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Registered number: 13368037










Heathcote Holdings Limited










Annual report and financial statements

For the year ended 30 April 2024

 
Heathcote Holdings Limited
 

Company Information


Directors
T L Heathcote 
M L Heathcote 




Registered number
13368037



Registered office
Stanford Bridge Farm
Pluckley

Ashford

Kent

TN27 0RU




Independent auditor
Kreston Reeves LLP
Statutory Auditor & Chartered Accountants

37 St Margaret's Street

Canterbury

Kent

CT1 2TU





 
Heathcote Holdings Limited
 

Contents



Page
Group strategic report
 
1 - 5
Directors' report
 
6 - 8
Independent auditor's report
 
9 - 13
Consolidated statement of comprehensive income
 
14
Consolidated balance sheet
 
15 - 16
Company balance sheet
 
16
Consolidated statement of changes in equity
 
17
Company statement of changes in equity
 
18
Consolidated statement of cash flows
 
19 - 20
Notes to the financial statements
 
21 - 51


 
Heathcote Holdings Limited
 

Group strategic report
For the year ended 30 April 2024

Introduction
 
The results presented are for the third trading year since the formation of the new Group structure.
The Group achieved customers and operation gains as a result of using a Group approach in areas where it is deemed constructive.  
At the same time the Group empowered decision making at the entity level, subject to the need to ensure risks are understood and managed to Group satisfaction.

Business review
 
During the year the Group showed a significant increase in turnover mainly arising from waste management services, acquisition of further waste sites and plant hire acquisitions. 
Accordingly operating revenue increased from £136.3mn to £164.0mn.
The Group invested a further £29.3mn during the year on assets across all activities ensuring replacement of aging equipment and adoption of the latest environmental protection technology to reduce carbon emission impact.

Principal risks and uncertainties
 
The daily management of the businesses and the execution of the strategies are subject to several risks. The predominate business risks affecting the Companies are:
Staff
Availability generally is causing concern and attention is focused on ensuring effective People Management by engaging with employees regularly including providing support as required, aiding retention of skilled personnel. To assist a dedicated Group Human Resources Director has been appointed looking after the People Assets of the businesses.
Operating Costs
Increases caused by inflationary pressures particularly with regards materials used for maintenance of property
& machinery and fuel given predominately providing road transport services. These are being closely monitored and mitigated where possible rather than simply passed on to customers unless unavoidable.
Equipment
The supply of new equipment to keep up with the CAPEX replacement program when existing needs maintaining more regularly, and lead times are being extended. Early communication with key suppliers of future requirements are being carried out endeavouring to mitigate potential delays.
Liquidity Risk
Regular increasing interest rates when funding expansion by borrowing is under close review, where possible, this continues to be minimised whilst ensuring the Group has sufficient resources to meet the working capital needs of the business. A revolving credit facility setup during the year and invoice financing facilities are used to accommodate seasonal fluctuations and provide flexibility plus fund future growth opportunities. 
 
Page 1

 
Heathcote Holdings Limited
 

Group strategic report (continued)
For the year ended 30 April 2024

Credit Risk
The majority of the customers who wish to trade on credit terms are subject to regular credit verification procedures and must trade within the credit limit allowance granted to their account which will be inextricably linked to their credit rating provided by outsourced specialist industry rating services. Credit account customers will not be allowed to place further orders for goods and services which will exceed their approved rating. Prepayment is required from customers requiring services ahead of a trade account being approved.
Trade debtors are reviewed on a weekly basis and provision is made for doubtful debts where considered necessary. In the case where debtors cannot settle their account within the agreed terms, an orderly installment payment plan is established to provide a certain and regular balance reduction; during this period, no further business will be placed on the account.
Legislative risk
Environmental standards in the UK continue to improve and the group is committed to being at the forefront of legislation led change. Any such change is viewed as positive and swiftly adopted across the companies.
Health and safety
The group is fully committed to the health and safety of all staff and any visitors of company sites. Across the companies regular meetings and inspections take place as a result of recommendations continuous investment the latest equipment and training takes place.

Financial position
 
The financial position of the companies is considered to be strong by the Directors and is in line with their expectations. The  strength of  the  companies is  improving further throughout the  coming period although challenging weather conditions during the summer period affected some operations. Positive consistent cash generation continues which contributes to reinvestment in staff and assets.

Financial key performance indicators
 
The Directors consider operating profit to be the key measure of performance of the business. During the year the companies generated a combined operating profit of £23.15mn (£18.5mn, excluding fair value movements) (2023: £10.13mn) and a further strengthening of the balance sheet by £11.7mn.
Post year end events 
The group will begin replacing a variety of ERP systems during 2024 with a new cloud-based product. This will further enhance financial controls, enabling greater understanding of operational performance utilising real time data captured and supporting reporting regularly to senior management and stakeholders. The benefit being the ability to further improve financial performance by timely decision making. 

Page 2

 
Heathcote Holdings Limited
 

Group strategic report (continued)
For the year ended 30 April 2024

Directors' statement of compliance with duty to promote the success of the Group
 
The directors of the company must act in the way they consider, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole. In doing so they must have regard to the matters set out in the Companies Act 2006, section 172(1) and a company must include a statement in its strategic report describing how the directors have had regard to the matters set out in this section. These matters along with an explanation of how the directors have had regard to them are summarised below as the company’s section 172(1) statement:
(a) The likely consequences of any decision in the long term
Boards of  large companies invariably delegate day-to-day management and decision-making to  executive management. Directors should maintain oversight of a company’s performance and ensure that management is acting in accordance with the strategy and plans agreed by a board and its delegated authorities. The culture, values and standards that underpin this delegation should help ensure that when decisions are made their wider impact has been considered. A board should also reserve certain matters for its own consideration so that it can exercise judgemental directly when making major decisions, and in doing so promote the success of the company whilst having regard to all necessary matters. A board needs assurance that a company’s financial reporting, risk management, governance and internal control processes, including policies mandating procedural requirements and standards, are operating effectively.
Overview of how the Board discharges its duties:
The strategy and governance of the company is set at Board meetings held regularly throughout the year. The strategy agreed forms the basis of the budget for the forthcoming year as well as informing the capital and investment plans for the period.
The  financial  performance  of  the  company  is  reviewed  by  management  account  information.  These management accounts are prepared monthly and provided to the directors on a timely basis by the Finance Directors along with detailed commentary.
The Board is mindful of the risks the Company faces when making its strategic decisions. As well as the general risks facing every company in terms of the general economy, the directors have agreed that the main risks facing the Company are:
 
Current macro-economic factors such as rapidly rising inflation.
Reliability of the supply of goods/services especially vehicles, plant & equipment and fuel.
Lack of succession in key managerial staff further hindered by a shortage of available workers generally.
The ability of larger companies to compete aggressively on price for new business.
The costs of compliance in highly regulated industries.
IT systems required within a growing group and adoption of latest technology to access new markets. 

The company’s strategy has been to limit these risks as far as practicable across the group.
(b) The interests of the company’s employees
Employees are central to the long-term success of a company, as such, a board should consider their interests, and, to assist in doing so, have means of engaging with and understanding their views. 
 
Page 3

 
Heathcote Holdings Limited
 

Group strategic report (continued)
For the year ended 30 April 2024


Overview of how the Board performed its duties: 
The directors are fortunate that they have regular contact with all employees, not just managers across the group. Directors regularly attend operational sites and are available to discuss issues with staff members. Various media platforms are used to keep employees informed with any company news and other relevant guidance.
We value the feedback from our employees, and regular contact with Union representatives takes place where relevant.
Previously, the company’s have undertaken employee surveys, and this is a method of engagement that will be employed again in the future. Managers have update meetings with their staff on a regular basis.
The directors have a responsibility of overseeing how the group deals with employees that fall short of our required standards. At least one member of a senior management team will be involved in any disciplinary procedures.
The group has a continuous review program for its Employee Handbooks especially the sections on ethics, standards and grievances. These policies are reviewed regularly to ensure their effectiveness.
(c) The need to foster the company’s business relationships with suppliers, customers and others.
Fostering business relationships with key stakeholders, such as customers and suppliers, is important to a company’s success. A board should have visibility of these relationships so that it is able to take stakeholder considerations into account when making decisions.
Overview of how the Board performed its duties: Suppliers
The company has regular meetings with key suppliers such as our main vehicle and plant & machinery dealerships as part of ongoing repairs & maintenance arrangements in place with these companies. We also have regular contact with many of our smaller suppliers and can be flexible with our invoice payment policy. Wherever possible, the company likes to engage with local suppliers.
Customers
The company has contractual obligations with its main local authority customers to report and meet with the appointed local authority representatives on a minimum monthly basis. This regular reporting and meeting arrangements also apply to what the company classifies as its key corporate and off-take customers.  Other customer complaints are reviewed by at least one director and responded to as quickly as possible. Feedback is used to improve our service to all customers.
(d) The impact of the company’s operations on the community and the environment
In their decision-making, directors need to have regard to the impact of a company’s operations on the community and environment. 
 
Page 4

 
Heathcote Holdings Limited
 

Group strategic report (continued)
For the year ended 30 April 2024


Overview of how the Board performed its duties:
All the company’s have an important social responsibility to both their local community and the wider environment. The directors take this responsibility seriously and are mindful of it when making decisions.
Furthermore, the company has a contractual commitment to assist its local authority customers in meeting their obligations under the Public Services (Social Value) Act 2012 and it is fully committed to delivering social value under these contracts and more widely to the communities in which many of its staff and customers live.
The company’s activities have an obvious impact on the environment and we are committed to operating our recycling processes strictly in accordance with our environmental permits and all other consents issued pursuant to regulations that control the way we undertake our business. The company is committed to investing in new cleaner technology and is looking to introduce fully electric mobile plant at some of its operating sites during the course of the coming financial year.
(e) The desirability of the company maintaining a reputation for high standards of business contact 
Culture, values and standards underpin how a company creates and sustains value over the longer term and are key elements of how it maintains a reputation for high standards of business conduct. They also guide and assist in decision making and thereby help promote a company’s success, recognising, amongst other things, the likely consequences of any decision in the long term and wider stakeholder considerations. The standards set by a board mandate certain requirements and behaviours with regards to the activities of its directors, employees and others associated with it.
Overview of how the Board discharged its duties
The Board helps to shape the values and culture of the group through our engagement with all stakeholders, including employees, customers and regulators. Key to the company’s identify is that it is family-owned. The long-term success of the company is derived from its relationships with its employees and its customers.
(f) The need to act fairly between members of the company 
A board should communicate effectively with its shareholders and understand their views, and also act fairly as between different members.
Overview of how the Board discharged its duties
The company presides over a large group of individual companies and still remains ultimately family owned. Members of the family are directors of the company and attend Board and management meetings on a regular basis. They take an active role in the day-to-day running of all the companies.
Accordingly, the Board of Directors of the company consider, both individually and together, that they have acted in the way they consider would be for the benefits of its members as a whole, in the decisions they have made in the year ended 30th April 2024.
 


This report was approved by the board on 31 January 2025 and signed on its behalf.



T L Heathcote
Director

Page 5

 
Heathcote Holdings 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' responsibilities statement

The directors are responsible for preparing the Group strategic report, the Directors' report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period.

 In preparing these financial statements, the directors are required to:


select suitable accounting policies for the Group's financial statements and then apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group 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 the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Results and dividends

The profit for the year, after taxation and minority interests, amounted to £14,754,021 (2023 - £8,045,784).

No dividends were paid during the year. The directors do not recommend payment of a further dividend.

Directors

The directors who served during the year were:

T L Heathcote 
M L Heathcote 

Future developments

For information regarding the future developments of the group, please see the Strategic report.

Engagement with employers, suppliers, customers and others

The Directors engagement with employees, suppliers, customers and others is detailed in the strategic report on page 3 to 5.

Page 6

 
Heathcote Holdings Limited
 

 
Directors' report (continued)
For the year ended 30 April 2024

Greenhouse gas emissions, energy consumption and energy efficiency action

The Group has continued to invest in energy saving equipment during the financial year. A large solar panel installation has been completed at another operational site to further increase access to renewable energy sources. 
On-going capital investment in new operational equipment incorporating the latest advances in technology enables further efficiency savings to reduce fossil fuel usage.
The Group's greenhouse gas emissions and energy consumption are as follows:

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Consumption figures are derived from actual meter readings on purchase invoices and fuel usage records that are kept for business analysis purposes.
Conversion calculations for greenhouse gas emissions are based on the factors published by the Department for Business, Energy & Industrial Strategy.
CO2e is the universal unit of measurement to indicate the global warming potential (GWP) of greenhouse gases, expressed in terms of the GWP of one unit of carbon dioxide.

Disclosure of information to auditor

Each of the persons who are directors at the time when this Directors' report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company and the Group's auditor is unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company and the Group's auditor is aware of that information.

Page 7

 
Heathcote Holdings Limited
 

 
Directors' report (continued)
For the year ended 30 April 2024


Post balance sheet events

On 27 September 2024, the group acquired 50% of the shares of Direct Enviro Services Limited and acquired two additional properties.
The group also renewed their banking facility with HSBC UK Bank plc.

Auditor

The auditor, Kreston Reeves LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 31 January 2025 and signed on its behalf.
 





T L Heathcote
Director

Page 8

 
Heathcote Holdings Limited
 

 
Independent auditor's report to the members of Heathcote Holdings Limited
 

Opinion


We have audited the financial statements of Heathcote Holdings Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 30 April 2024, which comprise the Consolidated statement of comprehensive income, the Consolidated balance sheet, the Company balance sheet, the Consolidated statement of cash flows, the Consolidated statement of changes in equity, the Company statement of changes in equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Group's and of the parent Company's affairs as at 30 April 2024 and of the Group's profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


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


Conclusions relating to going concern


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


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


Page 9

 
Heathcote Holdings Limited
 

 
Independent auditor's report to the members of Heathcote Holdings Limited (continued)


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 ReportOur 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.


Opinion on other matters prescribed by the Companies Act 2006
 

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


the information given in the Group strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Group strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.


Matters on which we are required to report by exception
 

In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group strategic report or the 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:


adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent Company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


Responsibilities of directors
 

As explained more fully in the Directors' responsibilities statement set out on page 6, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.


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


Page 10

 
Heathcote Holdings Limited
 

 
Independent auditor's report to the members of Heathcote Holdings Limited (continued)


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 Group financial statements.


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:

Capability of the audit in detecting irregularities, including fraud
Based on our understanding of the company and industry, and through discussion with the directors and other management (as required by auditing standards), we identified that the principal risks of non-compliance with laws and regulations related to health and safety, anti-bribery and employment law. We considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006, Statement of Recommended Practice, taxation and pension legislation. We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to management override. Audit procedures performed by the engagement team:
 
Discussions with management and assessment of known or suspected instances of non-compliance with laws and regulations (including health and safety) and fraud, and review of the reports made by management;
Assessment of identified fraud risk factors;
Conducting interviews with appropriate personnel to gain further insight into the control systems implemented, and the risk of irregularity;
Challenging assumptions and judgments made by management in its significant accounting estimates;
Performing analytical procedures to identify any unusual or unexpected relationships, including related party transactions, that may indicate risks of material misstatement due to fraud;
Confirmation of related parties with management, and review of transactions throughout the period to identify any previously undisclosed transactions with related parties outside the normal course of business;
Performing analytical procedures with automated data analytics tools to identify any unusual or unexpected relationships, including related party transactions, that may indicate risks of material misstatement due to fraud;
Reading minutes of meetings of those charged with governance, reviewing internal audit reports and reviewing correspondence with relevant tax and regulatory authorities;
Review of internal controls and physical inspection of tangible assets susceptible to fraud or irregularity;
Review of significant and unusual transactions and evaluation of the underlying financial rationale supporting the transactions; and
Identifying and testing journal entries, in particular any manual entries made at the year end for financial statement preparation.
 
Page 11

 
Heathcote Holdings Limited
 

 
Independent auditor's report to the members of Heathcote Holdings Limited (continued)




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


As part of an audit in accordance with ISAs (UK), we exercise professional judgement and maintain professional scepticism throughout the audit. We also:


Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion of the effectiveness of the Company's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our Auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our Auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statementsWe are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.


We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.


Page 12

 
Heathcote Holdings Limited
 

 
Independent auditor's report to the members of Heathcote Holdings Limited (continued)


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 2006Our 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.





Tracey Becker (Senior statutory auditor)
  
for and on behalf of
Kreston Reeves LLP
 
Statutory Auditor
Chartered Accountants
  
Canterbury

31 January 2025
Page 13

 
Heathcote Holdings Limited
 

Consolidated statement of comprehensive income
For the year ended 30 April 2024


2024
2023
Note
£
£

  

Turnover
 4 
163,952,805
136,274,667

Cost of sales
  
(111,977,803)
(101,293,183)

Gross profit
  
51,975,002
34,981,484

Administrative expenses
  
(34,093,914)
(25,328,630)

Other operating income
 5 
651,252
474,665

Fair value movements
 16 
4,616,268
-

Operating profit
 6 
23,148,608
10,127,519

Income from participating interests
  
47,210
27,438

Interest receivable and similar income
 10 
304,124
344,625

Interest payable and similar expenses
 11 
(1,370,094)
(898,867)

Profit before taxation
  
22,129,848
9,600,715

Tax on profit
 12 
(6,015,275)
(1,420,610)

Profit for the financial year
  
16,114,573
8,180,105

  

Unrealised (deficit)/surplus on revaluation of tangible fixed assets
  
(4,560,300)
4,560,300

Total comprehensive income for the year
  
11,554,273
12,740,405

Profit for the year attributable to:
  

Non-controlling interests
  
1,360,552
134,321

Owners of the parent Company
  
14,754,021
8,045,784

  
16,114,573
8,180,105

Total comprehensive income for the year attributable to:
  

Non-controlling interest
  
1,360,552
134,321

Owners of the parent Company
  
10,193,721
12,606,084

  
11,554,273
12,740,405

Page 14

 
Heathcote Holdings Limited
Registered number: 13368037

Consolidated balance sheet
As at 30 April 2024

2024
2023
Note
£
£

Fixed assets
  

Intangible assets
 13 
14,039,907
3,989,849

Tangible assets
 14 
97,318,205
93,306,321

Investments
 15 
1,309,879
1,272,669

Investment property
 16 
16,787,822
-

  
129,455,813
98,568,839

Current assets
  

Fixed assets held for sale
  
310,025
-

Stocks
 17 
2,380,798
1,945,017

Debtors: amounts falling due after more than one year
 18 
3,625,185
5,715,043

Debtors: amounts falling due within one year
 18 
42,041,455
38,150,616

Cash at bank and in hand
 19 
12,250,169
7,417,164

  
60,607,632
53,227,840

Creditors: amounts falling due within one year
 20 
(43,343,861)
(35,250,374)

Net current assets
  
 
 
17,263,771
 
 
17,977,466

Total assets less current liabilities
  
146,719,584
116,546,305

Creditors: amounts falling due after more than one year
 21 
(30,630,248)
(15,878,108)

Provisions for liabilities
  

Deferred taxation
 24 
(11,539,404)
(7,819,993)

Net assets
  
104,549,932
92,848,204


Capital and reserves
  

Called up share capital 
 25 
9,419
9,419

Revaluation reserve
 26 
-
4,560,300

Other reserves
 26 
3,674,817
50,000

Profit and loss account
 26 
99,111,482
87,982,278

Equity attributable to owners of the parent Company
  
102,795,718
92,601,997

Non-controlling interests
  
1,754,214
246,207

  
104,549,932
92,848,204


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 31 January 2025.


T L Heathcote
Director

The notes on pages 21 to 51 form part of these financial statements.
Page 15

 
Heathcote Holdings Limited
Registered number: 13368037

Company balance sheet
As at 30 April 2024

2024
2023
Note
£
£

Fixed assets
  

Investments
 15 
9,419
9,419

Current assets
  

Debtors: amounts falling due after more than one year
 18 
3,983,891
6,339,561

Debtors: amounts falling due within one year
 18 
2,798,640
1,100,603

Cash at bank and in hand
 19 
33,493
66,097

  
6,816,024
7,506,261

Creditors: amounts falling due within one year
 20 
(1,404,588)
(973,002)

Net current assets
  
 
 
5,411,436
 
 
6,533,259

Total assets less current liabilities
  
5,420,855
6,542,678

Creditors: amounts falling due after more than one year
 21 
(6,075,000)
(6,975,000)

Net liabilities
  
(654,145)
(432,322)


Capital and reserves
  

Called up share capital 
 25 
9,419
9,419

Profit and loss account brought forward
  
(441,741)
(331,733)

Loss for the year

  

(221,823)
(110,008)

Profit and loss account carried forward
  
(663,564)
(441,741)

  
(654,145)
(432,322)


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 31 January 2025.




T L Heathcote
Director

The notes on pages 21 to 51 form part of these financial statements.

Page 16

 
Heathcote Holdings Limited
 

Consolidated statement of changes in equity
For the year ended 30 April 2024


Called up share capital
Revaluation reserve
Other reserves
Profit and loss account
Non-controlling interests
Total equity

£
£
£
£
£
£


At 1 May 2022
9,419
-
50,000
79,936,494
220,791
80,216,704


Comprehensive income for the year

Profit for the year
-
-
-
8,045,784
-
8,045,784

Surplus on revaluation of freehold property
-
4,560,300
-
-
-
4,560,300


Contributions by and distributions to owners

Other movement
-
-
-
-
25,416
25,416


Total transactions with owners
-
-
-
-
25,416
25,416



At 1 May 2023
9,419
4,560,300
50,000
87,982,278
246,207
92,848,204


Comprehensive income for the year

Profit for the year
-
-
-
14,754,021
1,360,552
16,114,573

Deficit on revaluation of freehold property
-
(4,560,300)
-
-
-
(4,560,300)


Contributions by and distributions to owners

Transfer to/from profit and loss account
-
-
3,624,817
(3,624,817)
-
-

Other movements
-
-
-
-
(112,020)
(112,020)

On acquisition of subsidiaries
-
-
-
-
259,475
259,475


Total transactions with owners
-
-
3,624,817
(3,624,817)
147,455
147,455


At 30 April 2024
9,419
-
3,674,817
99,111,482
1,754,214
104,549,932


Page 17

 
Heathcote Holdings Limited
 

Company statement of changes in equity
For the year ended 30 April 2024


Called up share capital
Profit and loss account
Total equity

£
£
£


At 1 May 2022
9,419
(331,733)
(322,314)


Comprehensive income for the year

Loss for the year
-
(110,008)
(110,008)



At 1 May 2023
9,419
(441,741)
(432,322)


Comprehensive income for the year

Loss for the year
-
(221,823)
(221,823)


At 30 April 2024
9,419
(663,564)
(654,145)


Page 18

 
Heathcote Holdings Limited
 

Consolidated statement of cash flows
For the year ended 30 April 2024

2024
2023
£
£

Cash flows from operating activities

Profit for the financial year
16,114,573
8,180,105

Adjustments for:

Amortisation of intangible assets
558,946
243,103

Depreciation of tangible assets
13,121,633
11,922,308

Loss on disposal of tangible assets
(596,918)
(811,906)

Government grants
(122,627)
(19,296)

Interest paid
1,370,094
1,711,080

Interest received
(351,334)
(1,255,721)

Taxation charge
6,015,275
1,420,610

(Increase) in stocks
(405,281)
(43,315)

(Increase) in debtors
(2,546,100)
(6,425,013)

Increase/(decrease) in creditors
3,138,814
(1,836,754)

Net fair value (gains)/losses recognised in P&L
(4,616,268)
-

Corporation tax received/(paid)
806,064
(1,394,324)

Net cash generated from operating activities

32,486,871
11,690,877


Cash flows from investing activities

Purchase of tangible fixed assets
(16,608,602)
(19,961,003)

Sale of tangible fixed assets
4,752,930
5,996,856

Purchase of investment properties
(3,953,280)
-

Government grants received
122,627
19,296

Purchase of subsidiaries (net of cash)
(15,907,789)
(3,096,914)

Interest received
304,124
1,255,721

HP interest paid
(653,384)
(501,960)

Income from investments in related companies
47,210
27,438

Fixed assets held for sale
(310,025)
-

Net cash from investing activities

(32,206,189)
(16,260,566)
Page 19

 
Heathcote Holdings Limited
 

Consolidated statement of cash flows (continued)
For the year ended 30 April 2024


2024
2023

£
£



Cash flows from financing activities

New secured loans
15,000,000
-

Repayment of loans
(917,487)
(909,754)

Repayment of/new finance leases
(8,513,280)
(1,224,812)

Interest paid
(716,710)
(1,209,120)

Distributions paid to non-controlling interests
(112,020)
-

Net cash used in financing activities
4,740,503
(3,343,686)

Net increase/(decrease) in cash and cash equivalents
5,021,185
(7,913,375)

Cash and cash equivalents at beginning of year
7,228,984
15,142,359

Cash and cash equivalents at the end of year
12,250,169
7,228,984


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
12,250,169
7,417,164

Bank overdrafts
-
(188,180)

12,250,169
7,228,984


Page 20

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

1.


General information

Heathcote Holdings Limited is a private company limited by shares and is incorporated in England with registration number 13368037. The address of the registered office is Stanford Bridge Farm, Station Road, Pluckley, Ashford, Kent, TN27 0RU.
The principal activities of the company and its subsidiaries are that of in hand farming, shared farming, whole farm contracting and management together with ground care maintenance incorporating light, heavy commercial plant hire, waste management services, and the provision and management of alternative water supply services.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgement in applying the Group's accounting policies (see note 3).

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of comprehensive income in these financial statements.

The financial statements are rounded to the nearest pound.

The following principal accounting policies have been applied:

 
2.2

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
In the opinion of the directors, the creation of the group was a group reconstruction rather than an acquisition, since the equity holders of the company remain the same as the former equity holders and the rights of the equity holders are unchanged and no minority interest in the net assets of the group has arisen. In addition, the purpose of the transaction was not to move the net asset value out of the group and return it to the equity holder, but rather to reorganise the assets and liabilities within the existing individual entities. Therefore, the directors consider that to record the transaction as an acquisition by the company, attributing fair values to the assets and liabilities of the group and reflecting only the post transaction results within these financial statements would fail to give a true and fair view of the group's results and financial position.
For the initial acqisition on 1 May 2021, the directors adopted the merger accounting principles. The main consequence of adopting merger rather than acquisition accounting is that the balance sheet of the merged group includes the assets and liabilities of each of the group's combining entities at their carrying values prior to the merger, subject to any adjustments to achieve uniformity of accounting policies, rather than at their fair values at the date of the merger.
 
Page 21

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

2.Accounting policies (continued)


2.2
Basis of consolidation (continued)

During the year, the Group also made several acquisitions, the consolidated financial statements incorporate the results of these business combinations using the purchase method. In the Balance sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date control ceases.  The group includes the consolidation of the entities, as included within note 15.

 
2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
the Group has transferred the significant risks and rewards of ownership to the buyer;
the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the Group will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the Group will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

Page 22

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

2.Accounting policies (continued)

 
2.4

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is Pounds Sterling.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Consolidated statement of comprehensive income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.

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

 
2.5

Operating leases: the Group as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.6

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Consolidated statement of comprehensive income in the same period as the related expenditure.

 
2.7

Interest income

Interest income is recognised in profit or loss using the effective interest method.

Page 23

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

2.Accounting policies (continued)

 
2.8

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.9

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

 
2.10

Pensions

Defined contribution pension plan

The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance sheet. The assets of the plan are held separately from the Group in independently administered funds.

 
2.11

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company and the Group operate and generate income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits;
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.


Page 24

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

2.Accounting policies (continued)

 
2.12

Intangible assets

Goodwill

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

Other intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

 
2.13

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method and reducing balance method.

Depreciation is provided on the following basis:

Freehold Land
-
Freehold land is not depreciated
Tenants leasehold improvements
-
10% straight line
Plant and machinery
-
20/25% reducing balance or 20% straight line as appropriate
Motor vehicles
-
25% reducing balance
Fixtures and fittings
-
20% straight line
Office equipment
-
33% straight line
Assets under construction
-
Not depreciated

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

Page 25

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

2.Accounting policies (continued)

 
2.14

Revaluation of tangible fixed assets

Individual freehold and leasehold properties are carried at current year value at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Revaluations are undertaken with sufficient regularity to ensure the carrying amount does not differ materially from that which would be determined using fair value at the balance sheet date.
Fair values are determined from market based evidence normally undertaken by professionally qualified valuers.

Revaluation gains and losses are recognised in other comprehensive income unless losses exceed the previously recognised gains or reflect a clear consumption of economic benefits, in which case the excess losses are recognised in profit or loss.

 
2.15

Investment property

Investment property is carried at fair value determined annually by the directors, with assistance of specialists within the group and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in profit or loss.

 
2.16

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Investments in unlisted Group shares, whose market value can be reliably determined, are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in the Consolidated statement of comprehensive income for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment.

 
2.17

Associates and joint ventures

An entity is treated as a joint venture where the Group is a party to a contractual agreement with one or more parties from outside the Group to undertake an economic activity that is subject to joint control.

An entity is treated as an associated undertaking where the Group exercises significant influence in that it has the power to participate in the operating and financial policy decisions.
In the consolidated accounts, interests in associated undertakings are accounted for using the equity method of accounting. Under this method an equity investment is initially recognised at the transaction price (including transaction costs) and is subsequently adjusted to reflect the investors share of the profit or loss, other comprehensive income and equity of the associate. The Consolidated statement of comprehensive income includes the Group's share of the operating results, interest, pre-tax results and attributable taxation of such undertakings applying accounting policies consistent with those of the Group. In the Consolidated balance sheet, the interests in associated undertakings are shown as the Group's share of the identifiable net assets, including any unamortised premium paid on acquisition.
Any premium on acquisition is dealt with in accordance with the goodwill policy.

Page 26

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

2.Accounting policies (continued)

 
2.18

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet date, stocks are assessed for impairment. If stock is 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.

 
2.19

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.20

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Consolidated statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.

 
2.21

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.22

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

 
2.23

Financial instruments

The Group has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the Group's Balance sheet when the Group 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.
 
Page 27

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

2.Accounting policies (continued)


2.23
Financial instruments (continued)


Basic financial assets

Basic financial assets, which include trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.

Other financial assets

Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.

Impairment of financial assets

At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. 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. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

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 Group after the deduction of all its liabilities.

Basic financial liabilities, which include trade and other creditors, bank loans, other loans and loans due to fellow group companies are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.

Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Page 28

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

2.Accounting policies (continued)


2.23
Financial instruments (continued)


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

Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Group transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Group will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

Financial liabilities are derecognised when the Group's contractual obligations expire or are discharged or cancelled.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

The preparation of the financial statements requires the directors to make judgments, estimates and assumptions that can affect the amounts reported for assets and liabilities, and the results for the year.  The nature of estimation is such though that actual outcomes could differ significantly from those estimates.
The following judgments have had the most significant impact on amounts recognised in the financial statements:
Lease commitments
The Group has entered into a range of lease commitments in respect of property, plant and equipment.  The classification of these leases as either financial or operating leases requires the directors to consider whether the terms and conditions of each lease are such that the Group has acquired the risks and rewards associated with the ownership of the underlying assets.
Goodwill and intangible assets
The group has recognised goodwill and other intangible assets arising from business combinations with a carrying value of £14,037,701 (2023: £3,989,849) at the reporting date (see note 13). On acquisition the group determines a reliable estimate of the useful life of goodwill and intangible assets based upon factors such as the expected use of the acquired business, forecasts of expected future results and cash flows, and any legal, regulatory or contractual provisions that can limit useful life.  At each subsequent reporting date the directors consider whether there are any factors such as technological advancements or changes in market conditions that indicate a need to reconsider the useful life of goodwill and intangible assets.
 
Page 29

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

3.Judgements in applying accounting policies (continued)

Tangible fixed assets
The Group has recognised tangible fixed assets with a carrying value of £97,318,205 (2023: £93,306,321) at the reporting date (see note 14).  These assets are stated at their cost less provision for depreciation and impairment.  The group’s accounting policy sets out the approach to calculating depreciation for assets acquired.   For assets such as land and buildings the group determines at acquisition reliable estimates for the useful life of the asset, its residual value and decommissioning costs.  These estimates are based upon such factors as the expected use of the acquired asset and market conditions.  At subsequent reporting dates the directors consider whether there are any factors such as technological advancements or changes in market conditions that indicate a need to reconsider the estimates used.
Where there are indicators that the carrying value of tangible assets may be impaired the group undertakes tests to determine the recoverable amount of assets.  These tests require estimates of the fair value of assets less cost to sell and of their value in use.  Wherever possible the estimate of the fair value of assets is based upon observable market prices less incremental cost for disposing of the asset.  The value in use calculation is based upon a discounted cash flow model, based upon the group’s forecasts for the foreseeable future which do not include any restructuring activities that the group is not yet committed to or significant future investments that will enhance the asset’s performance.  The recoverable amount is most sensitive to the discount rate used for the discounted cash flow model as well expected future cash flows and the growth rate used for extrapolation purposes.
Investment properties
The company holds investment property with fair value of £16,787,822 at the year end (see note 16). In order to determine the fair value of investment property the directors have used a valuation technique based on comparable market data. The determined fair value of the investment property is most sensitive to fluctuations in the property market.


4.


Turnover

The whole of the turnover is attributable to the principal activity of the Group. 

Analysis of turnover by country of destination:

2024
2023
£
£

United Kingdom
162,716,501
135,630,970

Rest of Europe
1,236,304
643,697

163,952,805
136,274,667


Page 30

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

5.


Other operating income

2024
2023
£
£

Other operating income
444,279
321,395

Net rents receivable
12,000
12,000

Government grants receivable
122,627
19,296

Insurance claims receivable
68,530
120,000

Sundry income
3,816
1,974

651,252
474,665



6.


Operating profit

The operating profit is stated after charging:

2024
2023
£
£

Research & development charged as an expense
655
6,936

Exchange differences
(38,453)
36,104

Other operating lease rentals
2,416,576
1,673,678


7.


Auditor's remuneration

During the year, the Group obtained the following services from the Company's auditor and its associates:


2024
2023
£
£

Fees payable to the Company's auditor and its associates for the audit of the consolidated and parent Company's financial statements
12,960
12,540

Fees payable to the Company's auditor and its associates in respect of:

The auditing of accounts of associates of the Company
142,410
115,040

Audit-related assurance services
-
28,245

Taxation compliance services
54,065
26,770

All non-audit services not included above
40,566
19,605

Page 31

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

8.


Employees

Staff costs, including directors' remuneration, were as follows:


Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£


Wages and salaries
33,380,314
30,378,996
-
441

Social security costs
3,735,892
3,413,105
-
-

Cost of defined contribution scheme
1,508,261
1,069,653
-
-

38,624,467
34,861,754
-
441


The average monthly number of employees, including the directors, during the year was as follows:


        2024
        2023
            No.
            No.







Directors, management and staff
842
781

The Company has no employees other than the director, who did not receive any remuneration (2023 - £NIL)

9.


Directors' remuneration

2024
2023
£
£

Directors' emoluments
233,272
157,418

Group contributions to defined contribution pension schemes
4,541
4,271

237,813
161,689


During the year retirement benefits were accruing to 1 director (2023 - 1) in respect of defined contribution pension schemes.

The highest paid director received remuneration of £181,292.

The value of the Group's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £4,541.


10.


Interest receivable

2024
2023
£
£


Other interest receivable
304,124
344,625

Page 32

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

11.


Interest payable and similar expenses

2024
2023
£
£


Bank interest payable
20,802
6,045

Other loan interest payable
695,908
390,862

Finance leases and hire purchase contracts
653,384
501,960

1,370,094
898,867


12.


Taxation


2024
2023
£
£

Corporation tax


Current tax on profits for the year
1,806,722
40,564

Adjustments in respect of previous periods
(30,504)
(19,354)


Total current tax
1,776,218
21,210

Deferred tax


Origination and reversal of timing differences
4,239,057
1,399,400


Taxation on profit on ordinary activities
6,015,275
1,420,610
Page 33

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024
 
12.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is higher than (2023 - lower than) the standard rate of corporation tax in the UK of 25% (2023: 19.49%). The differences are explained below:

2024
2023
£
£


Profit on ordinary activities before tax
22,129,848
9,600,715


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 19.49%)
5,532,462
1,871,179

Effects of:


Non-tax deductible amortisation of goodwill and impairment
(110,724)
-

Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
364,582
50,642

Capital allowances for year in excess of depreciation
289,694
(722,196)

Adjustments to tax charge in respect of prior periods
267,952
87,510

Other timing differences leading to an increase (decrease) in taxation
(24,620)
195,672

Non-taxable income
(41,875)
(97,471)

Capital gains
75,961
-

Effect of changes in tax
-
111,853

Deferred tax not recognised
-
(76,579)

Tax on LLP not accounted for
(335,912)
-

Marginal relief
(2,245)
-

Total tax charge for the year
6,015,275
1,420,610


Factors that may affect future tax charges

There were no factors that may affect future tax charges.

Page 34

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

13.


Intangible assets

Group and Company





Patents
Goodwill
Negative goodwill
Total

£
£
£
£



Cost


At 1 May 2023
-
5,023,011
(509,512)
4,513,499


Disposals
-
(300,000)
-
(300,000)


On acquisition of subsidiaries
2,206
10,606,798
-
10,609,004



At 30 April 2024

2,206
15,329,809
(509,512)
14,822,503



Amortisation


At 1 May 2023
-
1,033,162
(509,512)
523,650


Charge for the year
-
558,946
-
558,946


On disposals
-
(300,000)
-
(300,000)



At 30 April 2024

-
1,292,108
(509,512)
782,596



Net book value



At 30 April 2024
2,206
14,037,701
-
14,039,907



At 30 April 2023
-
3,989,849
-
3,989,849


The individual intangible assets which are material to the financial statements are £3,547,765 of goodwill in respect of the acquisition of Envar Composting (Kent) Limited and £2,898,101 in respect of Four Jays Limited.  Given the date of these acquisitions, no amortisation has been charged on this goodwill and the goodwill will be amortised over the next 10 years.
There is also £3,953,973 of goodwill in respect of the acquisition of the Envar Organics Limited group.  The carrying value of this goodwill is £3,838,921 and there are 9 years and 8 and a half months of amortisation remaining.


The company has no intangible fixed assets.

Page 35

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

14.


Tangible fixed assets

Group






Freehold property
Long-term leasehold property
Short-term leasehold property
Plant and machinery
Motor vehicles

£
£
£
£
£



Cost or valuation


At 1 May 2023
37,664,584
6,993,244
121,964
76,426,323
20,110,358


Additions
2,150,877
59,570
-
14,974,802
4,213,158


Acquisition of subsidiary
4,008,115
-
-
2,243,367
1,196,036


Disposals
(1,016,298)
-
-
(8,348,729)
(3,073,234)


Transfers between classes
(4,528,687)
1,254,975
(121,964)
611,900
-


Revaluations
(5,630,000)
-
-
-
-



At 30 April 2024

32,648,591
8,307,789
-
85,907,663
22,446,318



Depreciation


At 1 May 2023
6,155,870
1,481,549
7,115
33,790,173
8,866,308


Charge for the year
774,364
238,360
11,180
9,546,148
2,506,140


Disposals
(177,119)
-
-
(6,268,500)
(1,844,722)


Transfers between classes
-
18,295
(18,295)
-
-



At 30 April 2024

6,753,115
1,738,204
-
37,067,821
9,527,726



Net book value



At 30 April 2024
25,895,476
6,569,585
-
48,839,842
12,918,592



At 30 April 2023
31,508,714
5,511,695
114,849
42,636,150
11,244,050
Page 36

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

           14.Tangible fixed assets (continued)


Fixtures and fittings
Assets under construction
Total

£
£
£



Cost or valuation


At 1 May 2023
1,213,628
1,822,439
144,352,540


Additions
123,092
3,638,450
25,159,949


Acquisition of subsidiary
30,336
-
7,477,854


Disposals
(14,464)
(1,281)
(12,454,006)


Transfers between classes
40,867
(2,975,365)
(5,718,274)


Revaluations
-
-
(5,630,000)



At 30 April 2024

1,393,459
2,484,243
153,188,063



Depreciation


At 1 May 2023
745,204
-
51,046,219


Charge for the year
45,441
-
13,121,633


Disposals
(7,653)
-
(8,297,994)


Transfers between classes
-
-
-



At 30 April 2024

782,992
-
55,869,858



Net book value



At 30 April 2024
610,467
2,484,243
97,318,205



At 30 April 2023
468,424
1,822,439
93,306,321

The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2024
2023
£
£



Plant and machinery
21,602,301
14,465,575

Motor vehicles
5,389,592
7,407,729

26,991,893
21,873,304

Page 37

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

15.


Fixed asset investments

Group





Unlisted investments
Investment in joint ventures
Total

£
£
£



Cost or valuation


At 1 May 2023
1,035,129
237,540
1,272,669


Share of profit/(loss)
-
37,210
37,210



At 30 April 2024
1,035,129
274,750
1,309,879




Company





Investments in subsidiary companies

£



Cost or valuation


At 1 May 2023
9,419



At 30 April 2024
9,419





Direct subsidiary undertakings


The following were direct subsidiary undertakings of the Company:

Name

Class of shares

Holding

FGS Agri Limited
Ordinary
100%
Countrystyle Group Limited
Ordinary
100%
F.G.S Plant Limited
Ordinary
100%

Page 38

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

Indirect subsidiary undertaking


The following was an indirect subsidiary undertaking of the Company:


ole68e3.png

* Entities have taken advantage of audit exemption in accordance with Section 479A of the Companies Act 2006.

Page 39

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

16.


Investment property

Group


Freehold investment property

£



Valuation


Additions at cost
3,953,280


Surplus on revaluation
4,616,268


Transfers between classes
5,718,274


On acquisition of subsidiaries
2,500,000



At 30 April 2024
16,787,822


Comprising


Cost
12,171,554

Annual revaluation surplus/(deficit):


2024
4,616,268

At 30 April 2024
16,787,822

The 2024 valuations were made on a fair value basis, by the directors and informed by expertise within the group regarding real estate.










17.


Stocks

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Raw materials and consumables
632,978
531,488
-
-

Finished goods and goods for resale
1,747,820
1,413,529
-
-

2,380,798
1,945,017
-
-


Page 40

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

18.


Debtors

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Due after more than one year

Amounts owed by group undertakings
-
-
3,983,891
6,339,561

Companies under common control
3,014,799
2,985,475
-
-

Other debtors
610,386
2,729,568
-
-

3,625,185
5,715,043
3,983,891
6,339,561


Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Due within one year

Trade debtors
28,254,190
22,802,801
-
-

Amounts owed by group undertakings
-
-
2,665,494
834,278

Amounts owed by companies under common control
1,500,503
1,526,149
-
-

Other debtors
2,877,226
5,205,855
-
-

Called up share capital not paid
7,400
7,400
-
-

Prepayments and accrued income
9,402,136
8,608,411
133,146
266,325

42,041,455
38,150,616
2,798,640
1,100,603



19.


Cash and cash equivalents

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Cash at bank and in hand
12,250,169
7,417,164
33,493
66,097

Less: bank overdrafts
-
(188,180)
-
-

12,250,169
7,228,984
33,493
66,097


Page 41

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

20.


Creditors: Amounts falling due within one year

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Bank overdrafts
-
188,180
-
-

Bank loans
924,314
924,314
900,000
900,000

Trade creditors
16,253,707
12,749,240
114,410
-

Amounts owed to group undertakings
-
-
212,545
-

Amounts owed to companies under common control
356,731
177,593
-
-

Corporation tax
1,929,844
36,669
-
-

Other taxation and social security
3,424,396
3,411,240
-
-

Obligations under finance lease and hire purchase contracts
7,302,521
7,769,406
-
-

Other creditors
3,356,392
3,057,540
-
-

Accruals and deferred income
9,795,956
6,936,192
177,633
73,002

43,343,861
35,250,374
1,404,588
973,002



21.


Creditors: Amounts falling due after more than one year

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Bank loans
21,322,567
7,240,054
6,075,000
6,975,000

Net obligations under finance leases and hire purchase contracts
9,307,681
8,515,427
-
-

Accruals and deferred income
-
122,627
-
-

30,630,248
15,878,108
6,075,000
6,975,000


All of the group's bank loans are due to HSBC Bank Plc and are secured by way of a fixed and floating charge over the assets of the group.
The group's bank overdraft with HSBC Bank plc is secured by a fixed and floating charge over the assets of the company.
Obligations under finance leases and hire purchase contracts are secured over the assets which the liability relates.

Page 42

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

22.


Loans


Analysis of the maturity of loans is given below:


Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Amounts falling due within one year

Bank loans
924,314
924,314
900,000
900,000

Amounts falling due 1-2 years

Bank loans
21,322,567
7,240,054
6,075,000
6,975,000

22,246,881
8,164,368
6,975,000
7,875,000



23.


Hire purchase and finance leases


Minimum lease payments under hire purchase fall due as follows:

Group
Group
2024
2023
£
£

Within one year
7,302,521
8,469,945

Between 1-5 years
9,307,681
7,814,888

16,610,202
16,284,833

Page 43

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

24.


Deferred taxation


Group



2024
2023


£

£






At beginning of year
(7,819,993)
(4,471,434)


Charged to profit or loss
(4,239,057)
(1,433,542)


Charged to other comprehensive income
1,069,700
(1,069,700)


Arising on business combinations
(550,054)
(880,025)


Utilised in year
-
34,708



At end of year
(11,539,404)
(7,819,993)




2023
The provision for deferred taxation is made up as follows:

Group
Group
2024
2023
£
£

Accelerated capital allowances
(9,948,012)
(10,429,895)

Tax losses carried forward
20,935
2,580,024

Fair value movements
(1,410,745)
-

Capital gains
(345,664)
-

Short term timing differences
144,082
29,878

(11,539,404)
(7,819,993)


25.


Share capital

2024
2023
£
£
Allotted, called up and fully paid



9,400 (2023 - 9,400) Ordinary shares of £1.0000 each
9,400
9,400
18,800 (2023 - 18,800) Ordinary 0.1p shares shares of £0.0010 each
19
19

9,419

9,419


Page 44

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

26.


Reserves

Revaluation reserve

The Group has adopted the revaluation model for measurement of some of its freehold property. This reserve is used to record increased in the fair value of freehold property, less any related provision for deferred tax. 

Other reserves

This reserve comprises amounts transferred from the profit and loss reserve that are non-distributable.

Profit and loss account

This reserve comprises all current and prior period retained profits and losses after deducting any distributions made to the company’s shareholders.

27.


Analysis of net debt






At 1 May 2023
Cash flows
Acquisition and disposal of subsidiaries
New finance leases
At 30 April 2024
£

£

£

£

£

Cash at bank and in hand

7,417,164

2,370,193

2,462,812

-

12,250,169

Bank overdrafts

(188,180)

188,180

-

-

-

Debt due after 1 year

(7,240,054)

(14,082,513)

-

-

(21,322,567)

Debt due within 1 year

(1,177,896)

(18,168)

-

-

(1,196,064)

Finance leases

(16,284,833)

8,513,280

(287,302)

(8,551,347)

(16,610,202)


(17,473,799)
(3,029,028)
2,175,510
(8,551,347)
(26,878,664)

Page 45

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

28.
 

Business combinations

During the year, Envar Composting Limited acquired 100% of the share capital of Envar Organics Limited (formerly Tamar Organics Limited) and Envar Composting Kent Limited (formerly New Earth Solutions (Kent) Limited.  FGS Agri Limited also acquired 50% of the share capital of FH Ventures Limited and F.G.S.Plant Limited acquired 100% of Four Jays Limited.

Acquisition of Envar Organics Limited

Recognised amounts of identifiable assets acquired and liabilities assumed

Fair value
£

Fixed Assets

Tangible
1,577,922

1,577,922

Current Assets

Debtors
310,287

Cash at bank and in hand
85,374

Total Assets
1,973,583

Creditors

Due within one year
(1,327,174)

Deferred taxation
(179,293)

Total Identifiable net assets
467,116


Goodwill
3,953,973

Total purchase consideration
4,421,089

Consideration

£


Cash
4,335,585

Deferred consideration
-

Directly attributable costs
85,504

Total purchase consideration
4,421,089

Page 46

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

28.Business combinations (continued)

Cash outflow on acquisition

£


Purchase consideration settled in cash, as above
4,335,585

Directly attributable costs
85,504

4,421,089

Less: Cash and cash equivalents acquired
(85,374)

Net cash outflow on acquisition
4,335,715

Acquisition of Four Jays Limited

Recognised amounts of identifiable assets acquired and liabilities assumed

Fair value
£

Fixed Assets

Tangible
3,117,512

3,117,512

Current Assets

Stocks
30,500

Debtors
587,167

Cash at bank and in hand
2,323,310

Total Assets
6,058,489

Creditors

Due within one year
(895,538)

Due after more than one year
(97,292)

Deferred taxation
(768,392)

Total Identifiable net assets
4,297,267


Goodwill
2,898,131

Total purchase consideration
7,195,398

Consideration

£


Cash
7,128,337

Deferred consideration
-

Directly attributable costs
67,061

Total purchase consideration
7,195,398

Page 47

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

28.Business combinations (continued)

Cash outflow on acquisition

£


Purchase consideration settled in cash, as above
7,128,337

Directly attributable costs
67,061

7,195,398

Less: Cash and cash equivalents acquired
(2,323,310)

Net cash outflow on acquisition
4,872,088

Acquisition of Envar Composting Kent Limited

Recognised amounts of identifiable assets acquired and liabilities assumed

Fair value
£

Fixed Assets

Tangible
2,782,420

Intangible
2,206

2,784,626

Current Assets

Debtors
326,129

Cash at bank and in hand
28,958

Total Assets
3,139,713

Creditors

Due within one year
(534,957)

Total Identifiable net assets
2,604,756


Goodwill
3,547,765

Total purchase consideration
6,152,521

Consideration

£


Cash
6,050,000

Directly attributable costs
102,521

Total purchase consideration
6,152,521

Page 48

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

28.Business combinations (continued)

Cash outflow on acquisition

£


Purchase consideration settled in cash, as above
6,050,000

Directly attributable costs
102,521

6,152,521

Less: Cash and cash equivalents acquired
(28,958)

Net cash outflow on acquisition
6,123,563

Acquisition of FH Ventures Limited

Recognised amounts of identifiable assets acquired and liabilities assumed

Fair value
£

Fixed Assets

Investment properties
2,500,000

Current Assets

Debtors
11,887

Cash at bank and in hand
25,170

Total Assets
2,537,057

Creditors

Due within one year
(1,858,674)

Deferred taxation
(159,432)

Total Identifiable net assets
518,951


Non-controlling interests
(259,476)

Goodwill
11,343

Total purchase consideration
270,818

Consideration

£


Cash
262,500

Directly attributable costs
8,318

Total purchase consideration
270,818

Page 49

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

28.Business combinations (continued)

Cash outflow on acquisition

£


Purchase consideration settled in cash, as above
262,500

Directly attributable costs
8,318

270,818

Less: Cash and cash equivalents acquired
(25,170)

Net cash outflow on acquisition
245,648


29.


Capital commitments




At 30 April 2024 the Group and Company had capital commitments as follows:


Group
Group
2024
2023
£
£

Contracted for but not provided in these financial statements
729,848
689,591


30.


Pension commitments

The Group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £1,508,261 (2023: £1,069,653). Contributions totaling £248,380 (2023: £218,095) were payable to the fund at the balance sheet date and are included in creditors.


31.


Commitments under operating leases

At 30 April 2024 the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
2024
2023
£
£

Not later than 1 year
3,561,120
4,387,821

Later than 1 year and not later than 5 years
7,871,359
9,829,317

Later than 5 years
3,552,768
4,130,054

14,985,247
18,347,192

32.


Transactions with directors

During the year M Heathcote, a director of group, purchased a property from the company for £227,600, the company also made payments on his behalf totaling £31,721 and £86,801 was repaid. As at 30 April 2024 was owed £172,521 by the director and is included within other debtors. The loan is interest free and is repayable on demand. 

Page 50

 
Heathcote Holdings Limited
 

 
Notes to the financial statements
For the year ended 30 April 2024

33.


Related party transactions

The company is exempt from disclosing related party transactions with other companies that are wholly owned within the group. The following are related party transactions outside of the group:


2024
2023
£
£

Sales to entities of which the entity has control, joint control or significant interest
14,182
-
Sales to entities controlled by key management personnel
3,244,966
2,407,781
Purchases from entities controlled by key management personnel
2,858,715
1,790,255
Amounts due from entities of which the entity has control, joint control or significant interest
3,059,889
3,077,049
Amounts due from entities controlled by key management personnel
4,756,084
4,976,221
Amounts owed to entities of which the entity has control, joint control or significant interest.
680,000
740,000
Amounts due to entities controlled by key management personnel
358,412
188,012
Amounts due to directors
596,620
235,232
Amounts due from directors
172,520
-
Interest received from entities controlled by key management personnel
198,047
99,556
Share of profits from entities of which the entity has control, joint control or significant interest
10,000
-

'The total compensation paid to key management personnel of the company amounted to £1,216,155 (2023: £943,282).


34.


Post balance sheet events

On 27 September 2024, the group acquired 50% of the shares of Direct Enviro Services Limited for £450,000 and acquired two additional properties for £1.36m.
The group also renewed their banking facilities with HSBC UK Bank plc, extending the payment term of their loans.


35.


Controlling party

The ultimate controlling party is T L Heathcote by virtue of his majority shareholding. 


Page 51