Registered number:
FOR THE YEAR ENDED 30 JUNE 2024
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
COMPANY INFORMATION
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
CONTENTS
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2024
FY24 was difficult year, worldwide, with a significant number of country elections, high interest rates, and several areas of conflict. This led to a business environment that was cautious and unwilling to invest. This had some effect on the company results with a subdued Test & Measurement market giving little on the upside previously forecasted. In addition, market areas such as oil & gas exploration, although fairly small anyway, all but disappeared, although this was also affected by the move to sustainable fuels. The company also experienced a cancellation of a military project, although an agreed cancellation fee resulted in no loss to the business.
Despite the above, sales for FY24 increased to an all time high of £7.3m. Gross margin remained around 50%, as it has for some years, with both materials and direct labour costs being well controlled, even with higher inflation. The company is a customer led business, with a concentration on a top 5 or 6 customers. Supporting these businesses gives a constant supply of design and development work, and this has allowed the business to develop a number of market leading techniques, which has not only allowed the business to pick up further, related, work, but which has also given a positive effect on the balance sheet. The largest of these programs is in the aerospace sector, and is looking very promising for volume production in the medium term. FY25 started with a similar subdued market, although Q1 has a history of being the weakest quarter of the year. However, the number, and quality, of enquiries and new projects has picked up significantly over the first half of FY25, and this is expected to improve sales in the second half of FY25, and into FY26. The company exports around 90% of its sales, with nearly all exports to the United States. These sales are all in USD. The business has some natural protection to exchange rates, as nearly all materials are sourced in the Far East, or North America, and purchased in USD. The company also undertakes some forwarding to reduce effects of any sudden rate changes. The gradual weakening of the USD against the GBP has had some negative effect, but the more recent strengthening, with the election of Donald Trump, has been welcome. The company will be looking closely at any Trade Tariffs which may be issued by the new American administration, and will be making adjustments as necessary. The company has already looked at a number of scenarios where a positive outcome could be achieved.
This report was approved by the board and signed on its behalf.
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2024
The directors present their report and the financial statements for the year ended 30 June 2024.
The directors who served during the year were:
The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Company'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 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 to 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.
The profit for the year, after taxation, amounted to £855,351 (2023 - £825,433).
During the year there were two dividends declared and paid, totalling £440,000, to Adfen Investments Limited, the Company's parent company (2023 - £375,000).
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
The auditor, James Cowper Kreston Audit, will 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.
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ADVANCED FIBREOPTIC ENGINEERING LIMITED
We have audited the financial statements of Advanced Fibreoptic Engineering Limited (the 'Company') for the year ended 30 June 2024, which comprise the Statement of Comprehensive Income, the Balance Sheet, the Statement of Cash Flows, the Statement of Changes in Equity and the related notes, 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).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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.
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the Annual Report other than the financial statements and our Auditor's Report thereon. The directors are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ADVANCED FIBREOPTIC ENGINEERING LIMITED (CONTINUED)
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ADVANCED FIBREOPTIC ENGINEERING LIMITED (CONTINUED)
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditor's Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
The specific procedures for this engagement that we designed and performed to detect material misstatements in respect of irregularities, including fraud, were as follows:
∙Enquiry of management and those charged with governance around actual and potential litigation and claims;
∙Enquiry of management and those charged with governance to identify any material instances of non-compliance with laws and regulations;
∙Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
∙Performing audit work to address the risk of irregularities due to management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for evidence of bias.
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 Auditor's Report.
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ADVANCED FIBREOPTIC ENGINEERING LIMITED (CONTINUED)
This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditor's Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants and Statutory Auditor
201 Cumnor Hill
Cumnor
Oxfordshire
OX2 9PJ
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2024
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
REGISTERED NUMBER: 05469396
BALANCE SHEET
AS AT 30 JUNE 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2024
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2024
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 30 JUNE 2024
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
Advanced Fibreoptic Engineering Limited is a company limited by shares and incorporated in England and Wales. The registered office is Unit 2 & 3 Glebe Court, West Oxfordshire Business Park, Carterton, OX18 3FX. The principal activity of the Company in the year under review was that of the design, development and manufacture of specialist fibreoptic components and assemblies.
2.Accounting policies
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.
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.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
At the balance sheet date the Company had net assets of £4,184,371 (2023: £3,769,020) which includes net current assets of £2,030,672 (2023: £2,220,696) having made a profit before tax in the year of £1,059,924 (2023: £1,007,802). The directors believe it is appropriate to prepare the financial statements on a going concern basis.
Functional and presentation currency
Transactions and balances
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
Grants of a revenue nature are recognised in the Statement of Comprehensive Income in the same period as the related expenditure.
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
Development costs are capitalised within intangible assets when they can be identified with a specific product or project anticipated to produce future benefits, and are amortised on a straight-line basis over the anticipated life of the benefits arising from the completed product or project which varies from 3-10 years.
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 stocks. Cost is based on costs of materials.
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using a combination of the reducing balance and the straight-line method..
Depreciation is provided on the following basis:
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.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
2.Accounting policies (continued)
The Company enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities such as trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in non-puttable ordinary shares.
The Company also enters into forward foreign exchange contracts which are not basic financial instruments. These are initially recognised at fair value on the date a forward contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value are recognised in profit or loss in finance costs or income as appropriate. The Company does not currently apply hedge accounting for foreign exchange derivatives. Intangible fixed assets Development expenditure is capitalised as an intangible fixed asset if the Company can demonstrate that the Compnay intends to complete the asset to use or sell and it is technically feasible to do so, the Company is able to use the asset, the asset will generate future probably economic benefits, the Company has adequate technical, financial or other resources to complete the development and to use or sell the asset and the Company can reliably measure the expenditure attributable to the intangible asset during its development. The Company uses judgement to make these assessments and actual results may vary. Intangible fixed assets are amortised over the period the Company expects to use the assets. the actual lives of the assets are assessed annually and may vary depnding on a number of factors. Residual value assessments consider issues such as the remaining life of the asset and any impairments.
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
Analysis of turnover by country of destination:
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
11.Taxation (continued)
There are no factors affecting future tax charges.
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
As at 30 June 2024, the Company was committed to the sale of foreign currency amounting to £369,800 (2023: £392,833).
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ADVANCED FIBREOPTIC ENGINEERING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
The Company operates a defined contribution scheme at a cost during the year to the Company of £215,324 (2023: £128,413) with an amount outstanding at the year end of £18,710 (2022: £228).
The ultimate parent undertaking is
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