The directors present the strategic report for the year ended 30 March 2024.
Despite a challenging year, the directors are satisfied with the reported group financial performance, to the extent it is in line with the short-term business plan.
For both HWL and the newly acquired CPG, the key objectives were to set the foundations for future-proofed, resilient businesses which could support existing and new client engagements, delivering long-term financial security for the group. Fundamental changes were made, which involved altering the organisational structures, employing new people in key roles, as well as updating core processes, systems and controls.
It was fully anticipated that these changes would bring additional one-off costs, those being disproportionate to the trading performance and ultimately impacting on the group’s ability to deliver profits in the period under review. The directors strongly believed that the changes made were fundamental to the longer-term success of the group, and on that basis accepted the investment in people and processes would have a significant impact on the short-term financial performance. With suitable working capital deployed to support business operations, the directors were confident in their strategy, which based upon the group financial performance post year end has been justified.
In the year under review, group turnover has increased to £22.2m (2023: £7.6m), this being a 190% improvement on the prior year. Although much of the growth was driven by HWL, this is also the first year that CPG has been included in the group, with their turnover contributing £6.5m to the consolidated results.
Pleasingly, the group gross profit margin percentage improved by 3.8% to 19.3% (2023:15.5%) despite the well-publicised price and supply chain pressures within the construction industry, linked to external factors such as the War in Ukraine.
Although the consolidated net liability position worsened on the prior year, increasing to £1.1m (2023: £0.1m), the group retained a positive current ratio of 1.15:1 (2023: 2.07:1) indicating its ability to continue to meet short liabilities as they fall due.
At the time of signing the financial statements, the combined turnover of the trading subsidiaries for the first 9 months of the March 2025 year had reached £25.0m, with pretax profits of £1.2m. A prudent full year projection indicates turnover may increase to £30.0m with pretax profits of £1.5m. This would represent a marked improvement on the trading performance of both subsidiaries, relative to the reported results for the March 2024 year, and one that should see the consolidated net liabilities reverse to a significant extent at the next balance sheet date.
Liquidity risk
The group manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the group has sufficient liquid resources to meet the operating needs of the business.
Interest rate risk
The group is exposed to fair value interest rate risk on its fixed rate borrowings and cash flow interest rate risk on floating rate deposits, bank overdrafts and loans.
Credit risk
Investments of cash surpluses and borrowings are made through banks and companies which must fulfil credit rating criteria approved by the Board.
All clients who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.
On behalf of the board
The directors present their annual report and financial statements for the year ended 30 March 2024.
The results for the year are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
DSG were appointed as auditor to the group and company during the year ended 30 March 2024.
DSG resigned as auditor on 11 September 2024. DSG Audit were appointed on 11 September 2024 as auditor to the company and group and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
The group and company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the group'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. This has been done in respect of principal activities and financial instruments.
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
We have audited the financial statements of RW Integrated Solutions Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 March 2024 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows 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).
Basis for opinion
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
The information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
The strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
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.
Discussions were held with, and enquiries made of, management and those charged with governance with a view to identifying those laws and regulations that could be expected to have a material impact on the financial statements. During the engagement team briefing, the outcomes of these discussions and enquiries were shared with the team, as well as consideration as to where and how fraud may occur in the entity.
The following laws and regulations were identified as being of significance to the group:
Those laws and regulations considered to have a direct effect on the financial statements include UK financial reporting standards, Company Law, Tax legislation, and distributable profits legislation.
The group complies with various laws and regulations, some specific to the industry in which it operates and some not. The key area of focus is to guarantee compliance with applicable health and safety laws, given the nature of works undertaken for clients. To ensure a robust framework for managing health and safety is in place, the company has taken the steps necessary to achieve the industry standard ISO45001 accreditation. In the year under review, and during the subsequent period up until the signing of the financial statements, there have been no reported non-conformances in respect of adherence to this standard.
Audit procedures undertaken in response to the potential risks relating to irregularities (which include fraud and non-compliance with laws and regulations) comprised of: enquiries of management and those charged with governance as to whether the entity complies with such laws and regulations; enquiries with the same concerning any actual or potential litigation or claims; inspection of relevant legal correspondence; testing the appropriateness of entries in the nominal ledger, including journal entries; reviewing transactions around the end of the reporting period; and the performance of analytical procedures to identify unexpected movements in account balances which may be indicative of fraud.
No instances of material non-compliance were identified. However, the likelihood of detecting irregularities, including fraud, is limited by the inherent difficulty in detecting irregularities, the effectiveness of the entity’s controls, and the nature, timing and extent of the audit procedures performed. Irregularities that result from fraud might be inherently more difficult to detect than irregularities that result from error. As explained above, there is an unavoidable risk that material misstatements may not be detected, even though the audit has been planned and performed in accordance with ISAs (UK).
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Other matters which we are required to address
Comparative information in the financial statements is derived from the parent company's prior period financial statements which were not audited.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
The notes on pages 14 to 34 form part of these financial statements.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s loss for the year was £476,967 (2023 - £208,691 loss).
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
RW Integrated Solutions Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Unit 2 Prenton Way, North Cheshire Trading Estate, Prenton Way, Prenton, CH43 3EA.
The group consists of RW Integrated Solutions Limited and all of its subsidiaries.
The principal activities of the group and company are disclosed in the Strategic Report.
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.
The 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 for parent company information presented within the consolidated financial statements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The consolidated group financial statements consist of the financial statements of the parent company RW Integrated Solutions Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.
All financial statements are made up to 30 March 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
As outlined in the business review on page 1, the year under review has been a challenging but positive time for the group, due to the significant growth in trade of both HWL and the newly acquired CPG.
Despite the reported losses and further increase in the net liability position of the RWIS group, the directors remain positive about the future given the encouraging improvement in financial performance in the year ending 30 March 2025.
RWIS as a standalone company incurred losses of £0.5m (2023: £0.2m) in the year under review, with similar losses forecast for the forthcoming year to March 2025. The losses are directly linked to the borrowing costs incurred on a term loan disclosed in note 19 to these financial statements, the proceeds of which have redeployed within the group to support with the subsidiaries’ working capital requirements. Once the financial performance of the trading subsidiaries stabilises, with consistent profits generated, there will be scope to vote and pay dividends to RWIS, therefore creating investment income in the parent company. This in turn will generate profits in RWIS, reversing the profit and loss account deficit on the balance sheet, and ultimately generating the funds required to settle the term loan. In the short term, the subsidiaries are committed to meeting the terms of their respective group loan agreements, which generates the cashflow required to service the monthly borrowing costs in RWIS.
At the time of signing the financial statements, the combined turnover of the trading subsidiaries for the first 9 months of the March 2025 year had reached £25.0m, with pretax profits of £1.2m. A prudent full year projection indicates turnover may increase to £30.0m with pretax profits of £1.5m. This would represent a marked improvement on the trading performance of both subsidiaries, relative to the reported results for the March 2024 year, and one that should see the consolidated net liabilities reverse to a significant extent at the next balance sheet date.
The directors have reviewed the trading subsidiaries’ budgets for the 30 March 2025 year and based upon the
current levels of over performance have reforecast the 5-year plan to account for similar growth in profits.
Specifically, the directors have reviewed the forecasts for a period of 12 months from the date of these financial statements, concluding that the subsidiaries will have sufficient trading performance to support consistent profitability and cash generation for at least the next year. In turn this will give the group the financial resource it needs to satisfy its ongoing commitments in respect of the term loan disclosed in note 19 to these accounts.
With reference to the above, the directors are satisfied that it remains appropriate for the company to prepare
its financial statements on a going concern basis.
Turnover represents the value of invoices raised in the year, net of value added tax and discounts where applicable, adjusted for movements in amounts recoverable on contract. All contracts are assessed on an individual basis, with the relevant profit and loss account entries recording turnover and matched contract costs reflective of activity on the relevant works under way. Turnover is established with reference to the stage of completion of the relevant works, with valuations periodically agreed by clients in line with the terms of contract in place. Profits on contracts are realised when the outcome of the work being undertaken can be assessed with reasonable certainty and turnover will only be recognised where there is a contractual right to do so. Where applicable, losses on contracts are recognised as soon as it is apparent the contract cannot return a positive return over its full term. Where the outcome of contract cannot be reasonably assessed, the relevant costs are recorded in the profit and loss account with a corresponding amount included in turnover, to ensure no profit or loss is realised. Where applicable, retentions may be applied by clients on the cumulative value of amounts invoiced. Such adjustments serve to reduce the value of trade debtors, with the future recoverable amount included within other debtors, however do not impact on the disclosure of turnover in the profit and loss account which continues to be disclosed gross of retentions.
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 recognised in the profit and loss account.
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
The group 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 group's balance sheet when the group becomes party to the contractual provisions of the instrument.
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.
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, 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, 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.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group 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.
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 group after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans and loans from fellow group companies, 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.
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.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
The tax expense represents the sum of the tax currently payable and deferred 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 group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
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 if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
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.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
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 leased asset are consumed.
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
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.
Amounts recoverable on maintenance contracts and work in progress are based on a stage of completion determined by the group on the basis of expected total revenue and expected total costs on projects. The recoverability of such amounts are subject to negotiation with customers which may cause adjustments up and down in determining final amounts.
Under FRS 102, the group and company is required to evaluate the fair value of the assets and liabilities of the acquired party where the acquisition is accounted for as a business combination. The directors' assessment of fair values requires detailed judgement alongside consideration of the useful economic life of the goodwill.
The group depreciates tangible assets, and amortises intangible assets, over their estimated useful lives. In determining appropriate useful lives of assets, the directors have considered historic performance as well as future expectations for factors such as expected usage of the asset, physical wear and tear, technical and commercial obsolescence and legal limitations of the usage of the asset, such as lease terms. The actual lives of these assets can vary depending on a variety of factors, including technological innovation, product life cycles and maintenance programmes.
Judgement is applied to determine the residual values for tangible assets. When determining the residual values, the directors have assessed the amount that the group would currently obtain for the disposal of the asset, if it were already of the condition expected at the end of its useful economic life. At each reporting date, the directors have also assessed whether there have been any indicators, such as a change in how the asset is used, significant unexpected wear and tear and changes in market prices, which suggest previous estimates may differ from current expectations. Where this is the case, the residual value and/or useful life is amended and accounted for on a prospective basis.
During the year, the group earned commissions totaling £49,426 (2023: £363,339), net of value added tax, in respect of debt recovery services delivered to a company in administration. The income is considered to be one-off in nature, therefore being disclosed as an exceptional item in the statement of comprehensive income.
On 15 November 2022, the group acquired the trade, assets and employees of a company in administration, the outcome of which led to a high volume of client contracts being novated to the group. To secure the ongoing support of materials, suppliers and subcontractors the group spent significant sums settling their outstanding historic liabilities. This action was seen as an essential part of the longer-term strategic plans for the group. In total, £1,022,022 of supplier support payments, net of value added tax, were settled by the group in the period 15 November 2022 to 30 March 2023. In the same period, the group made supplier support payments totaling £35,595, net of value added tax, for goods and services of an administrative nature. These costs were considered to be one-off transactions, of material value, and on that basis have been classed as exceptional items in the statement of comprehensive income. There were no such costs in the year ended 30 March 2024.
As at 15 November 2022, the group owed a related party the sum of £197,235 in respect of cost of sales transactions which had occurred up until that date. An agreement was reached between both parties meaning that balance was not payable, with the full sum written-back to the statement of comprehensive income as income.
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
In respect of HWL, on 15 November 2022, the contracts of employment for 161 employees were subject to a TUPE arrangement from a company in administration therefore securing the continued employment for the entire workforce of that company. For the period 15 November 2022 to 30 March 2023 the average monthly number of employees was 162 in respect of this company.
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2023: 2)
The actual credit for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
At the year end the group had tax losses available for carry forward to future financial years amounting to £2,153,549. Based on these losses a deferred tax asset has been recognised.
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
Details of the company's subsidiaries at 30 March 2024 are set out in the table below. Those marked with an
asterisk are held indirectly through the direct investment in Russell Painting Holdings Limited.
Included in other creditors is a balance owing to Bibbys Financial Services Limited totaling £996,956 (2023: £nil) in respect of an invoice finance facility. This creditor is secured by way of a fixed and floating charge on certain company assets, dated 31 May 2023.
Also included in other creditors is a balance owing to eCapital Commercial Finance Limited totaling £417,338 (2022: £nil) in respect of an invoice finance facility. This creditor is secured by way of a fixed and floating charge on certain company assets, dated 21 May 2021.
Loans of £4,450,000 (2023: £4,450,000) are secured by a floating charge that covers all of the property or undertakings of the company and its subsidiary undertaking. Interest is charged at 12% per annum on the loan balance. The loan is due to be repaid in full in October 2027.
Bank loans includes £19,500 (2022: £nil) in respect of a Coronavirus Bounce Back Loan. This loan was repaid in full on 4 October 2024.
Also included in bank loans is £198,732 (2022: £nil) which is secured by a fixed and floating charge over the assets of the company. Interest is charged on the loan at 7% per annum and the loan is due to mature in September 2027.
At 30 March 2023 other loans comprised borrowings of £66,667 with Federal Capital and £235,876 with Premium Credit, both of which were unsecured. The balances outstanding at 30 March 2023 have been repaid in full during the year ended 30 March 2024. There was no equivalent loan balance at the 30 March 2024 year end.
Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 4 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
On 30 April 2023 the group acquired 100 percent of the issued capital of Russell Painting Holdings Limited which in turn holds 100% of the issued share capital of Curtis Painting Group Ltd.
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
During the year the group loaned £1,721,812 to a company related by a common director. In total £1,756,812 was repaid by that related party during the year, leaving a balance of £nil at 30 March 2024 (2023: £35,000).
In addition to the loan transactions, the related party supplied various goods and services totalling £127,850 net of VAT (2023: £40,993) during the year, the associated liabilities of which had been settled in full at 30 March 2024.
Included within other debtors is an amount of £223,499 (2022: £nil) due from related parties linked by a common director. The movement in the related party debtors represents various working capital loans between the relevant entities, rather than from the trade of goods and services.
Included within other creditors is an amount of £49,923 (2022: £267,136) due to related parties linked by a common director. The movement in the related party creditors represents various working capital loans between the relevant entities.
Also included in other creditors are amounts totalling £223,606 (2023: £176,009) due to companies with common shareholders.
Finally, included in other creditors falling due within one year is £42,857 (2023: £nil) due to a previous shareholder of Russell Painting Holdings Limited, being a person connected to one of the directors.
The company has taken advantage of the reduced disclosure exemption available under Financial Reporting Standard 102 relating to the disclosure of related party transactions between wholly owned group companies.
During the year HWL loaned sums totalling £231,464 to the directors of that company. Loans totalling £320,792 were repaid by directors during the year, leaving a credit balance of £7,265 due at 30 March 2024 (2023: £82,063 overdrawn).
In CPG, loans totalling £131,178 were made to a director. This balance was repaid in full by the director during the year ended 30 March 2024.
In RWIS, at 30 March 2024 there was a loan balance due to a director of £240,038 (2023: £39,900).