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Registered number: 12726816










CHESNEYS GROUP LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

 
CHESNEYS GROUP LIMITED
 
 
COMPANY INFORMATION


Directors
P J Chesney MA (Cantab) 
N P W Chensey 




Company secretary
P J Chesney MA (Cantab)



Registered number
12726816



Registered office
194-196 Battersea Park Road

London

England

SW11 4ND




Independent auditors
HaysMac LLP

10 Queen Street Place

London

EC4R 1AG





 
CHESNEYS GROUP LIMITED
 

CONTENTS



Page
Group Strategic Report
1 - 4
Directors' Report
5 - 6
Independent Auditors' Report
7 - 11
Consolidated Statement of Comprehensive Income
12
Consolidated Balance Sheet
13 - 14
Company Balance Sheet
15
Consolidated Statement of Changes in Equity
16
Company Statement of Changes in Equity
17
Consolidated Statement of Cash Flows
18
Consolidated Analysis of Net Debt
19
Notes to the Financial Statements
20 - 41


 
CHESNEYS GROUP LIMITED
 
 
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

 
The directors present their strategic report of the company and the group for the year ended 31 December 2023.
The purpose of this report is to provide an insight into the company’s performance in 2023 whilst also highlighting some of the challenges, risks, and opportunities in 2024 and beyond.  
Background
Chesneys is internationally recognised as the leading brand in the luxury heating sector, offering its clients a uniquely diverse portfolio of beautiful products. A family run business which started in London 40 years ago that now has subsidiaries in China and USA and sells its products to international markets.
Chesneys Group Ltd is a company incorporated in England and Wales with a wholly subsidiary, Chesneys Inc, in USA and a joint venture in China which produces bespoke fireplace surrounds primarily for Chesneys in the UK and USA.
In July 2020, the business undertook a corporate restructuring shedding all debt and replacing it with a new shareholder, Compass Group, owning the entire company.

Our Business Model
 
We provide our customers with high quality indoor and outdoor heating products in addition to Fireplace surrounds.
Our fireplace surrounds are meticulously manufactured at our factories in China along with third parties based in Europe. With over 40 year’s experience in this sector, Chesneys can offer bespoke designs in traditional materials as well as more exotic and unique marbles.
Chesneys products have led the field in both design and functionality with many competitors copying our designs. The latest iteration of our stoves, launched in 2024, demonstrate this once again by becoming the most environmentally friendly stove available by beating the current regulatory standards by 7x. 
Our products are available online, via our own retail outlets in London and from nearly 200 third party distributors across the country catering to the web shopper and also those customers which prefer to see our products in person before purchase.
Chesneys also offers a project management and installation service for those clients with multiple installations or multi-building developments.
Our products are distributed from our warehouse in Nottingham. A location ideally suited to national distribution. In addition, a satellite warehouse is operated out of London to satisfy our large business within London and the home counties.
Chesneys prides itself on its high-quality products and outstanding customer service which our customers have come to expect.

Page 1

 
CHESNEYS GROUP LIMITED
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Key Developments in 2023
 
For the 12 months ending on 31st December 2023, the consolidated group achieved net sales of £14m (2022: £15.2m), generating an EBITDA of £74k (2022: £544k). 2023 was a very challenging year for one of our largest products, wood burning stoves. Stove demand dramatically reduced compared to 2022, impacting both sales and profitability. The Stove Industry Alliance figures show that the UK market was down 36% year on year for Ecodesign stoves. Determining why customer demand has changed in any one year is difficult but it may be due to higher interest rates or a reversion from the higher demand seen in 2022. Whilst the exact reason maybe unclear, Chesneys has continued to invest in its stove range to ensure that it can offer customers the best in class experience. 
Net assets were £133k, a reduction of £204k compared to the previous year and cash balances were £230k at the year end down £266k on the previous year.
 
As with any major R&D project, we faced setbacks and challenges in overhauling our stoves which delayed the launch of our new products until January 2024. The considerable effort that has been put into the design of the new stove range has been rewarded as Chesneys now has the most efficient and environmentally friendly stove on the UK market. 
2024 was a transformational year for Chesneys with more new product launches than ever in its history. Two new wood burning stove models have been launched in January with a third coming later in the year. Additionally, the new technology will be transitioned into the existing wood burning stove product range over the first half of 2024. With more new products to come in both gas, bio-ethanol and electric, 2024 will be a very exciting year.
The current Enterprise Resource Management system will be upgraded along with a Customer Relationship Management system to enhance the efficiency of the business. Not only will our processes be streamlined but much better visibility of the business will allow enhanced management.
Whilst there were many achievements in 2024, the business also experienced some supply chain difficulties which impacted orders and inflated production costs. In addition, product launch delays hindered performance. Both issues contributed to the loss experienced in 2024 but have now been resolved as we look forward to 2025.

Challenges, Risks and Opportunities
 
The nature of our products mean that our supplier lead times can be up to 16 weeks. In times of changing demand, it can be challenging to ensure that we stock the correct quantity to fulfil demand. Therefore, the business is susceptible to both over and under stocking. The business endeavours to mitigate such risk with careful planning but cannot be avoided completely.
Whilst our products tend to be at the luxury end of the range, which provides some insulation from the vagaries of the economy, a sharp downturn in economic activity will cause lower sales and volumes. The long lead times mean that it would take a number of months to adjust production and inventory to match demand which would impact profitability.
2024 was a very exciting year seeing the launch of many new products which will lead the industry and allow Chesneys to capture market share. These products are truly cutting edge with the latest technology delivering enhanced performance whilst at the same time being the most environmentally friendly on the market.
Some of these products will open up international expansion into Europe and potentially the USA. Our recent collaboration with English Heritage will produce a collection of fireplaces and baskets taking inspiration from stately homes around the UK.

Page 2

 
CHESNEYS GROUP LIMITED
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Future Developments
 
Chesneys has always been at the forefront of innovation in its main product categories whether it be replica fireplaces, new stoves or novel outdoor living appliances. Whilst 2024 saw a slate of new product launches, our R&D department will continue our roadmap with more product launches in 2025.
Our model for new products involves in-house design and capital but, most importantly, ensures that all Intellectual Property resides with Chesneys. This approach is the most cost effective but carries the risk that the new product may not repay the capital in the design process. We are comfortable with this risk reward profile given our knowledge of the marketplace and manufacturing processes.
Chesneys strong brand has been built over many years and is the combined effort of everyone who works here. We are very proud that our employees feel as passionately about the brand as we do and thank them for their continued hard work and support.
Going concern
The Group has generated a loss before tax for the year ended 31 December 2023 of £209k (2022: proft of £390k) and has net current liabilities at 31 December 2023 of £1,037k (2022: £768k).
Although Chesneys Group Limited (the Company) generated a profit after tax of £74k (2022: £572k), 2023 was a tough year across all channels, but especially Trade which in line with the overall market experienced much lower sales of wood burning stoves, with the Group generating a loss after tax of £276k (2022: profit of £269k).
 
Whilst 2024 has been a transformational year in many respects, it has been a challenging year for the Group resulting in a net loss for the year ended 31 December 2024, which has put a strain on cash flow. The following two factors in particular contributed to the loss, both of which have now been resolved and will each be a significant element of the company’s growth in sales and profitability in 2025.  
 
Chesneys experienced a halt to production/dispatch of fire surrounds for 4 months during 2024. This had a severely negative impact. Orders were cancelled, revenues delayed and inflated short term production costs elsewhere were incurred. Reliable manufacturing has since been set up in a new location delivering much improved margins which will enhance earnings in 2025, particularly through the UK retail channel and US subsidiary, where fire surrounds are the main product sold. 
 
2024 Q1 should have seen the launch of new wood burning and gas stove ranges following two years of extensive and expensive R & D. The launch was delayed, which negatively impacted performance as stove sales are the mainstay of the trade arm and the old range was experiencing a decline in sales, reflecting 15 year old technology. The new range was not launched in full with display models installed at all dealerships until the start of Q4 2024 and order intake for Q4 was up 56% vs 2023 and was ahead of the UK market, which saw stove sales for the quarter decline by 16% YOY. A new gas stove range using the same designs that have proved so popular for wood stoves will launch in Q1 2025, and a similarly positive outcome is anticipated. 
 
Whilst these issues have resulted in short-term cashflow pressures, management is forecasting strong UK Trade sales for 2025 based on the sales of new wood stoves since their launch and the introduction of new gas stoves, and a healthy uplift in Retail driven by improved purchasing costs which will drive improved margins and increased sales. January 2025 saw both of these increases achieved and the Retail order intake up by 100% year on year.  
 
Management have prepared budgets and cash flow forecasts on a regular basis to monitor the performance and financial position of the business. The cash flow forecast has been stress tested by reducing forecast revenues by 5%. This analysis supports the view that sufficient cash will be generated to sustain the business for a period of at least 12 months from the date of signing these financial statements. Therefore following this assessment, the directors consider that it is appropriate to have prepared the accounts on the going concern basis. 
 
Page 3

 
CHESNEYS GROUP LIMITED
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023


In so doing the directors recognize that this assessment is based upon the availability of future funding to sustain the business through its current cash flow challenges. The group requires financing for working capital requirements and is currently in discussions to arrange a further loan facility. Whilst discussions over the new loan facility are at an advanced stage, the new loan has not yet been finalized and approved. Management remain confident that the funding will be secured but recognize that in the unlikely event that this funding should not be secured then the quantum and timing of future cash flows will be insufficient to enable the Company and Group to meet their obligations in the normal course of business and therefore a material uncertainty exists that may cast significant doubt on the ability of the Company and Group to continue as a going concern.


This report was approved by the board and signed on its behalf.



................................................
P J Chesney MA (Cantab)
Director

Date: 12 March 2025

Page 4

 
CHESNEYS GROUP LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

The directors present their report and the financial statements for the year ended 31 December 2023.

Directors' responsibilities statement

The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 the Group and of the profit or loss of the Group for that period.

 In preparing these financial statements, the directors are required to:


select suitable accounting policies for the Group's financial statements and then apply them consistently;

make judgments 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 Group 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 the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Dividends

No dividends will be distributed for the period ended 31 December 2023.

Directors

The directors who served during the year were:

P J Chesney MA (Cantab) 
N P W Chensey 

Both the directors who are eligible offer themselves for election at the forthcoming first Annual General Meeting.

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company and the Group's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company and the Group's auditors are aware of that information.

Page 5

 
CHESNEYS GROUP LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Post balance sheet events

The Chinese based subsidiary, Yantai Euro Stone Ltd, was closed off in 2024 and all balances written off.

Auditors

The auditorsHaysMac LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board and signed on its behalf.
 





................................................
P J Chesney MA (Cantab)
Director

Date: 12 March 2025

Page 6

 
CHESNEYS GROUP LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CHESNEYS GROUP LIMITED
 

Opinion


We have audited the financial statements of Chesneys Group Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2023, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Balance Sheet, the Company Balance Sheet, the Consolidated Statement of Cash Flows, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Group's and of the parent Company's affairs as at 31 December 2023 and of the Group's loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.


Material uncertainty related to going concern


We draw attention to note 2.2 in the financial statements, which indicates that in assessing the going concern position of the Company and Group, the directors are reliant on raising further loan financing. As stated in note 2.2, these events or conditions, along with the other matters as set forth in note 2.2, indicate that a material uncertainty exists that may cast significant doubt on the Group’s or the parent company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.


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.


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


Page 7

 
CHESNEYS GROUP LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CHESNEYS GROUP LIMITED (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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.


Opinion on other matters prescribed by the Companies Act 2006
 

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


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


Matters on which we are required to report by exception
 

In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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:


adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent Company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


Page 8

 
CHESNEYS GROUP LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CHESNEYS GROUP LIMITED (CONTINUED)


Responsibilities of directors
 

As explained more fully in the Directors' Responsibilities Statement set out on page 5, 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 Group's and the parent 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 Group or the parent Company or to cease operations, or have no realistic alternative but to do so.


Page 9

 
CHESNEYS GROUP LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CHESNEYS GROUP LIMITED (CONTINUED)


Auditors' 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 Auditors' 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 Group financial statements.


IIrregularities, 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:

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
Based on our understanding of the Group and industry, we identified that the principal risks of non-compliance with laws and regulations related to regulatory requirements for the company and trade regulations and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006 and tax regulation.
We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries to revenue and management bias in accounting estimates. Audit procedures performed by the engagement team included:
•Inspecting correspondence with regulators and tax authorities;
•Discussions with management including consideration of known or suspected instance of                                           non-compliance with laws and regulation and fraud;
•Evaluating management’s controls designed to prevent and detect irregularities;
•Identifying and testing accounting journal entries, in particular those journal entries which exhibited the  characteristics we had identified as possible indicators of irregularities; and
•Challenging assumptions and judgements made by management in their critical accounting estimates


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 is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


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


Page 10

 
CHESNEYS GROUP LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CHESNEYS GROUP LIMITED (CONTINUED)


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 2006Our 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 Auditors' 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.





Gareth Ogden (Senior Statutory Auditor)
for and on behalf of
HaysMac LLP
Statutory Auditors
10 Queen Street Place
London
EC4R 1AG

12 March 2025
Page 11

 
CHESNEYS GROUP LIMITED
 
 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023


2023
2022
Note
£
£

Turnover
 4 
13,719,187
15,274,795

Cost of sales
  
(9,668,936)
(10,631,201)

Gross profit
  
4,050,251
4,643,594

Administrative expenses
  
(4,180,999)
(4,284,107)

Other operating income
  
22,375
-

Operating (loss)/profit
 5 
(108,373)
359,487

Other finance income
  
7,948
-

Interest payable and similar expenses
 7 
(108,799)
(74,677)

Exceptional administrative expenses
 9 
-
105,222

(Loss)/profit before taxation
  
(209,224)
390,032

Tax on (loss)/profit
 8 
(67,294)
(121,169)

(Loss)/profit for the financial year
  
(276,518)
268,863

(Loss)/profit for the year attributable to:
  

Non-controlling interests
  
9,125
(11,895)

Owners of the parent Company
  
(285,643)
280,758

  
(276,518)
268,863

The notes on pages 20 to 41 form part of these financial statements.

Page 12

 
CHESNEYS GROUP LIMITED
REGISTERED NUMBER: 12726816

CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Intangible assets
 10 
879,842
807,913

Tangible assets
 11 
229,397
197,861

Investments
 12 
100,000
100,000

  
1,209,239
1,105,774

Current assets
  

Stocks
 13 
3,361,377
3,363,439

Debtors
 14 
1,910,495
1,979,018

Cash at bank and in hand
  
229,776
496,378

  
5,501,648
5,838,835

Creditors: amounts falling due within one year
 15 
(6,539,126)
(6,607,113)

Net current liabilities
  
 
 
(1,037,478)
 
 
(768,278)

Total assets less current liabilities
  
171,761
337,496

Creditors: amounts falling due after more than one year
 16 
(38,375)
-

Provisions for liabilities
  

Net assets
  
133,386
337,496


Capital and reserves
  

Called up share capital 
 19 
100
100

Share premium account
 21 
499,900
499,900

Foreign exchange reserve
 21 
286,241
213,834

Profit and loss account
 21 
(713,926)
(428,283)

Equity attributable to owners of the parent Company
  
72,315
285,551

Non-controlling interests
  
61,071
51,945

  
133,386
337,496


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 

................................................
P J Chesney MA (Cantab)
Director

Date: 12 March 2025
Page 13

 
CHESNEYS GROUP LIMITED
REGISTERED NUMBER: 12726816
    
CONSOLIDATED BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2023


The notes on pages 20 to 41 form part of these financial statements.

Page 14

 
CHESNEYS GROUP LIMITED
REGISTERED NUMBER: 12726816

COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Intangible assets
 10 
384,711
236,608

Tangible assets
 11 
79,078
63,949

Investments
 12 
125,005
125,005

  
588,794
425,562

Current assets
  

Stocks
 13 
2,480,065
2,308,750

Debtors
 14 
2,511,810
2,691,191

Cash at bank and in hand
  
179,120
372,034

  
5,170,995
5,371,975

Creditors: amounts falling due within one year
 15 
(4,739,911)
(4,863,793)

Net current assets
  
 
 
431,084
 
 
508,182

Total assets less current liabilities
  
1,019,878
933,744


Capital and reserves
  

Called up share capital 
 19 
100
100

Share premium account
 21 
499,900
499,900

Foreign exchange reserve
 21 
11,888
-

Profit and loss account brought forward
  
433,744
(138,189)

Profit for the year
  
74,246
571,933

Profit and loss account carried forward
  
507,990
433,744

  
1,019,878
933,744


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 


................................................
P J Chesney MA (Cantab)
Director

Date: 12 March 2025

The notes on pages 20 to 41 form part of these financial statements.

Page 15
 

 
CHESNEYS GROUP LIMITED


 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023



Called up share capital
Share premium account
Foreign exchange reserve
Profit and loss account
Non-controlling interests
Total equity


£
£
£
£
£
£



At 1 January 2022
100
499,900
-
(709,041)
63,840
(145,201)





Profit for the year
-
-
-
280,758
-
280,758


Currency translation differences
-
-
213,834
-
-
213,834


Non-controlling interest arising on business combination
-
-
-
-
(11,895)
(11,895)





At 1 January 2023
100
499,900
213,834
(428,283)
51,945
337,496





Loss for the year
-
-
-
(285,643)
-
(285,643)


Currency translation differences
-
-
72,407
-
-
72,407


Non-controlling interest arising on business combination
-
-
-
-
9,126
9,126



At 31 December 2023
100
499,900
286,241
(713,926)
61,071
133,386



The notes on pages 20 to 41 form part of these financial statements.

Page 16
 
CHESNEYS GROUP LIMITED
 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023


Called up share capital
Share premium account
Foreign exchange reserve
Profit and loss account
Total equity

£
£
£
£
£


At 1 January 2022
100
499,900
-
(138,189)
361,811



Total comprehensive income
-
-
-
571,933
571,933



At 1 January 2023
100
499,900
-
433,744
933,744



Profit for the year
-
-
-
74,246
74,246

Currency translation differences
-
-
11,888
-
11,888


At 31 December 2023
100
499,900
11,888
507,990
1,019,878


The notes on pages 20 to 41 form part of these financial statements.

Page 17

 
CHESNEYS GROUP LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
£
£

Cash flows from operating activities

(Loss)/profit for the financial year
(276,518)
268,863

Adjustments for:

Depreciation of tangible assets
181,910
184,796

Interest paid
108,799
4,781

Interest received
(7,948)
-

Taxation charge
67,294
121,169

Decrease/(increase) in stocks
2,063
(583,314)

Decrease/(increase) in debtors
50,817
(426,225)

(Decrease)/increase in creditors
(250,960)
538,619

Corporation tax received
129,925
122,472

Net cash generated from operating activities

5,382
231,161

Cash flows from investing activities

Purchase of intangible fixed assets
(194,278)
(124,110)

Purchase of tangible fixed assets
(103,193)
(23,927)

Sale of tangible fixed assets
12,095
4,861

Purchase of share in joint ventures
-
(100,000)

Interest received
7,948
-

Net cash from investing activities

(277,428)
(243,176)

Cash flows from financing activities

Other new loans
38,375
-

Interest paid
(108,799)
(4,781)

Net cash used in financing activities
(70,424)
(4,781)

Net (decrease) in cash and cash equivalents
(342,470)
(16,796)

Cash and cash equivalents at beginning of year
496,378
513,174

Foreign exchange gains and losses
75,868
-


Cash at bank and in hand
229,776
496,378


The notes on pages 20 to 41 form part of these financial statements.

Page 18

 
CHESNEYS GROUP LIMITED
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2023





At 1 January 2023
Cash flows
Acquisition and disposal of subsidiaries
At 31 December 2023
£

£

£

£

Cash at bank and in hand

496,378

(226,602)

(40,000)

229,776

Debt due after 1 year

-

(38,375)

-

(38,375)

Debt due within 1 year

(12,741)

(9,814)

-

(22,555)


483,637
(274,791)
(40,000)
168,846

The notes on pages 20 to 41 form part of these financial statements.

Page 19

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

Chesneys Group Limited is a private company, limited by shares, registered in England and Wales. The Company's registered number is 12726816 and registered office address is 194-196 Battersea Park Road, London, England, SW11 4ND.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

 
2.2

Going concern

The Group has generated a loss before tax for the year ended 31 December 2023 of £209k (2022: £390k profit before tax) and has net current liabilities at 31 December 2023 of £1,037k (2022: £768k).
Although Chesneys Group Limited (the Company) generated a profit after tax of £74k (2022: £572k), 2023 was a tough year across all channels, but especially Trade which in line with the overall market experienced much lower sales of wood burning stoves, with the Group generating a loss after tax of £276k (2022: profit of £269k).
 
Whilst 2024 has been a transformational year in many respects, it has been a challenging year for the Group resulting in a net loss for the year ended 31 December 2024, which has put a strain on cash flow. The following two factors in particular contributed to the loss, both of which have now been resolved and will each be a significant element of the company’s growth in sales and profitability in 2025.  
 
Chesneys experienced a halt to production/dispatch of fire surrounds for 4 months during 2024. This had a severely negative impact. Orders were cancelled, revenues delayed and inflated short term production costs elsewhere were incurred. Reliable manufacturing has since been set up in a new location delivering much improved margins which will enhance earnings in 2025, particularly through the UK retail channel and US subsidiary, where fire surrounds are the main product sold. 
 
2024 Q1 should have seen the launch of new wood burning and gas stove ranges following two years of extensive and expensive R & D. The launch was delayed, which negatively impacted performance as stove sales are the mainstay of the trade arm and the old range was experiencing a decline in sales, reflecting 15 year old technology. The new range was not launched in full with display models installed at all dealerships until the start of Q4 2024 and order intake for Q4 was up 56% vs 2023 and was ahead of the UK market, which saw stove sales for the quarter decline by 16% YOY. A new gas stove range using the same designs that have proved so popular for wood stoves will launch in Q1 2025, and a similarly positive outcome is anticipated. 
 
Whilst these issues have resulted in short-term cashflow pressures, management is forecasting strong UK Trade sales for 2025 based on the sales of new wood stoves since their launch and the introduction of new gas stoves, and a healthy uplift in Retail driven by improved purchasing costs which will drive improved margins and increased sales. January 2025 saw both of these increases achieved and the Retail order intake up by 100% year on year.  
 
Management have prepared budgets and cash flow forecasts on a regular basis to monitor the performance and financial position of the business. The cash flow forecast has been stress tested by reducing forecast revenues by 5%. This analysis supports the view that sufficient cash will be
Page 20

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.2
Going concern (continued)

generated to sustain the business for a period of at least 12 months from the date of signing these financial statements. Therefore following this assessment, the directors consider that it is appropriate to have prepared the accounts on the going concern basis. 
In so doing the directors recognize that this assessment is based upon the availability of future funding to sustain the business through its current cash flow challenges. The group requires financing for working capital requirements and is currently in discussions to arrange a further loan facility. Whilst discussions over the new loan facility are at an advanced stage, the new loan has not yet been finalized and approved. Management remain confident that the funding will be secured but recognize that in the unlikely event that this funding should not be secured then the quantum and timing of future cash flows will be insufficient to enable the Company and Group to meet their obligations in the normal course of business and therefore a material uncertainty exists that may cast significant doubt on the ability of the Company and Group to continue as a going concern.

 
2.3

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.
In accordance with the transitional exemption available in FRS 102, the Group has chosen not to retrospectively apply the standard to business combinations that occurred before the date of transition to FRS 102, being 14 June 2012.

Page 21

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.4

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Consolidated Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.

On consolidation, the results of overseas operations are translated into Sterling at rates approximating to those ruling when the transactions took place. All assets and liabilities of overseas operations are translated at the rate ruling at the reporting date. Exchange differences arising on translating the opening net assets at opening rate and the results of overseas operations at actual rate are recognised in other comprehensive income.

  
2.5

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

  
2.6

Goodwill

Goodwill, being the amount paid in connection with the acquisition of a business in 2020, is being amortised evenly over its estimated useful life of ten years.

  
2.7

Intangible assets

Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Page 22

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.8

Research and development

In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight-line basis over their useful economic lives, which range from 3 to 6 years.
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.

 
2.9

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.10

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.11

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

 
2.12

Pensions

Defined contribution pension plan

The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Group in independently administered funds.

Page 23

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.13

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company and the Group operate and generate income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits;
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.


Page 24

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.14

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Motor vehicles
-
25% on cost
Fixtures and fittings
-
20% on cost
Computer equipment
-
33% on cost

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

  
2.15

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

 
2.16

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.17

Associates and joint ventures

An entity is treated as a joint venture where the Group is a party to a contractual agreement with one or more parties from outside the Group to undertake an economic activity that is subject to joint control.

An entity is treated as an associated undertaking where the Group exercises significant influence in that it has the power to participate in the operating and financial policy decisions.
In the consolidated accounts, interests in associated undertakings are accounted for using the equity method of accounting. Under this method an equity investment is initially recognised at the transaction price (including transaction costs) and is subsequently adjusted to reflect the investors share of the profit or loss, other comprehensive income and equity of the associate. The Consolidated Statement of Comprehensive Income includes the Group's share of the operating results, interest, pre-tax results and attributable taxation of such undertakings applying accounting policies consistent with those of the Group. In the Consolidated Balance Sheet, the interests in associated undertakings are shown as the Group's share of the identifiable net assets, including any unamortised premium paid on acquisition.
Any premium on acquisition is dealt with in accordance with the goodwill policy.

Page 25

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.18

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.19

Cash

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours.


 
2.20

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.21

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

 
2.22

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, 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 trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.

Impairment of financial assets

At the end of each reporting period financial assets measured at amortised cost are assessed for
Page 26

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.22
Financial instruments (continued)

objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

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 Group after the deduction of all its liabilities.

Basic financial liabilities, which include trade and other creditors, bank loans, other loans and loans due to fellow group companies are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.

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

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

  
2.23

Hire purchase and leasing commitments

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

  
2.24

Pension costs and other post-retirement benefits

The group operates a defined contribution pension scheme. Contributions payable to the group's  pension scheme are charged to profit or loss in the period to which they relate

Page 27

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

3.


Judgments in applying accounting policies and key sources of estimation uncertainty

In the application of the group's accounting policies, the director is required to make judgments, estimates and assumptions about the carrying amount of the 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 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:

 
1.Warranty Provision
In 2021, the first year of accounts, Chesneys Group Ltd took over the warranty obligations of Chesneys Ltd, and a general warranty provision was established to cover those obligations. 
Warranty costs are expenses to the P&L as they occur. Any expected warranty costs that have not been expensed at the end of the period are provided for as part of the warranty provision. 
 
2.Impairment of Intangibles and estimation of UEL
The value of intangibles is assessed at the period end to ensure that it is probable that the expected future economic benefits attributable to the asset will flow to the Group. Any impairment to the value of intangibles is expensed to the Profit and Loss in the current year.
Useful economic life of goodwill has been estimated to be 10 years, which is a period within which economic benefit is expected to flow to the group. 
 
3.Capitalization of R&D and estimation of UEL
To ensure that products are compelling, safe and environmentally friendly, Chesneys incurs costs in research and design. These upfront costs drive future sales and are capitalized until the product is launched. Once launched, the costs are amortized over the expected life of the product. Research and Design costs are only capitalized when they can be easily identified and measured.
At each period end, the value of capitalized costs is assessed to ensure that the carrying value is less than the economic benefit expected to be derived from the sales of the product.
Useful economic life of development costs has been estimated to be between 3 and 6 years, which is a period within which economic benefit is expected to flow to the group.
 
4.Deferred Tax Asset
Deferred tax is provided in full in respect of taxation deferred by timing differences between the treatment of certain items for taxation and accounting purposes. The deferred tax balance has not been discounted.
 
5.Stock Provisions
Stock is held at the lower between cost and realizable value. Stock is assessed at the period end and provisions made where it is believed that the value is above that realizable in a normal sale process.

Page 28

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

4.


Turnover

2023
2022
£
£


United Kingdom
9,753,425
10,381,420

Europe
206,864
230,410

United States
3,605,146
4,367,214

Asia
-
1,367

Rest of the world
68,618
294,384

13,634,053
15,274,795


5.


Operating (loss)/profit

The operating (loss)/profit is stated after charging:

2023
2022
£
£

Hire of plant and machinery
-
20,053

Depreciation - owned assets
59,561
93,263

Goodwill amortisation
46,175
14,999

Auditors' remuneration
54,000
36,000

Foreign exchange differences
7,742
26,414

Page 29

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

6.


Employees and directors

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£


Wages and salaries
3,521,708
3,296,829
2,065,455
2,025,282

Social security costs
469,532
384,752
469,532
384,752

Cost of defined contribution scheme
48,499
40,212
48,499
40,212

4,039,739
3,721,793
2,583,486
2,450,246


The average monthly number of employees, including the directors, during the year was as follows:


        2023
        2022
            No.
            No.







Direct staff
65
77



Indirect staff
28
28



Direct consultants
2
3



Indirect consultant
1
2

96
110


.



2023
2022
£
£



Directors' remuneration
242,588
211,000


.




Information regarding the highest paid director is as follows:




Emoluments
137,800
137,800

Page 30

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

7.


Interest payable and similar expenses

2023
2022
£
£


Other loan interest
1,981
-

Loan interest
106,818
74,677

108,799
74,677


8.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
61,452
29,356

Adjustments in respect of previous periods
41,597
-


Foreign tax on income for the year
(24,722)
-

(24,722)
-


Deferred tax
(11,033)
91,813


Tax on (loss)/profit
67,294
121,169
Page 31

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
8.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022: the same as) the standard rate of corporation tax in the UK of 25% (2022: 19%). The differences are explained below:

2023
2022
£
£


(Loss)/profit on ordinary activities before tax
(209,223)
390,032


(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2022 - 19%)
(31,083)
74,096

Effects of:


Fixed asset differences
6,442
-

Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
14,587
35,481

Capital allowances for year in excess of depreciation
(1,409)
-

Adjustments to tax charge in respect of prior periods
41,597
(92,327)

Remeasurement of deferred tax for changes in tax rates
(171)
26,845

Movement in deferred tax not recognized
(23,136)
77,074

Provision for unrealised profit adjustment
45,994
-

Goodwill Amortisation
14,473
-

Total tax charge for the year
(67,294)
(121,169)


9.


Exceptional items

2023
2022
£
£


Exceptional items
-
105,222

-
105,222

The 2022 figure relates to a combination of a credit (£162k) to exceptional expenses relating to the US entity relating to adjustments for over-accrued expenses. This is offset by further payments of 57k to suppliers of Chesneys Limited.

Page 32

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

10.


Intangible assets

Group





Development expenditure
Goodwill
Total

£
£
£



Cost


At 1 January 2023
124,110
911,736
1,035,846


Additions
194,278
-
194,278



At 31 December 2023

318,388
911,736
1,230,124



Amortisation


At 1 January 2023
-
227,933
227,933


Charge for the year on owned assets
31,175
91,174
122,349



At 31 December 2023

31,175
319,107
350,282



Net book value



At 31 December 2023
287,213
592,629
879,842



At 31 December 2022
124,110
683,803
807,913



Page 33

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
           10.Intangible assets (continued)

Company




Product Development
Goodwill
Total

£
£
£



Cost


At 1 January 2023
124,110
149,997
274,107


Additions
194,278
-
194,278



At 31 December 2023

318,388
149,997
468,385



Amortisation


At 1 January 2023
-
37,499
37,499


Charge for the year
31,175
15,000
46,175



At 31 December 2023

31,175
52,499
83,674



Net book value



At 31 December 2023
287,213
97,498
384,711



At 31 December 2022
124,110
112,498
236,608

Page 34

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

11.


Tangible fixed assets

Group






Plant and machinery
Fixtures and fittings
Motor vehicles
Computer equipment
Total

£
£
£
£
£



Cost


At 1 January 2023
166,085
99,181
19,395
55,147
339,808


Additions
41,138
22,028
-
40,027
103,193


Disposals
(11,347)
-
(749)
(25,000)
(37,096)



At 31 December 2023

195,876
121,209
18,646
70,174
405,905



Depreciation


At 1 January 2023
34,226
54,012
4,409
49,300
141,947


Charge for the year on owned assets
14,022
32,082
2,821
10,636
59,561


Disposals
-
-
-
(25,000)
(25,000)



At 31 December 2023

48,248
86,094
7,230
34,936
176,508



Net book value



At 31 December 2023
147,628
35,115
11,416
35,238
229,397



At 31 December 2022
131,859
45,169
14,986
5,847
197,861

Page 35

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

           11.Tangible fixed assets (continued)


Company






Fixtures and fittings
Motor vehicles
Computer equipment
Total

£
£
£
£

Cost


At 1 January 2023
99,181
8,871
38,973
147,025


Additions
22,028
-
38,595
60,623


Disposals
-
(749)
(25,000)
(25,749)



At 31 December 2023

121,209
8,122
52,568
181,899



Depreciation


At 1 January 2023
54,012
4,410
24,654
83,076


Charge for the year on owned assets
32,082
2,821
9,842
44,745


Disposals
-
-
(25,000)
(25,000)



At 31 December 2023

86,094
7,231
9,496
102,821



Net book value



At 31 December 2023
35,115
891
43,072
79,078



At 31 December 2022
45,169
4,461
14,319
63,949






Page 36

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

12.


Fixed asset investments

Group





Investment in joint ventures

£



Cost


At 1 January 2023
100,000



At 31 December 2023
100,000




Company





Investments in subsidiary companies
Investment in joint ventures
Total

£
£
£



Cost


At 1 January 2023
25,005
100,000
125,005



At 31 December 2023
25,005
100,000
125,005





Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Registered office

Class of shares

Holding

Chesneys Inc
979 Third Avenue, Suite 1119, NY 10022, New York
Ordinary
100%
Yantai Euro Stone Ltd
15 Tonghe road, Laishan Industrial Park, 264000, Yantai, China
Ordinary
85%

Page 37

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

13.


Stocks

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Raw materials and consumables
225,842
294,452
-
-

Finished goods
3,135,535
3,068,987
2,480,065
2,308,750



14.


Debtors

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£


Trade debtors
494,240
976,628
437,353
964,786

Amounts owed by group undertakings
-
-
1,200,929
1,187,236

Other debtors
763,803
421,687
711,773
350,130

Prepayments and accrued income
313,514
224,062
150,722
143,487

Tax recoverable
-
45,552
-
45,552

Deferred taxation
338,938
311,089
11,033
-

1,910,495
1,979,018
2,511,810
2,691,191



15.


Creditors: amounts falling due within one year

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Trade creditors
927,845
1,233,503
608,637
910,142

Amounts owed to group undertakings
-
-
244,755
224,003

Corporation tax
285,547
102,572
285,547
102,572

Other taxation and social security
752,152
546,199
736,356
561,877

Other creditors
843,458
1,169,949
777,560
1,083,590

Accruals and deferred income
3,730,124
3,554,890
2,087,056
1,981,609

6,539,126
6,607,113
4,739,911
4,863,793


Page 38

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

16.


Creditors: amounts falling due after more than one year

Group
Group
2023
2022
£
£

Other loans
38,375
-


Amounts included in Other loans are repayable in equal monthly installments up to August 2028.


17.


Loans


Analysis of the maturity of loans is given below:


Group
Group
2023
2022
£
£

Amounts falling due 1-2 years

Other loans
16,397
-

Amounts falling due 2-5 years

Other loans
21,979
-

38,376
-



18.


Deferred taxation


Group



2023
2022


£

£






At beginning of year
311,089
403,627


Charged to profit or loss
27,851
(92,538)



At end of year
338,940
311,089

Page 39

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
18.Deferred taxation (continued)

Company


2023
2022


£

£






At beginning of year
-
91,813


Charged to profit or loss
11,033
(91,813)



At end of year
11,033
-

The deferred tax asset is made up as follows:

Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Losses carried forward (Inc)
338,939
311,089
11,033
-


19.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



100 (2022:100) Ordinary shares of £1.00 each
100
100



20.


Non-controlling interest

The minority interest is calculated as 15% of the net assets attributable to minority shareholders of Yantai Oudong Jingyi Stone Co. Ltd.


21.


Reserves

Share premium account

The share premium account relates to the cash paid over and above the nominal value of the shares. 

Foreign exchange reserve

The foreign exchange reserves includes exchange differences arising on translation of investments in overseas subsidiaries.

Profit and loss account

The profit and loss account is the total cumulative value of profit or losses incurred since inception. 

Page 40

 
CHESNEYS GROUP LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

22.


Commitments under operating leases

At 31 December 2023 the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
Company
Company
2023
2022
2023
2022
£
£
£
£

Not later than 1 year
785,171
849,983
358,119
304,911

Later than 1 year and not later than 5 years
1,830,515
1,607,058
812,864
790,980

Later than 5 years
426,362
246,365
426,362
246,365

3,042,048
2,703,406
1,597,345
1,342,256


23.


Related party disclosures

At the balance sheet date P J Chesney and N P W Chesney owed the company £279,686 (2022:  £261,423) and £10,553 (2022: £10,197) respectively, due to expenses paid by the group on their behalf. During the year ended 31 December 2023, the total expenses paid by the company on their behalf were £18,264 (2022: £124,729) and £10,553 (2022: £356) for PJ Chesney and N Chesney, respectively.


24.


Post balance sheet events

The Chinese based subsidiary, Yantai Euro Stone Ltd, was closed off in 2024 and all balances written off.


25.


Ultimate Controlling party

The ultimate controlling party is Compass Group Limited.
Compass Group Limited is a company registered in Guernsey.

Page 41