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REGISTERED NUMBER: 11267668 (England and Wales)















Merlin Diesel Holdings Limited

Group Strategic Report,

Report of the Directors and

Audited

Consolidated Financial Statements

for the Year Ended 31 July 2024






Merlin Diesel Holdings Limited (Registered number: 11267668)






Contents of the Consolidated Financial Statements
for the year ended 31 July 2024




Page

Company Information 1

Group Strategic Report 2

Report of the Directors 5

Report of the Independent Auditors 7

Consolidated Income Statement 10

Consolidated Other Comprehensive Income 11

Consolidated Balance Sheet 12

Company Balance Sheet 13

Consolidated Statement of Changes in Equity 14

Company Statement of Changes in Equity 15

Consolidated Cash Flow Statement 16

Notes to the Consolidated Cash Flow Statement 17

Notes to the Consolidated Financial Statements 19


Merlin Diesel Holdings Limited

Company Information
for the year ended 31 July 2024







DIRECTORS: LK Bramley
S Bramley
M Rawlinson
MF Brown
JE Morley
DJ Henry
AT Ashcroft
AG James





SECRETARY: EC Bramley





REGISTERED OFFICE: 189/191 Bradkirk Place
Walton Summit
Preston
Lancashire
PR5 8AJ





REGISTERED NUMBER: 11267668 (England and Wales)





AUDITORS: McMillan & Co LLP
Chartered Accountants and
Statutory Auditor
28 Eaton Avenue
Matrix Office Park
Buckshaw Village
Chorley
Lancashire
PR7 7NA

Merlin Diesel Holdings Limited (Registered number: 11267668)

Group Strategic Report
for the year ended 31 July 2024

The directors present their strategic report of the company and the group for the year ended 31 July 2024.

REVIEW OF BUSINESS
Merlin Diesel Holdings Limited is the parent company of a group dedicated to the supply of parts and servicing of fuel systems for diesel engines. In addition the Group manufactures the machinery necessary for servicing and testing fuel systems for all diesel engines including large marine engines and generators.

The Group recorded sales in the year ended 31 July 2024 of £75.0m (2023: £68.5m), an increase of £6.5m (9.5%). Despite the strengthening of sterling over the euro, the Group's products continue to be attractive to the European market, as well as domestically.

The gross margin percentage has remained consistent at 25.5% (2023: 26.1%) and with the increased revenues this has flowed through to create operating profit of £7.4m (2023: £6.6m).

The Group continued to invest in stock holding during the year and the closing net stock balance was £31.0m (2023: £28.8m).

At 31 July 2024 the net assets, excluding non controlling interests, of the Group were £31.2m (2023: £26.7m).

PRINCIPAL RISKS AND UNCERTAINTIES
The principal risks and uncertainties facing the company relate to:

- Maintaining margins and cash management.
- Maintaining a quality stockholding.
- Liquidity risk and annual renewal of overdraft facility.
- Impact of trading resulting from the Ukraine conflict.
- Adverse exchange rate movements.


KEY PERFORMANCE INDICATORS
2024 2023

Gross profit margins (gross profit/turnover) 25.5% 26.1%

Net stockholding £31.0m £28.8m

Stock turn (stock/cost of sales x 365 days) 203 days 208 days



Merlin Diesel Holdings Limited (Registered number: 11267668)

Group Strategic Report
for the year ended 31 July 2024

SECTION 172(1) STATEMENT
Introduction
As directors we are committed to promoting the success of the company for the benefit of the Group as a whole. In doing so, we have regard to the matters set out in Section 172(1) of the Companies Act 2006.

Long-Term Decision Making
We consider the likely consequences of our decisions in the long term. This includes evaluating the sustainability of our business model, investing in innovation, and ensuring that our strategic plans align with our long-term goals.

Employee Interests
Our employees are our most valuable asset. We strive to create a positive working environment, offer opportunities for professional development, and ensure fair treatment and equal opportunities for all.

The board address the employees in forums to update them on the Group's performance and to enable employees to put forward comments and feedback together with any suggestions for change.

Business Relationships
Under S172 of the Companies Act 2006 the directors have a duty to act in good faith in a way that is most likely to promote the success of the Group for the benefit of its members as a whole, having regard to the likely consequences of decisions for the long term, the interests of the Group's employees, the need to foster relationships with suppliers, customers, and other stakeholders, the impact on the community and the environment, maintaining a reputation for high standards of business conduct, and the need to act fairly as between members of the Group.

Regular supply meetings take place where any feedback on quality, delivery and payment times can be discussed openly and honestly.

Community and Environment
We are committed to minimizing our environmental impact and contributing positively to the communities in which we operate. This includes implementing sustainable practices and supporting local initiatives or charities for example wherever possible.

High Standards of Business Conduct
Maintaining a reputation for high standards of business conduct is crucial to our success. We adhere to ethical practices, comply with all relevant regulations, and promote a culture of integrity within the company.

Fairness Between Members
The Directors and staff own 100% of the shares of Merlin Diesel Holdings Limited, and as such the shareholders of Merlin Diesel Holdings Limited hold an implicit knowledge of the decisions made by the Directors.

Conclusion
The directors are dedicated to promoting the success of the group while considering the broader impact of our actions on employees, business partners, the community, and the environment.


Merlin Diesel Holdings Limited (Registered number: 11267668)

Group Strategic Report
for the year ended 31 July 2024

ENERGY AND EMISSIONS REPORT
In the year we consumed the following energy in the support of the trade.

2024 2023

UK energy use kWh 1,472,877 1,171,697

Associated greenhouse gas emissions - tonnes of CO2
equivalent


304.96


242.63

Intensity ratio emissions per £million turnover 4.06 3.54

UK energy use covers gas and electricity at our warehouse. Associated greenhouse gases have been calculated using the methodology set out in "2024 Government Greenhouse Gas Conversion Factors for Company Reporting".

ON BEHALF OF THE BOARD:





LK Bramley - Director


30 January 2025

Merlin Diesel Holdings Limited (Registered number: 11267668)

Report of the Directors
for the year ended 31 July 2024

The directors present their report with the financial statements of the company and the group for the year ended 31 July 2024.

PRINCIPAL ACTIVITY
The principal activity of the group in the year under review was that of holding company

DIVIDENDS
A dividend of £1,157,222 (2023: £1,193,196) was paid in the year.

FUTURE DEVELOPMENTS
The Group is totally dedicated to maintaining a high quality service, with the right machinery and the necessary highly skilled engineers.

DIRECTORS
The directors shown below have held office during the whole of the period from 1 August 2023 to the date of this report.

LK Bramley
S Bramley
M Rawlinson
MF Brown
JE Morley
DJ Henry
AT Ashcroft
AG James

Other changes in directors holding office are as follows:

K Bramley (deceased) - deceased 13 October 2023

STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Group Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

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

- select suitable accounting policies and then apply them consistently;
- make judgements and accounting estimates that are reasonable and prudent;
- state whether applicable accounting standards have been followed, subject to any material departures
disclosed and explained in the financial statements;
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

Merlin Diesel Holdings Limited (Registered number: 11267668)

Report of the Directors
for the year ended 31 July 2024


AUDITORS
The auditors, McMillan & Co LLP, are deemed to be reappointed under section 487(2) of the Companies Act 2006.

ON BEHALF OF THE BOARD:





LK Bramley - Director


30 January 2025

Report of the Independent Auditors to the Members of
Merlin Diesel Holdings Limited

Opinion
We have audited the financial statements of Merlin Diesel Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 July 2024 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:
-give a true and fair view of the state of the group's and of the parent company affairs as at 31 July 2024 and of the group's profit for the year then ended;
-have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' 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 UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

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

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

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

Other information
The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether 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 the audit:
- the information given in the Group Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Group Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Report of the Independent Auditors to the Members of
Merlin Diesel Holdings Limited


Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Directors.

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

Responsibilities of directors
As explained more fully in the Statement of Directors' Responsibilities set out on page five, 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 necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

Auditors' 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 a Report of the Auditors 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.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

- the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
- we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the sector;
- we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation and data protection, anti-bribery, employment, environmental and health and safety legislation;
- we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
- identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

Report of the Independent Auditors to the Members of
Merlin Diesel Holdings Limited


We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:


- making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
- considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

To address the risk of fraud through management bias and override of controls, we:

- performed analytical procedures to identify any unusual or unexpected relationships; and
- tested journal entries to identify unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

- agreeing financial statement disclosures to underlying supporting documentation;
- reading the minutes of meetings of those charged with governance;
- enquiring of management as to actual and potential litigation and claims; and
- reviewing correspondence with HMRC, relevant regulators including the Health and Safety Executive, and the company's legal advisors.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

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 Report of the Auditors.

Use of our report
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors 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.




Andrea Gerring FCA (Senior Statutory Auditor)
for and on behalf of McMillan & Co LLP
Chartered Accountants and
Statutory Auditor

30 January 2025

Merlin Diesel Holdings Limited (Registered number: 11267668)

Consolidated Income Statement
for the year ended 31 July 2024

2024 2023
Notes £ £ £ £

TURNOVER 3 75,027,831 68,509,204

Cost of sales 55,925,501 50,652,248
GROSS PROFIT 19,102,330 17,856,956

Distribution costs 7,154,059 6,983,813
Administrative expenses 4,543,633 4,275,404
11,697,692 11,259,217
7,404,638 6,597,739

Other operating income - 12,941
OPERATING PROFIT 5 7,404,638 6,610,680

Interest receivable and similar income 40,797 19,034
Other finance income 24 45,000 3,000
85,797 22,034
7,490,435 6,632,714

Interest payable and similar expenses 6 172,094 205,261
PROFIT BEFORE TAXATION 7,318,341 6,427,453

Tax on profit 7 1,577,733 1,213,567
PROFIT FOR THE FINANCIAL YEAR 5,740,608 5,213,886
Profit attributable to:
Owners of the parent 5,623,342 5,184,007
Non-controlling interests 117,266 29,879
5,740,608 5,213,886

Merlin Diesel Holdings Limited (Registered number: 11267668)

Consolidated Other Comprehensive Income
for the year ended 31 July 2024

2024 2023
Notes £ £

PROFIT FOR THE YEAR 5,740,608 5,213,886


OTHER COMPREHENSIVE INCOME
Actuarial gain/loss on pension scheme 56,000 697,000
Income tax relating to other
comprehensive income

(14,000

)

(174,250

)
OTHER COMPREHENSIVE INCOME
FOR THE YEAR, NET OF INCOME TAX

42,000

522,750
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR

5,782,608

5,736,636

Total comprehensive income attributable to:
Owners of the parent 5,665,342 5,706,757
Non-controlling interests 117,266 29,879
5,782,608 5,736,636

Merlin Diesel Holdings Limited (Registered number: 11267668)

Consolidated Balance Sheet
31 July 2024

2024 2023
Notes £ £ £ £
FIXED ASSETS
Intangible assets 10 129,337 258,673
Tangible assets 11 5,023,738 5,142,336
Investments 12 9,909 9,909
5,162,984 5,410,918

CURRENT ASSETS
Stocks 13 31,029,635 28,845,195
Debtors 14 9,333,125 8,262,933
Cash at bank and in hand 1,323,234 517,665
41,685,994 37,625,793
CREDITORS
Amounts falling due within one year 15 15,125,199 16,173,299
NET CURRENT ASSETS 26,560,795 21,452,494
TOTAL ASSETS LESS CURRENT
LIABILITIES

31,723,779

26,863,412

CREDITORS
Amounts falling due after more than one
year

16

(593,237

)

(29,506

)

PROVISIONS FOR LIABILITIES 20 (277,295 ) (430,684 )

PENSION ASSET 24 757,500 625,500
NET ASSETS 31,610,747 27,028,722

CAPITAL AND RESERVES
Called up share capital 21 92,400 92,840
Share premium 22 48,179 91,100
Capital redemption reserve 22 1,900 1,460
Other reserves 22 69,380 69,380
Retained earnings 22 30,940,401 26,432,721
SHAREHOLDERS' FUNDS 31,152,260 26,687,501

NON-CONTROLLING INTERESTS 23 458,487 341,221
TOTAL EQUITY 31,610,747 27,028,722

The financial statements were approved by the Board of Directors and authorised for issue on 30 January 2025 and were signed on its behalf by:



LK Bramley - Director


Merlin Diesel Holdings Limited (Registered number: 11267668)

Company Balance Sheet
31 July 2024

2024 2023
Notes £ £ £ £
FIXED ASSETS
Intangible assets 10 - -
Tangible assets 11 1,876,831 1,896,732
Investments 12 2,162,022 2,162,022
4,038,853 4,058,754

CURRENT ASSETS
Cash at bank 110,137 10,301

CREDITORS
Amounts falling due within one year 15 2,417,664 2,325,403
NET CURRENT LIABILITIES (2,307,527 ) (2,315,102 )
TOTAL ASSETS LESS CURRENT
LIABILITIES

1,731,326

1,743,652

CAPITAL AND RESERVES
Called up share capital 21 92,400 92,840
Share premium 22 48,178 91,100
Capital redemption reserve 22 1,900 1,460
Retained earnings 22 1,588,848 1,558,252
SHAREHOLDERS' FUNDS 1,731,326 1,743,652

Company's profit for the financial year 1,188,258 1,220,100

The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the Board of Directors and authorised for issue on 30 January 2025 and were signed on its behalf by:





LK Bramley - Director


Merlin Diesel Holdings Limited (Registered number: 11267668)

Consolidated Statement of Changes in Equity
for the year ended 31 July 2024

Called up Capital
share Retained Share redemption
capital earnings premium reserve
£ £ £ £
Balance at 1 August 2022 93,230 21,919,160 129,000 1,460

Changes in equity
Issue of share capital (390 ) - (37,900 ) -
Dividends - (1,193,196 ) - -
Total comprehensive income - 5,706,757 - -
Balance at 31 July 2023 92,840 26,432,721 91,100 1,460

Changes in equity
Issue of share capital (440 ) - (42,921 ) -
Dividends - (1,157,222 ) - -
Total comprehensive income - 5,664,902 - 440
Balance at 31 July 2024 92,400 30,940,401 48,179 1,900
Other Non-controlling Total
reserves Total interests equity
£ £ £ £
Balance at 1 August 2022 69,380 22,212,230 311,342 22,523,572

Changes in equity
Issue of share capital - (38,290 ) - (38,290 )
Dividends - (1,193,196 ) - (1,193,196 )
Total comprehensive income - 5,706,757 29,879 5,736,636
Balance at 31 July 2023 69,380 26,687,501 341,221 27,028,722

Changes in equity
Issue of share capital - (43,361 ) - (43,361 )
Dividends - (1,157,222 ) - (1,157,222 )
Total comprehensive income - 5,665,342 117,266 5,782,608
Balance at 31 July 2024 69,380 31,152,260 458,487 31,610,747

Merlin Diesel Holdings Limited (Registered number: 11267668)

Company Statement of Changes in Equity
for the year ended 31 July 2024

Called up Capital
share Retained Share redemption Total
capital earnings premium reserve equity
£ £ £ £ £
Balance at 1 August 2022 93,231 1,531,348 129,000 1,460 1,755,039

Changes in equity
Issue of share capital (391 ) - (37,900 ) - (38,291 )
Dividends - (1,193,196 ) - - (1,193,196 )
Total comprehensive income - 1,220,100 - - 1,220,100
Balance at 31 July 2023 92,840 1,558,252 91,100 1,460 1,743,652

Changes in equity
Issue of share capital (440 ) - (42,922 ) - (43,362 )
Dividends - (1,157,222 ) - - (1,157,222 )
Total comprehensive income - 1,187,818 - 440 1,188,258
Balance at 31 July 2024 92,400 1,588,848 48,178 1,900 1,731,326

Merlin Diesel Holdings Limited (Registered number: 11267668)

Consolidated Cash Flow Statement
for the year ended 31 July 2024

2024 2023
Notes £ £
Cash flows from operating activities
Cash generated from operations 1 6,939,096 3,618,780
Interest paid (168,601 ) (203,452 )
Interest element of hire purchase
payments paid

(3,493

)

(1,809

)
Tax paid (1,869,909 ) (553,965 )
Net cash from operating activities 4,897,093 2,859,554

Cash flows from investing activities
Purchase of tangible fixed assets (437,666 ) (854,934 )
Purchase of other investments - (9,909 )
Sale of tangible fixed assets 49,606 32,734
Purchase of subsidiary - (866,345 )
Cash acquired with subsidiary - 67,877
Interest received 40,797 20,032
Net cash from investing activities (347,263 ) (1,610,545 )

Cash flows from financing activities
New loans in year - 750,000
Loan repayments in year (1,662,105 ) (667,729 )
New HP in year (14,394 ) -
Amount introduced by directors - 112,500
Amount withdrawn by directors - (25,007 )
Share issue - 5,072
Share buyback (43,362 ) (43,362 )
Cashflows relating to pension scheme (89,000 ) (77,000 )
Equity dividends paid (1,157,222 ) (1,193,196 )
Net cash from financing activities (2,966,083 ) (1,138,722 )

Increase in cash and cash equivalents 1,583,747 110,287
Cash and cash equivalents at
beginning of year

2

(331,559

)

(441,846

)

Cash and cash equivalents at end of
year

2

1,252,188

(331,559

)

Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Cash Flow Statement
for the year ended 31 July 2024

1. RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM
OPERATIONS

2024 2023
£ £
Profit before taxation 7,318,341 6,427,453
Depreciation charges 696,341 626,938
Profit on disposal of fixed assets (35,546 ) (9,684 )
Finance costs 172,094 205,261
Finance income (85,797 ) (22,034 )
8,065,433 7,227,934
Increase in stocks (2,184,440 ) (6,039,446 )
Increase in trade and other debtors (1,070,192 ) (379,036 )
Increase in trade and other creditors 2,128,295 2,809,328
Cash generated from operations 6,939,096 3,618,780

2. CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 July 2024
31/7/24 1/8/23
£ £
Cash and cash equivalents 1,323,234 517,665
Bank overdrafts (71,046 ) (849,224 )
1,252,188 (331,559 )
Year ended 31 July 2023
31/7/23 1/8/22
£ £
Cash and cash equivalents 517,665 329,685
Bank overdrafts (849,224 ) (771,531 )
(331,559 ) (441,846 )


Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Cash Flow Statement
for the year ended 31 July 2024

3. ANALYSIS OF CHANGES IN NET (DEBT)/FUNDS

Other
non-cash
At 1/8/23 Cash flow changes At 31/7/24
£ £ £ £
Net cash
Cash at bank
and in hand 517,665 805,569 1,323,234
Bank overdrafts (849,224 ) 778,178 (71,046 )
(331,559 ) 1,583,747 1,252,188
Debt
Finance leases (50,157 ) 14,394 - (60,562 )
Debts falling due
within 1 year (2,277,740 ) 2,217,740 - (60,000 )
Debts falling due
after 1 year - (555,635 ) - (555,635 )
(2,327,897 ) 1,676,499 - (676,197 )
Total (2,659,456 ) 3,260,246 - 575,991

Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements
for the year ended 31 July 2024

1. STATUTORY INFORMATION

Merlin Diesel Holdings Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the General Information page.

The presentation currency of the financial statements is the Pound Sterling (£).


The amounts in the financial statements have been rounded to the nearest £1.

2. ACCOUNTING POLICIES

Basis of preparing the financial statements
These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Going concern
The directors have reviewed the future forecasts of the business, the funding requirements, and the strong balance sheet. They are confident that the going concern basis is appropriate.

Critical accounting judgements and key sources of estimation uncertainty
In the application of the group's accounting policies, which are described in note 2, the directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from those estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

The directors do not consider there to be any critical judgments that require disclosure in the financial statements.

Sources of estimation uncertainty
The directors consider the following matters to be key sources of estimation uncertainty which affect the financial statements;

Valuation of stocks
Stocks are carried at the lower of cost and net realisable valuate. In determining net realisable value, the directors apply a provisioning policy to the value of stocks held. This provides an estimate of net realisable value for old and slow moving stocks.

Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 July 2024

2. ACCOUNTING POLICIES - continued

Turnover
The turnover shown in the profit and loss account represents the fair value of all goods and services, delivered during the year, at selling price exclusive of discounts, rebates, Value Added Tax and other sales taxes. Sales are recognised at the point at which the company has fulfilled its contractual obligations to the customer.

Goodwill
Goodwill is calculated as the investment cost less the fair value of assets acquired.

Goodwill is measured after accumulated amortisation and any impairment losses.

Amortisation is charged so as to allocate the cost over the estimated useful life using the straight-line method for the acquisition in 2015. For the acquisition in 2021, the goodwill was amortised over 1 year. For the acquisition in 2022, the goodwill is being amortised over 3 years.

If there is an indication that there has been a significant change in the estimated useful life, the amortisation of that asset is revised prospectively to reflect the new expectations.

Tangible fixed assets
Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.
Freehold property - 5% on cost and 1% on cost
Short leasehold - 5% on cost and Over the term of the lease
Long leasehold - 1% on cost and Over the term of the lease
Plant and machinery - 25% on cost, 20% on cost and 12.5% on cost
Fixtures and fittings - 20% on cost and 10% on cost
Motor vehicles - 25% on cost

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

Stocks
Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Financial instruments
Financial instruments are recognised when the company becomes party to the contractual provisions of the instrument. Basic financial assets, which include debtors, prepayments and bank balances, are initially measured at transaction price and are subsequently carried at cost unless the arrangement indicates otherwise and then the asset is measured at the present value of the future receipts discounted at a market rate of interest. Basic financial liabilities, which include creditors, accruals, loans and group borrowings, are initially recognised at transaction price and are subsequently carried at cost unless the arrangement indicates otherwise and then the liability is measured at the present value of the future obligations discounted at a market rate of interest. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Taxation
Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.


Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 July 2024

2. ACCOUNTING POLICIES - continued
Deferred tax
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Research and development
Expenditure on research and development is written off in the year in which it is incurred. The total amount of expenditure recognised in the year was £641,508 (2023: £526,111).

Foreign currencies
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Hire purchase and leasing commitments
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

Pension costs and other post-retirement benefits

The Group operates both a defined benefit and defined contribution pension scheme and the defined benefit scheme has been closed to new entrants.

The defined benefit scheme assets and liabilities are shown in the balance sheet and interest on pension scheme liabilities is charged to the profit and loss account. Actuarial gains and losses are reported in the statement of total recognised gains and losses.

Contributions payable to the defined contribution scheme are charged to the profit and loss account as incurred. The asset of this scheme are held separately from the company in an independently administered fund and are not disclosed in the financial statements.

3. TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the group.

An analysis of turnover by geographical market is given below:

2024 2023
£ £
United Kingdom 29,794,557 26,442,736
Overseas 45,233,274 42,066,468
75,027,831 68,509,204

Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 July 2024

4. EMPLOYEES AND DIRECTORS
2024 2023
£ £
Wages and salaries 6,909,362 6,766,399
Social security costs 653,408 590,739
Other pension costs 899,660 704,673
8,462,430 8,061,811

The average number of employees during the year was as follows:
2024 2023

Engineers 78 85
Sales 70 73
Warehouse 31 28
Administration 23 20
202 206

2024 2023
£ £
Directors' remuneration 150,167 185,577
Directors' pension contributions to money purchase schemes 174,665 144,570

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes 8 8

5. OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2024 2023
£ £
Hire of plant and machinery 20,916 17,702
Other operating leases 365,385 385,216
Depreciation - owned assets 567,003 497,600
Profit on disposal of fixed assets (35,546 ) (9,684 )
Goodwill amortisation 129,336 129,336
Auditors' remuneration 22,925 21,550
Auditors' remuneration for non audit work 3,950 5,600

6. INTEREST PAYABLE AND SIMILAR EXPENSES
2024 2023
£ £
Bank interest 21,892 38,679
Bank loan interest 146,709 146,546
Other interest - 18,227
Hire purchase 3,493 1,809
172,094 205,261

Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 July 2024

7. TAXATION

Analysis of the tax charge
The tax charge on the profit for the year was as follows:
2024 2023
£ £
Current tax:
UK corporation tax 1,690,401 1,160,529
Tax adjustment prior year (3,278 ) 8,798
Total current tax 1,687,123 1,169,327

Deferred tax:
Deferred tax (153,390 ) 24,990
Deferred tax on pension scheme 44,000 19,250
Total deferred tax (109,390 ) 44,240

Tax on profit 1,577,733 1,213,567

UK corporation tax has been charged at 25 % (2023 - 21.01 %).

Reconciliation of total tax charge included in profit and loss
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below:

2024 2023
£ £
Profit before tax 7,318,341 6,427,453
Profit multiplied by the standard rate of corporation tax in the UK of
25 % (2023 - 21.005 %)

1,829,585

1,350,087

Effects of:
Expenses not deductible for tax purposes 2,357 5,036
Depreciation in excess of capital allowances - 4,155
Utilisation of tax losses (29,343 ) (21,134 )
Adjustments to tax charge in respect of previous periods (3,278 ) 361
Super deduction/restrictions on capital allowances and capital gains - (14,054 )
Research & development relief (137,924 ) (128,706 )
Adjustment in respect of prior year - 8,798
accelerated capital allowances
Goodwill amortisation on consolidation 32,334 27,167
Other adjustments 18,484 (9,264 )
Change in rate of deferred tax - (11,955 )
Deferred tax on pension gains 44,000 19,250
Defined benefit pension scheme asset/liability adjustments (33,500 ) (16,174 )
Tax losses carried forward (144,982 ) -
Total tax charge 1,577,733 1,213,567

Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 July 2024

7. TAXATION - continued

Tax effects relating to effects of other comprehensive income

2024
Gross Tax Net
£ £ £
Actuarial gain/loss on pension scheme 56,000 (14,000 ) 42,000

2023
Gross Tax Net
£ £ £
Actuarial gain/loss on pension scheme 697,000 (174,250 ) 522,750

Following the increase in corporation tax from 19% to 25% on 1 April 2023, the effective rate of tax in the prior year was 21.005%. Deferred tax has been provided at 25% for the current and prior year.

8. INDIVIDUAL INCOME STATEMENT

As permitted by Section 408 of the Companies Act 2006, the Income Statement of the parent company is not presented as part of these financial statements.


9. DIVIDENDS
2024 2023
£ £
Ordinary shares of £1 each
Dividends paid 1,157,222 1,193,196

10. INTANGIBLE FIXED ASSETS

Group
Goodwill
£
COST
At 1 August 2023
and 31 July 2024 1,059,253
AMORTISATION
At 1 August 2023 800,580
Amortisation for year 129,336
At 31 July 2024 929,916
NET BOOK VALUE
At 31 July 2024 129,337
At 31 July 2023 258,673

Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 July 2024

11. TANGIBLE FIXED ASSETS

Group
Freehold Short Long Improvements
property leasehold leasehold to property
£ £ £ £
COST
At 1 August 2023 3,086,194 918,094 346,123 4,619
Additions - 113,296 11,511 -
Disposals - - - -
At 31 July 2024 3,086,194 1,031,390 357,634 4,619
DEPRECIATION
At 1 August 2023 216,727 243,432 283,911 4,619
Charge for year 30,004 50,728 - -
Eliminated on disposal - - - -
At 31 July 2024 246,731 294,160 283,911 4,619
NET BOOK VALUE
At 31 July 2024 2,839,463 737,230 73,723 -
At 31 July 2023 2,869,467 674,662 62,212 -

Fixtures
Plant and and Motor
machinery fittings vehicles Totals
£ £ £ £
COST
At 1 August 2023 4,999,158 1,226,585 252,571 10,833,344
Additions 177,669 68,977 91,012 462,465
Disposals (332,540 ) (46,327 ) (96,502 ) (475,369 )
At 31 July 2024 4,844,287 1,249,235 247,081 10,820,440
DEPRECIATION
At 1 August 2023 3,922,445 867,265 152,609 5,691,008
Charge for year 353,545 88,020 44,706 567,003
Eliminated on disposal (325,889 ) (46,327 ) (89,093 ) (461,309 )
At 31 July 2024 3,950,101 908,958 108,222 5,796,702
NET BOOK VALUE
At 31 July 2024 894,186 340,277 138,859 5,023,738
At 31 July 2023 1,076,713 359,320 99,962 5,142,336

Included within tangible fixed assets are assets held under hire purchase agreements. The net book value of these assets at the year end was £70,048 (2023 £67,513) and the depreciation charged on them in the year was £18,872 (2023: £7,122)

Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 July 2024

11. TANGIBLE FIXED ASSETS - continued

Company
Freehold
property
£
COST
At 1 August 2023
and 31 July 2024 1,990,038
DEPRECIATION
At 1 August 2023 93,306
Charge for year 19,901
At 31 July 2024 113,207
NET BOOK VALUE
At 31 July 2024 1,876,831
At 31 July 2023 1,896,732

12. FIXED ASSET INVESTMENTS

Group
Unlisted
investments
£
COST
At 1 August 2023
and 31 July 2024 9,909
NET BOOK VALUE
At 31 July 2024 9,909
At 31 July 2023 9,909
Company
Shares in
group Other
undertakings investments Totals
£ £ £
COST
At 1 August 2023
and 31 July 2024 2,152,113 9,909 2,162,022
NET BOOK VALUE
At 31 July 2024 2,152,113 9,909 2,162,022
At 31 July 2023 2,152,113 9,909 2,162,022


Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 July 2024

13. STOCKS

Group
2024 2023
£ £
Stock 31,029,635 28,845,195

14. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group
2024 2023
£ £
Trade debtors 8,619,100 7,562,146
Other debtors 339,767 493,812
Prepayments and accrued income 374,258 206,975
9,333,125 8,262,933

15. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group Company
2024 2023 2024 2023
£ £ £ £
Bank loans and overdrafts (see note 17) 131,046 3,126,964 - 1,618,391
Hire purchase contracts (see note 18) 22,960 20,651 - -
Trade creditors 14,043,774 11,950,077 - -
Amounts owed to group undertakings - - 2,300,090 595,014
Corporation tax 351,709 534,495 13,249 11,998
Social security and other taxes 249,270 201,977 - -
Directors' current accounts 212,500 212,500 100,000 100,000
Accruals and deferred income 113,940 126,635 4,325 -
15,125,199 16,173,299 2,417,664 2,325,403

The directors' loan accounts are unsecured, bear no interest and have no fixed repayment term.

16. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE
YEAR

Group
2024 2023
£ £
Bank loans (see note 17) 555,635 -
Hire purchase contracts (see note 18) 37,602 29,506
593,237 29,506

Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 July 2024

17. LOANS

An analysis of the maturity of loans is given below:

Group Company
2024 2023 2024 2023
£ £ £ £
Amounts falling due within one year or on demand:
Bank overdrafts 71,046 849,224 - -
Bank loans 60,000 2,277,740 - 1,618,391
131,046 3,126,964 - 1,618,391
Amounts falling due between one and two years:
Bank loans - 1-2 years 60,000 - - -
Amounts falling due between two and five years:
Bank loans - 2-5 years 151,667 - - -
Amounts falling due in more than five years:
Repayable by instalments
Bank loans more 5 yr by instal 343,968 - - -

Following a technical breach of the financial covenants at the prior year end, the long term loan was reclassified as due within one year. No action was taken as a result of the technical breach, and the covenants have been met in the current year.

18. LEASING AGREEMENTS

Minimum lease payments fall due as follows:

Group
Hire purchase contracts
2024 2023
£ £
Net obligations repayable:
Within one year 22,960 20,651
Between one and five years 37,602 29,506
60,562 50,157

Group
Non-cancellable
operating leases
2024 2023
£ £
Within one year 259,364 18,508
Between one and five years 156,550 664,965
415,914 683,473

Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 July 2024

19. SECURED DEBTS

The following secured debts are included within creditors:

Group Company
2024 2023 2024 2023
£ £ £ £
Bank overdrafts 71,046 849,224 - -
Bank loans 615,635 2,277,740 - 1,618,391
Hire purchase contracts 60,562 - - -
747,243 3,126,964 - 1,618,391

The bank loan and overdraft are secured by a first legal charge dated 15 April 2019 and a debenture dated 29 June 2018, both incorporating a fixed and floating charge over all current and future assets of the group.

There is an unlimited multilateral guarantee dated 9 August 2018 between Merlin Diesel Holdings Limited, Merlin Diesel Systems Limited and Colchester Fuel Injection Limited.

There is a guarantee dated 15 February 2012 in favour of HM Revenue & Customs for £200,000.

Hire purchase liabilities are secured on the underlying asset.

20. PROVISIONS FOR LIABILITIES

Group
2024 2023
£ £
Deferred tax
Accelerated capital allowances 56,541 -
Tax losses carried forward (144,982 ) -
Deferred tax 365,736 430,684
277,295 430,684

Group
Deferred tax
£
Balance at 1 August 2023 430,684
Provided during year (153,389 )
Balance at 31 July 2024 277,295

Deferred tax had been calculated at 25%. A previously unrecognised deferred tax asset has been recognised in a subsidiary during the year. This amounted to a deferred tax credit in the income statement of £145,000.

Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 July 2024

21. CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:
Number: Class: Nominal 2024 2023
value: £ £
87,851 Ordinary £1 87,411 87,851
4,989 Ordinary A £1 4,989 4,989
92,400 92,840

On 8 May 2024, the company bought back 440 Ordinary shares of £1 each, for a total consideration of £43,362. These shares were immediately cancelled.

22. RESERVES

Group
Capital
Retained Share redemption Other
earnings premium reserve reserves Totals
£ £ £ £ £

At 1 August 2023 26,432,721 91,100 1,460 69,380 26,594,661
Profit for the year 5,623,342 5,623,342
Dividends (1,157,222 ) (1,157,222 )
Purchase of own shares (440 ) (42,921 ) 440 - (42,921 )
Actuarial gain relating to
defined benefit pension
scheme


56,000


-


-


-


56,000
Deferred tax on actuarial
movement

(14,000

)

-

-

-

(14,000

)
At 31 July 2024 30,940,401 48,179 1,900 69,380 31,059,860

Company
Capital
Retained Share redemption
earnings premium reserve Totals
£ £ £ £

At 1 August 2023 1,558,252 91,100 1,460 1,650,812
Profit for the year 1,188,258 1,188,258
Dividends (1,157,222 ) (1,157,222 )
Purchase of own shares (440 ) (42,922 ) 440 (42,922 )
At 31 July 2024 1,588,848 48,178 1,900 1,638,926


Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 July 2024

23. NON-CONTROLLING INTERESTS

Non controlling interests comprise of the following;

2024 2023
Non controlling interest holds a shareholding in the following
subsidiary;

Tyne Electro Diesel Limited 48% 48%


Equity shareholding held by the non controlling interest;

480 £1
shares

480 £1
shares

Share of net assets attributable to the non controlling
interest;


£458,487


£341,221


24. EMPLOYEE BENEFIT OBLIGATIONS

The Group acquired a subsidiary which operates a defined benefit scheme in the UK on 1 August 2022. The assets and liabilities associated with the Scheme have been consolidated into these financial statements.

The Scheme is closed to new members. A full actuarial valuation was carried out on 1 June 2022. The next full valuation will be at 1 June 2025. Details of the defined benefit scheme are as follows:

Colchester Fuel Injection Ltd is the principal employer of a defined benefit pension scheme, the Colchester Fuel Injection Ltd Retirement Benefits Scheme ("the Scheme"), which is administered by trustees. Contributions to the Scheme are charged to the profit and loss account so as to spread the cost of the pensions over the employees working lives with the company. The contributions are determined by independent qualified actuaries. The major assumptions used by the actuary were:

The amounts recognised in profit or loss are as follows:

Defined benefit
pension plans
2024 2023
£ £
Current service cost - -
Interest cost 141,000 122,000
Past service cost - -
Expenses paid 10,000 8,000
151,000 130,000

Return on plan assets 186,000 125,000

Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 July 2024

24. EMPLOYEE BENEFIT OBLIGATIONS - continued

Changes in the present value of the defined benefit obligation are as follows:

Defined benefit
pension plans
2024 2023
£ £
Opening defined benefit obligation 2,832,000 3,504,000
Interest cost 141,000 122,000
Benefits paid (127,000 ) (59,000 )
Actuarial (gains)/loss from changes in
assumptions

70,000

(735,000

)
2,916,000 2,832,000

Changes in the fair value of scheme assets are as follows:

Defined benefit
pension plans
2024 2023
£ £
Opening fair value of scheme assets 3,666,000 3,564,000
Contributions by employer 85,000 82,000
Return on plan assets 186,000 125,000
Benefits paid (127,000 ) (59,000 )
Expenses paid (10,000 ) (8,000 )
Actuarial gains/(losses) on assets 126,000 (38,000 )
3,926,000 3,666,000

The amounts recognised in other comprehensive income are as follows:

Defined benefit
pension plans
2024 2023
£ £
Actuarial (gains)/loss from changes in
assumptions

(70,000

)

735,000
Actuarial gains/(losses) on assets 126,000 (38,000 )
56,000 697,000

The major categories of scheme assets as a percentage of total scheme assets are as follows:

Defined benefit
pension plans
2024 2023
Equities 44% 43%
Fixed interest 42% 42%
Insurance policies 14% 15%
100% 100%

Merlin Diesel Holdings Limited (Registered number: 11267668)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 July 2024

24. EMPLOYEE BENEFIT OBLIGATIONS - continued

Principal actuarial assumptions at the balance sheet date (expressed as weighted averages):

2024 2023
Discount rate 5.05% 5.10%
RPI 3.25% 3.45%
CPI 2.70% 2.80%
Cash commutation 100% 100%

The mortality assumption used was S3PA CMI 2023 1.5% + 0.5%.

The pension scheme asset on the balance sheet is net of deferred tax. See note 20.

25. BUSINESS COMBINATIONS

On 1 August 2022 Merlin Diesel Holdings Limited acquired 100% of the share capital of Colchester Fuel Injection Limited for £866,345. The acquisition has been accounted for using the acquisition method of accounting and the goodwill arising on acquisition is being amortised over 3 years. The final fair value of the assets and liabilities acquired is set out below.

Book value and fair value
£   
Tangible fixed assets 214,198
Stock 565,515
Debtors 456,934
Cash at bank 67,877
Creditors (846,139 )
Pension asset 45,000
Deferred taxation (25,049 )
Net assets 478,336

Cost of acquisition (including related expenses) 866,345
Goodwill 388,009

The financial statements of Colchester Fuel Injection Limited for the years ended 31 July 2023 and 2024 have been included in these consolidated financial statements.

26. RELATED PARTY DISCLOSURES

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

Transactions between group entities which have been eliminated on consolidation are not disclosed within the financial statements.

In the opinion of the directors the group is controlled by the directors.

27. ULTIMATE CONTROLLING PARTY

The company is controlled jointly by LK Bramley and S Bramley, by virtue of their shareholdings.