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Registration number: 01599748

Pentagram Design Limited

Annual Report and Financial Statements

for the Year Ended 30 September 2024

 

Pentagram Design Limited

Contents

Company Information

1

Strategic Report

2 to 3

Directors' Report

4 to 5

Independent Auditor's Report

6 to 10

Profit and Loss Account

11

Statement of Comprehensive Income

12

Balance Sheet

13 to 14

Statement of Changes in Equity

15

Statement of Cash Flows

16

Notes to the Financial Statements

17 to 29

 

Pentagram Design Limited

Company Information

Directors

H Pearce

L Powell

M Willer

D Lippa

J Rushworth

A Hyland

J Hudson-Powell

J Marshall

Company secretary

C Francis-Kirton

Registered office

11 Needham Road
London
W11 2RP

Auditors

Sterling Grove Accountants Limited
Chartered Certified Accountants and Statutory AuditorsFawley House
2 Regatta Place
Marlow Road
Bourne End
Buckinghamshire
SL8 5TD

 

Pentagram Design Limited

Strategic Report for the Year Ended 30 September 2024

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

Principal activity

The principal activity of the company is design and consultancy services through our office in London.

Fair review of the business

Despite national and global economic factors including high inflation, high interest rates, political uncertainty and the ongoing cost of living crisis, the period to September 2024 has continued to see Pentagram’s growing commitment within our core multi-disciplinary design business to provide industry-leading work. With both productivity and our teams’ work/life balance in mind, we now continue to follow a hybrid model with most teams spending three or four days a week in the studio and Friday working from home.

Pentagram has completed numerous high-profile projects during this period, which saw the partners from our London office completing a substantial and diverse portfolio of new work. Some of our most notable recent projects include redesigning the brand identity for the Guggenheim Museum, creating a new masterbrand for MotoGP and designing a new identity for Chatsworth House and the Devonshire Group.

Pentagram also delivered brand identity projects for AI companies Pienso and Isomorphic, technical camera maker Stereolab, new Manchester business district Sister, and TfL’s property arm, Places for London. We have continued to work with longstanding clients such as the John Lewis Partnership and Waitrose & Partners, and department store Liberty.

Pentagram has also delivered several new projects in the Third Sector, including identities for changemakers Manuvo; Skatepal, a book about Skateboarding for a Palestinian charity, and The Superpower of Looking, an initiative by art charity Art UK.

Industrial design projects included an innovative chai maker for Loka and a sustainable range of packaging for Life Supplies.

Additionally, we have continued to be highly active in the cultural world, designing the brand identities for Young V&A, The Book of Kells Experience and the 22nd London Design Festival. As part of LDF 2024, Needham Road housed an installation and talk by artist Karel Martens on his collaboration with Pentagram and Liberty, and an exhibition of original limited-edition screenprints Overlooked 2 was held at Borough Yards.

We have been shortlisted for and won several major design awards, receiving accolades from Dezeen, D&AD and Transform Awards Europe.

During this period we have continued to be actively involved in initiatives which aim to increase diversity within our business, these include the ongoing Future Forward scholarship with University of the Arts. We have also welcomed design students from around the world for talks at the Studio.

The trade edition of our two-volume book celebrating Pentagram’s 50th anniversary Pentagram: Living by Design was published by Thames & Hudson and launched at an event at the London studio attended by industry professionals and friends.

Pentagram’s communications channels speak to a global audience and continue to grow at a steady rate. Our Instagram following now stands at 993k followers, we have 157k Facebook followers, and we now have an audience of 308k on X (formerly Twitter) and 185k followers on Threads. Our LinkedIn presence has also continued to develop and now reaches 386k professionals.

 

Pentagram Design Limited

Strategic Report for the Year Ended 30 September 2024

Additionally, our London office remains a recognised hub for creative ideas. We continue to share and showcase our design expertise, with our London-based partners expanding their reach by speaking at numerous in-person and online events, viewed simultaneously by audiences from around the world.

The company's key financial and other performance indicators during the year were as follows:

Financial KPIs

Unit

2024

2023

Turnover

£

14,738,738

14,393,525

Turnover (decline)/growth

%

2

(5)

Net assets at the balance sheet date

£

2,600,190

2,540,190

No. of clients

No.

155

147

Gross profit margin

%

80

77

Principal risks and uncertainties


Currency risk

The company is exposed to translation and transaction foreign exchange risk as some of the company's sales and purchases are transacted in non-sterling. The net exposure of each currency is monitored and managed by the use of currency hedging. Foreign exchange differences on retranslation of these assets and liabilities are taken to the profit and loss account of the company.

Liquidity risk

The company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs. The company has a rolling cash flow forecast which is regularly updated, ensuring it maintains cash reserves to cover several months core costs. It also has an overdraft facility available.

Interest rate risk

The company finances its operations through retained profits and has no significant interest bearing assets or liabilities, and so is not exposed to material risk. The balance sheet includes trade debtors and creditors which do not attract interest and are therefore subject to fair value interest rate risk.

Credit risk

The company's principal financial assets are cash and trade debtors. The credit risk associated with cash is limited as the counterparties have high credit ratings assigned by international credit-rating agencies. The principal credit risk arises, therefore, from trade debtors.

In order to manage credit risk, management set limits for customers based on a combination of payment history and third party credit references. Credit limits are reviewed periodically by the financial controller.

Approved and authorised by the Board on 24 February 2025 and signed on its behalf by:
 

.........................................
J Marshall
Director

 

Pentagram Design Limited

Directors' Report for the Year Ended 30 September 2024

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

Directors of the company

The directors who held office during the year were as follows:

H Pearce

S Lobe (resigned 31 March 2024)

L Powell

M Willer

D Lippa

J Rushworth

A Hyland

J Hudson-Powell

J Marshall

Directors' responsibilities statement

The directors acknowledge their responsibilities 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:

select suitable accounting policies and apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's 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 and in accordance with FRS 102. 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.

The directors are responsible for the maintenance and integrity of the corporate and financial information included on the company's website Legislation in the United Kingdon, governing the preparation and dissemination of financial statements may differ from legislation in other juristictions.

 

Pentagram Design Limited

Directors' Report for the Year Ended 30 September 2024

Financial instruments

Objectives and policies

The company uses various financial instruments which include cash, trade debtors, trade creditors and amounts due to group undertakings that arise directly from its operations. The main purpose of these financial instruments is to raise finance for the company's operations. The existence of these financial instruments exposes the company to a number of financial risks, which are described in more detail in the strategic report.

Environmental matters

Pentagram is committed to environmental protection.The company has a policy of internal waste management and environmental protection within the office. Recycling procedures are in place for all appropriate materials and environmentally sound adhesives and adhesive application systems used by all design teams.

The company attempts to be environmentally responsible in all design disciplines, using recycled/recyclable materials in graphic projects, non-endangered materials in architecture and interior design projects.

Future developments

The Directors are encouraged with the overall performance for the year and feel they are well positioned for an exciting and successful 2025.

Disclosure of information to the auditors

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditors are unaware.

Reappointment of auditors

The auditors Sterling Grove Accountants Limited are deemed to be reappointed under section 487(2) of the Companies Act 2006.

Approved and authorised by the Board on 24 February 2025 and signed on its behalf by:
 

.........................................
J Marshall
Director

 

Pentagram Design Limited

Independent Auditor's Report to the Members of Pentagram Design Limited

Opinion

We have audited the financial statements of Pentagram Design Limited (the 'company') for the year ended 30 September 2024, which comprise the Profit and Loss Account, Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Statement of Cash Flows, and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

give a true and fair view of the state of the company's affairs as at 30 September 2024 and of its profit for the year then ended;

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor 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 director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

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

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

Other information

The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.

 

Pentagram Design Limited

Independent Auditor's Report to the Members of Pentagram Design Limited

Opinion on other matter prescribed by the Companies Act 2006

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

the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of our 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 and the Directors' Report.

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

adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

the financial statements are not in agreement with the accounting records and returns; or

certain disclosures of directors' remuneration specified by law are not made; or

we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Directors' report,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.

 

Pentagram Design Limited

Independent Auditor's Report to the Members of Pentagram Design Limited

Auditor 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.

As part of an audit in accordance with ISAs (UK), we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

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. 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.

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control.

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.

Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern.

Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the company to express an opinion on the financial statements. We are responsible for the direction, supervision and performance of the company audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

 

Pentagram Design Limited

Independent Auditor's Report to the Members of Pentagram Design Limited

The 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, to detect material misstatements in respect of irregularities,
including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is
detailed below:

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

We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
- making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
- considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

To address the risk of fraud through management bias and override of controls, we:
- performed analytical procedures to identify any unusual or unexpected relationships;
- tested journal entries to identify unusual transactions;
- assessed whether judgements and assumptions made in determining the accounting estimates set out in the accounting policies were indicative of potential bias; and
- investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
- agreeing financial statement disclosures to underlying supporting documentation;
- reading the minutes of meetings of those charged with governance;
- enquiring of management as to actual and potential litigation and claims; and
- reviewing correspondence with HMRC, relevant regulators and the company's legal advisors.

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

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.

 

Pentagram Design Limited

Independent Auditor's Report to the Members of Pentagram Design Limited

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

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

......................................
Mr Gino Paolo Amasanti FCCA (Senior Statutory Auditor)
For and on behalf of Sterling Grove Accountants Limited, Statutory Auditor
 Fawley House
2 Regatta Place
Marlow Road
Bourne End
Buckinghamshire
SL8 5TD

24 February 2025

 

Pentagram Design Limited

Profit and Loss Account for the Year Ended 30 September 2024

Note

2024
£

2023
£

Turnover

3

14,738,738

14,393,525

Cost of sales

 

(2,993,110)

(3,301,905)

Gross profit

 

11,745,628

11,091,620

Administrative expenses

 

(15,248,357)

(11,116,397)

Other operating income

4

3,564,216

82,544

Operating profit

5

61,487

57,767

Other interest receivable and similar income

6

2,003

7,640

Interest payable and similar expenses

7

(6,945)

(8,587)

   

(4,942)

(947)

Profit before tax

 

56,545

56,820

Tax on profit

11

3,455

-

Profit for the financial year

 

60,000

56,820

The above results were derived from continuing operations.

The company has no recognised gains or losses for the year other than the results above.

 

Pentagram Design Limited

Statement of Comprehensive Income for the Year Ended 30 September 2024

2024
£

2023
£

Profit for the year

60,000

56,820

Total comprehensive income for the year

60,000

56,820

 

Pentagram Design Limited

(Registration number: 01599748)
Balance Sheet as at 30 September 2024

Note

2024
£

2023
£

Fixed assets

 

Tangible assets

12

179,325

1,023,203

Investments

13

2

2

 

179,327

1,023,205

Current assets

 

Debtors

14

8,257,142

5,020,694

Cash at bank and in hand

 

3,298,802

3,019,766

 

11,555,944

8,040,460

Creditors: Amounts falling due within one year

16

(9,135,081)

(5,629,369)

Net current assets

 

2,420,863

2,411,091

Total assets less current liabilities

 

2,600,190

3,434,296

Provisions for liabilities

17

-

(894,106)

Net assets

 

2,600,190

2,540,190

Capital and reserves

 

Called up share capital

105,007

105,007

Retained earnings

2,495,183

2,435,183

Shareholders' funds

 

2,600,190

2,540,190

Approved and authorised by the Board on 24 February 2025 and signed on its behalf by:
 

.........................................
L Powell
Director

.........................................
M Willer
Director

.........................................
D Lippa
Director

 

Pentagram Design Limited

(Registration number: 01599748)
Balance Sheet as at 30 September 2024

.........................................
J Rushworth
Director

.........................................
A Hyland
Director

.........................................
J Hudson-Powell
Director

.........................................
J Marshall
Director

 

Pentagram Design Limited

Statement of Changes in Equity for the Year Ended 30 September 2024

Share capital
£

Retained earnings
£

Total
£

At 1 October 2023

105,007

2,435,183

2,540,190

Profit for the year

-

60,000

60,000

At 30 September 2024

105,007

2,495,183

2,600,190

Share capital
£

Retained earnings
£

Total
£

At 1 October 2022

105,007

2,378,363

2,483,370

Profit for the year

-

56,820

56,820

At 30 September 2023

105,007

2,435,183

2,540,190

 

Pentagram Design Limited

Statement of Cash Flows for the Year Ended 30 September 2024

Note

2024
£

2023
£

Cash flows from operating activities

Profit for the year

 

60,000

56,820

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

5

125,384

197,068

Loss on disposal of tangible assets

166

1,198

Finance income

6

(2,003)

(7,640)

Finance costs

7

6,945

8,587

Taxation charge

11

(3,455)

-

Reversal of unused provisions

 

(86,816)

-

 

100,221

256,033

Working capital adjustments

 

(Increase)/decrease in trade debtors

14

(3,164,997)

384,238

Increase/(decrease) in trade creditors

16

3,505,712

(1,769,983)

Cash generated from operations

 

440,936

(1,129,712)

Income taxes paid

11

(67,996)

-

Net cash flow from operating activities

 

372,940

(1,129,712)

Cash flows from investing activities

 

Interest received

6

2,003

7,640

Acquisitions of tangible assets

(91,711)

(132,655)

Proceeds for sale of assets

 

2,749

-

Net cash flows from investing activities

 

(86,959)

(125,015)

Cash flows from financing activities

 

Interest paid

7

(6,945)

(8,587)

Net increase/(decrease) in cash and cash equivalents

 

279,036

(1,263,314)

Cash and cash equivalents at 1 October

 

3,019,766

4,283,080

Cash and cash equivalents at 30 September

 

3,298,802

3,019,766

 

Pentagram Design Limited

Notes to the Financial Statements for the Year Ended 30 September 2024

1

General information

The company is a private company limited by share capital, incorporated in England and Wales with registration number 01599748.

The address of its registered office is:
11 Needham Road
London
W11 2RP

These financial statements were authorised for issue by the Board on 24 February 2025.

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.

Basis of preparation

These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.

The financial statements are prepared in sterling which is the functional currency of the company.

Group accounts not prepared

The company has taken advantage of the exemption provided by Section 402 of the Companies Act 2006 and has not prepared group accounts on the grounds that the inclusion of the subsidiary (which is dormant) is not material for the purposes of giving a true and fair view.

Judgements

The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for income and expenses during the year and that affect the amounts reported for assets and liabilities at the reporting date. For this reporting date there are no significant judgements, estimates or assumptions that have been required.

 

Pentagram Design Limited

Notes to the Financial Statements for the Year Ended 30 September 2024

Revenue recognition

Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the Company’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts and after eliminating sales within the company.

The Company recognises revenue when a service has been completed in accordance with the terms of agreement with the client. Where the provision of a service remains incomplete at the end of a period, a proportion of the income pertaining to the level of the service performed is accrued and is part of the debtors balance within amounts recoverable on contracts.

Where clients have been invoiced in advance for services to be delivered at a future date, the income is deferred and becomes part of the creditors balance.

Foreign currency transactions and balances

Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rate on the date when the fair value is re-measured.

Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.

Tax

The tax expense for the period comprises current tax. Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

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

Tangible assets

Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class

Depreciation method and rate

Short leasehold improvements

Over the unexpired term of the lease

Fixtures, fittings and computer equipment

20%-33% on cost

Investments

Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.

 

Pentagram Design Limited

Notes to the Financial Statements for the Year Ended 30 September 2024

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Trade debtors

Trade debtors are amounts due from customers for services performed in the ordinary course of business. Trade debtors are recognised at the transaction price less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the Company will not be able to collect all amounts due according to the original terms of the receivables.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the Company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Provisions

Provisions are recognised when the company has an obligation at the reporting date as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.

Share capital

Ordinary shares are classified as equity.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the Company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans and other short term employee benefits are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

 

Pentagram Design Limited

Notes to the Financial Statements for the Year Ended 30 September 2024

Financial instruments

Financial assets
Basic financial assets, including trade and other receivables, cash and bank balances and investments in commercial paper, are initially recognised at transaction price, 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. Such assets are subsequently carried at amortised cost using the effective interest method.
At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
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.
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.
Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party, or (c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.


Financial liabilitie s
Basic financial liabilities, including trade and other payables, 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 receipts discounted at a market rate of interest. Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a pre-payment for liquidity services and amortised over the period of the facility to which it relates.
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts 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 payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.


 Offsetting
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
The company has chosen to adopt Sections 11 and 12 of FRS 102 in respect of financial instruments.

 

Pentagram Design Limited

Notes to the Financial Statements for the Year Ended 30 September 2024

3

Turnover

The analysis of the company's revenue for the year from continuing operations is as follows:

2024
 £

2023
 £

Design and consultancy services

14,738,738

14,393,525

4

Other operating income

The analysis of the company's other operating income for the year is as follows:

2024
 £

2023
 £

Rental income and other operating income

64,216

82,544

Exceptional item - Damages settlement agreement

3,500,000

-

3,564,216

82,544

5

Operating profit

Arrived at after charging/(crediting)

2024
 £

2023
 £

Depreciation expense

125,384

197,068

Foreign exchange losses

241,420

75,157

Operating lease expense - property

550,000

550,000

Operating lease expense - office equipment

17,086

20,368

Loss on disposal of property, plant and equipment

166

1,198

Auditor's remuneration - The audit of the company's annual accounts

24,158

22,000

Auditor's remuneration - Tax services

2,500

2,500

Auditor's remuneration - Other services

3,000

3,000

6

Other interest receivable and similar income

2024
 £

2023
 £

Interest income on bank deposits

1,977

7,640

Other finance income

26

-

2,003

7,640

7

Interest payable and similar expenses

2024
 £

2023
 £

Other interest expenses

6,945

8,587

 

Pentagram Design Limited

Notes to the Financial Statements for the Year Ended 30 September 2024

8

Staff costs

The aggregate payroll costs (including directors' remuneration) were as follows:

2024
 £

2023
 £

Wages and salaries

9,298,081

7,292,803

Social security costs

1,177,193

908,300

Pension costs, defined contribution scheme

79,448

74,508

Other employee expense

255,426

124,255

10,810,148

8,399,866

The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:

2024
No.

2023
No.

Production

66

65

Administration and support

18

17

84

82

9

Directors' remuneration

The directors' remuneration for the year was as follows:

2024
 £

2023
 £

Remuneration

5,172,708

3,310,331

Contributions paid to money purchase schemes

8,696

7,925

Compensation for loss of office

92,100

-

5,273,504

3,318,256

During the year the number of directors who were receiving benefits and share incentives was as follows:

2024
No.

2023
No.

Accruing benefits under money purchase pension scheme

8

6

In respect of the highest paid director:

2024
 £

2023
 £

Remuneration

599,372

393,451

Company contributions to money purchase pension schemes

110

1,431

 

Pentagram Design Limited

Notes to the Financial Statements for the Year Ended 30 September 2024

10

Auditors' remuneration

2024
£

2023
£

Audit of the financial statements

24,158

22,000

Other fees to auditors

Taxation compliance services

2,500

2,500

All other assurance services

3,000

3,000

5,500

5,500


 

11

Taxation

Tax charged/(credited) in the profit and loss account

2024
£

2023
£

Current taxation

UK corporation tax adjustment to prior periods

(3,455)

-

The tax on profit before tax for the year is the same as the standard rate of corporation tax in the UK (2023 - the same as the standard rate of corporation tax in the UK) of 25% (2023 - 25%).

The differences are reconciled below:

2024
£

2023
£

Profit before tax

56,545

56,820

Corporation tax at standard rate

14,136

14,205

Decrease in UK and foreign current tax from adjustment for prior periods

(3,455)

-

Tax increase from effect of capital allowances and depreciation

15,379

15,166

Effect of expense not deductible in determining taxable profit (tax loss)

8,048

21,166

Effect of tax losses

(37,420)

(50,677)

Tax (decrease)/increase from other tax effects

(143)

140

Total tax credit

(3,455)

-

 

Pentagram Design Limited

Notes to the Financial Statements for the Year Ended 30 September 2024

12

Tangible assets

Land and buildings
£

Furniture, fittings and equipment
 £

Total
£

Cost or valuation

At 1 October 2023

1,104,921

973,893

2,078,814

Additions

30,461

61,250

91,711

Disposals

(995,000)

(16,524)

(1,011,524)

At 30 September 2024

140,382

1,018,619

1,159,001

Depreciation

At 1 October 2023

215,596

840,015

1,055,611

Charge for the year

7,118

118,266

125,384

Eliminated on disposal

(187,710)

(13,609)

(201,319)

At 30 September 2024

35,004

944,672

979,676

Carrying amount

At 30 September 2024

105,378

73,947

179,325

At 30 September 2023

889,325

133,878

1,023,203

Included within the net book value of land and buildings above is £105,378 (2023 - £889,325) in respect of short leasehold land and buildings.
 

13

Investments

2024
£

2023
£

Investments in subsidiaries

2

2

Subsidiaries

£

Cost or valuation

At 1 October 2023

2

Provision

Carrying amount

At 30 September 2024

2

At 30 September 2023

2

 

Pentagram Design Limited

Notes to the Financial Statements for the Year Ended 30 September 2024

Details of undertakings

Details of the investments (including principal place of business of unincorporated entities) in which the company holds 20% or more of the nominal value of any class of share capital are as follows:

Undertaking

Country of incorporation

Holding

Proportion of voting rights and shares held

     

2024

2023

Subsidiary undertakings

Pentagram Design Services Limited

11 Needham Road, London,
W11 2RP, England

Ordinary

100%

100%

         

Subsidiary undertakings

Pentagram Design Services Limited

The principal activity of Pentagram Design Services Limited is is of a dormant company.

14

Debtors

Current

Note

2024
£

2023
£

Trade debtors

 

3,237,621

3,187,936

Amounts owed by related parties

22

360,191

585,733

Other debtors

 

3,549,623

36,080

Prepayments

 

384,882

395,905

Accrued income

 

390,493

624,208

Gross amount due from customers for contract work

 

262,881

190,832

Taxation recoverable

11

71,451

-

   

8,257,142

5,020,694

15

Cash and cash equivalents

2024
 £

2023
 £

Cash on hand

3,745

3,716

Cash at bank

3,295,057

3,016,050

3,298,802

3,019,766

 

Pentagram Design Limited

Notes to the Financial Statements for the Year Ended 30 September 2024

16

Creditors

Note

2024
 £

2023
 £

Due within one year

 

Trade creditors

 

589,117

487,581

Amounts due to related parties

22

1,066,498

1,274,107

Social security and other taxes

 

208,639

329,265

Outstanding defined contribution pension costs

 

21,104

17,123

Other payables

 

126,324

22,392

Accruals and deferred income

 

7,123,399

3,498,901

 

9,135,081

5,629,369

17

Provisions for liabilities

Other provisions
£

Total
£

At 1 October 2023

894,106

894,106

Unused provision reversed

(894,106)

(894,106)

At 30 September 2024

-

-

The other provision relates to dilapidations for the cost of reinstating the company's rented office premises to its former condition at the end of its lease, expiring on 25 December 2032. During the year £894,106 (2023: £nil) of this provision was reversed on 28 March 2024 when the agreement for surrender was signed and the company was released from this liability.

18

Pension and other schemes

Defined contribution pension scheme

The company operates defined contribution pension schemes. The pension cost charge for the year represents contributions payable by the company to the schemes and amounted to £79,448 (2023 - £74,508).

Contributions totalling £21,104 (2023 - £17,123) were payable to the scheme at the end of the year and are included in creditors.

 

Pentagram Design Limited

Notes to the Financial Statements for the Year Ended 30 September 2024

19

Share capital

Allotted, called up and fully paid shares

2024

2023

No.

£

No.

£

Ordinary of £1 each

105,007

105,007

105,007

105,007

       

Rights, preferences and restrictions

Ordinary shares have the following rights, preferences and restrictions:
Ordinary shares of £1 have full voting rights in the company with respect to voting.

20

Obligations under leases and hire purchase contracts

Operating leases

The total of future minimum lease payments is as follows:

2024
£

2023
£

Not later than one year

550,000

17,036

Later than five years

-

5,087,500

550,000

5,104,536

The amount of non-cancellable operating lease payments recognised as an expense during the year was £567,086 (2023 - £570,368).

21

Analysis of changes in net debt

At 1 October 2023
£

Financing cash flows
£

Foreign exchange movements
£

At 30 September 2024
£

Cash and cash equivalents

Cash

3,019,766

379,947

(100,911)

3,298,802

 

3,019,766

379,947

(100,911)

3,298,802

 

Pentagram Design Limited

Notes to the Financial Statements for the Year Ended 30 September 2024

22

Related party transactions

Other transactions with directors

During the year the directors operated directors' loan accounts. Advance to directors in the year were £1,535,880 (2023: £384,691) and repayments made by directors were £1,408,419 (2023: £1,255,818). At the balance sheet date amounts owed to the directors by the company was £439,035 (2023: £566,496). These loans are repayable on demand.

The company leases its London office from joint owners which includes some of the current directors. The total rents charged during the year amounted to £550,000 (2023: £550,000). At the balance sheet date the amount due to the directors (in relation to rent payable) was £nil (2023: £nil).

Income and receivables from related parties

2024

Other related parties
£

Amounts receivable from related party

343,695

2023

Other related parties
£

Amounts receivable from related party

551,437

Expenditure with and payables to related parties

2024

Parent
£

Amounts payable to related party

627,463

2023

Parent
£

Amounts payable to related party

707,610

Loans to related parties

Terms of loans to related parties

During the year interest of £6,945 (2023: £8,587) was paid on the loan from the parent company. The payable is unsecured, repayable on demand and no guarantees have been given.
 The receivable from other related parties is unsecured, interest-free, repayable on demand and no guarantees have been received.

23

Financial instruments

Categorisation of financial instruments

2024
 £

2023
 £

Financial assets measured at amortised cost

10,446,237

6,829,515

Financial liabilities measured at amortised cost

8,271,813

4,778,398

 

Pentagram Design Limited

Notes to the Financial Statements for the Year Ended 30 September 2024

24

Parent and ultimate parent undertaking

The company's immediate parent is Pentagram Design AG, incorporated in Switzerland.

  These financial statements are available upon request from Pentagram Design AG
Untermuli 7
Postfach 4440
CH-6304 Zug
Switzerland

 

25

Non adjusting events after the financial period

On 9th January 2025 the company entered into a non-cancellable operating lease for rent of an office building with an annual rental of £773,778, expiring on 8th January 2035.