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Registered number: 05466873










STM GROUP (UK) LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 JANUARY 2024

 
STM GROUP (UK) LIMITED
 
 
COMPANY INFORMATION


Director
Mr P B Simpson 




Registered number
05466873



Registered office
Solar House
1st Floor

Romford Road

London

E15 4LJ




Independent auditors
MHA
Statutory Auditors

6th Floor

2 London Wall Place

London, United Kingdom

EC2Y 5AU




Bankers
HSBC Bank Plc
59-61 The Mall

London

E15 1XF





 
STM GROUP (UK) LIMITED
 

CONTENTS



Page
Strategic report
 
1 - 3
Director's report
 
4 - 6
Independent auditors' report
 
7 - 9
Statement of comprehensive income
 
10
Balance sheet
 
11
Statement of changes in equity
 
12
Notes to the financial statements
 
13 - 25


 
STM GROUP (UK) LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JANUARY 2024

Introduction
 
The Director presents his Report and Financial Statements for the year ended 31 January 2024.

Business review
 
The last 12 months have seen a period of strategic change for STM Group (UK) Ltd, with the full integration of
Cleaning Services into the combined Group. The continued growth of Cleaning dictated the need for consistent
financial disciplines to be applied, thus ensuring an appropriate business focus on effective organisational management, whilst promoting maximum profitability. These fundamental, but much needed, business integration changes have presented various challenges, inevitably requiring some adjustments to prior-year accounts, together with an impact on current year results. I am confident that the loss shown is not a true reflection of the trading position, or profitability, of the business, but rather resulting from the need to realign, and restructure, the business going forward. To achieve same, a fundamental change to the Company payroll process was required which, to fully comply with accounting requirements, created the stated loss.
Due to the restructuring, and the absolute need to demonstrate business progression, STM Group (UK) Ltd will be changing its accounting reference date, requiring another Year End seven months after these results. The primary purpose of this change is to bring the Company in line with the new accounting reference date of 31st August, whilst highlighting the immediate financial improvements resulting from these carefully planned business changes. I am confident that STM remains in a strong trading position, with healthy profits emphasised in future results.
Overall, the STM Group (UK) Ltd Board of Directors are pleased that, through careful planning and management, the Company is emerging in good financial shape from a challenging period of change. The necessary restructuring of, and financial alterations to, the business has not only enabled a sharper focus on financial performance, but also prepared the business for future growth. 

Principal risks and uncertainties
 
The Board of Directors are pleased that STM Group, through careful planning and management, are emerging from some challenging periods in good financial shape. The focus this year has been restructuring the business for future growth. This has resulted in some financial alterations to the business, and part of our ongoing focus on financial performance.
Financial risk
Due to the nature of the industry in which the company operates, there are various financial risks which the company may be exposed to, namely, credit risk, liquidity risk and interest risk.
Credit risk
The company offers credit terms to its customers that allow payment after delivery of the supply of goods and services. The company prides itself on strong ongoing customer relationships and this reduces the exposure to credit risk in the majority of cases.
Liquitity risk
The company seeks to ensure sufficient liquidity is available to meet day-to-day operations and future potential developments by way of invoice financing arrangements that are used to provide short-term debt flexibility.
Interest risk
The company keeps interest rate exposure under review to ensure this is factored into any business decisions.

Page 1

 
STM GROUP (UK) LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024

Financial key performance indicators
 
During the current reporting year, the Company made a pre-tax loss of £300,278, I am confident that the loss shown is not a true reflection of the trading position, or profitability, of the business, but rather resulting from the need to realign, and restructure, the business going forward. To achieve same, a fundamental change to the Company payroll process was required which, to fully comply with accounting requirements, created the stated loss.

Page 2

 
STM GROUP (UK) LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024

Other key performance indicators
 
The companies other key performance indicator is considered to be its net assets position. This is as follows for the last two years:
                                         
      2024                  2023
Net Assets/(Liabilities)           (£123,956)          £179,584


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



................................................
Mr P B Simpson
Director

Date: 12 February 2025

Page 3

 
STM GROUP (UK) LIMITED
 
 
 
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 JANUARY 2024

The director presents his report and the financial statements for the year ended 31 January 2024.

Director's responsibilities statement

The director is responsible for preparing the Strategic report, the Director's report and the financial statements in accordance with applicable law and regulations.
 
Company law requires the director to prepare financial statements for each financial year. Under that law the director has elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.

 In preparing these financial statements, the director is required to:


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

make judgments and accounting estimates that are reasonable and prudent;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

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

Results and dividends

The loss for the year, after taxation, amounted to £303,540 (2023 - profit £302,501).

No dividends were paid in the year (2023: £Nil).

Director

The director who served during the year was:

Mr P B Simpson 

Future developments

The company is looking to grow each year. The Director considers that the company is well positioned to keep the ongoing uncertainty of the economic climate following Brexit minimal.
The company operates in a highly competitive market and profit margins are constantly squeezed. The Director is therefore conscious that costs and overheads are constantly monitored to maintain a level of profitability within the company. The Director expects the way forward for growth is by building on current relationships and efficiency.

Page 4

 
STM GROUP (UK) LIMITED
 
 
 
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024

Engagement with employees

STM Group (UK) Ltd is an Equal Opportunities and Diversity Aware employer, committed to promoting equality, diversity and inclusion amongst its workforce, whilst eliminating discrimination. Through its Support, Trust, Manage Vision, STM treats all employees as 'internal customers'. The STM aim is to create an inclusive environment and culture, with a diverse workforce that is representative of all sections of society, where everyone has the opportunity to fully contribute, and achieve, individual, full potential. 
It is STM's policy to treat all employees (and job applicants) fairly and equally, regardless of individual sex, sexual orientation, gender re-assignment, marriage or civil partnership, pregnancy or maternity, race, colour, creed, nationality, ethnic or national origin, marital status, religion or belief, age, disability, or union membership status.
STM's policy is to recruit disabled workers for those vacancies that they are able to fill. All neccessary assistance with initial training courses is given. Once employed, a career plan is developed so as to ensure suitable opportunities for each disables poerson. Arrangements are made, wherever possible, for retraining employees who become disabled, to enable them to perform work identified as apprropriate for their aptitudes and abilities.
STM, consequently, commits to ensuring every employee is given equal opportunity in every aspect of their working role, with individual differences (and similarities) not only being embraced, but also where individual employee contribution is recognised, celebrated and valued. All STM employees will be given the necessary support and encouragement to develop individual ability and utilise unique talent.
This policy to all aspects of employment, recruitment and related Terms & Conditions of Employment, including pay and benefits, training, appraisals, career development, conduct at work, disciplinary and grievance procedures, termination of employment and all other aspects of employment.

Qualifying third party indemnity provisions

Director's liability and indemnity insurance was in force throughout the year to cover the directors and officers of
the company against actions brought against them in their personal capacities. Cover is not provided where the
individual has acted fraudulently or dishonestly.

Disclosure of information to auditors

The director at the time when this Director's report is approved has confirmed that:
 
so far as he is aware, there is no relevant audit information of which the Company's auditors are unaware, and

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

Post balance sheet events

There have been no significant events affecting the Company since the year end.

Auditors

The auditorsMHAwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

Page 5

 
STM GROUP (UK) LIMITED
 
 
 
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024

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





Mr P B Simpson
Director

Date: 12 February 2025

Page 6

 
STM GROUP (UK) LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF STM GROUP (UK) LIMITED
 

Opinion


We have audited the financial statements of STM Group (UK) Limited (the 'Company') for the year ended 31 January 2024, which comprise the Statement of comprehensive income, the Balance sheet, the Statement of changes in equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Company's affairs as at 31 January 2024 and of its loss 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 Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.


Conclusions relating to going concern


In auditing the financial statements, we have concluded that the director's 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 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 director with respect to going concern are described in the relevant sections of this report.


Page 7

 
STM GROUP (UK) LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF STM GROUP (UK) LIMITED (CONTINUED)


Other information


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


We have nothing to report in this regard.


Opinion on other matters prescribed by the Companies Act 2006
 

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


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


Matters on which we are required to report by exception
 

In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic report or the Director's report.


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


adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of director's 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 Director's responsibilities statement set out on page 4, the director is 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 director determines 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 director is responsible for assessing the 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 director either intends to liquidate the Company or to cease operations, or have no realistic alternative but to do so.


Page 8

 
STM GROUP (UK) LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF STM GROUP (UK) LIMITED (CONTINUED)


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 an Auditors' 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:

•     Obtaining an understanding of the legal and regulatory frameworks that the company operates in;
•     Reviewing key correspondence with regulatory authorities;
•     Testing for evidence of management override;
•     Enquiry of management to identify any instances of non-compliance with laws and regulations;
•     Enquiry of management around actual and potential litigation and claims;
•     Enquiry of management to identify any instances of known or suspected instances of fraud;
•     Discussing among the engagement team regarding how and where fraud might occur.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including
those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk
increases the more that compliance with a law or regulation is removed from the events and transactions
reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.
The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves
intentional concealment, forgery, collusion, omission or misrepresentation.


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' 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 2006Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' 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.



Atul Kariya FCCA (Senior statutory auditor)
  
for and on behalf of
MHA
 
Statutory Auditors
  
London, United Kingdom

Date: 
 
MHA is the trading name of MacIntyre Hudson LLP, a limited liability partnership in England and Wales (registered number OC312313).
12 February 2025
Page 9

 
STM GROUP (UK) LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JANUARY 2024

2024
2023
Note
£
£

  

Turnover
 4 
32,167,701
25,477,435

Cost of sales
  
(27,374,768)
(20,846,719)

Gross profit
  
4,792,933
4,630,716

Administrative expenses
  
(5,057,249)
(4,335,218)

Exceptional administrative expenses
 11 
(37,341)
-

Operating (loss)/profit
 5 
(301,657)
295,498

Interest receivable and similar income
 8 
7,211
7,003

Interest payable and similar expenses
  
(5,832)
-

(Loss)/profit before tax
  
(300,278)
302,501

Tax on (loss)/profit
 10 
(3,262)
-

(Loss)/profit for the financial year
  
(303,540)
302,501

There was no other comprehensive income for 2024 (2023:£NIL).

The notes on pages 13 to 25 form part of these financial statements.

Page 10

 
STM GROUP (UK) LIMITED
REGISTERED NUMBER: 05466873

BALANCE SHEET
AS AT 31 JANUARY 2024

2024
2023
Note
£
£

Fixed assets
  

Tangible assets
 12 
285,402
292,620

  
285,402
292,620

Current assets
  

Debtors: amounts falling due within one year
 13 
9,977,517
7,853,794

Cash at bank and in hand
 14 
462,039
1,078

  
10,439,556
7,854,872

Creditors: amounts falling due within one year
 15 
(10,848,914)
(7,967,908)

Net current liabilities
  
 
 
(409,358)
 
 
(113,036)

Total assets less current liabilities
  
(123,956)
179,584

  

Net (liabilities)/assets
  
(123,956)
179,584


Capital and reserves
  

Called up share capital 
 16 
2,000
2,000

Profit and loss account
 17 
(125,956)
177,584

  
(123,956)
179,584


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




................................................
Mr P B Simpson
Director

Date: 12 February 2025

The notes on pages 13 to 25 form part of these financial statements.

Page 11

 
STM GROUP (UK) LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2024


Called up share capital
Profit and loss account
Total equity

£
£
£


At 1 February 2022 (as previously stated)
2,000
2,015,099
2,017,099

Prior year adjustment - correction of error
-
(2,140,016)
(2,140,016)


At 1 February 2022 (as restated)
2,000
(124,917)
(122,917)


Comprehensive income for the year

Profit for the year
-
302,501
302,501
Total comprehensive income for the year
-
302,501
302,501



At 1 February 2023
2,000
177,584
179,584


Comprehensive income for the year

Loss for the year
-
(303,540)
(303,540)
Total comprehensive income for the year
-
(303,540)
(303,540)


At 31 January 2024
2,000
(125,956)
(123,956)


The notes on pages 13 to 25 form part of these financial statements.

Page 12

 
STM GROUP (UK) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

1.


General information

STM Group (UK) Ltd is a private company limited by shares incorporated in England and Wales in the United Kingdom. The registered office of the entity is Solar House, 1st Floor, Romford Road, London, E15 4LJ. The principal activity of the company is the provision of security services.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

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

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

The financial statements are presented in £ sterling, the functional currency, rounded to the nearest £1.

The following principal accounting policies have been applied:

 
2.2

Financial Reporting Standard 102 - reduced disclosure exemptions

The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
the requirements of Section 7 Statement of Cash Flows;
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of STM Group Holdings Limited as at 31 January 2024 and these financial statements may be obtained from Companies House.

Page 13

 
STM GROUP (UK) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

2.Accounting policies (continued)

 
2.3

Going concern

The financial statements have been prepared on a going concern basis.
 
The director has considered relevant information, including the annual budget, forecast future cash flows and the impact of subsequent events in making his assessment. The company made a loss of £303,540 (2023: profit of £302,501) in the year and at the balance sheet date the company  has net liabilities of £123,956 (2023: net assets £179,684). The director has confirmed his continued support for the company and confirmed that he has the ability to do so. 
Based on these assessments and having regard to the resources available to the entity, the director has concluded that there is no material uncertainty and the company can continue to adopt the going concern basis in preparing the annual report and accounts for the foreseeable future. 

 
2.4

Revenue

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

Rendering of services

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

 
2.5

Operating leases: the Company as lessee

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

 
2.6

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Statement of comprehensive income in the same period as the related expenditure.

 
2.7

Interest income

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

Page 14

 
STM GROUP (UK) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

2.Accounting policies (continued)

 
2.8

Finance costs

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

 
2.9

Borrowing costs

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

 
2.10

Pensions

Defined contribution pension plan

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

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

 
2.11

Taxation

Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

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

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

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


Page 15

 
STM GROUP (UK) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

2.Accounting policies (continued)

 
2.12

Tangible fixed assets

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

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on a reducing balance basis.

Depreciation is provided on the following basis:

Motor vehicles
-
15%
Fixtures and fittings
-
10%
Office equipment
-
8%
Computer equipment
-
8%

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

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

 
2.13

Debtors

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

 
2.14

Cash and cash equivalents

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

 
2.15

Creditors

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

 
2.16

Financial instruments

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

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

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to
Page 16

 
STM GROUP (UK) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

2.Accounting policies (continued)


2.16
Financial instruments (continued)

settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

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

Other financial assets

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

Impairment of financial assets

At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss. 

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

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

Financial liabilities

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

Basic financial liabilities, which include trade and other creditors, bank loans and other loans are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the
Page 17

 
STM GROUP (UK) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

2.Accounting policies (continued)


2.16
Financial instruments (continued)

present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.

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

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

Other financial instruments

Derivatives, including forward exchange contracts, futures contracts and interest rate swaps, are not classified as basic financial instruments. These are initially recognised at fair value on the date the derivative contract is entered into, with costs being charged to the profit or loss. They are subsequently measured at fair value with changes in the profit or loss.

Debt instruments that do not meet the conditions as set out in FRS 102 paragraph 11.9 are subsequently measured at fair value through the profit or loss. This recognition and measurement would also apply to financial instruments where the performance is evaluated on a fair value basis as with a documented risk management or investment strategy.

Derecognition of financial instruments

Derecognition of financial assets

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

Derecognition of financial liabilities

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


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

The director considers that the critical accounting policies where judgments and estimations have been
applied relate to the tangible asset lives, in particular the useful economic life and residual values of office equipment, and the recoverability of trade debtors. The director has concluded that the asset values
and residual values are appropriate for tangible fixed assets and that trade debtors are appropriately
valued.

Page 18

 
STM GROUP (UK) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

4.


Turnover

The whole of the turnover is attributable to provision of security services.

All turnover arose within the United Kingdom.


5.


Operating (loss)/profit

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

2024
2023
£
£

Operating lease rentals
68,909
49,495

Exceptional expenses (Note 11)
37,341
-


6.


Auditors' remuneration

During the year, the Company obtained the following services from the Company's auditors:


2024
2023
£
£

Fees payable to the Company's auditors for the audit of the Company's financial statements
27,000
24,000

The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent Company.

Page 19

 
STM GROUP (UK) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

7.


Employees

Staff costs were as follows:


2024
2023
£
£

Wages and salaries
22,921,365
17,674,941

Social security costs
1,823,038
1,457,818

Cost of defined contribution pension scheme
295,895
227,470

25,040,298
19,360,229


The director received no remuneration, pension or other benefits from the company in the year (2023: none) and accrues no pension benefits.

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


        2024
        2023
            No.
            No.







Employees
925
825


8.


Interest receivable

2024
2023
£
£


Other interest receivable
7,211
7,003

7,211
7,003


9.


Interest payable and similar expenses

2024
2023
£
£


Other interest payable
5,832
-

5,832
-

Page 20

 
STM GROUP (UK) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

10.


Taxation


2024
2023
£
£

Corporation tax


Adjustments in respect of previous periods
3,262
-


Total current tax
3,262
-

Factors affecting tax charge for the year

The tax assessed for the year is higher than (2023 - higher than) the standard rate of corporation tax in the UK of 25% (2023 - 19%). The differences are explained below:

2024
2023
£
£


(Loss)/profit on ordinary activities before tax
(300,278)
302,501


(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 19%)
(75,070)
57,475

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
13,690
7,367

Capital allowances for year in excess of depreciation
(6,805)
-

Utilisation of tax losses
(1,803)
(64,842)

Adjustments to tax charge in respect of prior periods
3,262
-

Non-taxable income
1,803
-

Unrelieved tax losses carried forward
68,185
-

Total tax charge for the year
3,262
-


Factors that may affect future tax charges

On 1 April 2023 the corporation tax rate increased to 25%. 

Page 21

 
STM GROUP (UK) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

11.


Exceptional items

2024
2023
£
£


Exceptional expenses
37,341
-

37,341
-

Exceptional expenses of £37,341 related to legal fees relating to an ongoing dispute with a supplier.


12.


Tangible fixed assets





Motor vehicles
Fixtures and fittings
Office equipment
Computer equipment
Total

£
£
£
£
£



Cost


At 1 February 2023
109,915
33,080
390,704
124,848
658,547


Additions
-
-
15,262
11,688
26,950



At 31 January 2024

109,915
33,080
405,966
136,536
685,497



Depreciation


At 1 February 2023
89,936
28,258
201,007
46,726
365,927


Charge for the year
5,448
792
18,673
9,255
34,168



At 31 January 2024

95,384
29,050
219,680
55,981
400,095



Net book value



At 31 January 2024
14,531
4,030
186,286
80,555
285,402



At 31 January 2023
19,979
4,822
189,697
78,122
292,620


13.


Debtors

2024
2023
£
£


Trade debtors
6,014,478
4,233,611

Amounts owed by group undertakings
2,105,276
1,569,277

Other debtors
318,624
467,028

Prepayments and accrued income
1,484,305
1,529,044

Tax recoverable
54,834
54,834
Page 22

 
STM GROUP (UK) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

13.Debtors (continued)


9,977,517
7,853,794



14.


Cash and cash equivalents

2024
2023
£
£

Cash at bank and in hand
462,039
1,078

Less: bank overdrafts
-
(1,060,343)

462,039
(1,059,265)



15.


Creditors: Amounts falling due within one year

2024
2023
£
£

Bank overdrafts
-
1,060,343

Trade creditors
3,480,312
2,566,504

Amounts owed to group undertakings
-
777

Corporation tax
-
90,494

Other taxation and social security
1,008,611
-

Other creditors
4,416,924
3,411,527

Accruals and deferred income
1,943,067
838,263

10,848,914
7,967,908


The bank overdraft is secured on the assets of the company. 


16.


Share capital

2024
2023
£
£
Allotted, called up and fully paid



2,000 (2023 - 2,000) Ordinary shares of £1.00 each
2,000
2,000


Page 23

 
STM GROUP (UK) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

17.


Reserves

Profit and loss account

The Profit and loss account is represented by retained earnings. Changes in reserves are set out in the Statement of Changes in Equity.


18.


Pension commitments

The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £295,895 (2023: £227,470). There were overpayments to the fund totalling £6,005 and these are included in debtors, (2023: £6,508 payable to the fund included in creditors).


19.


Commitments under operating leases

At 31 January 2024 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2024
2023
£
£

Building


Not later than 1 year
247,101
220,416

Later than 1 year and not later than 5 years
-
26,685

247,101
247,101

2024
2023

£
£

Other


Not later than 1 year
262,246
220,416

Later than 1 year and not later than 5 years
-
26,685

262,246
247,101


20.


Transactions with directors

During the year, the company made advances totaling £Nil (2023: £Nil) to Mr P B Simpson, the director, and received credits of £Nil (2023: £Nil). Interest of £7,211 (2023: £7,003) has been charged at commercial rates on overdrawn balances. As at 31 January 2024, Mr P B Simpson owed the company £294,656 (2023: £287,136). The loan is unsecured and repayable on demand.

Page 24

 
STM GROUP (UK) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024

21.


Related party transactions

During the year, STM Cleaning Ltd, a limited liability company of which the director, Mr P B Simpson, is a shareholder, provided management services to the company totaling £2,596,655 (2023: £3,200,271). STM Cleaning Ltd also received services from STM Group (UK) Ltd during the year totalling £2,596,655 (2023: £3,200,271. As at 31 January 2024, STM Group (UK) Limited was owed £534,653 from STM Cleaning Ltd (2023: £373,627).  These transactions were on normal commercial terms.


22.


Parent entity and controlling party

The company was under the control of the director, Mr P B Simpson, throughout the current and prior year, as a result of his control of the parent company, STM Group Holdings Ltd.
The largest and smallest groups in which the results of the company are consolidated are those headed by STM Group Holdings Ltd, with a registered office of Solar House, 1st Floor, Romford Road, London, E15 4LJ.

 
Page 25