Company registration number 04583982 (England and Wales)
INNOVAL TECHNOLOGY LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
INNOVAL TECHNOLOGY LIMITED
COMPANY INFORMATION
Directors
Dr G Mahon
Mr A Betts
Mr G Mareschi Danieli
Dr M R Clinch
(Appointed 1 November 2023)
Secretary
Mr P Jordan
Company number
04583982
Registered office
4 Ignite
Magna Way
Rotherham
S60 1FD
Auditor
Hart Shaw LLP
Europa Link
Sheffield Business Park
Sheffield
S9 1XU
Business address
Beaumont Close
Banbury
Oxfordshire
OX16 1TQ
INNOVAL TECHNOLOGY LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4
Directors' responsibilities statement
5
Independent auditor's report
6 - 8
Statement of income and retained earnings
9
Balance sheet
10
Notes to the financial statements
11 - 19
INNOVAL TECHNOLOGY LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2024
- 1 -

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

Review of the business

The global aluminium industry was slow to recover from the depressed market condition of 2023. In relation to Innoval this was illustrated by a 37% decline in the opening order book of the year ending 30 June 2024. The company experienced depressed trading activity for much of the first half of the year. However since January 2024 new business accumulation has recovered strongly with an increase of 75% over the first half of the year. This has enabled the Company to close the year with a strong order book with 50% of the target sales already contracted for.

 

The major market for the Company’s services remains aluminium rolling companies, which account for 50% of sales. This is a combination of in-plant processes benchmarking and improvements, product analysis and development, training activities and strategic support for new investments, where the Company is engaged to provide support in a number of industry capital expansion projects. A major theme of much of our work for all markets we serve remains focused on sustainability initiatives where the main driver is the reduction of greenhouse gas emissions through the replacement of primary aluminium with post-consumer scrap. The company has grown its business capabilities in Life Cycle Analysis, feasibility studies and consulting services related to advanced scrap sorting technologies. The provision of both in-person and on-line training courses remains an important source of revenue which accounts for over 10% of sales.

 

We continue to provide services to our ultimate parent company Danieli & C in support of new aluminium rolling mill sales and mill commissioning, which provides a competitive advantage over other equipment suppliers to the aluminium industry.

 

Despite the lower sales revenue this year, Innoval’s new order intake has improved steadily throughout the year and gross margins have been maintained. At the close of year order backlog is healthy and debtors remain well controlled.

 

The company continues to promote its services by exhibiting and making technical presentations at industry events and trade shows in the UK and globally, including targeted activities in the major aluminium markets of North America and China. We have maintained a strong social media presence and regularly publish online blogs and articles in trade journals.

 

Principal risks and uncertainties.

Set out below are the principal risks facing the business. The Directors are of the opinion that a comprehensive risk management process is adopted to identify and review risk factors and this forms part of the Company’s on-going QS9001 certification and ISO17025 accreditation. Where possible internal business processes are in place to monitor and mitigate such risks.

 

INNOVAL TECHNOLOGY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 2 -
Principal risks and uncertainties

Set out below are the principal risks facing the business. The Directors are of the opinion that a comprehensive risk management process is adopted to identify and review risk factors and this forms part of the Company’s on-going QS9001 certification and ISO17025 accreditation. Where possible internal business processes are in place to monitor and mitigate such risks.

 

 

 

Research and development activities

The Company continues to be at the forefront of new technology development through its participation in collaborative UK government funded projects. A major theme of these projects during the year is related to sustainability in the automotive sector with ALIVE (Aluminium Intensive Vehicle Enclosures), which finished at the end of March 2024, and the continuation of CirConAl (Circular and Constant Aluminium). These projects form part of a coordinated response from the global aluminium industry, and major producers in particular, to accelerate decarbonisation efforts in line with the UN Sustainable Development Goals and Climate Change targets.

 

The Company also continues to invest in digital technologies including the development of improved process models for use in consulting activities with rolling company clients, accurately modelling operating costs, developing improved experimental techniques, and increasing the range of training and knowledge transfer products on offer. This included a new on-line training course on aluminium surfaces and treatments launched in 2024.

 

Key performance indicators

The Company directors recognise that the management of the gross margin on its contracts continues to be essential to understanding, developing and enhancing the position of the business. Gross margins on such contracts are monitored on a continuous basis and reviewed by the directors. In addition, working capital requirements are managed as required. The following table includes some of those key indicators:

 

 

 

2024

 

2023

 

Measure

Gross Margin

 

27.55%

 

38.46%

 

Gross profit/ Turnover

Profit/Loss Margin

 

-12.10%

 

4.86%

 

PBT / Turnover

Sales per employee

 

£85,797

 

£97,731

 

Turnover / Average no. of employees

 

Code of Ethics

The Company continued to implement various Danieli Group initiatives throughout the year. These included on-going cyber security awareness and training, an updated policy on international sanctions to restricting business with sanctioned individuals or entities and sanctioned products, the anti-corruption policy, the code of ethics and all employees completing the conflict-of-interest declaration. Employee performance, career development and growth opportunities are managed via the Danieli Group evaluation process, Metyou. The Company has also adopted the Danieli company culture core values.

 

INNOVAL TECHNOLOGY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 3 -
Environmental matters

Consistent with policy of The Danieli Group the Company has defined reference targets to maintain high levels of environmental protection standards. These being but not limited to:

 

On behalf of the board

Dr M R Clinch
Director
5 September 2024
INNOVAL TECHNOLOGY LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2024
- 4 -

The directors present their report with the audited financial statements of the Company for the year ended 30 June 2024.

Principal activities

Innoval Technology Limited (“the company”) provides world-class technical expertise to the global downstream aluminium industry. The company provides support to improve rolling and extrusion processes, to develop new aluminium alloys and products and to train customer’s personnel. The company also provides technical support in the design and sale of the new Danieli aluminium rolling mills and other processing equipment.

 

In addition the Company has provided support to the commercial activities of the Group in the sale of various rolling and finishing equipment in the aluminium plant sector as well as exploitation of the synergies between Innoval and Danieli Olivotto Ferre.

 

Matters required to be disclosed under Sch 7 of the Companies Act 2006 have been excluded from the Director’s report. They are set out in the Strategic report, in accordance with s414c(11) of the Companies Act 2006.

Results and dividends

The results for the year are set out on page 9.

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

Directors

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

Dr G Mahon
Mr A Betts
Mr G Mareschi Danieli
Dr M R Clinch
(Appointed 1 November 2023)
Auditor

The auditors, Hart Shaw LLP, were appointed auditors to the company and in accordance with section 487(2) of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.

Statement of disclosure to auditor

So far as the directors are aware, there is no relevant audit information of which the company's auditors are unaware. Additionally, the directors have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company's auditors are aware of that information.

Medium-sized companies exemption

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

On behalf of the board
Dr M R Clinch
Director
5 September 2024
INNOVAL TECHNOLOGY LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 JUNE 2024
- 5 -

The directors are responsible for preparing the Directors' 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 then apply them consistently;

- make judgements and accounting estimates that are reasonable and prudent;

- 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. 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.

INNOVAL TECHNOLOGY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF INNOVAL TECHNOLOGY LIMITED
- 6 -
Opinion

We have audited the financial statements of Innoval Technology Limited (the 'company') for the year ended 30 June 2024 which comprise the statement of income and retained earnings, the balance sheet and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

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

 

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

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

INNOVAL TECHNOLOGY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF INNOVAL TECHNOLOGY LIMITED
- 7 -
Matters on which we are required to report by exception

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

 

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

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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:

 

We have assessed the overall susceptibility of the financial statements to material misstatement due to irregularities as low.

 

At the planning stage we identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience and through discussion with the directors and other management, as required by auditing standards. The potential effect of any laws and regulation on the financial statements can vary considerably. There are laws and regulations that directly affect the financial statements (e.g. the Companies Act) as well as many other operational laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements. Owing to the size, nature and complexity of the organisation and the applicable laws and regulations to which it must adhere, the risk of material misstatement was deemed to be low, therefore the procedures performed by the audit team were limited to:

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

We have assessed the overall susceptibility of the financial statements to material misstatement due to fraud.

 

Management override is inherently high risk on any audit. Management override, which may cause there to be a material misstatement within the financial statements, may present itself in a number of ways, for example:

 

In order to reduce the risk of material misstatement to an acceptable level, numerous audit procedures were performed including:

 

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected material misstatements in the financial statements, even though we have performed our audit in accordance with auditing standards. Furthermore, as with all audits, there is a higher risk of irregularities (especially those relating to fraud) being undetected, as these may involve the override of internal controls, collusion, intentional omissions and misrepresentations etc. We are not responsible for preventing non-compliance or fraud and therefore cannot be expected to detect all instances of such. Our audit was not designed to identify misstatements or other irregularities that would not be considered to be material to the financial statements. The further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it.

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.

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.

Tim Dawson
Senior Statutory Auditor
For and on behalf of Hart Shaw LLP
11 September 2024
Chartered Accountants
Statutory Auditor
Europa Link
Sheffield Business Park
Sheffield
S9 1XU
INNOVAL TECHNOLOGY LIMITED
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 30 JUNE 2024
- 9 -
2024
2023
Notes
£
£
Turnover
2
1,887,554
2,052,361
Cost of sales
(1,383,534)
(1,263,049)
Gross profit
504,020
789,312
Administrative expenses
(732,391)
(689,584)
(Loss)/profit before taxation
(228,371)
99,728
Tax on (loss)/profit
6
(29,702)
(32,326)
(Loss)/profit for the financial year
(258,073)
67,402
Retained earnings brought forward
1,221,910
1,154,508
Retained earnings carried forward
963,837
1,221,910

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

INNOVAL TECHNOLOGY LIMITED
BALANCE SHEET
AS AT
30 JUNE 2024
30 June 2024
- 10 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
7
228,554
296,770
Current assets
Debtors falling due after more than one year
8
21,700
23,200
Debtors falling due within one year
8
517,098
712,391
Cash at bank and in hand
621,778
585,357
1,160,576
1,320,948
Creditors: amounts falling due within one year
9
(424,293)
(394,808)
Net current assets
736,283
926,140
Net assets
964,837
1,222,910
Capital and reserves
Called up share capital
12
1,000
1,000
Profit and loss reserves
963,837
1,221,910
Total equity
964,837
1,222,910

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

The financial statements were approved by the board of directors and authorised for issue on 5 September 2024 and are signed on its behalf by:
Dr M R Clinch
Director
Company registration number 04583982 (England and Wales)
INNOVAL TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
- 11 -
1
Accounting policies
Company information

Innoval Technology Limited is a private company, limited by shares and incorporated in England and Wales. The registered office is 4 Ignite, Magna Way, Rotherham, S60 1FD. The principal place of business is Beaumont Close, Banbury, Oxfordshire, OX16 1TQ.

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 Danieli & C. Officine Meccaniche SpA. These consolidated financial statements are available publicly and from its registered office, 33042 Buttrio, Udine, Italy.

The company is a wholly owned subsidiary of Danieli UK Holding Limited having its registered office at 4 Ignite, Magna Way, Rotherham, South Yorkshire, S60 1FD.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

The company sells consultancy services. The company recognises recoverable revenue from services as they are provided during the year.

1.4
Research and development expenditure

Research expenditure is written off against profits in the year in which it is incurred.

1.5
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

INNOVAL TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 12 -

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

Leasehold improvements
15% reducing balance
Plant and machinery
25% reducing balance
Fixtures, fittings & equipment
15% - 25% reducing balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

1.6
Impairment of fixed assets

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

1.7
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.

INNOVAL TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 13 -
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 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.

 

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.

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.

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

1.10
Taxation

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

INNOVAL TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 14 -
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.

1.12
Retirement benefits

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

1.13
Leases

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
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
Turnover

An analysis of the company's turnover is as follows:

2024
2023
£
£
Turnover analysed by class of business
Rendering of services
1,887,554
2,052,361
INNOVAL TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
2
Turnover
(Continued)
- 15 -
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
790,295
891,538
EU
508,515
515,185
Rest of the World
588,744
645,638
1,887,554
2,052,361
3
Operating (loss)/profit
2024
2023
Operating (loss)/profit for the year is stated after charging/(crediting):
£
£
Exchange losses
5,669
24,626
Research and development costs
(53,318)
(44,528)
Fees payable to the company's auditor for the audit of the company's financial statements
3,822
4,440
Depreciation of owned tangible fixed assets
69,892
44,583
(Profit)/loss on disposal of intangible assets
-
32
Operating lease charges
80,567
85,699
4
Employees

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

2024
2023
Number
Number
Technical
25
23
Administration
1
1
Total
26
24

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
1,318,004
1,177,546
Social security costs
118,519
114,812
Pension costs
86,563
79,173
1,523,086
1,371,531
INNOVAL TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 16 -
5
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
156,814
86,022
Company pension contributions to defined contribution schemes
13,304
9,333
170,118
95,355
The directors are the only key management personnel.

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2023 - 1).

6
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
13,329
9,126
Foreign current tax on profits for the current period
14,873
-
0
Total current tax
28,202
9,126
Deferred tax
Origination and reversal of timing differences
1,500
23,200
Total tax charge
29,702
32,326

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

2024
2023
£
£
(Loss)/profit before taxation
(228,371)
99,728
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 20.50%)
(57,093)
20,444
Tax effect of expenses that are not deductible in determining taxable profit
985
904
Effect of change in corporation tax rate
-
0
(14,653)
Permanent capital allowances in excess of depreciation
-
0
(4,430)
Deferred tax adjustments in respect of prior years
29,966
(7,282)
Tax credits surrendered to group
44,689
37,343
Irrecoverable foreign tax
11,155
-
0
Taxation charge for the year
29,702
32,326
INNOVAL TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 17 -
7
Tangible fixed assets
Leasehold improvements
Plant and machinery
Fixtures, fittings & equipment
Total
£
£
£
£
Cost
At 1 July 2023
50,389
369,556
294,244
714,189
Additions
-
0
1,082
594
1,676
At 30 June 2024
50,389
370,638
294,838
715,865
Depreciation and impairment
At 1 July 2023
42,276
156,790
218,353
417,419
Depreciation charged in the year
1,609
53,462
14,821
69,892
At 30 June 2024
43,885
210,252
233,174
487,311
Carrying amount
At 30 June 2024
6,504
160,386
61,664
228,554
At 30 June 2023
8,113
212,766
75,891
296,770
8
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
311,095
540,321
Corporation tax recoverable
39,989
35,402
Amounts owed by group undertakings
24,222
14,863
Other debtors
-
0
18,871
Prepayments and accrued income
141,792
102,934
517,098
712,391
2024
2023
Amounts falling due after more than one year:
£
£
Deferred tax asset (note 10)
21,700
23,200
Total debtors
538,798
735,591
INNOVAL TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 18 -
9
Creditors: amounts falling due within one year
2024
2023
£
£
Trade creditors
81,638
100,535
Amounts due to group undertakings
142,389
126,675
Other taxation and social security
3,776
-
0
Accruals and deferred income
196,490
167,598
424,293
394,808
10
Deferred taxation

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

Assets
Assets
2024
2023
Balances:
£
£
Fixed asset timing differences
(47,200)
(62,000)
Short term timing differences
15,200
1,900
Losses and other deductions
1,900
22,400
Unused R&D tax credit
51,800
60,900
21,700
23,200
2024
Movements in the year:
£
Asset at 1 July 2023
(23,200)
Charge to profit or loss
1,500
Asset at 30 June 2024
(21,700)

The deferred tax asset set out above is expected to reverse as per the following. Fixed asset timing differences are expected to reverse in line with the assets depreciation. Short term timing differences are expected to be reversed within the the next 12 months. Losses and unused R&D tax credits are expected to be utilised within the next two years.

INNOVAL TECHNOLOGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 19 -
11
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
86,563
79,173

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.

12
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of 10p each
10,000
10,000
1,000
1,000
13
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
79,750
79,750
Between two and five years
26,583
86,396
106,333
166,146
14
Related party transactions

As a subsidiary undertaking of Danieli & C Officine Meccaniche Spa, the company has taken advantage of the exemption in FRS 102 “Related party disclosures” not to disclose transactions with group companies.

 

Due to the key management personnel of the company being the same as the directors, the company has taken the exemption provided under FRS102 to not separately disclose key management personnel compensation. See 5 for directors' remuneration note.

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