Company registration number SC088385 (Scotland)
DALTON GROUP LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
DALTON GROUP LIMITED
COMPANY INFORMATION
Director
S Dalton (Jnr)
Company number
SC088385
Registered office
15 Youngs Road
East Mains Industrial Estate
Broxburn
Near Edinburgh
United Kingdom
EH52 5LY
Auditor
Azets Audit Services
Titanium 1
Kings Inch Place
Renfrew
United Kingdom
PA4 8WF
Solicitors
Ennova Law LLP
26 George Square
Edinburgh
EH8 9LD
Edinburgh
DALTON GROUP LIMITED
CONTENTS
Page
Strategic report
1
Director's report
2
Director's responsibilities statement
3
Independent auditor's report
4 - 6
Profit and loss account
7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Notes to the financial statements
11 - 23
DALTON GROUP LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 AUGUST 2024
- 1 -

The director presents the strategic report for the year ended 31 August 2024.

Review of the business

Dalton Group Limited is a scrap metal merchant operating out of five depots across the central belt of Scotland.

 

The results for the company show an operating profit of £1,804,131 (2023 - £1,574,085) for the year with turnover of £40.1m (2023 - £44.6m).

 

The company's profitability is heavily dependant on the underlying price and demand for metals. With continued investment in the plant and tight controls on costs and margins, the company has managed to achieve growth in operating profit despite the difficult trading conditions, with a reduction in turnover. With continued investment in plant and machinery at depots, the director is confident they can capitalise once the market recovers.

 

The director is of the opinion that analysis using KPIs is not necessary for an understanding of the development, performance and position of the business, given the straightforward nature of its operations.

 

At the year end the company continued to maintain a strong balance sheet with net assets amounting to £6,729,445(2023 - £5,812,845).

Principal risks and uncertainties

The key business risks affecting the company are as follows:-

 

 

The director has in place a risk management system which aims to manage and reduce the above risks to which the company is exposed.

Future outlook

The company continues to trade by identifying new suppliers and customers to ensure an adequate supply chain network.

Financial instruments

Objectives

Our financial risk management objectives are to ensure there is sufficient working capital and cash flow to meet the operating needs of the company and to ensure there is sufficient support for its growth strategy. This is achieved through careful management of our cash resources and utilisation of finance leases to improve the quality and efficiency of plant. No treasury transactions of derivatives are entered into.

 

Risks

The company trades with entities based in the UK and sells significant volumes to buyers in the Far East. As a result, the entity is exposed to credit risk and forex risk. The company mitigates this risk by seeking payment in advance of shipping goods where appropriate.

On behalf of the board

S Dalton (Jnr)
Director
3 March 2025
DALTON GROUP LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 AUGUST 2024
- 2 -

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

Principal activities

The principal activity of the company continued to be that of scrap metal merchanting.

Results and dividends

The results for the year are set out on page 7.

Ordinary dividends were paid amounting to £168,000. The director does not recommend payment of a final dividend.

Director

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

S Dalton (Jnr)
Auditor

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

Strategic report

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

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 director individually has taken all the necessary steps that he ought to have taken as director 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
S Dalton (Jnr)
Director
3 March 2025
DALTON GROUP LIMITED
DIRECTOR'S RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 AUGUST 2024
- 3 -

The director is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

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

 

 

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

DALTON GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF DALTON GROUP LIMITED
- 4 -
Opinion

We have audited the financial statements of Dalton Group Limited (the 'company') for the year ended 31 August 2024 which comprise the profit and loss account, 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 director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

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

 

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

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 director is 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:

DALTON GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF DALTON GROUP LIMITED
- 5 -
Matters on which we are required to report by exception

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

 

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

Responsibilities of director

As explained more fully in the director's responsibilities statement, the director is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the director determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the director is responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the director either intends to liquidate the company or to cease operations, or has 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.

DALTON GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF DALTON GROUP LIMITED
- 6 -

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.

Michael Walker
Senior Statutory Auditor
For and on behalf of Azets Audit Services
3 March 2025
Chartered Accountants
Statutory Auditor
Titanium 1
Kings Inch Place
Renfrew
United Kingdom
PA4 8WF
DALTON GROUP LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 AUGUST 2024
- 7 -
2024
2023
Notes
£
£
Turnover
40,145,303
44,620,627
Cost of sales
(30,734,315)
(36,159,925)
Gross profit
9,410,988
8,460,702
Administrative expenses
(7,617,563)
(6,907,638)
Other operating income
10,706
21,021
Operating profit
3
1,804,131
1,574,085
Interest payable and similar expenses
5
(339,132)
(285,323)
Profit before taxation
1,464,999
1,288,762
Tax on profit
6
(380,399)
(308,658)
Profit for the financial year
1,084,600
980,104

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

DALTON GROUP LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 AUGUST 2024
- 8 -
2024
2023
£
£
Profit for the year
1,084,600
980,104
Other comprehensive income
-
-
Total comprehensive income for the year
1,084,600
980,104
DALTON GROUP LIMITED
BALANCE SHEET
AS AT 31 AUGUST 2024
31 August 2024
- 9 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
8
12,720,434
10,185,403
Current assets
Stocks
9
1,525,472
2,224,704
Debtors
10
3,153,435
2,882,495
Cash at bank and in hand
942,807
1,787,131
5,621,714
6,894,330
Creditors: amounts falling due within one year
11
(5,031,487)
(5,362,631)
Net current assets
590,227
1,531,699
Total assets less current liabilities
13,310,661
11,717,102
Creditors: amounts falling due after more than one year
12
(4,529,679)
(4,233,119)
Provisions for liabilities
Deferred tax liability
14
2,051,537
1,671,138
(2,051,537)
(1,671,138)
Net assets
6,729,445
5,812,845
Capital and reserves
Called up share capital
16
10,000
10,000
Profit and loss reserves
17
6,719,445
5,802,845
Total equity
6,729,445
5,812,845
The financial statements were approved and signed by the director and authorised for issue on 3 March 2025
S Dalton (Jnr)
Director
Company Registration No. SC088385
DALTON GROUP LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 AUGUST 2024
- 10 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 September 2022
10,000
5,058,741
5,068,741
Year ended 31 August 2023:
Profit and total comprehensive income for the year
-
980,104
980,104
Dividends
7
-
(236,000)
(236,000)
Balance at 31 August 2023
10,000
5,802,845
5,812,845
Year ended 31 August 2024:
Profit and total comprehensive income for the year
-
1,084,600
1,084,600
Dividends
7
-
(168,000)
(168,000)
Balance at 31 August 2024
10,000
6,719,445
6,729,445
DALTON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
- 11 -
1
Accounting policies
Company information

Dalton Group Limited is a private company limited by shares incorporated in Scotland. The registered office is 15 Youngs Road, East Mains Industrial Estate, Broxburn, Near Edinburgh, United Kingdom, EH52 5LY.

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 Dalton Metal Recycling Limited. These consolidated financial statements are available from its registered office, Dalton House, 15 Youngs Road, East Mains Industrial Estate, Broxburn, Near Edinburgh, EH52 5LY.

DALTON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
1
Accounting policies
(Continued)
- 12 -
1.2
Going concern

The director is required to prepare the statutory financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. In satisfaction of this responsibility the director has considered the company's ability to meet its liabilities as they fall due.true

 

The company meets its day to day working capital requirements utilising cash reserves, finance leases and a loan from the parent entity. Management information tools including budgets and cash flow forecasts are used to monitor and manage current and future liquidity.

 

Despite tough trading conditions, the company has posted strong results in the year under review.

 

The company's profitability is heavily dependent on the underlying price and demand for metals. With continued investment in the plant and tight controls on costs and margins, the company has managed to achieve growth in operating profit despite the difficult trading conditions, with a reduction in turnover. With continued investment in plant and machinery at depots, the director is confident the company can capitalise in the near future. The director acknowledges this could change suddenly depending on how the situation evolves but is confident in the company's ability to react and adapt to future events.

 

As at 31 August 2024, the parent company had two bank loans. One of these loans was renewed during the year under review with a final repayment date in 20 years. The other loan is due for renewal and management have been in discussions with the lender and have considered the banks affordability criteria. Following this review, management are confident that this facility will be renewed in the normal course of business.

 

As such, the director considers that it is appropriate to prepare the financial statements on the going concern basis.

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

Income from insurance claims is recognised when it is virtually certain that the entity will received such reimbursement. Where the recovery is virtually certain, management make a prudent estimate of the amount recoverable. These amounts are included within other operating income and other debtors.

1.4
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:

Freehold property
5% on cost
Leasehold improvements
5% on cost
Plant & machinery
5% - 20% on cost
Fixtures and fittings
20% - 33% on cost
Motor vehicles
20% - 33% on cost

Assets in the course of construction are stated at cost. These assets are not depreciated until they are available for use.

DALTON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
1
Accounting policies
(Continued)
- 13 -

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.

1.5
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). 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.

1.6
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell.

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

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, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.8
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 and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

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.

DALTON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
1
Accounting policies
(Continued)
- 14 -
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.

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.

DALTON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
1
Accounting policies
(Continued)
- 15 -
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.

 

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

1.11
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.

DALTON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
1
Accounting policies
(Continued)
- 16 -
1.13
Leases

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

 

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

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

1.14
Government grants

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

 

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

1.15
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 director is 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.

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.

Impairment provisions against stock

Stock is carried at the lower of cost and net realisable value. Calculation of the net realisable value requires management to use estimates regarding future selling prices and other projections which includes a degree of uncertainty.

DALTON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 17 -
3
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(6,965)
11
Fees payable to the company's auditor for the audit of the company's financial statements
20,000
19,000
Depreciation of owned tangible fixed assets
393,188
391,832
Depreciation of tangible fixed assets held under finance leases
1,255,715
1,054,062
Profit on disposal of tangible fixed assets
(34,122)
(145,850)
Operating lease charges
361,673
378,653
4
Employees

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

2024
2023
Number
Number
Staff
65
65

The above average number of employees includes all those under contracts of service at any time in the month, including those on part time contracts. The full time equivalent was 59 (2023 - 61).

 

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
2,029,672
1,995,155
Social security costs
203,103
194,149
Pension costs
42,449
39,761
2,275,224
2,229,065
5
Interest payable and similar expenses
2024
2023
£
£
Interest on bank overdrafts and loans
-
17,915
Interest on finance leases and hire purchase contracts
339,132
267,408
339,132
285,323
6
Taxation
2024
2023
£
£
Current tax
Adjustments in respect of prior periods
-
0
(19,070)
DALTON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
6
Taxation
2024
2023
£
£
(Continued)
- 18 -
Deferred tax
Origination and reversal of timing differences
380,399
352,027
Adjustment in respect of prior periods
-
0
(24,299)
Total deferred tax
380,399
327,728
Total tax charge
380,399
308,658

Current tax is calculated at an effective rate of 25% of the estimated taxable profit for the year (2023 - 21.52%). Finance Act 2021 was ‘substantively enacted’ on 24 May 2021. This increased the main rate of corporation tax applicable to 25% from 1 April 2023, replacing the 20% rate previously effective from that date. The closing deferred tax assets and liabilities have been calculated in accordance with the rates substantively enacted at the Balance Sheet date.

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

2024
2023
£
£
Profit before taxation
1,464,999
1,288,762
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 21.52%)
366,250
277,342
Tax effect of expenses that are not deductible in determining taxable profit
9,956
40,996
Adjustments in respect of prior years
-
0
(19,070)
Other non-reversing timing differences
4,193
(15,383)
Deferred tax adjustments in respect of prior years
-
0
(24,299)
Remeasurement of deferred tax for changes in rate
-
0
49,072
Taxation charge for the year
380,399
308,658
7
Dividends
2024
2023
£
£
Interim paid
168,000
236,000
DALTON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 19 -
8
Tangible fixed assets
Freehold property
Leasehold improvements
Plant & machinery
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 September 2023
1,164,000
264,575
13,554,059
124,822
1,508,653
16,616,109
Additions
537,886
-
0
3,636,108
2,178
39,891
4,216,063
Disposals
-
0
-
0
-
0
-
0
(96,911)
(96,911)
At 31 August 2024
1,701,886
264,575
17,190,167
127,000
1,451,633
20,735,261
Depreciation and impairment
At 1 September 2023
-
0
-
0
5,781,881
90,990
557,835
6,430,706
Depreciation charged in the year
-
0
16,771
1,345,264
15,728
271,140
1,648,903
Eliminated in respect of disposals
-
0
-
0
-
0
-
0
(64,782)
(64,782)
At 31 August 2024
-
0
16,771
7,127,145
106,718
764,193
8,014,827
Carrying amount
At 31 August 2024
1,701,886
247,804
10,063,022
20,282
687,440
12,720,434
At 31 August 2023
1,164,000
264,575
7,772,178
33,832
950,818
10,185,403

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

2024
2023
£
£
Plant & machinery
8,343,442
6,704,237

The director's estimate of land included with freehold property is £1,164,000 and is not depreciated.

9
Stocks
2024
2023
£
£
Raw materials and consumables
1,525,472
2,224,704
DALTON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 20 -
10
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
1,422,172
1,428,405
Corporation tax recoverable
1,746
221,517
Other debtors
1,231,999
833,613
Prepayments and accrued income
497,518
398,960
3,153,435
2,882,495
11
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Obligations under finance leases
13
1,740,759
1,449,051
Trade creditors
2,035,404
2,563,492
Amounts owed to group undertakings
679,635
784,475
Taxation and social security
54,686
38,759
Other creditors
117,656
60,175
Accruals and deferred income
403,347
466,679
5,031,487
5,362,631
12
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Obligations under finance leases
13
4,529,679
4,233,119
13
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
1,740,759
1,449,051
In two to five years
4,225,901
3,809,162
In over five years
303,778
423,957
6,270,438
5,682,170
DALTON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
13
Finance lease obligations
(Continued)
- 21 -

Obligations under finance leases represent rentals payable by the company under hire purchase and lease asset purchase agreements for certain items of plant and machinery and motor vehicles. The average remaining lease term is 4 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

 

Lease asset purchase agreements and hire purchase contracts are secured over the assets to which they relate.

 

14
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
2,071,849
1,671,138
Tax losses
(20,312)
-
2,051,537
1,671,138
2024
Movements in the year:
£
Liability at 1 September 2023
1,671,138
Charge to profit or loss
380,399
Liability at 31 August 2024
2,051,537

The deferred tax liability set out above is expected to reverse and relates to accelerated capital allowances that are expected to mature within the same period.

15
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
42,449
39,761

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.

DALTON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 22 -
16
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
10,000
10,000
10,000
10,000

The company has one class of share capital. There are no restrictions on the distribution of dividends or the repayment of capital.

17
Profit and loss reserves
2024
2023
£
£
At the beginning of the year
5,802,845
5,058,741
Profit for the year
1,084,600
980,104
Dividends declared and paid in the year
(168,000)
(236,000)
At the end of the year
6,719,445
5,802,845
18
Financial commitments, guarantees and contingent liabilities

The company has issued a guarantee to the Royal Bank of Scotland plc for the borrowings of its parent company, Dalton Metal Recycling Limited. This guarantee has a limit of £1,125,000.

 

The Royal Bank of Scotland plc has a bond and floating charge over all the assets of the company.

 

The company is engaged in an ongoing legal dispute with a customer. As negotiations are ongoing regarding the legal dispute, the Director is of the view that it would be seriously prejudicial it if the company were to disclose the information usually required by FRS 102 in respect of provisions. The company has dealt with its estimated liabilities insofar as it is practicable for the Director to estimate at this stage, when calculating its accruals.

19
Operating lease commitments
Lessee

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

2024
2023
£
£
Within one year
300,000
300,000
20
Capital commitments

Amounts contracted for but not provided in the financial statements:

2024
2023
£
£
Acquisition of tangible fixed assets
242,200
1,955,737
DALTON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 23 -
21
Related party transactions

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

 

During the year the company entered into the following transactions with related parties:

 

Stephen G Dalton & Son

A partnership in which Mr S G Dalton Jnr is a partner.

 

During the year Stephen G Dalton & Son Partnership was invoiced for scrap sales totalling £574,777 (2023 - £195,485). Rent of £318,695 (2023 - £300,000) and consultancy fees of £168,000 (2023 - £168,000) were charged by the Partnership during the year.

 

At the balance sheet date, the company was due £1,020,953 (2023 - £7,356) from the Partnership.

 

22
Ultimate controlling party

The ultimate parent company is Dalton Metal Recycling Limited which is the largest and smallest group for which consolidated accounts are prepared. The registered office is 15 Youngs Road, East Mains Industrial Estate, Broxburn, Near Edinburgh, EH52 5LY. A copy of the consolidated financial statements can be obtained from Companies House.

2024-08-312023-09-01falsefalsefalseCCH SoftwareCCH Accounts Production 2024.310S Dalton (Jnr)SC0883852023-09-012024-08-31SC088385bus:Director12023-09-012024-08-31SC088385bus:RegisteredOffice2023-09-012024-08-31SC0883852024-08-31SC0883852022-09-012023-08-31SC088385core:RetainedEarningsAccumulatedLosses2022-09-012023-08-31SC088385core:RetainedEarningsAccumulatedLosses2023-09-012024-08-31SC0883852023-08-31SC088385core:LandBuildingscore:OwnedOrFreeholdAssets2024-08-31SC088385core:LeaseholdImprovements2024-08-31SC088385core:PlantMachinery2024-08-31SC088385core:FurnitureFittings2024-08-31SC088385core:MotorVehicles2024-08-31SC088385core:LandBuildingscore:OwnedOrFreeholdAssets2023-08-31SC088385core:LeaseholdImprovements2023-08-31SC088385core:PlantMachinery2023-08-31SC088385core:FurnitureFittings2023-08-31SC088385core:MotorVehicles2023-08-31SC088385core:CurrentFinancialInstrumentscore:WithinOneYear2024-08-31SC088385core:CurrentFinancialInstrumentscore:WithinOneYear2023-08-31SC088385core:Non-currentFinancialInstrumentscore:AfterOneYear2024-08-31SC088385core:Non-currentFinancialInstrumentscore:AfterOneYear2023-08-31SC088385core:CurrentFinancialInstruments2024-08-31SC088385core:CurrentFinancialInstruments2023-08-31SC088385core:ShareCapital2024-08-31SC088385core:ShareCapital2023-08-31SC088385core:RetainedEarningsAccumulatedLosses2024-08-31SC088385core:RetainedEarningsAccumulatedLosses2023-08-31SC088385core:ShareCapital2022-08-31SC088385core:RetainedEarningsAccumulatedLosses2022-08-31SC088385core:RetainedEarningsAccumulatedLosses2023-08-31SC088385core:LeaseholdImprovements2023-09-012024-08-31SC088385core:PlantMachinery2023-09-012024-08-31SC088385core:ConstructionInProgressAssetsUnderConstruction2023-09-012024-08-31SC088385core:UKTax2023-09-012024-08-31SC088385core:UKTax2022-09-012023-08-31SC08838512023-09-012024-08-31SC08838512022-09-012023-08-31SC088385core:LandBuildingscore:OwnedOrFreeholdAssets2023-08-31SC088385core:LeaseholdImprovements2023-08-31SC088385core:PlantMachinery2023-08-31SC088385core:FurnitureFittings2023-08-31SC088385core:MotorVehicles2023-08-31SC0883852023-08-31SC088385core:LandBuildingscore:OwnedOrFreeholdAssets2023-09-012024-08-31SC088385core:FurnitureFittings2023-09-012024-08-31SC088385core:MotorVehicles2023-09-012024-08-31SC088385core:Non-currentFinancialInstruments2024-08-31SC088385core:Non-currentFinancialInstruments2023-08-31SC088385core:WithinOneYear2024-08-31SC088385core:WithinOneYear2023-08-31SC088385core:BetweenTwoFiveYears2024-08-31SC088385core:BetweenTwoFiveYears2023-08-31SC088385core:MoreThanFiveYears2024-08-31SC088385core:MoreThanFiveYears2023-08-31SC088385bus:PrivateLimitedCompanyLtd2023-09-012024-08-31SC088385bus:FRS1022023-09-012024-08-31SC088385bus:Audited2023-09-012024-08-31SC088385bus:FullAccounts2023-09-012024-08-31xbrli:purexbrli:sharesiso4217:GBP