Company registration number 09954658 (England and Wales)
BAYBUTT INVESTMENTS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
BAYBUTT INVESTMENTS LIMITED
COMPANY INFORMATION
Directors
Mr R A Baybutt
Mrs R Baybutt
Mr J R Baybutt
Company number
09954658
Registered office
467 Moss Lane
Hesketh Bank
Preston
PR4 6XJ
Auditor
MHA
Richard House
9 Winckley Square
Preston
PR1 3HP
BAYBUTT INVESTMENTS LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
3
Directors' responsibilities statement
2
Independent auditor's report
4 - 7
Group statement of comprehensive income
8
Group balance sheet
9
Company balance sheet
11
Group statement of changes in equity
10
Company statement of changes in equity
12
Group statement of cash flows
13
Notes to the financial statements
14 - 32
BAYBUTT INVESTMENTS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 APRIL 2024
- 1 -
The directors present the strategic report for the year ended 30 April 2024.
Review of the business
The period under review saw an increase in turnover of 15.51%. This was in part due to difficult growing conditions experienced by other growers resulting in strong market prices and high demand from both retailers and the wholesale markets.
Staff costs increased in line with turnover and the business continued to keep tight control on all other costs.
During the year, the group continued to invest heavily in drainage and ground works.
The group has successfully passed all external audits from BRC, Red Tractor, F2F, Tesco Nurture and Leaf Marque, along with each audit carried out by its customers.
The group continues to invest in research and development to further extend the season and in order to develop new product lines and growing and harvesting practices throughout the business.
Principal risks and uncertainties
The continued squeeze on disposable income has forced supermarkets into price competition in order to retain and attract customers. Whilst this is a risk it is also an opportunity as the supermarkets are concerned about continuity of supply and range of product.
The weather is a major risk to the business. The group manages this risk by continuing to invest in plant, machinery and development of the land bank.
The board considers both short and long term group funding requirements, ensuring that sufficient funds are available to meet all operational and investment needs in what is a seasonal business. Together with the group’s bankers, funding is appropriate to the needs of the group and provides appropriate stability for the future years.
Other information and explanations
The board believes that the group is stable and well placed to adapt and remain at the forefront of an ever changing industry in the years ahead. They would also like to place on record their sincere thanks to the dedicated staff employed throughout the group.
Key performance indicators
Turnover increased to £16,410,263 (2023: £14,206,750), this is a result of high demand and increased planting during the year.
Mr J R Baybutt
Director
31 January 2025
BAYBUTT INVESTMENTS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 APRIL 2024
- 2 -
The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the ;
prepare the on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
BAYBUTT INVESTMENTS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 APRIL 2024
- 3 -
The directors present their annual report and financial statements for the year ended 30 April 2024.
Principal activities
The principal activity of the company was that of a holding company to a group of trading subsidiaries.
The principal activities of the group were the growing and packing varieties of lettuce, celery and spinach for supply to major UK supermarkets and wholesalers.
Results and dividends
The results for the year are set out on page 8.
Ordinary dividends were paid amounting to £117,500. The directors do not recommend payment of a further dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr R A Baybutt
Mrs R Baybutt
Mr J R Baybutt
Auditor
Following the merger of MHA Moore & Smalley with MHA, the company's independent auditor has now become MHA. A resolution to reappoint MHA as independent auditor will be proposed at the next Annual General Meeting.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.
Items referred to in the strategic report
The group has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the group's Strategic Report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the Directors' Report. It has done so in respect of future developments, research & development and financial instruments.
On behalf of the board
Mr J R Baybutt
Director
31 January 2025
BAYBUTT INVESTMENTS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BAYBUTT INVESTMENTS LIMITED
- 4 -
We have audited the financial statements of Baybutt Investments Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 April 2024 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion, except for the possible effects on the corresponding figures of the matters described in the Basis for Qualified Opinion section of our report, the financial statements:
give a true and fair view of the state of the group and parent company's affairs as at 30 April 2024 and of its 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 qualified opinion
In carrying out our audit work on the balances at 30 April 2022, we were not able to obtain sufficient appropriate audit evidence to verify the existence of non-growing stock lines held by Alan Baybutt & Sons Limited, which formed part of the stock balances included in the group balance sheet. Consequently we were unable to determine whether any adjustment to the group stock balance at 30 April 2022 was necessary, or whether there was any consequential effect on the group cost of sales for the comparative year ended 30 April 2023. Our audit opinion on the group financial statements for the year ended 30 April 2023 was modified accordingly. Our opinion on the current period's group financial statements is also modified because of the possible effect of this matter on the comparability of the current year's figures and the corresponding figures.
At 30 April 2022 the group was operating under significant operational pressures, specifically linked to the difficulties in securing sufficient and necessarily experienced labour. Because of this management did not have sufficient staff available to enable us to attend the stocktake. Due to this management imposed limitation of scope we were unable to attend site and conduct physical verification measures on the group's non-growing stock balances at the balance sheet date.
Owing to the nature of the non-growing stock base held within Alan Baybutt & Sons Limited, alternative procedures to provide the necessary evidence were ultimately not able to be completed to the necessary degree in respect of the group's 30 April 2022 non-growing stock balances.
Finally, at 30 April 2022, the subsidiary was unable to recover itemised stock records for two specific areas of non-growing stock balances. Accordingly we have not been able to conduct sample based testing surrounding the valuation of these balances and consequently to form an opinion on whether these balances contain misstatements which materially affect the group balances at 30 April 2022, or whether there was any consequential effect on the group's comparative cost of sales for the year ended 30 April 2023. Our audit opinion on the group's financial statements for the year ended 30 April 2023 was modified accordingly. Our opinion on the current period's financial statements is also modified because of the possible effect of this matter on the comparability of the group's current year and corresponding figures.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualified opinion.
BAYBUTT INVESTMENTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BAYBUTT INVESTMENTS LIMITED
- 5 -
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 and 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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the 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 strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
Except for the matters described in the basis for qualified opinion section of our report, in the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
Matters on which we are required to report by exception
Arising solely of the limitation on our work relating to stock balances at 30 April 2022, referred to above:
we have not obtained all the information and explanations that we considered necessary for the purpose of our audit; and
we were unable to determine whether adequate accounting records had been maintained.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
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.
BAYBUTT INVESTMENTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BAYBUTT INVESTMENTS LIMITED
- 6 -
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the group and 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.
Auditor responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
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 specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud, are detailed below:
Enquiries with management about any known or suspected instances of non-compliance with laws and regulations and fraud;
Auditing the risk of fraud in revenue, through the consideration of revenue accounting policies and subsequently reviewing the correct application of income cut off procedures around the balance sheet date and transaction testing to provide comfort that revenue is completely stated within the financial statements;
Reviewing that seasonal workers possessed the requisite rights to work in the country and that the group operated all aspects of payroll in a proper manner;
Challenging assumptions and judgements made by management in their significant accounting estimates; and
Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
BAYBUTT INVESTMENTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BAYBUTT INVESTMENTS LIMITED
- 7 -
Joe Sullivan FCA
Senior Statutory Auditor
For and on behalf of MHA, Statutory Auditor
Preston, United Kingdom
31 January 2025
MHA is the trading name of MacIntyre Hudson LLP, a limited liability partnership in England and Wales (registered number OC312313)
BAYBUTT INVESTMENTS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 APRIL 2024
- 8 -
2024
2023
Notes
£
£
Turnover
3
16,410,263
14,206,750
Cost of sales
(11,305,958)
(9,998,968)
Gross profit
5,104,305
4,207,782
Distribution costs
(180,314)
(94,304)
Administrative expenses
(3,636,779)
(3,000,370)
Other operating income
359,786
277,038
Operating profit
4
1,646,998
1,390,146
Interest receivable and similar income
8
788
Interest payable and similar expenses
9
(409,284)
(288,377)
Profit before taxation
1,237,714
1,102,557
Tax on profit
10
(434,482)
(230,227)
Profit for the financial year
803,232
872,330
Profit for the financial year is attributable to:
- Owners of the parent company
757,997
825,452
- Non-controlling interests
45,235
46,878
803,232
872,330
Total comprehensive income for the year is attributable to:
- Owners of the parent company
757,997
825,452
- Non-controlling interests
45,235
46,878
803,232
872,330
The Statement of Comprehensive Income has been prepared on the basis that all operations are continuing operations.
BAYBUTT INVESTMENTS LIMITED
GROUP BALANCE SHEET
AS AT
30 APRIL 2024
30 April 2024
- 9 -
2024
2023
Notes
£
£
£
£
Fixed assets
Goodwill
12
572,917
859,375
Tangible assets
13
14,322,544
13,025,838
Investments
14
500,000
500,000
15,395,461
14,385,213
Current assets
Stocks
17
2,295,849
1,891,637
Debtors
16
277,092
565,225
Cash at bank and in hand
216
61
2,573,157
2,456,923
Creditors: amounts falling due within one year
18
(4,905,755)
(4,040,173)
Net current liabilities
(2,332,598)
(1,583,250)
Total assets less current liabilities
13,062,863
12,801,963
Creditors: amounts falling due after more than one year
19
(6,503,599)
(7,087,783)
Provisions for liabilities
Deferred tax liability
22
1,150,127
965,775
(1,150,127)
(965,775)
Net assets
5,409,137
4,748,405
Capital and reserves
Called up share capital
24
3
3
Other reserves
25
4,424,997
4,424,997
Profit and loss reserves
930,939
290,442
Equity attributable to owners of the parent company
5,355,939
4,715,442
Non-controlling interests
53,198
32,963
5,409,137
4,748,405
The financial statements were approved by the board of directors and authorised for issue on 31 January 2025 and are signed on its behalf by:
31 January 2025
Mr J R Baybutt
Director
Company registration number 09954658 (England and Wales)
BAYBUTT INVESTMENTS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 APRIL 2024
- 10 -
Share capital
Other reserves
Profit and loss reserves
Total controlling interest
Non-controlling interest
Total
Notes
£
£
£
£
£
£
Balance at 1 May 2022
3
4,424,997
(456,010)
3,968,990
11,085
3,980,075
Year ended 30 April 2023:
Profit and total comprehensive income
-
-
825,452
825,452
46,878
872,330
Dividends
11
-
-
(79,000)
(79,000)
(25,000)
(104,000)
Balance at 30 April 2023
3
4,424,997
290,442
4,715,442
32,963
4,748,405
Year ended 30 April 2024:
Profit and total comprehensive income
-
-
757,997
757,997
45,235
803,232
Dividends
11
-
-
(117,500)
(117,500)
(25,000)
(142,500)
Balance at 30 April 2024
3
4,424,997
930,939
5,355,939
53,198
5,409,137
BAYBUTT INVESTMENTS LIMITED
COMPANY BALANCE SHEET
AS AT 30 APRIL 2024
30 April 2024
- 11 -
2024
2023
Notes
£
£
£
£
Fixed assets
Investments
14
5,880,844
5,880,844
Current assets
-
-
Creditors: amounts falling due within one year
18
(1,455,844)
(1,455,844)
Net current liabilities
(1,455,844)
(1,455,844)
Net assets
4,425,000
4,425,000
Capital and reserves
Called up share capital
24
3
3
Other reserves
25
4,424,997
4,424,997
Total equity
4,425,000
4,425,000
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £117,500 (2023 - £79,000 profit).
The financial statements were approved by the board of directors and authorised for issue on 31 January 2025 and are signed on its behalf by:
31 January 2025
Mr J R Baybutt
Director
Company registration number 09954658 (England and Wales)
BAYBUTT INVESTMENTS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 APRIL 2024
- 12 -
Share capital
Other reserves
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 May 2022
3
4,424,997
4,425,000
Year ended 30 April 2023:
Profit and total comprehensive income for the year
-
-
79,000
79,000
Dividends
11
-
-
(79,000)
(79,000)
Balance at 30 April 2023
3
4,424,997
4,425,000
Year ended 30 April 2024:
Profit and total comprehensive income
-
-
117,500
117,500
Dividends
11
-
-
(117,500)
(117,500)
Balance at 30 April 2024
3
4,424,997
4,425,000
BAYBUTT INVESTMENTS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 APRIL 2024
- 13 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
30
2,987,771
2,357,526
Interest paid
(409,284)
(288,377)
Income taxes (paid)/refunded
(3,423)
158,477
Net cash inflow from operating activities
2,575,064
2,227,626
Investing activities
Purchase of tangible fixed assets
(1,614,053)
(1,944,302)
Proceeds from disposal of tangible fixed assets
85,115
15,000
Interest received
788
Net cash used in investing activities
(1,528,938)
(1,928,514)
Financing activities
Proceeds from new bank loans
-
1,167,250
Repayment of bank loans
(389,177)
(388,499)
Payment of finance leases obligations
(555,785)
(290,795)
Dividends paid to equity shareholders
(117,500)
(79,000)
Dividends paid to non-controlling interests
(25,000)
(25,000)
Net cash (used in)/generated from financing activities
(1,087,462)
383,956
Net (decrease)/increase in cash and cash equivalents
(41,336)
683,068
Cash and cash equivalents at beginning of year
(739,126)
(1,422,194)
Cash and cash equivalents at end of year
(780,462)
(739,126)
Relating to:
Cash at bank and in hand
216
61
Bank overdrafts included in creditors payable within one year
(780,678)
(739,187)
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
- 14 -
1
Accounting policies
Company information
Baybutt Investments Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 467 Moss Lane, Hesketh Bank, Preston, PR4 6XJ.
The group consists of Baybutt Investments Limited and all of its subsidiaries.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:
Section 4 ‘Statement of Financial Position’ – Reconciliation of the opening and closing number of shares;
Section 7 ‘Statement of Cash Flows’ – Presentation of a statement of cash flow and related notes and disclosures;
Section 33 ‘Related Party Disclosures’ – Compensation for key management personnel.
1.2
Business combinations
In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.
Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 15 -
1.3
Basis of consolidation
The consolidated group financial statements consist of the financial statements of the parent company Baybutt Investments Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.
All financial statements are made up to 30 April 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Baybutt Holdings Limited has been included in the group financial statements using the purchase method of accounting. Accordingly, the group profit and loss account and statement of cash flows include the results and cash flows of Baybutt Holdings Limited for the period from its acquisition on 4 March 2016. The purchase consideration has been allocated to the assets and liabilities on the basis of fair value at the date of acquisition. The same is true in respect of Alan Baybutt & Sons Limited.
1.4
Going concern
The group has retained its close links with key customers who are looking to source goods from the next cycle of crops. At the time of approving the financial statements, the directors have also secured sufficient labour to harvest its crops in the upcoming Summer season.
Taking all of this into account, along with the budgets prepared and evidence obtained from interim accounts, the directors have at the time of approving the financial statements every expectation that the group and parent company has adequate resources to continue in operational existence for the foreseeable future and at the very least, greater than one year from the date of the audit report. As a consequence they continue to adopt the going concern basis of accounting in preparing the financial statements.
1.5
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 16 -
1.6
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is ten years.
For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.
1.7
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:
Freehold land and buildings
No depreciation on land. Buildings over 15 years
Plant and equipment
15% or 25% reducing balance
Fixtures and fittings
25% reducing balance or 33% on cost
Motor vehicles
25% reducing balance
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.
1.8
Fixed asset investments
Interests in subsidiaries, and other investments, are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in the statement of comprehensive income.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
Interests in unlisted investments are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 17 -
1.9
Impairment of fixed assets
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss.
1.10
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.11
Cash and cash equivalents
Cash at bank and in hand are basic financial assets and include cash in hand, deposits held at call with banks and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 18 -
1.12
Financial instruments
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets
All of the group's financial assets are basic financial instruments.
Impairment of financial assets
Financial assets are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 19 -
Basic financial liabilities
Basic financial liabilities, including creditors and bank loans are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
All of the group's financial liabilities are basic financial instruments.
Derecognition of financial liabilities
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
1.13
Equity instruments
Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
1.14
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 20 -
1.15
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.16
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.17
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 21 -
2
Judgements and key sources of estimation uncertainty
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Useful economic life of goodwill
The useful economic life of goodwill is based upon the directors' assessment of the stability of several factors, including (but not limited to) the market, key contracts, barriers to competition and the durability of key customer bases. A useful economic life of 10 years is applied to goodwill.
Carrying value of fixed asset investment
The group has made a material investment in another trading group. The directors have assessed the carrying value for any indications of impairment at the year end. As the directors have access to timely financial information and a seat on the board of the investment, they are equipped with relevant information to aid their considered judgement. In addition this is a complimentary investment to the business, meaning they can employ their many years of experience to benefit their judgement in this regard. At the balance sheet date, the directors judge that there are no indications of impairment.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Growing stock
Determining the year end stock value requires estimation of the quantities of items in the ground at the year end which were yielded and sold post year end. Information on post year end yields is available and can be used with the directors' knowledge of sowing periods to obtain a materially correct estimate of the quantities which were sown pre year end.
3
Turnover and other revenue
An analysis of the group's turnover is as follows:
2024
2023
£
£
Turnover analysed by class of business
Sales of produce
16,297,947
14,081,394
Other sales
112,316
125,356
16,410,263
14,206,750
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
3
Turnover and other revenue
(Continued)
- 22 -
2024
2023
£
£
Other revenue
Interest income
-
788
Rent received
304,298
254,372
Sundry income
31,626
8,694
4
Operating profit
2024
2023
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange gains
(580)
-
Depreciation of owned tangible fixed assets
526,031
404,970
Depreciation of tangible fixed assets held under finance leases
219,393
220,453
Profit on disposal of tangible fixed assets
(8,090)
(15,000)
Amortisation of intangible assets
286,458
286,458
Operating lease charges
524,412
413,731
5
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
3,000
1,750
Audit of the financial statements of the company's subsidiaries
16,600
9,170
19,600
10,920
6
Employees
The average monthly number of persons (including directors) employed by the group and company during the year was:
Group
Company
2024
2023
2024
2023
Number
Number
Number
Number
Directors
3
3
3
3
Seasonal employees
97
87
-
-
Permanent employees
27
25
-
-
Total
127
115
3
3
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
6
Employees
(Continued)
- 23 -
Their aggregate remuneration comprised:
Group
Company
2024
2023
2024
2023
£
£
£
£
Wages and salaries
4,742,719
3,871,567
Social security costs
482,533
412,233
-
-
Pension costs
78,307
86,376
5,303,559
4,370,176
7
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
18,620
14,918
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounts to 3.
8
Interest receivable and similar income
2024
2023
£
£
Interest income
Other interest income
-
788
9
Interest payable and similar expenses
2024
2023
£
£
Interest on bank overdrafts and loans
382,355
267,980
Interest on finance leases and hire purchase contracts
26,929
20,397
Total finance costs
409,284
288,377
10
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
250,130
3,423
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
10
Taxation
2024
2023
£
£
(Continued)
- 24 -
Deferred tax
Origination and reversal of timing differences
179,726
215,585
Changes in tax rates
4,626
11,219
Total deferred tax
184,352
226,804
Total tax charge
434,482
230,227
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2024
2023
£
£
Profit before taxation
1,237,714
1,102,557
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
309,429
209,486
Tax effect of expenses that are not deductible in determining taxable profit
9,782
4,935
Tax effect of income not taxable in determining taxable profit
(14,154)
Effect of change in corporation tax rate
56,861
11,219
Amortisation on assets not qualifying for tax allowances
71,614
54,427
Super deduction element
(49,840)
Gains/rollover relief
950
Taxation charge
434,482
230,227
The headline rate of corporation tax increased to 25% from 1 April 2023.
11
Dividends
2024
2023
Recognised as distributions to equity holders:
£
£
Final paid
117,500
79,000
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 25 -
12
Intangible fixed assets
Group
Goodwill
£
Cost
At 1 May 2023 and 30 April 2024
2,864,581
Amortisation and impairment
At 1 May 2023
2,005,206
Amortisation charged for the year
286,458
At 30 April 2024
2,291,664
Carrying amount
At 30 April 2024
572,917
At 30 April 2023
859,375
The company had no intangible fixed assets at 30 April 2024 or 30 April 2023.
13
Tangible fixed assets
Group
Freehold land and buildings
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 May 2023
9,155,889
5,782,638
31,203
368,893
15,338,623
Additions
369,848
1,578,182
171,125
2,119,155
Disposals
(80,000)
(80,000)
At 30 April 2024
9,525,737
7,280,820
31,203
540,018
17,377,778
Depreciation and impairment
At 1 May 2023
330,021
1,819,212
27,482
136,070
2,312,785
Depreciation charged in the year
662,681
1,087
81,656
745,424
Eliminated in respect of disposals
(2,975)
(2,975)
At 30 April 2024
330,021
2,478,918
28,569
217,726
3,055,234
Carrying amount
At 30 April 2024
9,195,716
4,801,902
2,634
322,292
14,322,544
At 30 April 2023
8,825,868
3,963,426
3,721
232,823
13,025,838
The company had no tangible fixed assets at 30 April 2024 or 30 April 2023.
Land with a total carrying value of £5,920,172 (2022: £5,570,172) is included within freehold land and buildings.
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 26 -
14
Fixed asset investments
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Investments in subsidiaries
15
5,880,844
5,880,844
Unlisted investments
500,000
500,000
500,000
500,000
5,880,844
5,880,844
Movements in fixed asset investments
Group
Investments
£
Cost or valuation
At 1 May 2023 and 30 April 2024
500,000
Carrying amount
At 30 April 2024
500,000
At 30 April 2023
500,000
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 May 2023 and 30 April 2024
5,880,844
Carrying amount
At 30 April 2024
5,880,844
At 30 April 2023
5,880,844
15
Subsidiaries
Details of the company's subsidiaries at 30 April 2024 are as follows:
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Indirect
Alan Baybutt & Sons Limited
467 Moss Lane, Preston, PR4 6XJ
Ordinary A
-
95.00
Baybutt Holdings Limited
467 Moss Lane, Preston, PR4 6XJ
Ordinary A
100.00
-
The group also owns 50% of Crossens Group Limited. At 30 April 2024 Crossens Group Limited had net assets of £100 (2023: £100).
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 27 -
16
Debtors
Group
Company
2024
2023
2024
2023
Amounts falling due within one year:
£
£
£
£
Trade debtors
187,681
305,512
Other debtors
77,539
107,983
Prepayments and accrued income
11,872
151,730
277,092
565,225
-
-
17
Stocks
Group
Company
2024
2023
2024
2023
£
£
£
£
Consumables and produce for resale
2,295,849
1,891,637
18
Creditors: amounts falling due within one year
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Bank loans and overdrafts
20
1,162,127
1,113,435
Obligations under finance leases
21
546,694
409,571
Trade creditors
2,016,989
1,727,399
Amounts owed to group undertakings
1,455,844
1,455,844
Corporation tax payable
250,130
3,423
Other taxation and social security
58,916
53,970
-
-
Other creditors
837,543
698,523
Accruals and deferred income
33,356
33,852
4,905,755
4,040,173
1,455,844
1,455,844
19
Creditors: amounts falling due after more than one year
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Bank loans and overdrafts
20
5,941,459
6,337,837
Obligations under finance leases
21
562,140
749,946
6,503,599
7,087,783
-
-
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
19
Creditors: amounts falling due after more than one year
(Continued)
- 28 -
Amounts included above which fall due after five years are as follows:
Payable by instalments
3,629,691
3,913,687
-
-
20
Loans and overdrafts
Group
Company
2024
2023
2024
2023
£
£
£
£
Bank loans
6,322,908
6,712,085
Bank overdrafts
780,678
739,187
7,103,586
7,451,272
-
-
Payable within one year
1,162,127
1,113,435
Payable after one year
5,941,459
6,337,837
The long-term loans are secured by way of a cross-company unlimited guarantee between all of the companies in the group as well as fixed and floating charges over group assets, legal charges over land and buildings owned by the group and a personal guarantee from the directors.
The group has a fixed rate bank loan with an interest rate of 3.57% and a variable rate bank loan with an interest rate of 1.8% above base rate. These loans are being repaid over 20 years to February 2038. The group also has another variable rate bank loan with an interest rate of 2% above base rate. This loan is being repaid over 20 years to December 2038. The group also has another fixed rate bank loan with an interest rate of 5.902%. This loan is being repaid over 5 years to January 2028.
The group also has a fixed rate bank loan with an interest rate of 4.95%. This loan was obtained as support during the COVID-19 pandemic and had an interest free period of one year. Repayment is being made over the 5 years to October 2026.
21
Finance lease obligations
Group
Company
2024
2023
2024
2023
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
545,694
448,337
In two to five years
633,252
805,736
1,178,946
1,254,073
-
-
Less: future finance charges
(70,112)
(94,556)
1,108,834
1,159,517
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
21
Finance lease obligations
(Continued)
- 29 -
Finance lease payments represent rentals payable by the group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The usual lease term is either 3 or 5 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
Finance leases are secured over the assets to which they relate.
22
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
Liabilities
Liabilities
2024
2023
Group
£
£
Accelerated capital allowances
1,150,619
970,893
Short term timing difference
-
(5,118)
Losses
(492)
-
1,150,127
965,775
The company has no deferred tax assets or liabilities.
Group
Company
2024
2024
Movements in the year:
£
£
Liability at 1 May 2023
965,775
-
Charge to profit or loss
184,352
-
Liability at 30 April 2024
1,150,127
-
The deferred tax liability set out above is not expected to materially reverse within 12 months owing to the group's capital expenditure programme.
23
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
78,307
86,376
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 30 -
24
Share capital
Group and company
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
'A' Ordinary shares of 1p each
100
100
1
1
'B' Ordinary shares of 1p each
100
100
1
1
'C' Ordinary shares of 1p each
100
100
1
1
300
300
3
3
All share classes rank pari passu in all regards save that rights to dividends may vary.
25
Reserves
Other reserves relate to a merger reserve created upon the acquisition of Baybutt Holdings Limited. Accounting principles in respect of this business combination give rise to a merger reserve in the financial statements being the difference between the nominal value of the new shares issued by Baybutt Investments Limited and the fair value of consideration represented by this transaction.
26
Financial commitments, guarantees and contingent liabilities
A cross-company unlimited guarantee is in place in favour of the company's bankers between all the companies in the group. At the balance sheet date, group borrowings totalled £7,103,586 (2023: £7,451,272).
27
Operating lease commitments
Lessee
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
Group
Company
2024
2023
2024
2023
£
£
£
£
Within one year
31,590
155,390
-
-
Between two and five years
17,010
-
-
-
48,600
155,390
-
-
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 31 -
28
Related party transactions
Transactions with related parties
Other information
Group
Group key management personnel were paid remuneration totalling £18,620 (2023: £14,918) and rent totalling £34,000 (2023: £34,000) in the year.
During the year, the group paid dividends of £117,500 (2023: £79,000) to its directors.
Group key management personnel have loan accounts against which personal expenditure and drawings may be charged. These loan accounts have remained in credit throughout the period.
During the year, the group purchased land from other related parties for £369,848. The directors deem this transaction to be at market value.
During the year the group made sales to other related parties of £13,160,288 (2023: £11,305,526) and purchases of £786,913 (2023: £665,738).
Company
The company has taken advantage of the exemption conferred by Section 1 FRS102 from disclosing transactions covered by Section 33 FRS102, namely any entered into between two or more members of the group, provided that any subsidiary which is a party to the transaction is wholly owned by such a member.
At the balance sheet date, the company owed £1,455,844 (2023: £1,455,844) to entities over which the company has control, joint control or significant influence.
During the year, the company paid dividends of £117,500 (2022: £79,000) to its directors.
29
Controlling party
The group and company was under the control of the directors in the period. In the opinion of the directors, there is no single ultimate controlling party.
BAYBUTT INVESTMENTS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 32 -
30
Cash generated from group operations
2024
2023
£
£
Profit for the year after tax
803,232
872,330
Adjustments for:
Taxation charged
434,482
230,227
Finance costs
409,284
288,377
Investment income
(788)
Gain on disposal of tangible fixed assets
(8,090)
(15,000)
Amortisation and impairment of intangible assets
286,458
286,458
Depreciation and impairment of tangible fixed assets
745,424
625,423
Movements in working capital:
Increase in stocks
(404,212)
(207,351)
Decrease in debtors
288,133
50,796
Increase in creditors
433,060
227,054
Cash generated from operations
2,987,771
2,357,526
31
Analysis of changes in net debt - group
1 May 2023
Cash flows
New finance leases
30 April 2024
£
£
£
£
Cash at bank and in hand
61
155
-
216
Bank overdrafts
(739,187)
(41,491)
-
(780,678)
(739,126)
(41,336)
-
(780,462)
Borrowings excluding overdrafts
(6,712,085)
389,177
-
(6,322,908)
Obligations under finance leases
(1,159,517)
555,785
(505,102)
(1,108,834)
(8,610,728)
903,626
(505,102)
(8,212,204)
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