Company registration number 08898301 (England and Wales)
HAIR BURST LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024
HAIR BURST LIMITED
COMPANY INFORMATION
Directors
H R Gwilliam
J P Hill
Company number
08898301
Registered office
Spaces
7 Park Row
Leeds
LS1 5HD
Auditor
Hart Shaw LLP
Europa Link
Sheffield Business Park
Sheffield
S9 1XU
HAIR BURST LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Notes to the financial statements
11 - 24
HAIR BURST LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JANUARY 2024
- 1 -

The directors present the strategic report for the year ended 31 January 2024.

Principal activities

The principal activity of the company continued to be that of the production and sale of hair vitamins and hair products.

Review of the business

Overview

During the financial year, our company navigated several significant changes, resulting in change of ERP system, and key personnel transitions.

 

These changes have presented both opportunities and challenges which we have managed with a focus on maintaining operational stability and driving future growth – which included entering new markets.

 

Year on year growth of topline Revenue (9% vs prior year), and significant improvement in operating profit for the same period (up £1.8m) highlights the strength and vigour of the brand.

 

ERP System change

The implementation of a new ERP system was delayed for several months, creating significant challenges and disruptions to our workflow.  We employed an external agency to manage the process of capturing all data in the new ERP system by going back to source for all transactions from the start of the year.  The new ERP is now fully operational. Much improved accuracy with timely bookkeeping and has enhanced our data management capabilities. While still a bit to do as we move into FY25, this has given us the foundation to streamline processes, improve reporting and provided better insights for decision-making.

 

Future Outlook

Looking ahead, we are confident that the changes implemented this year will position us for sustainable growth. Improved systems and processes, and a strengthened leadership team provide a solid foundation for achieving our strategic objectives as we look forward. We remain committed to continuous improvement and innovation, ensuring that we can adapt to future challenges and opportunities.

 

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

2024
2023
£
£
Turnover
16,327,104
14,983,955
Gross profit %
72.50%
65.11%
Operating (loss) / profit
667,143
(1,198,967)
Operating (loss) /profit %
4.09%
(8.00)%
Principal risks and uncertainties

Any business undertaking will involve some risk with many risk factors common to any business regardless of what sector it operates in. However, the Directors consider that certain risks and uncertainties are more specific to the Company and the retail sector in which it operates. These risks and uncertainties include the following:

 

 

The Directors continue to endeavour to manage these risks and uncertainties to the extent possible within the business.

HAIR BURST LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 2 -
Promoting the success of the company

This statement sets out how the Directors have approached and met their responsibilities under section 172 Companies Act 2006 and, in particular, how the Directors have satisfied themselves that they have acted in a way which is most likely to promote the success of the Company for the benefit of its members as a whole and having regard for stakeholders interests.

 

As such, the Directors have considered (amongst other things) the likely consequences of any decision in the long term. The Directors give significant consideration via the assessment of various board papers to the likely long term impact to the Company of any decisions made. It is the Directors' ultimate objective to deliver long term sustainable earnings growth.

 

Furthermore, the Directors have considered:

 

 

On behalf of the board

H R Gwilliam
Director
31 January 2025
HAIR BURST LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JANUARY 2024
- 3 -

The directors present their annual report and financial statements for the year ended 31 January 2024.

Results and dividends

The results for the year are set out on page 8.

Ordinary dividends were paid amounting to £1,571,308. The directors do not recommend payment of a final dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

H R Gwilliam
J P Hill
R Schultz
(Resigned 24 July 2023)
N Greenhalgh
(Resigned 24 July 2023)
Auditor

The auditor, Hart Shaw LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

On behalf of the board
H R Gwilliam
Director
31 January 2025
HAIR BURST LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 JANUARY 2024
- 4 -

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

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.

HAIR BURST LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HAIR BURST LIMITED
- 5 -
Opinion

We have audited the financial statements of Hair Burst Limited (the 'company') for the year ended 31 January 2024 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including 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:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the 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.

Conclusions relating to going concern

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

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. 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. 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 course of 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.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

HAIR BURST LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HAIR BURST LIMITED
- 6 -
Matters on which we are required to report by exception

In the light of the 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 or the directors' report.

 

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

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, 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 considered capable of detecting irregularities, including fraud and the audit response

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:

At the planning stage we identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience and through discussion with the directors and other management, as required by auditing standards. The potential effect of any laws and regulation on the financial statements can vary considerably. There are laws and regulations that directly affect the financial statements (e.g. the Companies Act) as well as many other operational laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements. Owing to the size, nature and complexity of the organisation and the applicable laws and regulations to which it must adhere, the risk of material misstatement was deemed to be low, therefore the procedures performed by the audit team were limited to:

 

HAIR BURST LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HAIR BURST LIMITED
- 7 -

We have assessed the overall susceptibility of the financial statements to material misstatement due to fraud. Management override is the most likely way in which fraud might present itself and as such is inherently high risk on any audit. Management override, which may cause there to be a material misstatement within the financial statements, may present itself in a number of ways, for example:

 

In order to reduce the risk of material misstatement to an acceptable level, numerous audit procedures were performed including:

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected material misstatements in the financial statements, even though we have performed our audit in accordance with auditing standards. Furthermore, as with all audits, there is a higher risk of irregularities (especially those relating to fraud) being undetected, as these may involve the override of internal controls, collusion, intentional omissions and misrepresentations etc. We are not responsible for preventing non-compliance or fraud and therefore cannot be expected to detect all instances of such. Our audit was not designed to identify misstatements or other irregularities that would not be considered to be material to the financial statements. The further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it.

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

Use of our report

This report is made solely to the 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.

Adam Shield
Senior Statutory Auditor
For and on behalf of Hart Shaw LLP
31 January 2025
Chartered Accountants
Statutory Auditor
Europa Link
Sheffield Business Park
Sheffield
S9 1XU
HAIR BURST LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JANUARY 2024
- 8 -
2024
2023
as restated
Notes
£
£
Turnover
3
16,327,104
14,983,955
Cost of sales
(4,489,837)
(5,227,417)
Gross profit
11,837,267
9,756,538
Distribution costs
(4,015,107)
(3,534,676)
Administrative expenses
(7,326,088)
(7,175,134)
Other operating income
-
0
120,000
Exceptional item
4
-
0
(365,695)
Exceptional item
4
171,071
-
0
Operating profit/(loss)
5
667,143
(1,198,967)
Interest receivable and similar income
9
-
0
2,284
Profit/(loss) before taxation
667,143
(1,196,683)
Tax on profit/(loss)
10
(128,218)
110,021
Profit/(loss) for the financial year
538,925
(1,086,662)

The profit and loss account has been prepared on the basis that all operations are continuing operations.

 

Prior period amounts have been reclassified for consistency with the current period presentation. A presentational adjustment was made reclassifying £630,964 as distribution costs which were previously classified as administrative expenses. The presentational change was made to better reflect the nature of the transactions.

HAIR BURST LIMITED
BALANCE SHEET
AS AT 31 JANUARY 2024
31 January 2024
- 9 -
31 January 2024
29 January 2023
Notes
£
£
£
£
Fixed assets
Tangible assets
12
27,489
24,753
Current assets
Stocks
13
2,368,748
4,068,211
Debtors
14
2,451,610
3,461,330
Cash at bank and in hand
410,101
237,741
5,230,459
7,767,282
Creditors: amounts falling due within one year
15
(2,674,890)
(3,108,071)
Net current assets
2,555,569
4,659,211
Total assets less current liabilities
2,583,058
4,683,964
Provisions for liabilities
Deferred tax liability
16
5,900
-
0
(5,900)
-
Net assets
2,577,158
4,683,964
Capital and reserves
Called up share capital
18
17
17
Profit and loss reserves
2,577,141
4,683,947
Total equity
2,577,158
4,683,964
The financial statements were approved by the board of directors and authorised for issue on 31 January 2025 and are signed on its behalf by:
H R Gwilliam
Director
Company registration number 08898301 (England and Wales)
HAIR BURST LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2024
- 10 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 30 January 2022
17
5,770,609
5,770,626
Year ended 29 January 2023:
Loss and total comprehensive income
-
(1,086,662)
(1,086,662)
Balance at 29 January 2023
17
4,683,947
4,683,964
Year ended 31 January 2024:
Profit and total comprehensive income
-
538,925
538,925
Dividends
11
-
(1,571,308)
(1,571,308)
Deemed distributions to parent due to group loan balance not being recoverable
11
-
(1,074,423)
(1,074,423)
Balance at 31 January 2024
17
2,577,141
2,577,158
HAIR BURST LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024
- 11 -
1
Accounting policies
Company information

Hair Burst Limited is a private company, limited by shares and incorporated in England and Wales. The registered office is Spaces, 7 Park Row, Leeds, LS1 5HD.

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.

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.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

 

 

The financial statements of the company are consolidated in the financial statements of HB Holdco Limited. These consolidated financial statements are available from its registered office, Spaces, 7 Park Row, Leeds, LS1 5HD.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future.

 

In making this assessment the directors have considered, amongst other things, the recent and projected trading performance. The results for the period to 31 January 2025 are expected to show a trading loss due to stock constraints restricting sales, however the company is forecast to return long term profitable results in the periods following. Over the next 12 months it is expected that there will be several points of short term cash constraints if the company does not open a facility with a lender.

 

The directors are confident in the company's ability to secure future funding, should this be required to satisfy short term cash flow requirements, whether this be external borrowing requiring personal guarantees by the directors, or funding provided personally by the directors.

Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

 

 

 

 

 

 

 

 

 

HAIR BURST LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 12 -
1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.4
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Fixtures and fittings
5 years straight line
Computers
3 years straight line

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

1.5
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

1.6
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.7
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.

HAIR BURST LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 13 -
1.8
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.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

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.

HAIR BURST LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 14 -
Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, 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.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.9
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

1.10
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 profit and loss account 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.

HAIR BURST LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 15 -
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 profit and loss account, 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.

1.11
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.12
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.13
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

2
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 amount 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 where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

HAIR BURST LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
2
Judgements and key sources of estimation uncertainty
(Continued)
- 16 -
Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Provision to write stocks down to net realiseable value

The company makes provisions for obsolete stock based on management estimates of sales volumes and the sell by date of products. The company's estimate of the provision required is included in note 13. Actual outcomes could vary significantly from these estimates.

3
Turnover and other revenue

An analysis of the company's turnover is as follows:

2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
8,246,048
8,020,702
Europe
6,819,238
5,150,551
Rest of World
1,261,818
1,812,702
16,327,104
14,983,955
2024
2023
£
£
Other revenue
Interest income
-
2,284
Management charges
-
0
120,000
4
Exceptional items
2024
2023
£
£
Expenditure
Impairment of trade debtor
-
365,695
Group loan release
(171,071)
-
(171,071)
365,695

Following the change in ownership during the period, amounts owed to certain former group companies were released to the statement of comprehensive income as these were no longer payable.

HAIR BURST LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 17 -
5
Operating profit/(loss)
2024
2023
Operating profit/(loss) for the year is stated after charging:
£
£
Exchange losses
30,812
52,791
Depreciation of owned tangible fixed assets
17,318
39,097
(Profit)/loss on disposal of tangible fixed assets
-
40,503
Operating lease charges
54,052
64,860
6
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
19,500
18,550
For other services
All other non-audit services
6,000
5,200
7
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2024
2023
Number
Number
Selling, distribution and administrative
33
34

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
1,465,879
2,127,371
Social security costs
158,221
183,955
Pension costs
25,533
25,491
1,649,633
2,336,817
8
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
120,000
240,000
HAIR BURST LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
8
Directors' remuneration
(Continued)
- 18 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
n/a
135,000

As total directors' remuneration was less than £200,000 in the current year, no disclosure is provided for that year.

9
Interest receivable and similar income
2024
2023
£
£
Interest income
Other interest income
-
0
2,284
10
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
48,351
-
0
Adjustments in respect of prior periods
(140,533)
123,413
Total current tax
(92,182)
123,413
Deferred tax
Origination and reversal of timing differences
112,000
(233,434)
Adjustment in respect of prior periods
108,400
-
0
Total deferred tax
220,400
(233,434)
Total tax charge/(credit)
128,218
(110,021)
HAIR BURST LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
10
Taxation
(Continued)
- 19 -

The actual charge/(credit) for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:

2024
2023
£
£
Profit/(loss) before taxation
667,143
(1,196,683)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 24.03% (2023: 19.00%)
160,314
(227,370)
Tax effect of expenses that are not deductible in determining taxable profit
37
955
Adjustments in respect of prior years
(140,533)
123,413
Permanent capital allowances in excess of depreciation
-
0
(3,938)
Deferred tax adjustments in respect of prior years
108,400
(3,081)
Taxation charge/(credit) for the year
128,218
(110,021)
11
Dividends and distributions
2024
2023
£
£
Dividends
Interim paid
1,571,308
-
0
Other distributions
Deemed distributions to parent due to group loan balance not being recoverable*
1,074,423
-
0
*During the year the ultimate parent of the company changed, after the change in ownership the directors have assessed the group balance with the company's parent company, Hairburst Holding Group Limited, as no longer recoverable. To show a true and fair view the write off of this balance has been represented as a distibribution.
HAIR BURST LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 20 -
12
Tangible fixed assets
Fixtures and fittings
Computers
Total
£
£
£
Cost
At 30 January 2023
11,437
66,821
78,258
Additions
-
0
20,054
20,054
At 31 January 2024
11,437
86,875
98,312
Depreciation and impairment
At 30 January 2023
6,350
47,155
53,505
Depreciation charged in the year
2,880
14,438
17,318
At 31 January 2024
9,230
61,593
70,823
Carrying amount
At 31 January 2024
2,207
25,282
27,489
At 29 January 2023
5,087
19,666
24,753
13
Stocks
2024
2023
£
£
Finished goods and goods for resale
2,368,748
4,068,211

Included in cost of stocks is a provision of £322,409 (2023: £814,933)

14
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
1,575,339
1,575,158
Corporation tax recoverable
385,130
211,792
Amounts owed by group undertakings
203,492
1,085,744
Other debtors
176,641
129,034
Prepayments and accrued income
111,008
245,102
2,451,610
3,246,830
2024
2023
Amounts falling due after more than one year:
£
£
Deferred tax asset (note 16)
-
0
214,500
Total debtors
2,451,610
3,461,330
HAIR BURST LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
14
Debtors
(Continued)
- 21 -

Amounts owed by group undertakings are unsecured, interest free and have no set payment terms.

15
Creditors: amounts falling due within one year
2024
2023
£
£
Trade creditors
857,720
826,081
Amounts owed to group undertakings
64,068
616,393
Taxation and social security
737,127
342,190
Other creditors
98,237
248,214
Accruals and deferred income
917,738
1,075,193
2,674,890
3,108,071

Amounts owed to group undertakings are unsecured, interest free and have no set payment terms.

16
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
Assets
Assets
2024
2023
2024
2023
Balances:
£
£
£
£
Accelerated capital allowances
5,900
-
-
(4,700)
Tax losses
-
-
-
219,200
5,900
-
-
214,500
2024
Movements in the year:
£
Asset at 30 January 2023
(214,500)
Charge to profit or loss
220,400
Liability at 31 January 2024
5,900

The deferred tax liability set out above is expected to reverse within 12 months and relates to accelerated capital allowances that are expected to mature within the same period.

HAIR BURST LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 22 -
17
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
25,533
25,491

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

18
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
12
12
12
12
Ordinary B shares of £1 each
2
2
2
2
Ordinary C shares of £1 each
1
1
1
1
Ordinary D shares of £1 each
1
1
1
1
Ordinary E shares of £1 each
1
1
1
1
17
17
17
17

No amendments to shares have been made in the period. All shares have rights to dividends but only the ordinary shares carry voting rights and the right to surplus capital on winding up. Shares rank pari passu in all other respects. All shares are fully paid up.

19
Operating lease commitments

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2024
2023
£
£
Within one year
-
0
54,052
20
Related party transactions

From 24 July 2023, the company's ultimate parent company was HB Holdco Limited. Prior to this date, the company was 75% owned by JD Sports Fashion Plc. During this entire period the company continued to be a wholly owned subsidiary of Hair Burst Holding Group Limited.

 

As a wholly owned subsidiary undertaking of Hair Burst Holding Group Limited, the company has taken advantage of the exemption in FRS 102 “Related party disclosures” not to disclose transactions with fellow group companies.

 

During the year the company entered into the following transactions with related parties:

HAIR BURST LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
20
Related party transactions
(Continued)
- 23 -
Purchase of employee services
Loan repayments
2024
2023
2024
2023
£
£
£
£
Entities with control, joint control or significant influence over the company
-
-
350,000
-
Other related parties
54,013
176,473
-
-
2024
2023
Amounts due to related parties
£
£
Entities with control, joint control or significant influence over the company
-
0
360,528
Other related parties
-
147,273

Amounts owed are all unsecured, interest free and have no set payment terms. During the year the decision was made to impair an amount owed by a company under the control of one of the directors amounting to £78,374.

The following amounts were outstanding at the reporting end date:

2024
2023
Amounts due from related parties
£
£
Companies under common control
8,716
-
Other related parties
-
73,334

Amounts owed are all unsecured, interest free and have no set payment terms. During the year the decision was made to impair an amount owed by a company under the control of one of the directors amounting to £78,374.

21
Directors' transactions

Interest free loans have been granted by the company to its directors as follows:

Description
% Rate
Opening balance
Amounts advanced
Closing balance
£
£
£
Directors' loans
-
15,816
1,500
17,316
15,816
1,500
17,316
HAIR BURST LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 24 -
22
Parent company & ultimate controlling party

Parent company

The company is a subsidiary undertaking of Hairburst Holding Group Limited, which is a subsidiary of HB Holdco Limited. HB Holdco Limited is registered in England. Copies of the consolidated financial statements of HB Holdco Limited are available to the public and can be obtained from the Company Secretary, C/O Pm+M New Century House, Greenbank Technology Park, Challenge Way, Blackburn, Lancashire, BB1 5QB.

 

Ultimate controlling party

The ultimate parent is HB Holdco Limited (a company registered in England). J Hill is considered the ultimate controlling party by virtue of their shareholding of HB Holdco Limited and Hairburst Holding Group Limited.

 

Consolidated financial statements will be prepared by HB Holdco Limited, which is the parent undertaking of the smallest and largest group of undertakings to consolidate these financial statements for the year ended 31 January 2024. The consolidated financial statements of HB Holdco Limited can be obtained from its registered office of C/O Pm+M New Century House, Greenbank Technology Park, Challenge Way, Blackburn, Lancashire, BB1 5QB.

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