Company registration number 06900094 (England and Wales)
The Wool Packaging Company Ltd
Annual report and financial statements
For the year ended 31 May 2024
The Wool Packaging Company Ltd
Company information
Directors
Mr D K Spilsbury
Miss J H Morris
Mrs A F Morris
Company number
06900094
Registered office
Units 1a & 1b, Tungsten Park
Opal Way
Stone Business Park
Stone
Staffordshire
England
ST15 0SS
Auditor
DJH Audit Limited
The Glades
Festival Way
Festival Park
Stoke on Trent
Staffordshire
ST1 5SQ
The Wool Packaging Company Ltd
Contents
Page
Strategic report
1 - 4
Directors' report
5 - 6
Independent auditor's report
7 - 10
Statement of income and retained earnings
11
Statement of financial position
12
Notes to the financial statements
13 - 26
The Wool Packaging Company Ltd
Strategic report
For the year ended 31 May 2024
- 1 -

The directors present the strategic report for the year ended 31 May 2024.

 

Principal Activities

Using natural materials to change the world, our principal activity continues to be that of designing, developing, manufacturing and supplying insulated packaging and temperature control solutions internationally. We strive to provide quality products, excellent customer service with a collaborative and future looking approach. We have worked with a significant number of our customers and key suppliers for many years, and we believe that strength and business security results from building strong partnerships, in which all parties can draw value, both measurable and holistic. This strategy has allowed us to target, meet and go on to exceed the significant growth demands of our key markets, and will continue to do so comfortably and confidently.

 

Review of the business

As a family business whose foundation in 2009 was based on an environmentally responsible product and family ethos, we believe in business as a force for good and that in the pursuit of profitability we should not forget our responsibilities to protect and support our planet and people. That is why, even in Board Level discussions, our decision making considers our environmental and social impact, as well as all of our stakeholders.

 

We have Five Woolcool Pillars which are underpinned by our commitment to innovation and creativity, both in terms of our company activities and our continual development through to improvement of our products and service. These Pillars allow us to monitor, measure and ensure meaningful impact of our decisions.

Our Pillars: -

° Our Customers

° Our Team

° Our Processes

° Our Environment & Community

° Our Finance

 

Our Values: -

° Be Honest

° Be Kind

° Be Responsible

° Be Creative

° Be Open-minded

° Get Sheep Done

The Wool Packaging Company Ltd
Strategic report (continued)
For the year ended 31 May 2024
- 2 -
Key performance indicators

After the global economic instability of last four to five years, including the impact of Brexit, Covid, Governmental changes and the Energy Crisis, the main focus of the last 12 months has been on ensuring we continue to innovate, to become as efficient as we can in our processes, invest in the development of our people and expand our reach within key sectors nationally and internationally. Whilst we are an ambitious, family owned, female led entity, we want to ensure that our growth rate is measured, creating business sustainability long into the future.

 

Key points from 2023-2024: -

° Growth in turnover of 20.89% - Driven in part by organic growth of e-commerce in the food sector. Although always part of our customer base, in the last three years we have also been intentional and targeted in our investments to expand into the Pharmaceutical Sector, and this year we have begun to see the positive results of this investment.

° Global Expansion – whilst the figures are relatively modest in their growth pattern, there has been a significant increase in our export activity, with new territories and opportunities unlocked on a monthly basis. We are purposely targeting certain overseas regions due to new market opportunities in both e-commerce and Pharmaceutical.

° Gross profit margin remained consistent with the prior year of 18.66% - despite a number of material increases at the beginning of the financial year heavily impacting our figures, we have worked hard in the second half to negate these increases where possible, predominantly through driving efficiencies, review of supply chain and investment.

° At the year end, the company’s net current assets remained strong, with an increase of £21k to £905k (2023: £884K).

° At the balance sheet date, net assets have remained consistent at the year-end increasing by £1k to £1.26m (2023: £1.26m). After what has been a tumultuous economic landscape, we are extremely pleased with these results and our financial position at the year-end. We continue to strive to improve our product, processes and business practices. We are looking forward to delivering further milestones against our objectives for the next 12 months and beyond, and to delighting our customers, suppliers, our team and all our other stakeholders in the process.

Research and Development

 

We are a design-led entity, something instilled by our Founder. As a result, R&D activity is ongoing and a busy department: -

 

° Pallet cover launch – 2023-2024 saw the launch of FreightGUARDIAN, an insulative and protective cover for larger freight items.

° Consumer products – Following our FreightGUARDIAN launch, several other potential product opportunities which we are currently assessing.

° Pharmaceutical developments – Our LifeGUARDIAN project is ongoing, developing a solution for the more stringent and extreme requirements for the shipment of specific sensitive products in this sector.

° Hortiwool – After researching the use of our packaging product in Horticulture, we have been reviewing the feasibility and opportunities to diversify with a new product range in an alternative sector.

The Wool Packaging Company Ltd
Strategic report (continued)
For the year ended 31 May 2024
- 3 -
Our Sustainability, Community & Team

Our Environment & Community and Our Team form two of our core business pillars. As with all pillars, both are continually evolving, and areas in which we can always find improvement. This year was no exception. We aim for meaningful and measured impact.

 

Our Environment & Community

° Following a site review, the business re-certified its B Corp accreditation, increasing its score by 15 points. Only 10% of B Corps are randomly selected for a site reviewed each year. This type of review is a magnified version of the usual assessment and saw areas of our submission closely scrutinised by the B Corp assessors. Following this process, our score increased by 15 points, and saw us join the ranks of the higher scoring companies in the Environmental section of the assessment.

° EcoVadis Silver Medal – We were awarded the EcoVadis Silver Medal – joining the top 15% of Companies Globally

° Charitable & Community Engagement – we have continued our support of the local causes and the community, both internally through supporting our team members and externally through charitable donations in time and money, supporting Youth Engagement, Health & Wellbeing and Family support charities across the area. We also pledged at least 2 hrs per team member annually to go towards charitable activity. Our MD sits as a Trustee on two local charities as well as volunteering on the Board of the Local University and Chamber of Commerce.

° UN’s Sustainable Development Goals – We recognise these goals as a guide to align our objectives with best sustainability practice. A number of these goals naturally lend themselves to our activity, such as those focusing on industry, innovation, infrastructure, consumption, and sustainability. As part of our company culture and ethos, we also align with equality, well-being, education, and community goals through purposeful practises and fostering an inclusive work environment.

 

Our Team

Without our team, there is no Woolcool, which is why we actively invest in team development and ensure our team feel Safe, Supported and Engaged.

° Team development – We commit that every team member has access to personal development, with qualifications from practical FLT licences through to NVQs and Degrees. This year, 96% of our team have engaged in courses or training.

° Training opportunities have also included social and environmental education, such as Diversity Training, Carbon Literacy Course and Domestic Abuse Awareness.

° Retention rates continue to track below the national average, with a number of the team reaching their 5, 7 and 10 year anniversaries this year.

° As always H&S is a key area of focus, to ensure a safe and healthy working space and team.

Future Developments

We are continually reviewing opportunities to develop, improve and diversify. Whilst there are always plenty of ideas and projects in the pipeline, the next 12 months will see our focus on four key areas.

° Carbon and Biodiversity monitoring – We will be reviewing our Carbon Footprint once again this year, extending this beyond just Carbon to our Biodiversity impact.

° Investment in Automation & Process efficiencies – We have plans to further expand our automation and machine capabilities.

° Export beyond EU and USA – Our eyes are on the emerging markets; we are beginning to formulate our strategy for these new regions.

° New Product Development

The Wool Packaging Company Ltd
Strategic report (continued)
For the year ended 31 May 2024
- 4 -
Risks

As with all businesses, we are faced with risks. We complete a SWOT analysis annually, and regularly assess any risks that are highlighted as a growing concern.

° Cash flow

° Credit risks & Bad Debt

° Operational risks e.g. supply chain disruption

° Unstable energy market

° Geo-Political Climate

° Climate Change

 

Thanks, and appreciation must be expressed to our committed and passionate team, our suppliers, partners, customers and wider supporters, without whom this business would not be possible. We look forward to building upon this year’s strong foundation in the coming 12 months, which is already shaping up to be full of exciting opportunities and energised potential.

On behalf of the board

Miss J H Morris
Director
6 February 2025
The Wool Packaging Company Ltd
Directors' report
For the year ended 31 May 2024
- 5 -

The directors present their annual report and financial statements for the year ended 31 May 2024.

Principal activities

The principal activity of the company continued to be that of the manufacture and supply of insulated packaging.

Results and dividends

The results for the year are set out on page 11.

Ordinary dividends were paid amounting to £480,000 (2023 - £252,268). The directors do not recommend payment of a final dividend.

Directors

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

Mr D K Spilsbury
Miss J H Morris
Mrs A F Morris
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 company and of the profit or loss of the company 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 company’s transactions and disclose with reasonable accuracy at any time the financial position of the 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 company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Strategic report

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report.

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 company’s auditor 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 company’s auditor is aware of that information.

The Wool Packaging Company Ltd
Directors' report (continued)
For the year ended 31 May 2024
- 6 -
Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
Miss J H Morris
Director
6 February 2025
The Wool Packaging Company Ltd
Independent auditor's report
To the members of The Wool Packaging Company Ltd
- 7 -
Opinion

We have audited the financial statements of The Wool Packaging Company Ltd (the 'company') for the year ended 31 May 2024 which comprise the statement of income and retained earnings, the statement of financial position 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 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 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.

The Wool Packaging Company Ltd
Independent auditor's report (continued)
To the members of The Wool Packaging Company Ltd
- 8 -

Opinions on other matters prescribed by the Companies Act 2006

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

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 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 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 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.

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

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities,

including fraud and non-compliance with laws and regulations, was as follows:

The Wool Packaging Company Ltd
Independent auditor's report (continued)
To the members of The Wool Packaging Company Ltd
- 9 -

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

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

In response to the risk of irregularities and non-compliance with laws and regulations, we designed

procedures which included, but were not limited to:

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

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

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.

Other matters which we are required to address

The prior period financial statements are not audited, therefore the corresponding figures are unaudited.

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.

The Wool Packaging Company Ltd
Independent auditor's report (continued)
To the members of The Wool Packaging Company Ltd
- 10 -
Stacey Parr FCCA
Senior Statutory Auditor
For and on behalf of DJH Audit Limited
13 February 2025
Accountants
Statutory Auditor
The Glades
Festival Way
Festival Park
Stoke on Trent
Staffordshire
ST1 5SQ
The Wool Packaging Company Ltd
Statement of income and retained earnings
For the year ended 31 May 2024
- 11 -
2024
2023
as restated
Notes
£
£
Turnover
3
12,746,686
10,543,790
Cost of sales
(10,427,240)
(8,575,823)
Gross profit
2,319,446
1,967,967
Administrative expenses
(1,696,678)
(1,664,973)
Other operating income
2,875
11,201
Operating profit
4
625,643
314,195
Interest receivable and similar income
7
817
62
Interest payable and similar expenses
8
(3,899)
(1,026)
Profit before taxation
622,561
313,231
Tax on profit
9
(143,098)
(33,378)
Profit for the financial year
479,463
279,853
Retained earnings brought forward
1,255,050
1,227,465
Dividends
10
(480,000)
(252,268)
Retained earnings carried forward
1,254,513
1,255,050
The Wool Packaging Company Ltd
Statement of financial position
As at 31 May 2024
- 12 -
2024
2023
as restated
Notes
£
£
£
£
Fixed assets
Tangible assets
11
423,099
403,456
Current assets
Stocks
12
361,066
319,611
Debtors
13
2,280,625
2,074,230
Cash at bank and in hand
464,199
234,939
3,105,890
2,628,780
Creditors: amounts falling due within one year
14
(2,202,936)
(1,744,699)
Net current assets
902,954
884,081
Total assets less current liabilities
1,326,053
1,287,537
Creditors: amounts falling due after more than one year
15
(58,256)
(4,403)
Provisions for liabilities
Deferred tax liability
17
13,100
27,900
(13,100)
(27,900)
Net assets
1,254,697
1,255,234
Capital and reserves
Called up share capital
20
184
184
Profit and loss reserves
21
1,254,513
1,255,050
Total equity
1,254,697
1,255,234

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved by the board of directors and authorised for issue on 6 February 2025 and are signed on its behalf by:
Miss J H Morris
Director
Company registration number 06900094 (England and Wales)
The Wool Packaging Company Ltd
Notes to the financial statements
For the year ended 31 May 2024
- 13 -
1
Accounting policies
Company information

The Wool Packaging Company Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Units 1a & 1b, Tungsten Park, Opal Way, Stone Business Park, Stone, Staffordshire, England, ST15 0SS.

1.1
Accounting convention

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

The financial statements cover the company as an individual entity and are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

 

 

The financial statements of the company are consolidated in the financial statements of The Wool Packaging Company (Holdings) Ltd. These consolidated financial statements are available from its registered office, Units 1a & 1b Tungsten Park, Opal Way, Stone Business Park, Stone, Staffordshire, ST15 0SS.

 

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

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company 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.

1.3
Turnover

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

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on delivery 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.

The Wool Packaging Company Ltd
Notes to the financial statements (continued)
For the year ended 31 May 2024
1
Accounting policies
(Continued)
- 14 -
1.4
Research and development expenditure

Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.

1.5
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 charged annually and is calculated at the balance sheet date.

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:

Leasehold improvements
10% on cost
Plant and equipment
20% on cost
Fixtures and fittings
20% on cost
Computers
33.33% on cost
Motor vehicles
25% on cost

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 credited or charged to profit or loss.

1.6
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible 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).

Recoverable amount is the higher of fair value less costs to sell and value in use.

 

If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset 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.

1.7
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Cost is calculated using the first in, first out method.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

The Wool Packaging Company Ltd
Notes to the financial statements (continued)
For the year ended 31 May 2024
1
Accounting policies
(Continued)
- 15 -
1.8
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand.

1.9
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 statement of financial position 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 settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

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

Other financial assets

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 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 company 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 company after deducting all of its liabilities.

The Wool Packaging Company Ltd
Notes to the financial statements (continued)
For the year ended 31 May 2024
1
Accounting policies
(Continued)
- 16 -
Basic financial liabilities

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

 

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

 

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

Other financial liabilities

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 company’s contractual obligations expire or are discharged or cancelled.

1.10
Equity instruments

Equity instruments issued by the company 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 company.

1.11
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 income statement 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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

The Wool Packaging Company Ltd
Notes to the financial statements (continued)
For the year ended 31 May 2024
1
Accounting policies
(Continued)
- 17 -
Deferred tax

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

 

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, 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.

1.12
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense.

 

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.

1.13
Retirement benefits

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

1.14
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the statement of financial position as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

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

1.15
Government grants

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

 

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

The Wool Packaging Company Ltd
Notes to the financial statements (continued)
For the year ended 31 May 2024
1
Accounting policies
(Continued)
- 18 -
1.16
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

2
Judgements and key sources of estimation uncertainty

In the application of the company’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.

 

In the directors' opinion there are no critical judgements or estimates that they have been made aware of in applying company's accounting policies and that have had a significant effect on the amounts recognised in the financial statements.

3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Packaging
12,746,686
10,543,790
2024
2023
£
£
Turnover analysed by geographical market
UK
11,648,713
9,534,873
Europe
980,234
834,192
Rest of World
117,739
174,725
12,746,686
10,543,790
2024
2023
£
£
Other revenue
Interest income
817
62
Grants received
2,875
11,201
The Wool Packaging Company Ltd
Notes to the financial statements (continued)
For the year ended 31 May 2024
- 19 -
4
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses
4,356
5,710
Research and development costs
13,310
13,033
Government grants
(2,875)
(11,201)
Fees payable to the company's auditor for the audit of the company's financial statements
19,500
-
0
Depreciation of owned tangible fixed assets
93,482
121,167
Depreciation of tangible fixed assets held under finance leases
25,071
-
(Profit)/loss on disposal of tangible fixed assets
(9,360)
1,288
Operating lease charges
153,875
154,296
5
Employees

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

2024
2023
Number
Number
Cost of sales
40
38
Admin
17
16
Directors
3
3
Total
60
57

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
1,526,892
1,344,643
Social security costs
147,847
127,372
Pension costs
40,101
34,349
1,714,840
1,506,364
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
63,595
33,335
The Wool Packaging Company Ltd
Notes to the financial statements (continued)
For the year ended 31 May 2024
- 20 -
7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
802
62
Other interest income
15
-
0
Total income
817
62
8
Interest payable and similar expenses
2024
2023
£
£
Interest on finance leases and hire purchase contracts
3,899
1,026
9
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
157,898
61,623
Adjustments in respect of prior periods
-
0
(13,745)
Total current tax
157,898
47,878
Deferred tax
Origination and reversal of timing differences
(14,800)
(14,500)
Total tax charge
143,098
33,378
The Wool Packaging Company Ltd
Notes to the financial statements (continued)
For the year ended 31 May 2024
9
Taxation
(Continued)
- 21 -

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2024
2023
£
£
Profit before taxation
622,561
313,231
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 25.00%)
155,640
78,308
Tax effect of expenses that are not deductible in determining taxable profit
837
444
Effect of change in corporation tax rate
-
0
(15,395)
Group relief
(4,477)
(4,995)
Depreciation on assets not qualifying for tax allowances
6,668
6,658
Research and development tax credit
(15,323)
(16,165)
Under/(over) provided in prior years
-
0
(13,745)
Enhanced capital allowances
-
0
(1,722)
Deferred tax adjustments in resepct of current year
(247)
(10)
Taxation charge for the year
143,098
33,378
10
Dividends
2024
2023
£
£
Interim paid
480,000
252,268
The Wool Packaging Company Ltd
Notes to the financial statements (continued)
For the year ended 31 May 2024
- 22 -
11
Tangible fixed assets
Leasehold improvements
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 June 2023
403,618
423,203
19,083
29,790
108,251
983,945
Additions
2,458
2,204
5,343
6,082
124,249
140,336
Disposals
(2,073)
(3,119)
(659)
(14,770)
(36,500)
(57,121)
At 31 May 2024
404,003
422,288
23,767
21,102
196,000
1,067,160
Depreciation and impairment
At 1 June 2023
82,272
357,172
8,423
24,371
108,251
580,489
Depreciation charged in the year
40,401
37,080
3,852
6,158
31,062
118,553
Eliminated in respect of disposals
(414)
(3,119)
(392)
(14,556)
(36,500)
(54,981)
At 31 May 2024
122,259
391,133
11,883
15,973
102,813
644,061
Carrying amount
At 31 May 2024
281,744
31,155
11,884
5,129
93,187
423,099
At 31 May 2023
321,346
66,031
10,660
5,419
-
0
403,456

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

2024
2023
£
£
Motor vehicles
75,212
-
0
12
Stocks
2024
2023
£
£
Raw materials and consumables
135,026
91,474
Finished goods and goods for resale
226,040
228,137
361,066
319,611
The Wool Packaging Company Ltd
Notes to the financial statements (continued)
For the year ended 31 May 2024
- 23 -
13
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
1,948,148
1,547,585
Amounts owed by group undertakings
208,396
342,906
Other debtors
1,100
15,644
Prepayments and accrued income
122,981
168,095
2,280,625
2,074,230
14
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Obligations under finance leases
16
19,603
6,402
Trade creditors
1,730,606
1,392,025
Corporation tax
157,898
61,623
Other taxation and social security
152,756
107,940
Other creditors
10,200
13,075
Accruals and deferred income
131,873
163,634
2,202,936
1,744,699
15
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Obligations under finance leases
16
58,256
4,403
16
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
19,603
6,402
In two to five years
58,256
4,403
77,859
10,805

Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Balances are secured by the assets to which they relate. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

The Wool Packaging Company Ltd
Notes to the financial statements (continued)
For the year ended 31 May 2024
- 24 -
17
Deferred taxation

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

Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
13,100
27,900
2024
Movements in the year:
£
Liability at 1 June 2023
27,900
Credit to profit or loss
(14,800)
Liability at 31 May 2024
13,100

 

18
Government grants

Capital grants of £2,875 (2023 - £7,733) were released in relation to certain items of plant and machinery.

 

Revenue grants of £nil (2023 - £3,468) were released in relating to training and apprenticeships.

19
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
40,101
34,349

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

 

At the year-end contributions totalling £8,151 (2023 - £5,933) were payable to the fund and are included in other creditors.

20
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
184
184
184
184
The Wool Packaging Company Ltd
Notes to the financial statements (continued)
For the year ended 31 May 2024
20
Share capital
(Continued)
- 25 -

Each ordinary share has full voting rights, full dividend rights and the right to participate in capital distributions.

21
Profit and loss reserves

Profit and loss reserves are made up of accumulated profits less accumulated losses and distributions up to the reporting date. This is a distributable reserve.

22
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2024
2023
£
£
Within one year
192,475
192,475
Between two and five years
192,475
384,950
384,950
577,425
23
Related party transactions
Remuneration of key management personnel

The remuneration of key management personnel consists of aggregate compensation of £75,319 (2023 - £14,874).

Other information

Group transactions and balances

 

During the year dividends have been paid to the parent company of £480,000 (2023 - £252,268).

 

Amounts owed from group companies at the year end totalled £208,396 (2023 - £342,906).

24
Ultimate controlling party

The immediate and ultimate parent company at the balance sheet date was The Wool Packaging Company (Holdings) Limited as a result of its 100% shareholding in the company. Consolidated financial statements as at 31 May 2024 may be obtained from Units 1a & 1b Tungsten Park, Opal Way, Stone Business Park, Stoke, Staffordshire, ST15 0SS.

 

The ultimate controlling parties are Mrs A F Morris and Mr D K Spilsbury, as a result of their 90% shareholding of the parent company.

25
Prior period adjustment
Reconciliation of changes in equity
The prior period adjustments do not give rise to any effect upon equity.
The Wool Packaging Company Ltd
Notes to the financial statements (continued)
For the year ended 31 May 2024
25
Prior period adjustment
(Continued)
- 26 -
Reconciliation of changes in profit for the previous financial period
2023
£
Total adjustments
-
Profit as previously reported
279,853
Profit as adjusted
279,853
Notes to reconciliation

A prior year adjustment has been made in respect of reclassifying finished goods from raw materials. There has been no effect on profits in relation to this.

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