause financial loss for the group. Through careful monitoring of the company’s marketplace and competitors the company’s exposure to price risk is kept to a minimum.

Credit risk:
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the group. The company's principal financial assets are bank balances, cash, trade and other debtors. The company's credit risk is primarily attributable to its trade receivables. The company's policies are aimed at minimising such losses through satisfactory credit worthiness procedures. The company runs credit checks on its customers on a regular basis. The limits are checked and monitored constantly to ensure that they are kept to terms.

Liquidity risk:
Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities. The company aims to mitigate liquidity risk by managing cash generation by its operations. The company constantly monitors the trading results to ensure that the company can meet its future obligations as they fall due.

Cash flow risk:
Cash flow risk is the risk that inflows and outflows of cash and cash equivalents will not be sufficient to finance the day-to-day operations of the company. Active management of working capital is the key control used by management to manage cash flow risk.

 

Biscuiteer Baking Company Limited

Directors' Report for the Year Ended 30 April 2024

Going concern

The directors have prepared forecasts for the period to 30 April 2027. The projections indicate that the company will be earnings before interest, tax, depreciation and amortisation (EBITDA) negative in 2025 and positive thereafter, but is expected to report an overall loss for the next two years. The forecasts assume that loans of £1 million that fall due for repayment in April 2025 (as noted in note 18 of these financial statements) will be refinanced on no less favourable terms than current arrangements and that additional funding will be secured (above that set out in note 27 of these financial statements) to fund losses in the short term. Failure to refinance and secure additional financing could render the company unable to settle its liabilities as and when they fall due, resulting in a material uncertainty around the company’s ability to continue as a going concern.

Directors' liabilities

The company maintained throughout the period, and at the date of approval of the financial statements, liability insurance for its directors and officers. This is a qualifying provision for the purposes of the Companies Act 2006.

Important non adjusting events after the financial period

In May 2024, the company secured a loan facility of £750,000, which attracts interest at a rate of 12%. The loan is repayable by April 2026.

In June 2024, the company secured a loan from a related party of £50,000. The loan attracts interest of 5% and is due to be repaid in January 2025.

In July 2024, the company raised £197,575 from A Ordinary shareholders under an Advanced Subscription Agreement. In September 2024, the company raised a further £89,800 from B Ordinary shareholders and a further £178,645 was raised from crowd funding in October 2024. A total of 208,547 A Ordinary shares and 103,788 B Investment shares with a nominal value of £0.0001 were issued in November 2024 in satisfaction for net amounts raised.

Disclosure of information to the auditors

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

Reappointment of auditors

In accordance with section 485 of the Companies Act 2006, a resolution for the re-appointment of Hazlewoods LLP as auditors of the company is to be proposed at the forthcoming Annual General Meeting.

Approved by the Board on 18 December 2024 and signed on its behalf by:


S C Congdon
Director

 

Biscuiteer Baking Company Limited

Statement of Directors' Responsibilities

The directors are responsible for preparing the Strategic Report, Director's 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 company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

select suitable accounting policies and apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards has 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 company's transactions and disclose with reasonable accuracy at any time the financial position of 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 company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

 

Biscuiteer Baking Company Limited

Independent Auditor's Report to the Members of Biscuiteer Baking Company Limited

Opinion

We have audited the financial statements of Biscuiteer Baking Company Limited (the 'company') for the year ended 30 April 2024, which comprise the Profit and Loss Account, Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, 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 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.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor responsibilities for the audit of the financial statements section of our report. We are independent of the company 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 related to going concern
We draw attention to note 2 of the financial statements which indicates that the company requires additional funding to ensure that it can meet its liabilities as they fall due. As stated in note 2, these events or conditions indicate that a material uncertainty exists that may cash significant doubt on the company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.

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.

Other matters
Comparative information in the financial statements is derived from the company's prior period financial statements which were unaudited.

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:

 

Biscuiteer Baking Company Limited

Independent Auditor's Report to the Members of Biscuiteer Baking Company Limited

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

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

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

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

Responsibilities of directors

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

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

Auditor’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 company’s industry and its control environment and reviewed the company’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 company 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 company’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 conducted in accordance with 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 judgements 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;

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.

 

Biscuiteer Baking Company Limited

Independent Auditor's Report to the Members of Biscuiteer Baking Company Limited

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





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

Staverton Court
Staverton
Cheltenham
GL51 0UX

18 December 2024

 

Biscuiteer Baking Company Limited

Profit and Loss Account for the Year Ended 30 April 2024

Note

2024
£

2023
£

Turnover

3

11,139,034

10,403,042

Cost of sales

 

(5,428,162)

(4,925,987)

Gross profit

 

5,710,872

5,477,055

Distribution costs

 

(2,158,987)

(1,824,326)

Administrative expenses

 

(4,361,822)

(4,006,503)

Exceptional expenses

5

-

(15,741)

Operating loss

4

(809,937)

(369,515)

Other interest receivable and similar income

6

2,848

1,653

Interest payable and similar expenses

7

(168,195)

(130,357)

Loss before tax

 

(975,284)

(498,219)

Tax on loss

11

(110,396)

116,690

Loss for the financial year

 

(1,085,680)

(381,529)

The above results were derived from continuing operations.

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

 

Biscuiteer Baking Company Limited

(Registration number: 06069955)
Balance Sheet as at 30 April 2024

Note

2024
£

(As restated)
2023
£

Fixed assets

 

Intangible assets

12

141,759

172,473

Tangible assets

13

1,783,905

2,071,003

 

1,925,664

2,243,476

Current assets

 

Stocks

14

598,164

505,444

Debtors

15

446,156

748,754

Cash at bank and in hand

 

132,813

229,935

 

1,177,133

1,484,133

Creditors: Amounts falling due within one year

17

(2,810,325)

(2,190,004)

Net current liabilities

 

(1,633,192)

(705,871)

Total assets less current liabilities

 

292,472

1,537,605

Creditors: Amounts falling due after more than one year

17

(175,914)

(335,367)

Provisions for liabilities

19

(305,713)

(305,713)

Net (liabilities)/assets

 

(189,155)

896,525

Capital and reserves

 

Called up share capital

1,408

1,408

Share premium reserve

23

1,849,775

1,849,775

Profit and loss account

23

(2,040,338)

(954,658)

Shareholders' (deficit)/funds

 

(189,155)

896,525

Approved and authorised by the Board on 18 December 2024 and signed on its behalf by:
 


S C Congdon
Director

 

Biscuiteer Baking Company Limited

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

Share capital
£

Share premium
£

Profit and loss account
£

Total
£

At 1 May 2023

1,408

1,849,775

(954,658)

896,525

Loss for the year

-

-

(1,085,680)

(1,085,680)

At 30 April 2024

1,408

1,849,775

(2,040,338)

(189,155)

Share capital
£

Share premium
£

Profit and loss account
£

Total
£

At 1 May 2022 (as restated)

1,408

1,849,775

(573,129)

1,278,054

Loss for the year

-

-

(381,529)

(381,529)

At 30 April 2023 (as restated)

1,408

1,849,775

(954,658)

896,525

 

Biscuiteer Baking Company Limited

Statement of Cash Flows for the Year Ended 30 April 2024

Note

2024
£

(As restated)
2023
£

Cash flows from operating activities

Loss for the year

 

(1,085,680)

(381,529)

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

4

522,265

512,571

Profit on disposal of tangible assets

(1,565)

-

Finance income

6

(2,848)

(1,653)

Finance costs

7

168,195

130,357

Income tax expense

11

110,396

(116,690)

 

(289,237)

143,056

Working capital adjustments

 

(Increase)/decrease in stocks

 

(92,720)

128,956

Decrease in trade debtors

 

157,770

71,021

Increase/(decrease) in trade creditors

 

285,596

(241,060)

Decrease in provisions

 

-

(33,938)

(Decrease)/increase in deferred income, including government grants

 

(82,481)

126,490

Cash generated from operations

 

(21,072)

194,525

Income taxes received/(paid)

 

34,432

(935)

Net cash flow from operating activities

 

13,360

193,590

Cash flows from investing activities

 

Interest received

 

2,848

1,653

Acquisitions of tangible assets

(131,828)

(9,262)

Proceeds from sale of tangible assets

 

6,670

-

Acquisition of intangible assets

 

(36,402)

(109,000)

Net cash flows from investing activities

 

(158,712)

(116,609)

Cash flows from financing activities

 

Interest paid

 

(149,399)

(130,357)

Proceeds from other borrowing draw downs

 

391,544

756,164

Repayment of bank and other borrowings

 

(16,055)

(688,597)

Payments to finance lease creditors

 

(177,860)

(189,127)

Net cash flows from financing activities

 

48,230

(251,917)

Net decrease in cash and cash equivalents

 

(97,122)

(174,936)

Cash and cash equivalents at 1 May

 

229,935

404,871

Cash and cash equivalents at 30 April

16

132,813

229,935

 

Biscuiteer Baking Company 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:
Unit 2 Greenlea Park
Prince George's Road
Colliers Wood
London
SW19 2JD

 

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.

Going concern

The directors have prepared forecasts for the period to 30 April 2027. The projections indicate that the company will be earnings before interest, tax, depreciation and amortisation (EBITDA) negative in 2025 and positive thereafter, but is expected to report an overall loss for the next two years. The forecasts assume that loans of £1 million that fall due for repayment in April 2025 (as noted in note 18 of these financial statements) will be refinanced on no less favourable terms than current arrangements and that additional funding will be secured (above that set out in note 27 of these financial statements) to fund losses in the short term. Failure to refinance and secure additional financing could render the company unable to settle its liabilities as and when they fall due, resulting in a material uncertainty around the company’s ability to continue as a going concern.

Prior period errors

A prior period adjustment of £287,651 has been recognised as a result of management reassessing their dilapidations provision. The adjustment increases the dilapidations provision from £18,062 to £305,713, and decreases the profit and loss reserves at 1 May 2022, as detailed in note 19 to these financial statements.

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.
 

 

Biscuiteer Baking Company Limited

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

Judgements

As stated in note 22 to the financial statements, the directors consider that charges arising in respect of share base payments are not material to the financial statements and no charge has therefore been recognised.

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

Key sources of estimation uncertainty

Management have estimated the provision of dilapidations on a lease by lease basis, which is based on the directors best estimate of the likely committed cash flows. The carrying amount is £305,713 (2023 - £305,713).

No other key sources of estimation uncertainty have been identified by management in preparing these financial statements other than those detailed in these accounting policies.

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 company’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts and after eliminating sales within the company.

The company 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 company's activities.

Loyalty points are issued when a customer makes a qualifying purchase. These points constitute a separate performance obligation providing a material right to a future discount. The total transaction price (sales price of goods) is allocated to the loyalty points and the goods sold based on their relative standalone selling prices, with the loyalty points standalone price based on the value of the points to the customer (adjusted for expected redemption rates). The amount allocated to loyalty points is deferred as a contract liability within accruals and deferred income. Revenue is recognised as the points are subsequently redeemed by the customer or the right to use such points expires.

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.

Tax

The tax expense for the period comprises current and deferred corporation 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 corporation tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates taxable income.

Deferred corporation tax is recognised on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements and on unused tax losses or tax credits in the company. 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.

 

Biscuiteer Baking Company Limited

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

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 over their estimated useful lives, as follows:

Asset class

Depreciation method and rate

Short leasehold property improvements

Straight line over the life of the lease

Plant and machinery

5 years straight line

Motor vehicles

25% reducing balance

Intangible assets

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

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

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

Trademarks

10 years straight line

Website development

4-5 years straight line

Cash and cash equivalents

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

Trade debtors

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

Trade debtors are recognised initially at the transaction price. All trade debtors are repayable within one year and hence are included at the undiscounted cost of cash expected to be received. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the debtors.

Stocks

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.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the company 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.

 

Biscuiteer Baking Company Limited

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

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 expenses.

Borrowings are classified as current liabilities unless the company 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 company has an obligation at the reporting date as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

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 company after deducting all of its liabilities. Where shares are issued, any component that creates a financial liability of the company 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.

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.

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.

 

Biscuiteer Baking Company Limited

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

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.

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.

Defined contribution pension obligation

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

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

 

3

Turnover

The analysis of the company's turnover for the year from continuing operations is as follows:

2024
£

2023
£

Sale of goods

11,139,034

10,403,042

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

2024
£

2023
£

UK

10,377,798

9,345,204

Rest of world

761,236

1,057,838

11,139,034

10,403,042

 

Biscuiteer Baking Company Limited

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

 

4

Operating loss

Arrived at after charging:

2024
£

2023
£

Depreciation expense

455,149

451,057

Amortisation expense (included in administrative expenses)

67,116

61,514

Foreign exchange losses

25

895

Operating lease expense - property

351,317

351,317

Operating lease expense - plant and machinery

3,368

2,023

Profit on disposal of property, plant and equipment

(1,565)

-

 

5

Exceptional items

2024
 £

2023
 £

Exceptional expenses

-

15,741

During the year ended 30 April 2023, the company incurred expenses on a premises which they were no longer occupying due to early termination of the lease. The directors consider the costs incurred to be non-recurring and were therefore disclosed as exceptional.

 

6

Other interest receivable and similar income

2024
£

2023
£

Interest on bank deposits

2,848

718

Other interest receivable

-

935

2,848

1,653

 

7

Interest payable and similar expenses

2024
£

2023
£

Interest on bank overdrafts and borrowings

5,833

-

Interest on obligations under finance leases and hire purchase contracts

20,891

28,446

Interest expense on other finance liabilities

141,471

101,911

168,195

130,357

 

8

Staff costs

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

2024
£

2023
£

Wages and salaries

5,359,179

4,730,785

Social security costs

480,826

272,484

Pension costs, defined contribution scheme

84,701

76,629

5,924,706

5,079,898

 

Biscuiteer Baking Company Limited

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

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

2024
No.

2023
No.

Sales

17

14

Production

152

138

Administration and support

42

38

211

190

 

9

Directors' remuneration

The directors' remuneration for the year was as follows:

2024
£

2023
£

Remuneration

266,461

295,439

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

2024
No.

2023
No.

Entitled to receive shares under long term incentive schemes

1

-

In respect of the highest paid director:

2024
£

2023
£

Remuneration

157,075

156,841

 

10

Auditors' remuneration

2024
£

2023
£

Audit of the financial statements

23,500

-


 

 

11

Taxation

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

2024
£

2023
£

Current taxation

UK corporation tax adjustment to prior periods

-

(31,717)

Deferred taxation

Arising from origination and reversal of timing differences

110,396

(84,973)

Tax expense/(receipt) in the income statement

110,396

(116,690)

 

Biscuiteer Baking Company Limited

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

The tax on loss 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%).

The differences are reconciled below:

2024
£

2023
£

Loss before tax

(975,284)

(498,219)

Corporation tax at standard rate

(243,821)

(97,119)

Adjustments to tax charge in respect of previous periods

-

(31,717)

Tax increase/(decrease) from effect of capital allowances and depreciation

1,103

(286)

Expenses not deductible for tax purposes

616

3,165

Deferred tax asset not recognised

352,200

35,682

Remeasurement of deferred tax for changes in tax rates

-

(26,577)

Other permanent differences

298

162

Total tax charge/(credit)

110,396

(116,690)

Deferred tax

Deferred tax assets and liabilities

2024

Asset
£

Difference between accumulated depreciation, amortisation and capital allowances

(241,096)

Short term timing differences

3,232

Losses and other deductions

237,864

-

2023

Asset
£

Difference between accumulated depreciation, amortisation and capital allowances

(306,386)

Short term timing differences

2,860

Losses and other deductions

413,922

110,396

As at 30 April 2024, there are £2.4m of unused tax losses (2023 - £nil) for which no deferred tax asset is recognised in the balance sheet, on the basis that it is unlikely that sustainable future tax profits will arise in the immediate future.

 

Biscuiteer Baking Company Limited

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

 

12

Intangible assets

Trademarks
£

Website development
 £

Total
£

Cost or valuation

At 1 May 2023

-

359,683

359,683

Additions

9,342

27,060

36,402

At 30 April 2024

9,342

386,743

396,085

Amortisation

At 1 May 2023

-

187,210

187,210

Amortisation charge

156

66,960

67,116

At 30 April 2024

156

254,170

254,326

Carrying amount

At 30 April 2024

9,186

132,573

141,759

At 30 April 2023

-

172,473

172,473

 

13

Tangible assets

Short leasehold property improvements
£

Plant and machinery
 £

Motor vehicles
 £

Total
£

Cost or valuation

At 1 May 2023

1,574,129

2,223,040

68,106

3,865,275

Additions

45,498

83,626

44,032

173,156

Disposals

-

(6,456)

(12,090)

(18,546)

At 30 April 2024

1,619,627

2,300,210

100,048

4,019,885

Depreciation

At 1 May 2023

422,973

1,335,816

35,483

1,794,272

Charge for the year

124,115

317,912

13,122

455,149

Eliminated on disposal

-

(3,503)

(9,938)

(13,441)

At 30 April 2024

547,088

1,650,225

38,667

2,235,980

Carrying amount

At 30 April 2024

1,072,539

649,985

61,381

1,783,905

At 30 April 2023

1,151,156

887,224

32,623

2,071,003

Assets held under finance leases

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

2024
£

2023
£

Plant and machinery

318,208

461,956

Motor vehicles

59,601

28,098

377,809

490,054

 

Biscuiteer Baking Company Limited

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

 

14

Stocks

2024
£

2023
£

Raw materials and consumables

598,164

505,444

 

15

Debtors

2024
£

2023
£

Trade debtors

77,300

42,429

Other debtors

198,288

206,137

Prepayments

169,319

203,319

Accrued income

1,249

152,041

Deferred tax assets

-

110,396

Corporation tax asset

-

34,432

446,156

748,754

 

16

Cash and cash equivalents

2024
£

2023
£

Cash at bank

132,813

229,935

 

17

Creditors

Note

2024
£

2023
£

Due within one year

 

Loans and borrowings

18

1,475,979

1,077,569

Trade creditors

 

547,248

442,973

Social security and other taxes

 

201,056

93,218

Outstanding defined contribution pension costs

 

17,284

15,022

Other payables

 

188,142

162,634

Accruals

 

202,702

138,193

Deferred income

 

177,914

260,395

 

2,810,325

2,190,004

Due after one year

 

Loans and borrowings

18

175,914

335,367

 

Biscuiteer Baking Company Limited

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

 

18

Loans and borrowings

Current loans and borrowings

2024
£

2023
£

Bank borrowings

10,140

9,890

Finance lease liabilities

188,815

176,035

Amounts due to related parties

100,000

-

Other borrowings

1,177,024

891,644

1,475,979

1,077,569

Non-current loans and borrowings

2024
£

2023
£

Bank borrowings

14,806

24,947

Finance lease liabilities

161,108

310,420

175,914

335,367


Bank borrowings
Bank borrowings comprises a Bounce Back loan of £50,000 which after 12 months from draw down attracts a fixed interest rate of 2.5%. The loan is repayable in 72 equal instalments of £887, with the final repayment due in August 2026. Bank borrowings are secured by way of a fixed and floating charge over the assets of the company. The charge was satisfied in full in March 2024.

Finance lease liabilities
Obligations under finance lease contracts are secured against the assets to which they relate.

Other borrowings
Other borrowings with a carrying value of £750,000 (2023 - £756,164), comprises a loan of £750,000, which attracts a fixed interest rate of 8%. The loan is repayable by April 2025.

Other borrowings with a carrying value of £250,000 (2023 - £nil), comprises a loan which was advanced during the year of £250,000, which attracts a fixed interest rate of 10%. The loan is repayable by April 2025.

Other borrowings with a carrying value of £177,024 (2023 - £135,480), comprises a trade facility which has a withdrawal limit of £200,000.

Amounts due to related parties
Amounts due to related parties with a carrying value of £100,000 (2023 - £nil), comprises a loan which was advanced during the year of £100,000, which attracts a fixed interest rate of 10%. The loan is repayable by December 2024.
 

 

19

Provisions

Dilapidations
£

At 1 May 2023 (as restated)

305,713

At 30 April 2024

305,713

A provision is recognised for expected dilapidations costs to be incurred to reinstate the leased buildings to their original state at the end of the lease period. The provision for dilapidations is management's best estimate of future cash outflows.

 

Biscuiteer Baking Company Limited

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

A prior period adjustment of £287,651 has been recognised as a result of management reassessing their dilapidations provision. The adjustment increases the dilapidations provision from £18,062 to £305,713, and decreases the profit and loss reserves at 1 May 2022.

 

20

Pension and other schemes

Defined contribution pension scheme

The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £84,701 (2023 - £76,629).

Contributions totalling £17,284 (2023 - £15,022) 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.

£

A Ordinary shares of £0.0001 each

12,880,940

1,288

12,880,940

1,288

B Investment shares of £0.0001 each

498,017

50

498,017

50

G shares of £0.0001 each

706,038

71

706,038

71

14,084,995

1,408

14,084,995

1,408

Rights, preferences and restrictions

All shares rank equally in terms of rights to take part in approved dividend distributions and right to participate in any distribution of capital on the winding up of the company. A Ordinary shares and G shares rank equally in terms of voting rights with each share being entitled to one vote. B Investment shares have no voting rights.

 

22

Share-based payments

The company operates an equity settled share options scheme to a number of employees. These employees are entitled to exercise the share options when specific events have occurred as set out in the rules of the scheme. The exercise price ranges from £0.08 to £1.14 per share option and is considered to be consistent with the fair value at the grant date of the option. As such, the directors consider that charges arising in respect of share base payments are not material to the financial statements and no charge has therefore been recognised.

The movements in the number of share options during the year were as follows:

2024
Number

2023
Number

Outstanding, start of year

509,000

355,000

Granted during the year

345,113

179,000

Forfeited during the year

(195,000)

(25,000)

Exercised during the year

-

-

Outstanding, end of year

659,113

509,000

 

Biscuiteer Baking Company Limited

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

 

23

Reserves

Called up share capital
Represents the issued equity share capital of the company.

Share premium account
The share premium account includes the premium on issue of equity shares, net of any issue costs.

Profit and loss account
Profit and loss account represents cumulative profits or losses net of dividends paid and other adjustments.

 

24

Obligations under leases

Finance leases

The total of future minimum lease payments is as follows:

2024
£

2023
£

Not later than one year

202,584

196,014

Later than one year and not later than five years

168,634

306,853

371,218

502,867

Operating leases

The total of future minimum lease payments is as follows:

2024
£

2023
£

Not later than one year

249,505

293,836

Later than one year and not later than five years

849,794

869,708

Later than five years

2,953,500

1,148,125

4,052,799

2,311,669

The amount of non-cancellable operating lease payments recognised as an expense during the year was £354,685 (2023 - £353,340).

 

25

Financial instruments

Items of income, expense, gains or losses

2024

Income
£

Expense
£

Net gains
£

Net losses
£

Financial liabilities measured at amortised cost

-

141,471

-

-

2023

Income
£

Expense
£

Net gains
£

Net losses
£

Financial liabilities measured at amortised cost

-

101,911

-

-

The total interest income for financial assets not measured at fair value through profit or loss is £2,848 (2023 - £1,653). The total interest expense for financial liabilities not measured at fair value through profit or loss is £162,362 (2023 - £130,357).

 

Biscuiteer Baking Company Limited

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

 

26

Analysis of changes in net debt

At 1 May 2023
£

Cash flows
£

At 30 April 2024
£

Cash and cash equivalents

Cash

229,935

(97,122)

132,813

Borrowings

Bank borrowings

(34,837)

9,890

(24,947)

Other borrowings

(891,644)

(385,379)

(1,277,023)

Finance lease liabilities

(486,455)

136,532

(349,923)

(1,412,936)

(238,957)

(1,651,893)

 

(1,183,001)

(336,079)

(1,519,080)

 

27

Non adjusting events after the financial period

In May 2024, the company secured a loan facility of £750,000, which attracts interest at a rate of 12%. The loan is repayable by April 2026.

In June 2024, the company secured a loan from a related party of £50,000. The loan attracts interest of 5% and is due to be repaid in January 2025.

In July 2024, the company raised £197,575 from A Ordinary shareholders under an Advanced Subscription Agreement. In September 2024, the company raised a further £89,800 from B Ordinary shareholders and a further £178,645 was raised from crowd funding in October 2024. A total of 208,547 A Ordinary shares and 103,788 B Investment shares with a nominal value of £0.0001 were issued in November 2024 in satisfaction for net amounts raised.

 

28

Parent and ultimate parent undertaking

The ultimate controlling party is S C Congdon and S H Hastings, by virtue of their shareholding.