Company registration number 15440100 (England and Wales)
TORSION GROUP HOLDCO LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2024
TORSION GROUP HOLDCO LIMITED
COMPANY INFORMATION
Directors
Mr M M E H Dearden
(Appointed 24 January 2024)
Mr D T Spencer
(Appointed 24 January 2024)
Mr D W Worsley
(Appointed 24 January 2024)
Company number
15440100
Registered office
1280 Century Way
Thorpe Park
Leeds
LS15 8ZB
Auditor
Sumer Auditco Limited
Fourth Floor
Unit 5B, The Parklands
Bolton
BL6 4SD
TORSION GROUP HOLDCO LIMITED
CONTENTS
Page
Strategic report
1 - 6
Directors' report
7 - 9
Independent auditor's report
10 - 12
Group statement of comprehensive income
13
Group balance sheet
14
Company balance sheet
15
Group statement of changes in equity
16
Company statement of changes in equity
17
Group statement of cash flows
18
Company statement of cash flows
19
Notes to the financial statements
20 - 35
TORSION GROUP HOLDCO LIMITED
STRATEGIC REPORT
FOR THE PERIOD ENDED 30 JUNE 2024
- 1 -

The directors present the strategic report for the Period ended 30 June 2024.

Review of the business

The period to June 2024 has seen the group deliver a loss before tax of £79k, and turnover of £64.3m. The year has been characterised by significant turnover growth and continued stabilised profits, in the company.

 

In 2023 regional teams were established as part of the strategic plan to increase turnover in the business to over £200m within 3 years. The business has now been restructured with Ed Wootton appointed as Managing Director and two distinct regions formed covering the North and the Midlands. With Richard Potts recruited as Regional Director for the North and Priesh Soni promoted to Regional Director in the Midlands to support the growth plans.

 

The turnover growth, by the company, in 2024 has been delivered as per the strategic plan and the group is currently tracking against the 2025 business plan with all future turnover secured. The average size of each contract, in the company, has increased from £15m to £40m which is the underlying significant contribution to achieving the planned turnover growth.

 

In addition, within the new regions we have continued to grow and work with our supply chain partners which has helped to maintain & grow profit margins. With the year still impacted by lower margins on a number of contracts won during COVID-19, and pre-inflation pressures future years are expected to improve year on year as these contracts are now closed out.

 

During the period, the group successfully handed over a scheme known as the Phoenix, a prestigious 367 luxury apartment scheme in the heart of Leeds city centre. This scheme, at a construction value of £57m, is the largest scheme delivered to date and delivered under the backdrop of COVID-19, inflation, interest rate increases and the Ukraine war, marks a turning point in the Company’s journey to establish itself delivering larger schemes.

 

In the period, group net assets are £70k. We remain committed to our 5-year plan of increasing the balance sheet and returning stable dividends to the shareholders

 

The secured workload and future order book now stands at £500.2m, giving the directors confidence to continue to invest in the structure of the business and to confidently deliver the business plan for the next 3 years.

 

As part of the restructure, we have also integrated the pre-construction team into the regional teams to ensure we have fully detailed and de-risked schemes before we enter into contract in collaboration with our key regional subcontractor partners with full accountability with the regional teams. This process also helps ensure we remain focused on our exemplar delivery model for our stakeholders ensuring we design schemes to budget and deliver a high quality product on time and safely.

 

Exceptional and talented people

The success of the business is based on having the best people. The experience, commitment and dedication of our staff is critical to the ongoing success of the company and delivery of the strategic vision.

 

We invest in attracting and developing exceptional people to create a solutions focused, vibrant, productive and flexible workforce who strive to exceed our client expectations. We carefully select our teams, using newly deployed industry leading team management tools to ensure our client focused culture is maintained and we are proud to say we employ some of the best people in the industry.

 

We were delighted to be awarded the Health and Wellbeing Award at the Yorkshire Post Excellence in Business Awards 2024, which demonstrates our commitment to making Torsion a great place to work.

 

To support the growth of the business, investment has been made in our recruitment process to ensure we employ the right calibre of staff, using personality/behaviour tools to support recruiting the right people to fit our culture. There has been an increase in headcount, in the group, by 39 in the year, with specific focus on recommendation. This included the senior appointment of Richard Potts, who was specifically targeted and recruited directly. We acknowledge the successful delivery of our schemes relies on our people. In addition, we have continued to focus on our ‘on boarding’ process, improving our staff retention and initial productivity outputs.

TORSION GROUP HOLDCO LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 2 -

We empower our people to take ownership, pride and passion in what they do. Our vision is set out clearly to staff, with our 1:3:5 strategy cascaded throughout the business, and individuals’ objectives linked to the strategy which generates a culture of success.

Principal risks and uncertainties

Maximising Cash performance

We have focused our efforts over the past twelve months to ensure the business has sufficient capital to continue to grow and most importantly meet its financial obligations. We are committed to ensuring we have the right balance between investing in future schemes and paying the supply chain partners promptly.

 

Profit margins

We are focused on improving margins as part of our growth strategy. To ensure we mitigate this risk we operate a full team approach to supply chain management and procurement, with the objective to engage our supply chain during the pre-construction stage of the contract. All of our pre-inflation and Covid secured contracts that have suppressed profits are now completed and we will see an significant percentage increase in profit in the coming years based on secured pipeline.

 

Project delivery

We continue to improve our internal processes to control Safety, Quality, Time and Cost to build on our successful track record of comprehensive management oversight, monthly project reviews and working closely with the clients to help mitigate the risk to successful project delivery and thus support the delivery of improved profit margins.

 

Health and safety

The health and safety of all persons on our sites is our number one priority. To mitigate risk, we continue to build our emphasise the strong safety culture by impacting behaviours to support a positive improvement. We use key metrics and live management information to review key lead and lag indicators to drive our strategic approach to long term safety whilst monitoring the safety on our sites, acting swiftly if any areas for improvement are identified.

 

Pipeline

Following a successful 2024 we have a very strong secured order book for 2025/26. With a secure pipeline we are now focused on securing quality schemes in sufficient time for project replacement in 2026 and to continue to deliver our turnover targets.

Development and performance

The company uses a range of financial and non-financial performance indicators. These are set out below:

 

The level of profitability is a key metric. The year to June 2024 delivered a loss before tax of £79k for the group.

 

Secured orders provide a measure of future growth and profitability. The current overall secured order book of £500.2m gives confidence in the future success of the business.

 

Our turnover is generated through both our sister company Torsion Developments Limited and external clients. The year to June 2024 had 57% internal turnover.

 

Cash backed profits are essential to sustainable growth of the group. As at 30 June 2024 cash was £5.5m.

 

Health and safety is critical to the operations of the company. The company uses the Accident Frequency Rate (AFR), a measure of the number of lost time incidents per 100,000 of hours worked. The AFR for the 12 months to 30 June 2023 was nil (12 months to June 2023 was 0.26). This represents excellent performance in the construction industry. We have also maintained accreditation with Construction Line Acclaim.

TORSION GROUP HOLDCO LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 3 -
Key performance indicators

ISO Accreditation

We are delighted to have maintained ISO9001, 14001, and 45001 accreditations during the year. These reflect the robustness of our processes and the commitment of our staff and our ethos of getting it right and constantly looking to improve.

 

Strategy

The directors undertook a review of the types of work best suited to the business and concluded the strategy will continue to focus on our own development led work and known third party clients, predominantly in the purpose-built student accommodation (PBSA), build-to-rent (BTR) and living sectors. The strategy is to grow turnover in the next 2 years to over £200m. The close relationship with TDL gives us certainty of pipeline, early engagement in the projects and clear channels of communication and full visibility to ensure profitability. Ed Wooton is also the Managing Director of TDL to create synergy between development and construction delivery, and David Worsley was recently promoted to Chief Operating Officer. This allows us to deliver and enhance our fully vertically integrated, develop, construct and operate business model, ensuring we provide a fully considered solution for delivering our schemes.

 

Our focus for the coming period is to ensure that we deliver all of our schemes with the first-class personalised service we are known for and that as we continue to grow, our management processes remain robust and enable is to identify and mitigate risk, whilst allowing our project teams to be empowered, agile and flexible.

 

To further consolidate our growth plans we have reviewed our approach to the support functions such as HR, Finance, and Marketing. There is now a Business Services lead, who ensures the visions across all areas is aligned with the Company strategy, and reports to the shareholders on a quarterly basis.

Enhancing our approach to ESG

As part of the restructure and under the guidance of the Business Service Lead – Paula Smith, we have we aligned our ESG strategy in line with growth. Each one of the key elements of the business Safety, Quality, Environment, Supply chain, People, Marketing, IT and Finance (alongside operations) have realigned their departmental visions and plans to create and aligned approach to our forward delivery of a set of measurable and co-ordinate tangible outcomes to deliver real change.

 

The ESG committee has been reorganised under our Business Service Lead (as chair) to be responsible for tracking and reporting to the shareholders against these plans on a quarterly basis to ensure we remain focussed on identifying how best we can contribute to building a better business and a better world. In our commitment to ESG we appointed an Environmental and Sustainability Advisor during the year.

TORSION GROUP HOLDCO LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 4 -
Other performance indicators

Environment

As a construction business, we participate in an environmentally destructive industry. We are responsible for addressing the impact and have an opportunity to be part of the solution. With growing pressure on our natural resources, it is our duty to ensure that all our business activities either maintain or enhance the resilience of the natural environment in which we and our supply chain operate.

We are taking steps towards establishing our organisational carbon footprint and are actively identifying viable carbon reduction measures and opportunities. We plan to set ourselves ambitious but achievable short, mid, and long-term carbon reduction targets. We are working with our supply chain to identify emission reduction opportunities up and down our value chain, establishing trust and common goals, promoting efficient and effective working practices while rewarding innovation. 

In the year we have entered our first funding arrangement using a green fund in TDL for the Construction of Burley Road with the committed reduction of carbon is 500 kg/ m2, currently were achieving 413 kg /m2.

Social

People are at the heart of everything that we do. Our approach is to focus on social value locally, driving the local pound and creating value that will ensure high impact and positive ripple effects. This will include spending with local businesses and creating opportunities for local employment. All of this is founded on the passion and engagement of our people and supply chain partners.

We have updated our EDI Policy in line with new legislation on employers being proactive in preventing Sexual Harassment and have rolled out refresher training to every employee. Our commitment is to educate employees on celebrating equality, diversity & inclusion and we invite everyone to be part of a culture where they treat others equally, fairly and with respect.

Governance

Our vision is to develop a culture of continuous improvement throughout our business, challenging our performance and business-as-usual processes to deliver outstanding service. Our 1:3:5 strategy has been cascaded throughout the business; it aligns with shareholder objectives. All business services have developed change plans which are being monitored quarterly at shareholder meetings.

One of the key focus areas is to strengthen our IT resilience. A detailed strategy is being developed and further investment in this area is planned by appointing an IT Manager.

Other information and explanations

2024 has been a transformational year where we are starting to see the success of our 5 year business strategy implemented 18 months ago and the governance provided by the newly formed regions and key senior appointments.

 

With a strong secured forward order book and current volume of works under construction the directors are confident the business will continue to increase turnover and deliver significantly increased profitability in 2025 and beyond.

TORSION GROUP HOLDCO LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 5 -
Section 172 Reporting

This is an overview of how Directors performed their duty to promote the success of the company under section 172 of the Companies Act 2006.

Duty to promote the success of the Company

In executing our strategy, Directors must act in accordance with a set of general duties detailed in section 172 of the Companies Act 2006. These general duties include a duty to promote the success of the Company, and specifically, to act in a way that the Director considers, in good faith, would be most likely to promote the success of the Company for the benefit of its shareholders as a whole and, in doing so, having regard (amongst other matters) to the:

 

This statement has been prepared in accordance with the requirements of The Companies (Miscellaneous Reporting) Regulations 2018, which require the Company to describe how the Directors have had regard to the matters set out in section 172 of the Companies Act 2006 during the financial year under review. It is noted that the Directors have always acted in accordance with such duties in their decision making and they will continue to do so. Considering the additional disclosure requirements, we have set out in the strategic report how the Directors have fulfilled their duties during the year ended 30 June 2024.

Having regard to the likely consequences of any decisions in the long-term

The Board cultivates strong relationships with key stakeholders so that it is well placed and sufficiently informed to take their considerations into account when making decisions and assessing any likely long-term impact of those decisions. Torsion Construction's core strategy is to provide a bespoke boutique operating model and be the best-in-class contractor of choice and this core strategy underpins all Board decisions and the creation of long-term value for all stakeholders.

Having regard to the interest of the Company’s employees

The Board understands that the Group’s employees are fundamental to its long-term success. The health, safety and well-being of the employees are of paramount importance alongside the provision of an ethical workplace. The Group engages in an active way with its employees. Many of the staff work on site and senior management regularly complete site visits to maintain timely interaction.

Having regard to the need to foster the Company's business relationships with suppliers, customers, and others.

Fostering positive business relationships with key stakeholders, such as suppliers and customers is also important to the success of the Group’s businesses. As a result of Torsion’s model, engagement with customers is a matter that is largely delegated to the management teams, who know their customers best. The Board has been and continues to be, available to support the business in this area as and when required and will continue to maintain the relationships with key suppliers and customers. The business has heavily invested in their relationships with suppliers and customers throughout the year ended 30 June 2024.

TORSION GROUP HOLDCO LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 6 -

Having regard to the impact of the Company’s operations on the community and environment

In their decision making, the Directors need to have regard to the impact of the Company’s operations on the community and environment. The Board plays a constructive role in tackling issues through engagement and investment.

It is important for the long-term future of our business that we protect and enhance the environment. Climate change will affect how much non-renewable energy is available, and the stakeholders are rightly concerned about the resilience of supplies and are looking to companies to adapt and take the necessary steps to reduce their climate change risk. We are committed to reducing our carbon footprint and contribution to climate change where economically viable.

Having regards to the desirability of the Company maintaining a reputation for high standards of business conduct

Customer fulfilment and customer satisfaction are essential for us to consistently deliver a high-quality service. The Board recognises that culture, values, and standards are key contributors to how a company creates and sustains value over the longer-term, to enable it to maintain a reputation for high standards of business conduct which guide and assist in the Board’s decision making, and in doing so, help promote the Company’s success, recognising, amongst other things, the likely consequences of any decision in the long-term and wider stakeholder considerations.

The standards set by the Board mandate certain requirements and behaviours with regards to the activities of the Directors, the Group’s employees and others associated with the Group.

Having regard to the need to act fairly between shareholders of the Company

The members of the Board consider, both individually and together, that they have acted in the way they consider, in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole (having regard to the stakeholders and matters set out in s172(1)(a-f) of the Companies Act 2006) in the decisions taken during the year ended 30 June 2024.

On behalf of the board

Mr D T Spencer
Director
31 January 2025
TORSION GROUP HOLDCO LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 30 JUNE 2024
- 7 -

The directors present their annual report and financial statements for the Period ended 30 June 2024.

Principal activities

The principal activity of the company is that of a holding company and the principal activity of the group is that of design and build.

Results and dividends

The results for the Period are set out on page 13.

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

Directors

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

Mr M M E H Dearden
(Appointed 24 January 2024)
Mr D T Spencer
(Appointed 24 January 2024)
Mr D W Worsley
(Appointed 24 January 2024)
Auditor

Sumer Auditco Limited were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, and deemed to be reappointed under section 487(2) of the Companies Act 2006.

Energy and carbon report

At Torsion, we are committed to building sustainable developments. With growing pressure on our natural resources, we must ensure all of our business activities enhance the resilience of the natural environment. We are committed to reducing carbon and waste on our projects and apply sustainability principles throughout our business activities.

The data below is for the year ended 30 June 2024.

Construction emissions relating to site, running the head office and staff business mileage have been included within this report.

In order to calculate the required information, we have used:

The company’s entire operations are based in the UK and its primary energy uses are:

TORSION GROUP HOLDCO LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 8 -

To account for changes in business activities year on year, the company applies an emission intensity ratio which expressed its annum emissions in relation to annual turnover. For 2024, the carbon emission intensity ratio for scope 1 & scope 2 emissions is shown in the table above.

As Torsion Construction begin to integrate sustainability considerations at the core of strategic business decisions, we expect energy efficiency action and sustainability initiatives to evolve year on year from the period covered by this report.

 

The adoption of SmartWaste software in spring 2023 has enabled the business to gather and monitor emissions data more efficiently. The business is in the process of improving utilisation of this software across our operations through training, awareness and auditing.

 

The business recognises that waste generated in our operations is likely to be a major emissions source. Although not reported this year, the company has a strong focus on reducing waste and monitors the amount of waste diverted from landfill. We also continue to use modern methods of construction (MMC) incorporating energy efficient design and environmentally sustainable materials wherever possible.

Two of our construction sites have opted to use giant battery energy storage systems on site, as an alternative to the traditional diesel generator solution, minimising diesel use on site. We are looking to explore this option further, as well as hybrid generator units, to expand utilisation of greener power solutions across our sites.

Torsion Construction have taken the step of employing a dedicated Environment and Sustainability Advisor in June 2024, to assist the business in establishing its sustainability strategy and goals, driving the adoption of effective carbon and energy management and reduction measures.

 

 

TORSION GROUP HOLDCO LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 9 -
Statement of directors' responsibilities

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

 

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

 

 

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

Statement of disclosure to auditor

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

On behalf of the board
Mr D T Spencer
Director
31 January 2025
TORSION GROUP HOLDCO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF TORSION GROUP HOLDCO LIMITED
- 10 -
Opinion

We have audited the financial statements of Torsion Group Holdco Limited (the 'parent company') and its subsidiaries (the 'group') for the Period ended 30 June 2024 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows, the company statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

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

Conclusions relating to going concern

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

 

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

 

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

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

TORSION GROUP HOLDCO LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF TORSION GROUP HOLDCO LIMITED
- 11 -
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 their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

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

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the 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 parent company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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.

We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience, and through discussions with the Directors (as required by auditing standards) and discussed with the Directors the policies and procedures regarding compliance with laws and regulations. We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit. The potential effect of these laws and regulations on the financial statements varies considerably.

Firstly, the Company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation and taxation legislation. We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.

 

Secondly, the Company is subject to many other laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines or litigation. We identified the following areas as those most likely to have such an effect; laws related to Health and Safety, Employment, UK Companies Act, Pension Legislation, Tax Legislation and Construction Regulations.

Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the Directors and inspection of regulatory and legal correspondence, if any. Through these procedures we did not become aware of any actual or suspected non-compliance.

TORSION GROUP HOLDCO LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF TORSION GROUP HOLDCO LIMITED
- 12 -

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations

We design procedures in line with our responsibilities, outlined below to detect material misstatement due to fraud:

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

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Stuart Stead
Senior Statutory Auditor
For and on behalf of Sumer Auditco Limited
Date: 31 January 2025
Statutory Auditor
Fourth Floor
Unit 5B, The Parklands
Bolton
BL6 4SD
TORSION GROUP HOLDCO LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 30 JUNE 2024
- 13 -
Period
ended
30 June
2024
Notes
£
Turnover
3
64,325,932
Cost of sales
(62,755,296)
Gross profit
1,570,636
Administrative expenses
(1,751,266)
Other operating income
165,870
Operating loss
4
(14,760)
Interest payable and similar expenses
7
(64,225)
Loss before taxation
(78,985)
Tax on loss
8
138,501
Profit for the financial Period
59,516
Profit for the financial Period is all attributable to the owners of the parent company.
Total comprehensive income for the Period is all attributable to the owners of the parent company.
TORSION GROUP HOLDCO LIMITED
GROUP BALANCE SHEET
AS AT
30 JUNE 2024
30 June 2024
- 14 -
2024
Notes
£
£
Fixed assets
Negative goodwill
9
(534,105)
Other intangible assets
9
59,877
Total intangible assets
(474,228)
Tangible assets
10
178,462
(295,766)
Current assets
Debtors
13
46,829,038
Cash at bank and in hand
5,546,212
52,375,250
Creditors: amounts falling due within one year
14
(50,221,805)
Net current assets
2,153,445
Total assets less current liabilities
1,857,679
Creditors: amounts falling due after more than one year
15
(1,767,797)
Provisions for liabilities
Deferred tax liability
17
19,876
(19,876)
Net assets
70,006
Capital and reserves
Called up share capital
19
10,490
Profit and loss reserves
59,516
Total equity
70,006
The financial statements were approved by the board of directors and authorised for issue on 31 January 2025 and are signed on its behalf by:
31 January 2025
Mr D T Spencer
Director
Company registration number 15440100 (England and Wales)
TORSION GROUP HOLDCO LIMITED
COMPANY BALANCE SHEET
AS AT 30 JUNE 2024
30 June 2024
- 15 -
2024
Notes
£
£
Fixed assets
Investments
11
2,780,767
Current assets
Debtors
13
2,991
Creditors: amounts falling due within one year
14
(623,395)
Net current liabilities
(620,404)
Net assets
2,160,363
Capital and reserves
Called up share capital
19
10,490
Revaluation reserve
679,122
Other reserves
1,457,501
Profit and loss reserves
13,250
Total equity
2,160,363

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £13,250.

The financial statements were approved by the board of directors and authorised for issue on 31 January 2025 and are signed on its behalf by:
31 January 2025
Mr D T Spencer
Director
Company registration number 15440100 (England and Wales)
TORSION GROUP HOLDCO LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 30 JUNE 2024
- 16 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 24 January 2024
-
-
-
Period ended 30 June 2024:
Profit and total comprehensive income
-
59,516
59,516
Issue of share capital
19
10,490
-
10,490
Balance at 30 June 2024
10,490
59,516
70,006
TORSION GROUP HOLDCO LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 30 JUNE 2024
- 17 -
Share capital
Revaluation reserve
Other reserves
Profit and loss reserves
Total
Notes
£
£
£
£
£
Balance at 24 January 2024
-
-
-
-
-
Period ended 30 June 2024:
Profit for the period
-
-
-
13,250
13,250
Other comprehensive income:
Adjustments to fair value of financial assets
-
679,122
-
-
679,122
Total comprehensive income
-
679,122
-
13,250
692,372
Issue of share capital
19
10,490
-
-
-
10,490
Transfers
-
-
1,457,501
-
1,457,501
Balance at 30 June 2024
10,490
679,122
1,457,501
13,250
2,160,363
TORSION GROUP HOLDCO LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 30 JUNE 2024
- 18 -
2024
Notes
£
£
Cash flows from operating activities
Cash generated from operations
21
7,306,529
Interest paid
(64,225)
Net cash inflow from operating activities
7,242,304
Investing activities
Purchase of tangible fixed assets
(6,148)
Purchase of subsidiaries, net of cash acquired
(2,014,761)
Net cash used in investing activities
(2,020,909)
Financing activities
Proceeds from new bank loans
508,565
Repayment of bank loans
(183,748)
Net cash generated from financing activities
324,817
Net increase in cash and cash equivalents
5,546,212
Cash and cash equivalents at beginning of Period
-
Cash and cash equivalents at end of Period
5,546,212
TORSION GROUP HOLDCO LIMITED
COMPANY STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 30 JUNE 2024
- 19 -
2024
Notes
£
£
Cash flows from operating activities
Cash generated from operations
22
610,145
Investing activities
Purchase of intangible assets
(623,395)
Dividends received
13,250
Net cash used in investing activities
(610,145)
Net increase in cash and cash equivalents
-
Cash and cash equivalents at beginning of Period
-
Cash and cash equivalents at end of Period
-
0
TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2024
- 20 -
1
Accounting policies
Company information

Torsion Group Holdco Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 1280 Century Way, Thorpe Park, Leeds, LS15 8ZB.

 

The group consists of Torsion Group Holdco Limited and all of its subsidiaries.

1.1
Reporting period

The reporting period was a 17 month period to 30 June 2024.

1.2
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, modified to include the revaluation of certain financial instruments at fair value. The principal accounting policies adopted are set out below.

1.3
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

1.4
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Torsion Group Holdco Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 30 June 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 21 -

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

 

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

 

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

1.5
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.6
Turnover

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

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

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

1.7
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 5 years.

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

1.8
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

 

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 22 -

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

Software
33% straight line
1.9
Tangible fixed assets

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

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

Fixtures and fittings
20% straight line
Computers
33% straight line

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

1.10
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

 

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

 

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

 

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 23 -
1.11
Impairment of fixed assets

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

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.12
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.13
Financial instruments

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 24 -
Other financial assets

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

Impairment of financial assets

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

 

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

 

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

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

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

TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 25 -
Other financial liabilities

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

 

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

Derecognition of financial liabilities

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

1.14
Equity instruments

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

1.15
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 26 -
1.16
Employee benefits

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

 

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

 

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

1.17
Retirement benefits

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

1.18
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

2
Judgements and key sources of estimation uncertainty

In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

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

TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
2
Judgements and key sources of estimation uncertainty
(Continued)
- 27 -
Key sources of estimation uncertainty

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

Construction Contracts

Profit on construction contracts ongoing at the balance sheet date is calculated based on the final expected profit margin for that contract as a percentage of completion of the contract. The percentage of completion of a contract is calculated based on the sales value to date versus the full contract value. Sales value is measured by reference to independent quantity surveyors' regular reports on the project.

 

Where contracts are forecast to make a loss, these are treated as onerous contracts in accordance with FRS102 and the total estimated loss is recognised in the year as part of the cost of sales and in provisions for liabilities on the balance sheet.

 

The Directors' have reviewed the status of all incomplete contracts both as at 30 June 2024 and up to the point of signing the financial statements and remain confident that assumed profitability levels will be maintained on the contracts through to completion. The directors' have considered previous forecasting accuracy in recent years in this regard and note that, with the exception of one specific contract, actual profitability achieved has been the same or higher than that initially forecasted in the pre-completion phases of the contracts. This suggests that the directors adopt a reasonably prudent approach in estimating contract profitability.

 

The directors acknowledge the inherent risk in this industry of contract losses occurring and are mindful of the significant losses incurred during the financial year to 30 June 2021 on one specific contract. These losses were incurred as a result of issues specific to that project and were exacerbated by delays caused by the COVID-19 pandemic. Management has put in place remedial action, including improving controls around governance and oversight as well as making changes in personnel, and they are of the view that the significant disruption caused by COVID-19 in 2020 and 2021 will not recur given the UK's vaccine-led recovery. On this basis, the directors have judged that none of the current ongoing contracts will result in such losses and have therefore not made provision to reflect that.

Recoverability of other debtors

Included within other debtors are amounts loaned to other entities under common ownership of the ultimate controlling party. These loans are repayable on demand and do not bear interest charges. Some of these ventures are start up companies which currently don't yet have sufficient resources to be in a position to repay the amounts owed to the Company should repayment be demanded.

 

The directors must ascertain recoverability of these debtors based on the forecasted cash flows to be generated by each venture. These ventures are in the homes and care homes sectors; the directors of those businesses have prepared business plans which demonstrate that repayment of amounts owed will be made within the foreseeable future following completion of sale contracts in those businesses. The businesses are currently performing as expected and no impairment triggers have been identified by the directors. On this basis, the directors continue to believe that full recovery of the amounts owed by these related parties is probable.

3
Turnover
2024
£
Turnover analysed by class of business
Construction contracts
64,325,932

The above turnover has been generated in the UK.

TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 28 -
4
Operating loss
2024
£
Operating loss for the period is stated after charging/(crediting):
Depreciation of owned tangible fixed assets
41,759
Amortisation of intangible assets
4,107
Release of negative goodwill
(48,533)
Operating lease charges
229,166
5
Auditor's remuneration
2024
Fees payable to the company's auditor and associates:
£
For audit services
Audit of the financial statements of the group and company
-
Audit of the financial statements of the company's subsidiaries
26,000
6
Employees

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

Group
Company
2024
2024
Number
Number
Management
9
3
Project staff
113
-
Administration
7
-
Total
129
3

Their aggregate remuneration comprised:

Group
Company
2024
2024
£
£
Wages and salaries
8,810,425
-
0
Social security costs
1,074,229
-
Pension costs
364,570
-
0
10,249,224
-
0

The director remuneration was £9,600 (2023: £9,600)

TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 29 -
7
Interest payable and similar expenses
2024
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
64,225
8
Taxation
2024
£
Current tax
UK corporation tax on profits for the current period
(158,377)
Deferred tax
Origination and reversal of timing differences
19,876
Total tax credit
(138,501)

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

2024
£
Loss before taxation
(78,985)
Expected tax credit based on the standard rate of corporation tax in the UK of 25.00%
(19,746)
Tax effect of expenses that are not deductible in determining taxable profit
35,044
Unutilised tax losses carried forward
(3,891)
Permanent capital allowances in excess of depreciation
34,383
Research and development tax credit
(184,291)
Taxation credit
(138,501)
TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 30 -
9
Intangible fixed assets
Group
Negative goodwill
Software
Total
£
£
£
Cost
At 24 January 2024
-
0
-
0
-
0
Additions - business combinations
(582,638)
63,984
(518,654)
At 30 June 2024
(582,638)
63,984
(518,654)
Amortisation and impairment
At 24 January 2024
-
0
-
0
-
0
Amortisation charged for the Period
(48,533)
4,107
(44,426)
At 30 June 2024
(48,533)
4,107
(44,426)
Carrying amount
At 30 June 2024
(534,105)
59,877
(474,228)
The company had no intangible fixed assets at 30 June 2024.
10
Tangible fixed assets
Group
Fixtures and fittings
Computers
Total
£
£
£
Cost
At 24 January 2024
-
0
-
0
-
0
Additions
-
0
7,624
7,624
Business combinations
114,962
97,635
212,597
At 30 June 2024
114,962
105,259
220,221
Depreciation and impairment
At 24 January 2024
-
0
-
0
-
0
Depreciation charged in the Period
14,543
27,216
41,759
At 30 June 2024
14,543
27,216
41,759
Carrying amount
At 30 June 2024
100,419
78,043
178,462
The company had no tangible fixed assets at 30 June 2024.
TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 31 -
11
Fixed asset investments
Group
Company
2024
2024
Notes
£
£
Investments in subsidiaries
12
-
0
2,780,767
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 24 January 2024
-
Additions
2,101,645
Valuation changes
679,122
At 30 June 2024
2,780,767
Carrying amount
At 30 June 2024
2,780,767
12
Subsidiaries

Details of the company's subsidiaries at 30 June 2024 are as follows:

Name of undertaking
Address
Class of
% Held
shares held
Direct
Torsion Construction Limited
1
Ordinary
100.00
Torsion Group Holdings Limited
1
Ordinary
100.00
Torsion Group Holdings 2 Limited
1
Ordinary
100.00

Registered office addresses (all UK unless otherwise indicated):

1
1280 Century Way, Thorpe Park, Leeds, West Yorkshire, England, LS15 8ZB
TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 32 -
13
Debtors
Group
Company
2024
2024
Amounts falling due within one year:
£
£
Trade debtors
14,275,696
-
0
Gross amounts owed by contract customers
8,763,196
-
0
Unpaid share capital
3,091
2,991
Corporation tax recoverable
497,755
-
0
Other debtors
20,178,346
-
0
Prepayments and accrued income
212,891
-
0
43,930,975
2,991
Amounts falling due after more than one year:
Trade debtors
2,898,063
-
0
Total debtors
46,829,038
2,991
14
Creditors: amounts falling due within one year
Group
Company
2024
2024
Notes
£
£
Bank loans
16
330,087
-
0
Trade creditors
11,493,171
-
0
Amounts owed to group undertakings
-
0
623,395
Other taxation and social security
720,289
-
Other creditors
3,265,760
-
0
Accruals and deferred income
34,412,498
-
0
50,221,805
623,395
15
Creditors: amounts falling due after more than one year
Group
Company
2024
2024
Notes
£
£
Bank loans and overdrafts
16
221,363
-
0
Trade creditors
1,546,434
-
0
1,767,797
-
TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 33 -
16
Loans and overdrafts
Group
Company
2024
2024
£
£
Bank loans
551,450
-
0
Payable within one year
330,087
-
0
Payable after one year
221,363
-
0

The long term loan of £221,363 is secured by a fixed and floating charge over the property or undertaking of Torsion Construction Limited and Torsion Group Holdco Limited.

17
Deferred taxation

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

Liabilities
2024
Group
£
Accelerated capital allowances
19,876
The company has no deferred tax assets or liabilities.
Group
Company
2024
2024
Movements in the Period:
£
£
Asset at 24 January 2024
-
-
Charge to profit or loss
19,876
-
Liability at 30 June 2024
19,876
-
18
Retirement benefit schemes
2024
Defined contribution schemes
£
Charge to profit or loss in respect of defined contribution schemes
364,570

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 34 -
19
Share capital
Group and company
2024
2024
Ordinary share capital
Number
£
Issued and not fully paid
Ordinary A shares of £1 each
7,500
7,500
Ordinary B shares of £1 each
2,465
2,465
Ordinary C shares of £1 each
525
525
10,490
10,490

The shareholders had unpaid share capital of £2,991.

20
Controlling party

D T Spencer is the ultimate controlling party by virtue of his controlling shareholding in the group.

21
Cash generated from group operations
2024
£
Profit after taxation
59,516
Adjustments for:
Taxation credited
(138,501)
Finance costs
64,225
Amortisation and impairment of intangible assets
(44,426)
Depreciation and impairment of tangible fixed assets
41,759
Movements in working capital:
Increase in debtors
(14,935,934)
Increase in creditors
22,259,890
Cash generated from operations
7,306,529
22
Cash generated from operations - company
2024
£
Profit after taxation
13,250
Adjustments for:
Investment income
(13,250)
Movements in working capital:
Increase in creditors
610,145
Cash generated from operations
610,145
TORSION GROUP HOLDCO LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2024
- 35 -
23
Analysis of changes in net funds - group
24 January 2024
Cash flows
30 June 2024
£
£
£
Cash at bank and in hand
-
5,546,212
5,546,212
Borrowings excluding overdrafts
-
(551,450)
(551,450)
-
4,994,762
4,994,762
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