Registered number:
FOR THE YEAR ENDED 31 DECEMBER 2023
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CUSTOM MATERIALS LTD
COMPANY INFORMATION
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CUSTOM MATERIALS LTD
CONTENTS
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CUSTOM MATERIALS LTD
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors present the strategic report for the year ended 31 December 2023.
A new trading platform was launched successfully in the last quarter of the year which opens up B2B markets, substantially expanding the accessible markets for the business. The previous trading platform was closed in Oct-2023 and has been written off in full in these accounts resulting in a one time non-cash expense of £2.8m.
There remains inflationary pressures in the supply chain but the team have mitigated these as far as possible by negotiating new contracts with a number of new suppliers across the EU & US. The group showed a year-on-year revenue decrease of £2.3m (33%) from £7.0m to £4.7m primarily due to the ending of a large enterprise contract combined with a transition to launch a new trading platform. The group ended the contract with a global enterprise customer in order to refocus the business around the new trading opportunities aligned to the launch of the new B2B platform. The group has further expanded its offer of print on demand products and continues to invest in staff to develop its software platform in order to provide a robust and up to date seller experience. The business remains a remote first organisation.
The directors consider the following to be the principal risks and uncertainties of the company and group:
Credit risk The group has limited credit risk due to the retail nature of the majority of the cash flows. Liquidity risk The company finances its operations through cash EBITDA generation and during the year had a successful fundraising round. The group's policy is to maintain good relationships with its bankers and lender to ensure that appropriate facilities are in place in the future to fund the company's needs as it expands. Economic risk The group operates on a global scale and therefore is relatively well diversified in terms of economic risk. Competition The print on demand sector is competitive and as such the group continues to face competitor risk in the markets where it operates. The Directors monitor key competitors in terms of pricing and quality on a regular basis. Foreign exchange risk Foreign exchange risk arises from assets and liabilities being denominated in currencies other than the group's functional currency. The group does have significant USD and EUR assets which are materially offset by the group's operational liabilities. The net exposure is not deemed significant. Legislation The group takes a proactive approach to compliance with all relevant legislation in the countries and territories where it operates.
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CUSTOM MATERIALS LTD
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Going concern The consolidated financial statements have been prepared on the going concern basis, notwithstanding the losses incurred during the current and prior year. The directors have undertaken an exercise to review the likely cash requirements of the group to January 2026 which indicate a positive cash balance maintained over the period considered. The forecast takes account of the circumstances following the year end when the directors have taken action to control losses by streamlining IT services and reducing the costs of support using automation available through the platform & external tools. The group dissolved the subsidiary undertaking Merch Hero Limited which ceased trading in September 2023, and placed CM Fulfilment Limited into insolvency through a creditors’ voluntary liquidation process (this business being the trading company for the now decommissioned trading platform). Management recognise that there is a high degree of uncertainty in the preparation of these forecasts due to the development of a new platform, wider continuing macroeconomic uncertainties and the timings of certain cash outflows. The group is in breach of a financial covenant with its lender which is also an investor, and is expected to do so again within 12 months from the date of approval of these financial statements, however the lender has indicated that it remains supportive of the group, it has agreed not to exercise its rights with respect to the existing breaches and has agreed to continue to provide incremental funding to ensure liquidity in the group. The forecast does not include certain risk factors; being the potential rejection of research and development tax credit claims and the guarantee by the company of obligations relating to CM Fulfilment Limited. Inclusion of payment of these amounts would result in a significant shortfall in working capital that would impact the group’s ability to settle its liabilities as they fall due. However the business has a supportive relationship with its lender and investors. Nonetheless, at the date of signing the financial statements, while the directors fully expect the forecasts to be met, they recognize that there is material uncertainty and significant doubt in relation to the ability of the parent company and group to continue as a going concern, and therefore that it may be unable to realise its assets and discharge its liabilities in the normal course of business. The financial statements have been prepared on a going concern basis because management are confident of the business maintaining sufficient cash to allow the group to meet its liabilities as they fall due for at least 12 months from the approval of the financial statements.
Operational performance of the group during the year was in line with expectation (gross profit margin excluding enterprise contracts increased from 17% in 2022 to 18% in 2023) with a shift towards the core entrepreneur markets which will enable future growth through new platform capabilities. There has been a continuing strong focus on reducing costs (administrative costs excluding one-offs were reduced by £1m vs 2022). The group has maintained the investment in talent needed to support the business on the continuing development and new growth phase of the new platform.
Further funding of £1.5m debt was secured during the period of which £1m was received in Q4-23. This will support the next phase in growth of the new platform and the integration of new channels to access wider market opportunities.
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CUSTOM MATERIALS LTD
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
This report was approved by the board and signed on its behalf.
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CUSTOM MATERIALS LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors present their report and the financial statements for the year ended 31 December 2023.
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.
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;
∙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 2006. They 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.
The loss for the year, after taxation, amounted to £7,441k (2022 - loss £2,982k).
No dividends were declared during the year (2022 - Nil).
The directors who served during the year were:
The development of the new trading platform will continue throughout the next 12-18 months, increasing materially the accessible markets and delivering substantial benefits in service to both customers and printers. The directors anticipate that this will lead to significantly increased revenue and future profitability.
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CUSTOM MATERIALS LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Certain items required under Schedule 7 to be disclosed in the Directors' Report are set out in the Strategic Report in accordance with S.414C(II) of the Companies Act 2006; these being the Group's principle risks and uncertainties.
The Group enacted restructuring of 2 subsidiaries to simplify the business as a whole and dissolved 2 dormant subsidiaries in 2024 (Merch Hero Ltd which ceased trading in September 2023 and Marcazo Ltd which had been dormant for the whole of 2023).
In August 2024, CM Fulfilment Ltd (the 100% owned subsidiary for the fully decommissioned trading platform) was placed into insolvency through a Creditors' Voluntary Liquidation process. The obligations of that company were guaranteed by Custom Materials Ltd, and there is a risk that a consequential claim may be made.
The auditor, MHA, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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CUSTOM MATERIALS LTD
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CUSTOM MATERIALS LTD
We have audited the financial statements of Custom Materials Ltd (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2023, 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 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).
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.
We draw attention to note 2.3 in the financial statements, which identifies that the Group has made successive losses and is in a net liability position at the year end. As stated in note 2.3, these events or conditions, along with other matters as set forth within the same note, indicate that a material uncertainty exists that may cast significant doubt on the Group's and the parent Company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.
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.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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CUSTOM MATERIALS LTD
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CUSTOM MATERIALS LTD (CONTINUED)
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.
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.
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.
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CUSTOM MATERIALS LTD
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CUSTOM MATERIALS LTD (CONTINUED)
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:
∙enquiry of management around actual and potential litigation claims;
∙enquiry of entity staff to identify any instances of non-compliance with laws and regulations;
∙performing audit work over the risk of management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias;
∙reviewing minutes of meetings of those charged with governance; and
∙reviewing financial statement disclosures and testing to supporting documentation to assess compliance
with applicable laws and regulation.
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 for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditor's Report.
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CUSTOM MATERIALS LTD
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CUSTOM MATERIALS LTD (CONTINUED)
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.
for and on behalf of
Statutory Auditor
Maidstone
United Kingdom MHA is the trading name of MacIntyre Hudson LLP, a limited liability partnership registered in England and Wales (registered number OC312313)
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CUSTOM MATERIALS LTD
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
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CUSTOM MATERIALS LTD
REGISTERED NUMBER: 09185258
CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 19 to 41 form part of these financial statements.
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CUSTOM MATERIALS LTD
REGISTERED NUMBER: 09185258
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023
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CUSTOM MATERIALS LTD
REGISTERED NUMBER: 09185258
COMPANY BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 19 to 41 form part of these financial statements.
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CUSTOM MATERIALS LTD
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
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CUSTOM MATERIALS LTD
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
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CUSTOM MATERIALS LTD
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
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CUSTOM MATERIALS LTD
CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
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CUSTOM MATERIALS LTD
CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2023
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Custom Materials Ltd (the "Company") is a private company limited by shares incorporated in England and Wales in the United Kingdom. The address of the registered office is 6th Floor One London Wall, London, United Kingdom, EC2Y 5EB.
The financial statements are peresented in sterling which is the functional currency of the company and is rounded to the nearest £1,000.
2.Accounting policies
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 following principal accounting policies have been applied:
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.
The consolidated financial statements incorporate the results of 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.
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
The consolidated financial statements have been prepared on the going concern basis, notwithstanding the losses incurred during the current and prior year. The directors have undertaken an exercise to review the likely cash requirements of the group to January 2026 which indicate a positive cash balance maintained over the period considered. The forecast takes account of the circumstances following the year end when the directors have taken action to control losses by streamlining IT services and reducing the costs of support using automation available through the platform & external tools. The group dissolved the subsidiary undertaking Merch Hero Limited which ceased trading in September 2023, and placed CM Fulfilment Limited into insolvency through a creditors’ voluntary liquidation process (this business being the trading company for the now decommissioned trading platform).
Management recognise that there is a high degree of uncertainty in the preparation of these forecasts due to the development of a new platform, wider continuing macroeconomic uncertainties and the timings of certain cash outflows. The group is in breach of a financial covenant with its lender which is also an investor, and is expected to do so again within 12 months from the date of approval of these financial statements, however the lender has indicated that it remains supportive of the group, it has agreed not to exercise its rights with respect to the existing breaches and has agreed to continue to provide incremental funding to ensure liquidity in the group. The forecast does not include certain risk factors; being the potential rejection of research and development tax credit claims and the guarantee by the company of obligations relating to CM Fulfilment Limited. Inclusion of payment of these amounts would result in a significant shortfall in working capital that would impact the group’s ability to settle its liabilities as they fall due. However the business has a supportive relationship with its lender and investors. Nonetheless, at the date of signing the financial statements, while the directors fully expect the forecasts to be met, they recognize that there is material uncertainty and significant doubt in relation to the ability of the parent company and group to continue as a going concern, and therefore that it may be unable to realise its assets and discharge its liabilities in the normal course of business. The financial statements have been prepared on a going concern basis because management are confident of the business maintaining sufficient cash to allow the group to meet its liabilities as they fall due for at least 12 months from the approval of the financial statements.
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Functional and presentation currency
Transactions and balances
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
The fair value of the award also takes into account non-vesting conditions. These are either factors beyond the control of either party (such as a target based on an index) or factors which are within the control of one or other of the parties (such as the Group keeping the scheme open or the employee maintaining any contributions required by the scheme). Where the terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured immediately before and after the modification, is also charged to profit or loss over the remaining vesting period. Where equity instruments are granted to persons other than employees, profit or loss is charged with fair value of goods and services received.
In line with its Terms & Conditions, the Group reserves the right to provide against customer credit balances which remain on its balance sheet after 24 months and which it deems highly unlikely to be claimed and to release the balances to Statement of Comprehensive Income. The obligation to pay out a balance remains in place should a customer request it.
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
All intangible assets are considered to have a finite useful life of five years.
At each reporting date the Group assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives.
Depreciation is provided on the following basis:
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.
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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.
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.
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
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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.
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.
The estimates and associated assumptions are based on historical experience and other factors that are 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. Share based payments Share options as set out in note 20 to the accounts have been granted to employees of the Company. As disclosed in the share-based payments accounting policy, the fair value of any vested share options is recognised in profit and loss. Intangible fixed assets In assessing expenditure on research and development that should be capitalised, management makes judgements as to the future economic benefits of the assets developed based on future business growth. Each year, management review the carrying value of intangibles for signs of impairment with reference to the future trading performance of the platform. This resulted in a £2.8m impairment charge in the year as detailed in note 12.
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Analysis of turnover by country of destination:
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
10.Taxation (continued)
The Group has not recognised a deferred tax asset of £3,963k (2022: £2,875k) in respect of trade losses carried forward of £15,852k (2022: £11,498k) on the basis that it is uncertain whether there will be any available future taxable profits.
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
12.Intangible assets (continued)
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
13.Tangible fixed assets (continued)
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
All share classes have full voting and dividend rights, they entitle the holder to a variable return on a capital distribution (depending on the amount to be distributed) and are non-redeemable.
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Share premium account
Share based payment reserve
Profit and loss account
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Both the company and consolidated balance sheets are marked as restated in the prior year in respect of amended disclosure of debtor and creditor balances - these restatements have had no impact on net assets of either balance sheet.
The Consolidated Statement of Cash Flows in the prior year has been restated in respect of taxation received of £1,312k. This balance was accrued and not received in the year, and the statement has been amended to reflect that. Other reserves in respect of equity based share options was overstated in the prior year by £364k. A prior year adjustment has been recognised to correct this, decreasing the reserve balance and staff costs by the stated amount. This adjustment had no tax impact, and has decreased the net assets of the company by the stated amount.
Research & Development claims were made in respect of accounting periods ended 31 December 2021 and 31 December 2022 which gave rise to total tax credits paid to the Group of £1,429k. These claims have since been subjected to enquiry by HMRC, who have concluded that the claims made do not meet the required criteria.
The Company has appealed HMRC's decision and have confidence their claim and supporting evidence satisfies legislative requirements. As the probability of the outcome cannot be reliably determined and therefore a reasonable estimate cannot be arrived at, no liability has been recognised in these financial statements.
The Group operated a defined contribution 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 £43k (2022 - £123k). Contributions totally £7k (2022 - £nil) were payable to the fund at the balance sheet date and are included within creditors.
In August 2024, CM Fulfilment Ltd (the 100% owned subsidiary for the fully decommissioned trading platform) was placed into insolvency through a Creditors' Voluntary Liquidation process. The obligations of that company were guaranteed by Custom Materials Ltd, and there is a risk that a consequential claim may be made.
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CUSTOM MATERIALS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
In the opinion of the directors there is no ultimate controlling party.
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