Company registration number 04013392 (England and Wales)
PEPPERMINT TECHNOLOGY LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
PEPPERMINT TECHNOLOGY LIMITED
COMPANY INFORMATION
Directors
Mr. N Davis
Ms. A Adams
Mr. G S Young
Ms. N J Redwood
Mr P Neeson
Company number
04013392
Registered office
Oaktree House
2 Phoenix Place
Phoenix Court
Nottingham
United Kingdom
NG8 6BA
Auditor
Azets Audit Services
2 Regan Way
Chetwynd Business Park
Chilwell
Nottingham
United Kingdom
NG9 6RZ
PEPPERMINT TECHNOLOGY LIMITED
CONTENTS
Page
Strategic report
1 - 4
Directors' report
5
Directors' responsibilities statement
6
Independent auditor's report
7 - 9
Statement of comprehensive income
10
Balance sheet
11
Statement of changes in equity
12
Notes to the financial statements
13 - 25
PEPPERMINT TECHNOLOGY LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2024
- 1 -

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

Fair review of the business

Peppermint Technology is an international legal-tech software company, dedicated to helping large law firms transform, modernise, and grow. Born in legal, built in Microsoft and living in the cloud, Peppermint provides law firms with a modular choice of easy-to-use, innovative, and modern applications. Our platform offers a full suite of legal applications including client engagement (CRM), matter management, case management, document management and work/resource management, complete with a native Microsoft 365 and Teams user experience through Peppermint Connect and is delivered as Software as a Service (SaaS).

 

Our flexible, cloud only client-centric software platform enables high-performing legal businesses to drive key legal processes, client activity, and insight through a single source of information. Peppermint CX365 empowers law firms to build stronger client relationships, develop innovative client services and make data-driven decisions. By building on the Microsoft Cloud the applications meet users where they love working the most - in Outlook, Teams and on their mobile devices. Our solutions enable firms to futureproof their investments in the Microsoft Cloud, meet compliance and security demands, and embrace a Microsoft-led modern workplace.

 

Peppermint’s growth strategy is underpinned by specialising and focusing exclusively on Large Law, with a clear commitment to creating long term, mutually beneficial relationships with clients. Peppermint’s strategy is to help legal firms build high performing businesses by enabling them to deliver more profitable legal services that meet and exceed changing client expectations. Peppermints modular software together with Microsoft applications establishes a single source of client data that will inform better decision-making and prepare firms to utilise the power of AI. Peppermint enables firms to develop efficient, automated digital business processes and innovative new services to outperform competitors and deliver a great client experience.

 

Peppermint benefits from a long-term strategic partnership with Microsoft and continues to invest in the relationship across product, go-to-market and service, to deliver the benefits of Microsoft Dynamics 365, Power Platform exclusively to the legal sector. The Microsoft Platform provides Peppermint with a unique edge, allowing for swift adoption and the ability to take advantage of the latest in Microsoft’s OpenAI investment. Peppermint’s AI roadmap shows commitment to innovation, efficiency, and ethical standards. We collaborate with clients and Microsoft to leverage AI with enriched business data, optimising performance and value.

 

The company has continued to focus resources on developing CX365, its innovative, cloud-based legal application platform targeted at the needs of larger law firms such as those in the UK Top 200 and US Am Law 200 segments.

 

The Peppermint Operating Plan centres around three key themes – Employee Health, Customer Health, and Financial Health, supported by five strategic pillars, with the aim to deliver: growth, outstanding customer experience, operational excellence, employee engagement and product innovation.

 

During the year, Peppermint has continued to invest in the development of its core applications as well as new value-added applications, such as Enterprise Relationship Management (ERM); designed to enhance the capabilities of our legal specific CRM offering, helping law firms revolutionise their approach to business development, marketing and client relationship management.

 

Alongside investment into the core modules, Peppermint remains committed to continued investment into research and development activities with continued focus this year on harnessing Artificial Intelligence (AI) and Machine Learning (ML), with the development of our Legal Analysis and Research Assistant (LARA), a sophisticated AI copilot seamlessly integrated into our suite of applications, supporting Microsoft 365 Copilot and designed to boost productivity and streamline workflows for legal professionals.

Peppermint recognises the importance of quality and information security and has continued to invest in quality programmes, retaining ISO9001, ISO27001, Cyber Essentials Plus and IASME governance certifications during the year. Alongside our execution of strategy and financial performance, Peppermint has a strong commitment to ESG practices and policies, and actively promotes, monitors, and manages its ESG policies and procedures.
Employee health and well-being is a particular focus for Peppermint and our People Community Champions actively promote support of our local communities and run Peppermint's charitable programs.
We thank our employees for their dedication and hard work during the year.
PEPPERMINT TECHNOLOGY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 2 -
Principal risks and uncertainties

Going Concern and events after the reporting date

The Directors have reviewed detailed financial projections and considered all reasonably foreseeable potential scenarios and uncertainties, they have satisfied themselves that the business will continue in operational existence for a period of at least 12 months from the signing of these financial statements and have therefore prepared the financial statement on a going concern basis.

The company's activities expose it to several financial risks, including cash flow risk, credit risk and liquidity risk. The group does not use derivative financial instruments for speculative purposes.

Cash Flow Risk

The company's cash flow risk is its exposure to variability in cash flows associated with a recognised asset or liability, such as future interest payments on a debt. The company’s loan from Accel-KKR bears a fixed rate of interest.

The company manages this risk, by monitoring cash flow projections on a regular basis to ensure that appropriate funding is in place.

Credit Risk

The company's credit risk is primarily attributable to its trade receivables. The amounts presented in the balance sheet are net of a provision for doubtful receivables. A provision for impairment is made where there is an identified loss event which is evidence of a reduction in the recoverability of the balance due.

Peppermint seeks to mitigate commercial and operational risks through ensuring operational policies are followed, ensuring strong credit control procedures are in place and by an ongoing review of changes in the industry. All new customer contracts are subject to internal legal, commercial, operational and finance sign off.

Liquidity Risk and Interest Risk

The cash generated by operations is monitored closely and all funds are held in readily accessible bank accounts. The company's cash flow forecasts are updated regularly to ensure that sufficient funds are available to meet all financial commitments.

Foreign Currency Risk

The company’s debt funding from Accel-KKR is denominated in sterling and therefore does not present a foreign currency risk.

Cybercrime Risk

Peppermint recognises the ever-changing threat landscape from cybercrime. The group has invested in several initiatives to improve security systems on internally hosted and SaaS platforms. This includes software and hardware solutions to protect and monitor services, security risk management policies, training, testing, and auditing. Additional investment has been made in software development and cloud platform tools, alongside Microsoft 365 E5 compliance and security services, to further protect our internal systems with active end point protection services. ISO 27001 accreditation further demonstrates Peppermint’s commitment to information security.

PEPPERMINT TECHNOLOGY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 3 -
Key performance indicators

 

Year ended

30 June 2024

£’000

Year ended

30 June 2023

£’000

Increase

Revenue

12,844

9,693

33%

Operating Loss

567

94

 

Adjusted EBITDA**

2,805

1,292

 

Adjusted EBITDA Margin

22%

13%

 

Contracted Annualised Recurring Revenue at year end (CARR)

11,878

10,858

9%

Cash and cash equivalents

4,753

3,656

 

 

In order to provide useful information about the company’s performance and to present information in a way that reflects how the Directors monitor and measure the performance of the company, the Directors believe it is appropriate to present the results of the company using selected alternative performance measures.

Revenue for the year was £12.8m, representing a year-on-year growth of 33% (2023: £9.7m).

Contracted Annualised Recurring Revenue, is the revenue generated from long term customers SaaS contracts and represents the annualised recurring revenue contracted by customers at the year end.CARR increased to £11.9m, a year-on-year growth of 9%.

Adjusted EBITDA* is shown as an alternative performance measure to present the underlying trading performance of the group. Adjusted EBITDA* improved to £2.8m for the year (2023: £1.3m).

Peppermint continued its strong sales momentum with new client wins, and expansion of its software footprint into several long-standing customers, contributing to the growth in CARR.

In the U.K., the company notably signed top 15 firm Pinsent Masons alongside Top 50 firm Browne Jacobson. The company’s brand position and sales pipeline continued to mature and grow significantly during the year, laying the foundations for future growth.

We continue to focus on ensuring our software adds value to our customers, with our customer success and executive teams actively engaged with the customer community, to gather feedback and insight to enable us to improve software quality functionality and overall user experience. Our proactive approach to customer success has seen a significant improvement in our overall customer satisfaction key performance indicators.

* Comprising earnings adjusted for interest, taxation, depreciation, and amortisation.

 

 

PEPPERMINT TECHNOLOGY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 4 -
Future prospects

The company is well positioned to continue to grow substantially, with a strong pipeline of opportunities in the UK. The sales pipeline in Large Law has developed significantly during the year and the foundations for growth in this market are particularly strong, with an increasing number of firms coming to the market for modern, cloud-based innovative legal solutions. Our focus on delivering lawyer efficiency, a better client experience and supporting our customers growth, with a market leading Microsoft based suite of SaaS applications, ideally places Peppermint to take advantage of the substantial market opportunity and advancements in AI based legal applications.

On behalf of the board

Mr. G S Young
Ms. N J Redwood
Director
Director
29 October 2024
29 October 2024
PEPPERMINT TECHNOLOGY LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2024
- 5 -

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

Principal activities

The principal activity of the company continued to be that of the provision of software and services to law firms.

Results and dividends

The results for the year are set out on page 10.

No ordinary dividends were paid. 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. N Davis
Ms. A Adams
Mr. D J Sneddon
(Resigned 4 September 2024)
Mr. G S Young
Ms. N J Redwood
Mr P Neeson
Qualifying third party indemnity provisions

The company has made qualifying third party indemnity provisions for the benefit of its directors during the year. These provisions remain in force at the reporting date.

Research and development

The company continues to invest in research and development activities to enhance its product offering to customers.

Auditor

The auditor, Azets Audit Services, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

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.

On behalf of the board
Mr. G S Young
Ms. N J Redwood
Director
Director
29 October 2024
29 October 2024
PEPPERMINT TECHNOLOGY LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 JUNE 2024
- 6 -

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.

PEPPERMINT TECHNOLOGY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PEPPERMINT TECHNOLOGY LIMITED
- 7 -
Opinion

We have audited the financial statements of Peppermint Technology Limited (the 'company') for the year ended 30 June 2024 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity 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.

Opinions on other matters prescribed by the Companies Act 2006

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

PEPPERMINT TECHNOLOGY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PEPPERMINT TECHNOLOGY LIMITED
- 8 -
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.

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.

PEPPERMINT TECHNOLOGY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PEPPERMINT TECHNOLOGY LIMITED
- 9 -

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

 

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework.  Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.  This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

 

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

 

 

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 of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

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.

Lee Meredith BFP ACA
(Senior Statutory Auditor)
For and on behalf of Azets Audit Services
30 October 2024
Chartered Accountants
Statutory Auditor
2 Regan Way
Chetwynd Business Park
Chilwell
Nottingham
United Kingdom
NG9 6RZ
PEPPERMINT TECHNOLOGY LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2024
- 10 -
2024
2023
Notes
£
£
Turnover
3
12,843,570
9,693,211
Cost of sales
(2,875,880)
(1,924,192)
Gross profit
9,967,690
7,769,019
Administrative expenses
(8,815,988)
(7,675,221)
Operating profit
4
1,151,702
93,798
Interest receivable and similar income
7
80,798
20,380
Interest payable and similar expenses
8
(665,895)
(603,347)
Profit/(loss) before taxation
566,605
(489,169)
Tax on profit/(loss)
9
64,017
536,212
Profit for the financial year
630,622
47,043

The profit and loss account has been prepared on the basis that all operations are continuing operations.

PEPPERMINT TECHNOLOGY LIMITED
BALANCE SHEET
AS AT
30 JUNE 2024
30 June 2024
- 11 -
2024
2023
Notes
£
£
£
£
Fixed assets
Intangible assets
10
5,710,739
4,913,999
Tangible assets
11
76,490
96,685
5,787,229
5,010,684
Current assets
Debtors
12
2,376,424
2,562,186
Cash at bank and in hand
4,753,456
3,655,731
7,129,880
6,217,917
Creditors: amounts falling due within one year
13
(7,489,629)
(6,677,966)
Net current liabilities
(359,749)
(460,049)
Total assets less current liabilities
5,427,480
4,550,635
Creditors: amounts falling due after more than one year
14
(5,047,619)
(4,973,933)
Provisions for liabilities
Deferred tax liability
16
172,537
-
0
(172,537)
-
Net assets/(liabilities)
207,324
(423,298)
Capital and reserves
Called up share capital
18
5,252
5,252
Profit and loss reserves
19
202,072
(428,550)
Total equity
207,324
(423,298)
The financial statements were approved by the board of directors and authorised for issue on 29 October 2024 and are signed on its behalf by:
Mr. G S Young
Ms. N J Redwood
Director
Director
Company Registration No. 04013392
PEPPERMINT TECHNOLOGY LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2024
- 12 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 July 2022
5,252
(475,593)
(470,341)
Year ended 30 June 2023:
Profit and total comprehensive income for the year
-
47,043
47,043
Balance at 30 June 2023
5,252
(428,550)
(423,298)
Year ended 30 June 2024:
Profit and total comprehensive income for the year
-
630,622
630,622
Balance at 30 June 2024
5,252
202,072
207,324
PEPPERMINT TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
- 13 -
1
Accounting policies
Company information

Peppermint Technology Limited is a private company limited by shares incorporated in England and Wales. The registered office is Oaktree House, 2 Phoenix Place, Phoenix Court, Nottingham, United Kingdom, NG8 6BA.

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 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 Peppermint Technology Holdings Limited. These consolidated financial statements are available Companies House, Crown Way, Cardiff, CF14 3UZ.

1.2
Going concern

In assessing the appropriateness of the going concern assumption, the directors have reviewed detailed profit and cashflow forecasts considering reasonably foreseeable potential scenarios and uncertainties in relation to income and expenditure for a period of at least 12 months from the sign off of these financial statements. The company continues to trade and has met liability payments as they fall due and the directors have concluded that there are no circumstances that give rise to a material uncertainty in relation to going concern and as such have deemed it appropriate for the financial statements to be prepared on the going concern basis.true

1.3
Turnover

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

Revenue for software as a service, subscription services and maintenance are recognised over the length of the contract on a straight line basis. Revenue from consulting and implementation services are recognised when the services are delivered.

PEPPERMINT TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 14 -
1.4
Intangible fixed assets other than goodwill

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

 

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

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

Software
5 years
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 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 land and buildings
10 years straight line
Fixtures and fittings
3-5 years straight line
Computers
5 years straight line

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is 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 and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

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

 

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

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

PEPPERMINT TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 15 -
1.7
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks.

1.8
Financial instruments

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

 

Financial instruments are recognised in the 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 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 loans to other 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, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

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

 

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

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the 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.

PEPPERMINT TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 16 -
Basic financial liabilities

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

 

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

 

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

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.

1.9
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.

1.10
Taxation

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

Current tax

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

Deferred tax

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

 

PEPPERMINT TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 17 -
1.11
Employee benefits

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

 

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

 

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

1.12
Retirement benefits

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

1.13
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.

Critical judgements
Assets' useful economic lives

Tangible fixed assets are depreciated over the useful lives of the related assets taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values.

PEPPERMINT TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
2
Judgements and key sources of estimation uncertainty
(Continued)
- 18 -
Key sources of estimation uncertainty

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

Capitalisation of intangible additions

Estimation is required in determining the appropriate percentage of staff time to capitalise as part of Intangible Asset additions in respect of the employee time cost in developing the Company's software products. Amounts capitalised are based on the monitoring of employee time by project managers and is based on managements best estimate of time spent on projects by each individual employee.

Recoverability of tangible and intangible assets

The carrying value of tangible and intangible fixed assets is reviewed annually for impairment taking into account the current trading performance and anticipated future cash flows to assess whether there is any indication of impairment. In assessing forecasted cash flows past performance will often be taken as the best available guide, unless it is known that circumstances have changed. These future cash flows are then discounted, using the company's cost of capital. As a result of the estimates involved, the actual impairment required in the future may differ from the assessment made in these financial statements.

3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Provision of IT services comprising SaaS, subscriptions, maintenance and consultancy services
12,843,570
9,693,211
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
12,843,570
9,693,211
2024
2023
£
£
Other revenue
Interest income
80,798
20,380
4
Operating profit
2024
2023
Operating profit for the year is stated after charging:
£
£
Exchange losses
1,827
-
0
Fees payable to the company's auditor for the audit of the company's financial statements
42,500
38,250
Depreciation of owned tangible fixed assets
30,582
28,695
(Profit)/loss on disposal of tangible fixed assets
-
5,407
Amortisation of intangible assets
1,623,213
1,164,463
PEPPERMINT TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 19 -
5
Employees

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

2024
2023
Number
Number
Administration
86
80

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
4,222,697
3,867,377
Social security costs
424,365
410,003
Pension costs
137,798
118,833
4,784,860
4,396,213
PEPPERMINT TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 20 -
6
Directors' remuneration

Directors of the company as at the date of these financial statements are also directors of the parent company, Peppermint Technology Holdings Ltd. Directors wages, in part, are recharged to Peppermint Technology Ltd via the management charge.

7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
80,798
20,380
8
Interest payable and similar expenses
2024
2023
£
£
Other interest
665,895
603,347
9
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
(236,738)
(536,212)
Adjustments in respect of prior periods
184
-
0
Total current tax
(236,554)
(536,212)
Deferred tax
Origination and reversal of timing differences
172,537
-
0
Total tax credit
(64,017)
(536,212)
PEPPERMINT TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
9
Taxation
(Continued)
- 21 -

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

2024
2023
£
£
Profit/(loss) before taxation
566,605
(489,169)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
141,651
(92,942)
Tax effect of expenses that are not deductible in determining taxable profit
4,190
(480,500)
Tax effect of income not taxable in determining taxable profit
(37)
-
0
Effect of change in corporation tax rate
-
0
(6,980)
Effects of R&D claim
(181,173)
224,082
Enhanced capital allowances
-
0
(1,351)
Provisions tax adjustment
185
-
0
Deferred tax not provided
(28,833)
(178,521)
Taxation credit for the year
(64,017)
(536,212)

As at 30 June 2024 the company had estimated tax losses of £4,944,000 (2024 - £4,943,000) available to carry forward against future taxable profits. The recognition of deferred tax assets has been capped at the deferred tax liability for accelerated capital allowances.

10
Intangible fixed assets
Software
£
Cost
At 1 July 2023
7,309,952
Additions - internally developed
2,419,953
At 30 June 2024
9,729,905
Amortisation and impairment
At 1 July 2023
2,395,953
Amortisation charged for the year
1,623,213
At 30 June 2024
4,019,166
Carrying amount
At 30 June 2024
5,710,739
At 30 June 2023
4,913,999
PEPPERMINT TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 22 -
11
Tangible fixed assets
Leasehold land and buildings
Fixtures and fittings
Computers
Total
£
£
£
£
Cost
At 1 July 2023
103,120
33,449
163,742
300,311
Additions
-
0
-
0
10,387
10,387
At 30 June 2024
103,120
33,449
174,129
310,698
Depreciation and impairment
At 1 July 2023
73,571
31,430
98,625
203,626
Depreciation charged in the year
10,312
486
19,784
30,582
At 30 June 2024
83,883
31,916
118,409
234,208
Carrying amount
At 30 June 2024
19,237
1,533
55,720
76,490
At 30 June 2023
29,549
2,019
65,117
96,685
12
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
1,366,993
977,627
Corporation tax recoverable
236,738
536,396
Amounts owed by group undertakings
33,351
-
0
Other debtors
29,158
62,772
Prepayments and accrued income
710,184
985,391
2,376,424
2,562,186
13
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Other borrowings
15
62,986
53,612
Trade creditors
664,944
643,034
Amounts owed to group undertakings
2,386,088
2,331,415
Taxation and social security
620,271
476,343
Other creditors
61,732
151,939
Accruals and deferred income
3,693,608
3,021,623
7,489,629
6,677,966

National Westminster Bank PLC hold a fixed charge over assets amounting to £150,000 in relation to business banking arrangements.

PEPPERMINT TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 23 -
14
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Other borrowings
15
5,047,619
4,973,933
15
Loans and overdrafts
2024
2023
£
£
Other loans
5,110,605
5,027,545
Payable within one year
62,986
53,612
Payable after one year
5,047,619
4,973,933

Other loans are secured by fixed and floating charges over the assets of the company.

On 18 January 2019, the company entered a term loan facility agreement for £5.5m. This is repayable on 31 October 2026 and has been split in the notes as amounts due within and after one year.

 

The term loan agreement carries interest of 11.75% per annum.

 

Total issue costs of £471,664 have been deducted from the carrying value and are charged to the profit or loss as part of the interest charge using the effective interest rate method.

 

The finance charge in the year relating to the amortisation of loan issue costs and interest is £665,895 (2023: £603,347).

16
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
1,417,377
-
Tax losses
(1,236,147)
-
Short term timing differences
(8,693)
-
172,537
-
PEPPERMINT TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
16
Deferred taxation
(Continued)
- 24 -
2024
Movements in the year:
£
Liability at 1 July 2023
-
Charge to profit or loss
172,537
Liability at 30 June 2024
172,537

 

17
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
137,798
118,833

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.

18
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
2 deferred shares of £1 each
2
2
2
2
4,798 ordinary shares of £1 each
4,798
4,798
4,798
4,798
451,500 B ordinary shares of 0.1p each
451,500
451,500
452
452
456,300
456,300
5,252
5,252
19
Profit and loss reserves

The company's capital and reserves are as follows:

 

Called up share capital

 

Called up share capital represents the nominal value of the shares issued.

 

Profit and loss account

 

The profit and loss account represents cumulative profits or losses net of dividends paid and other adjustments.

PEPPERMINT TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 25 -
20
Operating lease commitments

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
37,888
38,323
Between two and five years
25,454
63,446
63,342
101,769
21
Related party transactions

The company has taken advantage of certain disclosure exemptions, as permitted by FRS 102, which allows the company not to disclose transactions between wholly owned members of the group.

22
Ultimate controlling party

The directors consider that Peppermint Technology Holdings Limited is the parent undertaking of the company and its controlling party by virtue of its 100% ownership of the share capital of the company.

There is no ultimate controlling party.

The largest and smallest group of undertakings for which group accounts have been prepared are those of Peppermint Technology Holdings Limited. Consolidated financial statements are available from Companies House, Crown Way, Cardiff, CF14 3UZ.

2024-06-302023-07-01falsefalsefalseCCH SoftwareCCH Accounts Production 2024.310Mr. N DavisMs. A AdamsMr. D J SneddonMr. G S YoungMs. N J RedwoodMr P NeesonMs. N H GrundyMr. F McLatchie040133922023-07-012024-06-3004013392bus:Director12023-07-012024-06-3004013392bus:Director22023-07-012024-06-3004013392bus:Director42023-07-012024-06-3004013392bus:Director52023-07-012024-06-3004013392bus:Director62023-07-012024-06-3004013392bus:Director32023-07-012024-06-3004013392bus:Director72023-07-012024-06-3004013392bus:Director82023-07-012024-06-3004013392bus:RegisteredOffice2023-07-012024-06-30040133922024-06-30040133922022-07-012023-06-3004013392core:RetainedEarningsAccumulatedLosses2022-07-012023-06-3004013392core:RetainedEarningsAccumulatedLosses2023-07-012024-06-3004013392core:OtherResidualIntangibleAssets2024-06-3004013392core:OtherResidualIntangibleAssets2023-06-3004013392core:ComputerSoftware2024-06-3004013392core:ComputerSoftware2023-06-30040133922023-06-3004013392core:LandBuildingscore:LeasedAssetsHeldAsLessee2024-06-3004013392core:FurnitureFittings2024-06-3004013392core:ComputerEquipment2024-06-3004013392core:LandBuildingscore:LeasedAssetsHeldAsLessee2023-06-3004013392core:FurnitureFittings2023-06-3004013392core:ComputerEquipment2023-06-3004013392core:CurrentFinancialInstrumentscore:WithinOneYear2024-06-3004013392core:CurrentFinancialInstrumentscore:WithinOneYear2023-06-3004013392core:Non-currentFinancialInstrumentscore:AfterOneYear2024-06-3004013392core:Non-currentFinancialInstrumentscore:AfterOneYear2023-06-3004013392core:CurrentFinancialInstruments2024-06-3004013392core:CurrentFinancialInstruments2023-06-3004013392core:ShareCapital2024-06-3004013392core:ShareCapital2023-06-3004013392core:RetainedEarningsAccumulatedLosses2024-06-3004013392core:RetainedEarningsAccumulatedLosses2023-06-3004013392core:ShareCapital2022-06-3004013392core:RetainedEarningsAccumulatedLosses2022-06-3004013392core:ShareCapitalOrdinaryShares2024-06-3004013392core:ShareCapitalOrdinaryShares2023-06-3004013392core:IntangibleAssetsOtherThanGoodwill2023-07-012024-06-3004013392core:ComputerSoftware2023-07-012024-06-3004013392core:LandBuildingscore:LongLeaseholdAssets2023-07-012024-06-3004013392core:FurnitureFittings2023-07-012024-06-3004013392core:ComputerEquipment2023-07-012024-06-300401339212023-07-012024-06-300401339212022-07-012023-06-3004013392core:UKTax2023-07-012024-06-3004013392core:UKTax2022-07-012023-06-300401339222023-07-012024-06-300401339222022-07-012023-06-300401339232023-07-012024-06-300401339232022-07-012023-06-300401339242023-07-012024-06-300401339242022-07-012023-06-3004013392core:ComputerSoftware2023-06-3004013392core:ComputerSoftwarecore:InternallyGeneratedIntangibleAssets2023-07-012024-06-3004013392core:LandBuildingscore:LeasedAssetsHeldAsLessee2023-06-3004013392core:FurnitureFittings2023-06-3004013392core:ComputerEquipment2023-06-30040133922023-06-3004013392core:LandBuildingscore:LeasedAssetsHeldAsLessee2023-07-012024-06-3004013392core:Non-currentFinancialInstruments2024-06-3004013392core:Non-currentFinancialInstruments2023-06-3004013392core:WithinOneYear2024-06-3004013392core:WithinOneYear2023-06-3004013392core:BetweenTwoFiveYears2024-06-3004013392core:BetweenTwoFiveYears2023-06-3004013392bus:PrivateLimitedCompanyLtd2023-07-012024-06-3004013392bus:FRS1022023-07-012024-06-3004013392bus:Audited2023-07-012024-06-3004013392bus:FullAccounts2023-07-012024-06-30xbrli:purexbrli:sharesiso4217:GBP