REGISTERED NUMBER: |
Strategic Report, |
Report of the Directors and |
Audited Financial Statements |
for the Year Ended 29 June 2024 |
for |
AND Group Limited |
REGISTERED NUMBER: |
Strategic Report, |
Report of the Directors and |
Audited Financial Statements |
for the Year Ended 29 June 2024 |
for |
AND Group Limited |
AND Group Limited (Registered number: 02298288) |
Contents of the Financial Statements |
for the Year Ended 29 June 2024 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 7 |
Report of the Independent Auditors | 8 |
Profit and Loss Account and Other Comprehensive Income |
10 |
Balance Sheet | 11 |
Statement of Changes in Equity | 12 |
Notes to the Financial Statements | 13 |
AND Group Limited |
Company Information |
for the Year Ended 29 June 2024 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
17 Queens Lane |
Newcastle |
NE1 1RN |
AND Group Limited (Registered number: 02298288) |
Strategic Report |
for the Year Ended 29 June 2024 |
The directors present their strategic report for the year ended 29 June 2024. |
Directors' Duties |
The directors of the company, as those of all companies, must act in accordance with a set of general duties. These duties are detailed in section 172 of the UK Companies Act 2006 which is summarised as follows: 'A director of a company must act in the way they consider, in good faith, would be most likely to promote the success of the company for the benefit of its shareholders as a whole and, in doing so have regard (amongst other matters) to: |
- the likely consequences of any decisions in the long term; |
- the interests of the company's employees; |
- the need to foster the company's business relationships with suppliers, customers and others; |
- the impact of the company's operations on the community and environment; o the desirability of the company maintaining a reputation for high standards of business conduct; and |
- the need to act fairly as between shareholders of the company.' |
As part of their induction, a director is briefed on their duties and they can access professional advice on these, either from the Company secretary or, if they judge it necessary, from an independent adviser. |
Risk Management |
We provide business-critical services to our clients, often in highly regulated environments. As we grow, our business and our risk environment also become more complex. It is therefore vital that we effectively identify, evaluate, manage and mitigate the risks we face, and that we continue to evolve our approach to risk management. For details of our principal risks and uncertainties, and how we manage our risk environment, please see the principal risks and uncertainties section of this report. |
Our people |
The company is committed to being a responsible business. Our behaviour is aligned with the expectations of our people, clients, investors, communities and society as a whole. People are at the heart of our specialist services. For our business to succeed we need to manage our people's performance and develop and bring through talent while ensuring we operate as effectively as possible. We must also ensure we share common values that inform and guide our behaviour so we can achieve our goals in the right way. |
Business Relationships |
Our strategy priorities organic growth, driven by cross-selling and up-selling services to existing clients and bringing new clients into the Group. To do this, we need to develop and maintain strong client relationships. We value all of our suppliers and have multi-year contracts with our key suppliers. |
Community and Environment |
The company's approach is to use our position of strength to create positive change for the people and communities with which we interact. We want to leverage our expertise and enable colleagues to support communities around us. |
Shareholders |
The Board is committed to openly engaging with our shareholders, as we recognise the importance of a continuing effective dialogue. It is important to us that shareholders understand our strategy and objectives, so these must be explained clearly, feedback heard and any issues or questions raised properly and considered. |
AND Group Limited (Registered number: 02298288) |
Strategic Report |
for the Year Ended 29 June 2024 |
REVIEW OF BUSINESS |
AND Group Limited (AND) is part of Broadband Satellite Services Limited (BSSL) group of companies. It is one of four major operating entities, the others being Satcom Global Limited (UK), Satcom Global Inc (USA) and Satcom Global Aura Limited. |
As part of this group AND operates a global network that supports mission critical communications over satellite to a global customer base. AND does not own its own satellites but provides the services under a series of wholesale and lease capacity agreements with several global satellite network operators. |
Companies operating within the satellite services industry can be categorised as satellite operators, satellite service distributors and end users. Satellite network operators own and operate large or small fleets of satellites capable of providing global or regional network coverage. Significant cost is involved in the construction, launch and operation of each satellite. Satellite operators tend to prefer the sale of wholesale capacity on a lease basis, allowing focus on a small number of customers providing recurring revenue streams. The operation of terrestrial infrastructure which services the end user, installation, maintenance, and technical support would typically be provided to the end user by these wholesale lease customers. |
The mobile satellite service industry is segmented into land, marine and aeronautical services and within these vertical segments, provide voice, low speed data and broadband services. End users who include commercial shipping, airlines, government, defence forces, aid agencies, oil companies and NGOs may use different services across different segments |
AND offers a full range of services to the maritime industry, with secure access and global coverage. Increasingly services to the sector are being driven by the operational demands of vessel performance, or the access requirements of crew for welfare and recreational use. |
Land customers range from oil or mining customers in the harshest environments on earth, journalists with live broadcasting requirements and humanitarian agencies working in crisis zones. AND has long standing partnership agreements with government departments around the world providing secure and reliable voice and data services to meet security, safety, health, and education needs. |
AND customers range from dealers and large end users down to individual subscribers. They cover government, military, maritime, offshore, oil and gas exploration and humanitarian needs. These customers are supported by a network of global AND offices which supports the following channels: |
- | Government - direct and indirect supply to government agencies; |
- |
Enterprise - direct supply to large customers I corporate, service provider partners for smaller users and handset customers; |
- | Business to business - indirect channel partners including service providers, dealers, and agents; |
- | Commercial maritime - ship owners, ship managers, offshore operators. |
AND is deemed to be the supplier of choice in satellite communications for a diverse range of blue-chip customers around the globe. |
AND is a major distributor of L-band services for the three largest mobile satellite service network operators and as such provides a critical link in the satellite industry value chain. Distribution partners such as AND supply and support end user customers with specific services created by the L-band satellite network operators. AND also resells equipment to end user customers, paying a wholesale rate to the L-band satellite network for the airtime used by its customers. Its ground infrastructure provides connectivity which allows the end users to access their own corporate network or wider internet, providing controls on usage flow, content access and cost. |
The development of digital platforms, bandwidth-hungry business applications and welfare demands has however, driven growth beyond the capabilities of the traditional L-band services. Accordingly, AND operates a global Ku-band platform under the 'Aura' brand umbrella. Ku-band offers higher speeds and more affordable bandwidth options for customers in maritime and land environments. The demand for the Aura network is growing as customers find their needs cannot be satisfied by the limited speeds and bandwidth capabilities of the traditional L-band technologies. The Aura network provides customers with the higher bandwidth solutions required by modern vessels at sea. Aura provides users with access to a comprehensive global system of satellites, combining wide beam satellites for coverage and narrower higher throughput beams for better efficiency and increased bandwidth capacity. Our Ku-band network continues to grow strongly with significant maritime customers continuing to be added together with a significant order book to carry forward, with contracts signed and a forward going pipeline of vessel installations to be completed. |
The satellite industry is undergoing a significant step change with the emergence of LEO satellite constellations. To date the new entrants have been Starlink and OneWeb, but Amazon Kuiper is due to enter the market in 2025. One of the implications of these new entrants is that they will drive down the cost of satellite hardware and airtime costs, causing disruption to the current network operator incumbents and distribution companies. The group has mitigated this risk by launching the AuraNow LEO platform which integrates the LEO service into the vessel communication stack. This has proved successful in ensuring there has been no dilution of sales and margins. In addition, we have launched a vessel managed IT service which integrates the communication stack into the core LAN of the vessel and offers a fully managed service. |
AND Group Limited (Registered number: 02298288) |
Strategic Report |
for the Year Ended 29 June 2024 |
We expect the demand for satellite connectivity to continue to grow, especially in mobility-based applications in both our maritime and land businesses. In the business environment a rapidly growing range of applications are emerging to enable 'Internet of Things' solutions and are driving demand for lower bandwidth connectivity services. At the higher end demand is driven by an increasing number of data-rich applications and the requirement to continually increase the number of connected devices. We are continuing to see significant growth opportunities especially for mobility solutions where satellite connectivity is often more effective than traditional terrestrial network coverage. In the crew environment, demand continues on a steeply upward curve with crew members requiring internet and social media access as a base service level. The introduction of LEO services may increase the commoditisation of airtime revenues, which the group seeks to offset with the continual development of our value-added services platform. |
The wide base and strength of our product and service offering, together with our approach to supporting customers is demonstrated by the strong demand for our services. With our customers contracting for three-to-five-year periods and a growing customer base, it provides a durable base for future development plans. Our strategic initiatives have been focused on meeting the new demands of customers as they 'go digital.' The Directors believe that we are well positioned as a group to provide a future solid financial performance, with our continued investment and focus on value added services providing managed IT solutions providing new growth opportunities. |
In 2025 we will continue with our long-term strategy of growing our core maritime and land markets, with a focus on developing our managed services skillsets and introducing new services geared around the needs of key customers. We will continue to develop the AuraNow and IPSignature value added service solutions. Whilst the new LEO entrants will continue to cause disruption in the market in 2025, we believe AND is well positioned to take advantage of this change in technology. |
AND Group Limited (Registered number: 02298288) |
Strategic Report |
for the Year Ended 29 June 2024 |
PRINCIPAL RISKS AND UNCERTAINTIES |
AND takes a structured and proactive approach to risk management. BSSL's activities expose it to risks and uncertainties that may adversely affect business, operations, liquidity, financial position or future performance, not all of which are wholly within its control. The Board is responsible for ensuring that business risks are identified quickly and that appropriate risk mitigation steps are taken in a proactive and timely manner within the overall strategic objectives and activities of the company. The principal risks and uncertainties identified by the management are outlined below. This is not intended to be an exhaustive analysis. |
1. Competition |
AND operates in a highly competitive sector and faces competition today from alternative communications technologies in our target horizontal and vertical market sectors. In the normal operation of business, there is strong competition from other service providers and satellite network operators. There is a risk that new technologies introduced by competitors may reduce demand for services or replace the technologies provided. Service providers providing VSAT services will continue to target L-band users. It is believed that the L-band product offerings distributed will remain competitive in the specific markets targeted and that the development of the Aura Ku-band network places puts AND in a favourable position with other VSAT providers. AND is also building a number of new platforms aimed at enabling small-sat and 4G/5G/LTE services within our network offering. |
2. Key suppliers |
Whilst AND procures services from several satellite network operators, it is reliant on the continuance of supply agreements to sell the services to end-users. The loss of any one of the agreements may impact on competitiveness in the market as many customers have a preference of a specified network operator for the provision of our services. L-band networks are often subject to congestion in high-traffic areas and are sold on a 'best effort' basis with no service level agreement commitments. |
3. Satellite service continuity |
All the services provided are provisioned by third party-owned satellites which are subject to significant operational risks at launch or whilst in orbit. The loss of access to any of the satellites could adversely affect the revenues, profitability and liquidity of AND. Losses of connectivity, however, would not be limited to AND but would impact equally on all major competitors. |
4. Cyber security |
AND's networks may be vulnerable to security risks. They are designed to be robust and provide for secure transmission of confidential information. They may however in the future be vulnerable to unauthorised access, computer viruses and other security risks. AND has implemented industry-standard security measures and are continually increasing investment in counter cyber-threat tools and staff. Current evidence is that counter measures have been effective to date, as there has been no impact from previous cyber-attack events. The nature and diversity of cyber-threats is constantly changing, both in sophistication and number. There is a possibility that these measures may prove inadequate in the case of future attacks and could result in system failures and delays that could have a material adverse effect on business and financial results. |
5. Capacity oversupply |
Planned launches of Ku and Ka-band satellites may introduce an over-supply position to the markets, forcing prices to fall. The satellite operators are aware of this, and some launches continue to be delayed or cancelled as global bandwidth costs continue to decline. Technological innovation and the need for remote users to be part of the corporate network continues to drive data volumes. Crew demand on board ships drives both data volumes and the requirement for a 'bring your own device' capability onboard (BYOD). These additional volume demands will assist in offsetting the impact of any price decreases. |
6. Macro-economic risks |
Macro-economic risks changes can impact on AND's business. This risk is offset by the long-term nature of the customer contracts held by AND, which provide recurring monthly revenues. |
7. Regulation |
AND is subject to regulation with respect to the resale of satellite services. In the majority of cases, the satellite network operator is responsible for obtaining the licensing required to broadcast across a defined spectrum. AND is responsible for ensuring it holds all required licences for the resale of satellite services in the countries in which it operates. There is a risk that in order to hold such licenses, there could be exposure to additional costs or limitations to the ability to provide services. |
8. Management and employees |
AND needs to recruit and retain personnel capable of achieving the technological competence required. The business is dependent to a significant degree on being able to recruit and retain the number and calibre of management or employees necessary to maintain and develop the business. |
9. Financing and foreign exchange risk |
AND has a significant amount of debt. Whilst the directors are satisfied that the liquidity position is sufficient to meet AND's needs for future financial periods, the future cost of the debt represents a future risk. |
The company's functional and reporting currency is the US dollar. While most of our revenues are contracted in US Dollars, a proportion of our operating expenses and capital expenditure is denominated in currencies other than the US Dollar. AND does not currently hedge foreign exchange exposure in the short-term and there is a risk that in the longer-term that operations could be affected by US Dollar exchange rates. |
AND Group Limited (Registered number: 02298288) |
Strategic Report |
for the Year Ended 29 June 2024 |
AND's activities expose it to a variety of financial risks, including effects of credit and liquidity and cash flow. Risk management policies have been adopted which seek to mitigate these risks in a cost-effective manner. Financial assets that expose the company to financial risk consist primarily of trade debtors and cash. Financial liabilities that expose the company to financial risk consist principally of trade creditors and loan agreements. AND can deploy hedging policies in the case of any short-term market volatility which may impact on the overall business performance. As the company contracts most of its revenues in US dollars and its key suppliers are paid in US dollars it enjoys a natural hedge in respect of any significant level of exposure. |
10. Credit risk |
Credit risk is the loss of the value of financial assets due to counter-parties failing to meet all or part of their obligations. AND therefore performs ongoing credit evaluation of each of its major customers' financial position. |
11. Liquidity Risk |
Liquidity risk is the risk that AND does not have sufficient liquid assets to meet its obligations as they fall due. Liquidity is maintained at a prudent level and the company ensures that there is an adequate liquidity buffer to cover contingencies. The company maintains sufficient cash and open committed credit lines from its bankers to meet its current requirements. The directors assess the liquidity risk on a regular basis and ensures that sufficient cash is available to meet the company's needs. |
12. Geo-political risks |
The business operates in a wide range of geographic areas. This exposes AND to geo-political and |
strategic risks such as disruption due to war, civil unrest, security issues and government intervention. These risks currently exist in Ukraine and Israel as well as elsewhere in the Middle East, Russia and certain parts of Latin America, Africa and Asia. None of this however constitutes a large part of our ongoing business. Not all the events are negative to the mobile satellite services business as the events themselves can cause increased demand for satellite services. |
AND operates in markets where the services we supply are mission critical, rather than optional for our customers. We are always conscious to provide the required support to our customers, most of whom are contracted on 3-5 year-terms, thus providing some security of income. We have also secured the supply of equipment that is essential to our services - from multiple vendors. The COVID pandemic created demand amongst government agencies and within remote communities, with limited impact on our core maritime business. Demand for new installations of our Aura services remain strong. |
KEY PERFORMANCE INDICATORS |
The management team considers several key financial and operational performance indicators to assess the performance of the business against our key strategic priorities. These include: |
- |
Sales: As a broad measure, our sales achievement measures the success of our business model and our ability to develop our customer base. |
- | Sales and installation pipeline: Opportunities and vessels contracted with equipment yet to be installed. |
- | Network connections: The number of current subscribers to each of the connectivity services we offer. |
- |
Average Revenue Per Unit (ARPU): Below the macro level it also provides information on all our product portfolios and the ARPU attached to each service offering on our network. |
- |
Capital Expenditure: Measures our investment in growth and development of our network and infrastructure along with equipment supplied to operational vessels as part of service bundles. |
- | EBITDA: Measures the total group profitability before finance costs, taxation, depreciation, and amortisation. |
- | Network Availability: Measures our network uptime against our customer service level agreement of 99.9%. |
- |
Employee Turnover: Measures the number of voluntary leavers during the year as a percentage of the average number of employees in the year. |
ON BEHALF OF THE BOARD: |
AND Group Limited (Registered number: 02298288) |
Report of the Directors |
for the Year Ended 29 June 2024 |
The directors present their report with the financial statements of the company for the year ended 29 June 2024. |
PRINCIPAL ACTIVITY |
The company continues to specialise in the provision of telecommunications services and the supply, installation and maintenance of electronic and electric equipment in marine and offshore markets. |
DIVIDENDS |
No dividends will be distributed for the year ended 29 June 2024. |
The directors do not recommend payment of a final dividend. |
EVENTS SINCE THE END OF THE YEAR |
Information relating to events since the end of the year is given in the notes to the financial statements. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 30 June 2023 to the date of this report. |
DISCLOSURE IN THE STRATEGIC REPORT |
The company has chosen in accordance with S.414C(11) Companies Act 2006 to set out in the company's strategic report information required by Schedule 7 of the Large and Medium-sized Companies and Groups ( Accounts and Reports) Regulations 2008 to be contained in the directors' report. It has done so in respect of financial instruments and future developments. |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Strategic Report, the Report of the Directors 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. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
AUDITORS |
The auditors, CLA Evelyn Partners Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006. |
ON BEHALF OF THE BOARD: |
Report of the Independent Auditors to the Members of |
AND Group Limited |
Opinion |
We have audited the financial statements of AND Group Limited (the 'company') for the year ended 29 June 2024 which comprise the Profit and Loss Account and Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 29 June 2024 and of its profit for the year then ended; |
- | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
- | have been prepared in accordance with the requirements of the Companies Act 2006. |
Basis for opinion |
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' 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. |
Material uncertainty relating to going concern |
We draw attention to Note 3 in the financial statements, which notes that the Group is dependent on achieving sales growth and increased profitability to meet the financial conditions of its financing arrangements. Further, the Group's projections do not include any potential cash outflows arising from the potential crystallisation of certain contingent liabilities. While there are actions available to management which may be able to mitigate these risks, these events or conditions, indicate that a material uncertainty exists that may cast significant doubt on the company's ability to continue as a going concern. Our opinion is not modified in respect of this matter. |
Notwithstanding the above, 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. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. |
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether 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 the audit: |
- | the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors 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 company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors. |
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of directors' remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Report of the Independent Auditors to the Members of |
AND Group Limited |
Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page seven, 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 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. |
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 a Report of the Auditors 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. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
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 obtained an understanding of the legal and regulatory framework applicable to both the company itself and the industry in which it operates. We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our sector experience and through discussion with the directors and other management. The most significant were identified as the Companies Act 2006, UK GAAP (FRS 102) and relevant tax legislation. |
We considered the extent of compliance with those laws and regulations as part of our procedures on the related financial statements. Our audit procedures included: |
- | making enquires of directors and management as to where they consider there to be a susceptibility to fraud and whether they have any knowledge or suspicion of fraud; |
- | obtaining an understanding of the internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations; |
- | assessing the risk of management override including identifying and testing journal entries; |
- | challenging the assumptions and judgements made by management in its significant accounting estimates. |
Our audit did not identify any key audit matters relating to the detection of irregularities including fraud. However, despite the audit being planned and conducted in accordance with ISAs (UK) there remains an unavoidable risk that material misstatements in the financial statements may not be detected owing to inherent limitations of the audit, and that by their very nature, any such instances of fraud or irregularity likely involve collusion, forgery, intentional misrepresentations, or the override of internal controls. |
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 Report of the Auditors. |
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 a Report of the Auditors 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. |
for and on behalf of |
17 Queens Lane |
Newcastle |
NE1 1RN |
AND Group Limited (Registered number: 02298288) |
Profit and Loss Account and |
Other Comprehensive Income |
for the Year Ended 29 June 2024 |
2024 | 2023 |
as restated |
Notes | $ | $ |
TURNOVER | 5 |
Cost of sales | ( |
) | ( |
) |
GROSS LOSS | ( |
) | ( |
) |
Administrative expenses | ( |
) | ( |
) |
(4,914,615 | ) | (2,878,511 | ) |
Other operating income | 6 |
OPERATING PROFIT | 8 |
Interest payable and similar expenses | 10 | ( |
) | ( |
) |
PROFIT BEFORE TAXATION |
Tax on profit | 11 | ( |
) |
PROFIT FOR THE FINANCIAL YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
AND Group Limited (Registered number: 02298288) |
Balance Sheet |
29 June 2024 |
2024 | 2023 |
as restated |
Notes | $ | $ |
FIXED ASSETS |
Intangible assets | 13 |
Tangible assets | 14 |
CURRENT ASSETS |
Stocks | 15 |
Debtors | 16 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 17 | ( |
) | ( |
) |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CAPITAL AND RESERVES |
Called up share capital | 18 |
Share premium | 19 |
Profit and loss account | 19 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
AND Group Limited (Registered number: 02298288) |
Statement of Changes in Equity |
for the Year Ended 29 June 2024 |
Called up | Profit |
share | and loss | Share | Total |
capital | account | premium | equity |
$ | $ | $ | $ |
Balance at 30 June 2022 |
Changes in equity |
Total comprehensive income | - | - |
Balance at 29 June 2023 |
Changes in equity |
Total comprehensive income | - | - |
Balance at 29 June 2024 |
AND Group Limited (Registered number: 02298288) |
Notes to the Financial Statements |
for the Year Ended 29 June 2024 |
1. | STATUTORY INFORMATION |
AND Group Limited is a |
The presentation currency of the financial statements is the US Dollar ($). |
Monetary amounts in these financial statements are rounded to the nearest $. |
2. | STATEMENT OF COMPLIANCE |
3. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Going concern |
These financial statements are prepared on the going concern basis. The directors have a reasonable expectation that the group will continue in operational existence for 12 months from the date of approval of the financial statements. However, the directors are aware of certain material uncertainties which may cast significant doubt on the group's ability to continue as a going concern. |
The Directors have assessed the going concern of the company as part of a Group wide assessment. The Group has cash at bank of $1,583,308 as at 29 June 2024 and funds its operations and working capital primarily through a loan facility provided by Santander. As at the year end, the loan facility was $20,731,000, and was classified as a current liability as the facility was due to expire on 27 December 2024. However, after the year end on 27 January 2025 the facility was refinanced for an additional two years for $19,731,000. |
The Group's projections for the period to June 2026 (the review period) show that the Group is dependent upon achieving sales growth and increasing profitability in order to satisfy the financial conditions of the loan facility agreement dated 27 January 2025. |
Further, the projections do not include any repayments of corporation tax which may be required as a result of the HMRC review within another Group entity. |
As a result of these matters there is a material uncertainty that may cast significant doubt upon the group's ability to continue as a going concern. |
Management have implemented a sales development plan, and there are already forward orders for the new Starlink product which will help achieve some of this growth. Furthermore, in this scenario management consider that there are certain cost saving measures that are within their control, which could be implemented to manage cash flow. |
Although it is not certain that these efforts will be successful, management has determined that the actions that it has taken are sufficient to mitigate the uncertainty and has therefore prepared the financial statements on a going concern basis. |
Financial Reporting Standard 102 - reduced disclosure exemptions |
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: |
- Section 4 'Statement of Financial Position' - Reconciliation of the opening and closing number of shares; |
- Section 7 'Statement of Cash Flows' - Presentation of a statement of cash flow and related notes and disclosures; |
- Section 11 'Basic Financial Instruments' and Section 12 'Other Financial Instrument Issues' - Carrying amounts, interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income; |
- Section 26 'Share based Payment' - Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements; |
- Section 33 'Related Party Disclosures' - Compensation for key management personnel. |
The financial statements of the company are consolidated in the financial statements of Broadband Satellite Services Limited. These consolidated financial statements are available from its registered office, Tanners Bank, North Shields, Tyne & Wear, NE30 1JH. |
AND Group Limited (Registered number: 02298288) |
Notes to the Financial Statements - continued |
for the Year Ended 29 June 2024 |
3. | ACCOUNTING POLICIES - continued |
Related party exemption |
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |
Turnover |
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates. |
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income. |
Intangible assets |
Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives. Licences are fully amortised. |
Tangible fixed assets |
Plant and machinery | - |
Fixtures and fittings | - |
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses. |
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. |
Impairment of assets |
At each reporting date fixed assets are reviewed to determine whether there is any indication that those assets have suffered an impairment loss. If there is an indication of possible impairment, the recoverable amount of any affected asset is estimated and compared with its carrying amount. If estimated recoverable amount is lower, the carrying amount is reduced to its estimated recoverable amount, and an impairment loss is recognised immediately in profit or loss. |
If an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but not in excess of the amount that would have been determined had no impairment loss been recognised for the asset in prior years. A reversal of an impairment loss is recognised immediately in profit or loss. |
Stocks |
Stocks and work in progress are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items. |
Cost is calculated using the first-in, first-out method and includes all purchase, transport, and handling costs in bringing stocks to their present location and condition. |
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition. |
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss. |
AND Group Limited (Registered number: 02298288) |
Notes to the Financial Statements - continued |
for the Year Ended 29 June 2024 |
3. | ACCOUNTING POLICIES - continued |
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. |
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. |
Basic financial liabilities: |
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised. |
Other financial liabilities: |
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge. |
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy. |
Derecognition of financial liabilities: |
Financial liabilities are derecognised when the company's contractual obligations expire or are discharged or cancelled. |
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. |
AND Group Limited (Registered number: 02298288) |
Notes to the Financial Statements - continued |
for the Year Ended 29 June 2024 |
3. | ACCOUNTING POLICIES - continued |
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. |
Taxation |
Taxation expense represents the aggregate amount of current tax and deferred tax recognised in the reporting period. |
Current taxation is the amount of taxation in respect of the taxable profit for the year or prior years. |
A deferred taxation asset or liability is recognised for tax recoverable or payable in future periods in respect of transactions and events recognised in the financial statements of the current and previous period. |
Deferred taxation arises from timing differences that are differences between taxable profits and total comprehensive income as stated in the financial statements. Timing differences result from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in the financial statements. |
Deferred taxation recognised on all timing differences at the reporting date apart from certain exceptions. Unrelieved tax losses and other deferred tax assets are recognised only to the extent that the directors consider that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Deferred taxation is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing differences. Deferred tax relating to land and buildings measured at fair value is measured using the tax rates and allowances that apply to the sale of the asset. |
Foreign currencies |
Transactions in currencies other than US Dollars 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 are included in the profit and loss account for the period. |
Leasing |
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. |
Employee benefits |
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets. |
The cost of any unused holiday entitlement is recognised in the period in which the employee's services are received. |
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits. |
Retirement benefits |
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due. |
4. | JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY |
In the application of the company's accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. |
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods. |
AND Group Limited (Registered number: 02298288) |
Notes to the Financial Statements - continued |
for the Year Ended 29 June 2024 |
5. | TURNOVER |
The turnover and profit before taxation are attributable to the one principal activity of the company. |
An analysis of turnover by class of business is given below: |
2024 | 2023 |
as restated |
$ | $ |
An analysis of turnover by geographical market is given below: |
2024 | 2023 |
as restated |
$ | $ |
United States of America |
Asia |
Europe and Middle East | 2,462,864 | 2,420,508 |
Oceania | 6,807 | 5,171 |
6. | OTHER OPERATING INCOME |
2024 | 2023 |
as restated |
$ | $ |
Management fees |
7. | EMPLOYEES AND DIRECTORS |
2024 | 2023 |
as restated |
$ | $ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
2024 | 2023 |
as restated |
Management | 4 | 6 |
Finance and billing | 14 | 18 |
Customer support | 25 | 19 |
Development and infrastructure | 4 | 5 |
Sales and engineering | 16 | 16 |
2024 | 2023 |
as restated |
$ | $ |
Directors' remuneration |
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. |
AND Group Limited (Registered number: 02298288) |
Notes to the Financial Statements - continued |
for the Year Ended 29 June 2024 |
8. | OPERATING PROFIT |
The operating profit is stated after charging: |
2024 | 2023 |
as restated |
$ | $ |
Other operating leases |
Depreciation - owned assets |
Foreign exchange differences |
9. | AUDITORS' REMUNERATION |
2024 | 2023 |
as restated |
$ | $ |
Fees payable to the company's auditors for the audit of the company's financial statements |
42,756 |
61,454 |
10. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2024 | 2023 |
as restated |
$ | $ |
Other loan interest |
Hire purchase |
11. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
2024 | 2023 |
as restated |
$ | $ |
Current tax: |
UK corporation tax |
Adjustments in respect of |
earlier periods | - | 357,014 |
Tax on profit |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
2024 | 2023 |
as restated |
$ | $ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of (2023 - |
Effects of: |
Expenses not deductible for tax purposes |
Adjustments to tax charge in respect of previous periods |
tax losses not previously |
respect of prior periods |
Deferred tax not provided | ( |
) | ( |
) |
Other adjustments | ( |
) |
Total tax charge | - | 616,154 |
AND Group Limited (Registered number: 02298288) |
Notes to the Financial Statements - continued |
for the Year Ended 29 June 2024 |
12. | PRIOR YEAR ADJUSTMENT |
Prior period adjustments have been made in respect of the following: |
Sales credit notes |
The turnover for the year ended 30 June 2023 included sales amounting to $21,852 that were subsequently cancelled by credit notes raised after the year end. These post 30 June 2023 credit notes relating to pre 30 June 2023 sales could reasonably have been expected to have been taken into account the preparation of the financial statements for the year ended 30 June 2023. A prior period adjustment has therefore been made to reduce sales and increase the credit note provision within creditors for the year ended 30 June 2023 by an amount of $21,852. |
The impact on the statutory figures has been illustrated below: |
Previously reported | Adjustment | Adjusted |
$ | $ | $ |
TURNOVER | 4,146,079 | (21,852 | ) | 4,124,227 |
GROSS LOSS | (1,130,302 | ) | (21,852 | ) | (1,152,154 | ) |
Administrative expenses |
OPERATING PROFIT | 1,249,096 | (21,852 | ) | 1,227,244 |
PROFIT BEFORE TAXATION | 1,241,789 | (21,852 | ) | 1,219,937 |
PROFIT FOR THE FINANCIAL YEAR | 625,635 | (21,852 | ) | 603,783 |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR | 625,635 | (21,852 | ) | 603,783 |
CREDITORS: Amounts falling due within one year | (11,383,670 | ) | (21,852 | ) | (11,405,522 | ) |
NET CURRENT ASSETS | 6,700,233 | (21,852 | ) | 6,678,381 |
TOTAL ASSETS LESS CURRENT LIABILITIES | 6,701,683 | (21,852 | ) | 6,679,831 |
Profit and loss account | 6,399,876 | (21,852 | ) | 6,378,024 |
SHAREHOLDERS' FUNDS | 6,701,683 | (21,852 | ) | 6,679,831 |
13. | INTANGIBLE FIXED ASSETS |
Patents |
and |
licences |
$ |
COST |
At 30 June 2023 |
and 29 June 2024 |
AMORTISATION |
At 30 June 2023 |
and 29 June 2024 |
NET BOOK VALUE |
At 29 June 2024 |
At 29 June 2023 |
14. | TANGIBLE FIXED ASSETS |
Fixtures |
Plant and | and |
machinery | fittings | Totals |
$ | $ | $ |
COST |
At 30 June 2023 |
and 29 June 2024 |
DEPRECIATION |
At 30 June 2023 |
Charge for year |
At 29 June 2024 |
NET BOOK VALUE |
At 29 June 2024 |
At 29 June 2023 |
AND Group Limited (Registered number: 02298288) |
Notes to the Financial Statements - continued |
for the Year Ended 29 June 2024 |
15. | STOCKS |
2024 | 2023 |
as restated |
$ | $ |
Work-in-progress |
Finished goods and goods for |
resale |
16. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2024 | 2023 |
as restated |
$ | $ |
Trade debtors |
Amounts owed by group undertakings |
Other debtors |
Corporation tax recoverable |
Prepayments and accrued income |
17. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2024 | 2023 |
as restated |
$ | $ |
Trade creditors |
Amounts owed to group undertakings |
Tax |
Social security and other taxes |
Other creditors |
Accruals and deferred income |
18. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2024 | 2023 |
value: | as restated |
$ | $ |
Ordinary | £1 | 246,007 | 246,007 |
The Ordinary shares carry equal rights to voting, dividend distribution and on winding up. |
19. | RESERVES |
Profit and loss account: |
Includes all current and prior period retained profit and losses. |
Share premium: |
Includes any premiums received on issue of share capital. Any transaction costs associated with the issuing of shares are deducted from share premium. |
20. | FINANCIAL COMMITMENTS, GUARANTEES AND CONTINGENT LIABILITIES |
There is a cross-guarantee in place in respect of bank facilities for AND Holdings Limited up to an unlimited amount. |
AND Group Limited is an obligor under the terms of the Santander loan facility agreement in Satcom Global Limited. |
21. | POST BALANCE SHEET EVENTS |
Subsequent to the year end, on 27 January 2025, the Group refinanced its borrowing facilities with Santander. The existing facility was refinanced for an additional two years for $19,731,000. |
AND Group Limited (Registered number: 02298288) |
Notes to the Financial Statements - continued |
for the Year Ended 29 June 2024 |
22. | ULTIMATE CONTROLLING PARTY |
Broadband Satellite Services Limited is regarded by the directors as being the company's ultimate parent company. |
A copy of the consolidated financial statements can be obtained via the Companies House website. |
The ultimate controlling party is Mr B Howes and Mr I Robinson through their shareholding in Broadband Satellite Services Limited. |