The directors present the strategic report for the year ended 31 December 2024.
With over 45 years of distribution experience, Rapid has built a strong reputation within the industrial and education sectors for it's customer centric value proposition, focusing on range choice, customer convenience and overall commercial value provision. Rapid has had significant market headwinds to navigate throughout 2024 and we have continued to deliver an operating performance that has provided consistent customer value in all areas, whilst continuing progress in developing future business capabilities, that will enable the business to build on the excellent platform we have established. Our employees and suppliers continue to provide the foundation for our growth whilst we operate in demanding economic and regulatory climates, to keep serving our customers.
Rapid focuses on being an innovative and agile business that provides bespoke quantities and solutions to customers in our targeted industry sectors. We will continue to operate with a model that provides both a digital platform interface and a complimentary human interface to ensure all our customer needs are fulfilled.
Going forward we will target increased customer penetration and breadth through effective business model deployment that will always have the customer at the heart of our business focus.
Our range and choice will expand through carefully targeted additions and investment and we will support this through our objective of being the employer of choice for our employees.
The income statement and statement of comprehensive income discloses the full results.
The results reflect the continuation of challenging market conditions with revenue and profitability impacted, but our flexible operating model, strong cash conversion and a robust statement of financial position are reflective of a healthy business taking steps to maintain performance whilst market conditions have been suboptimal. Our resilience and market knowledge expertise were pivotal in guiding our suppliers and customers through these market conditions. Market confidence continues to be challenging as we focus on our customers, ensuring our value proposition meets or exceeds expectation.
The team at Rapid in 2024 continued to follow the core tenets of delighting our customers and supply partners, working hard to be a great place to work for our employees and delivering operational excellence through our services and digital platforms.
In 2024 turnover decreased by 20.6% compared to the prior year, a reduction of £5m. A proportion of turnover contraction can be attributed to decisions made to migrate away from low margin products both within the EV and Consumer markets. Overall, the business gross margin improved by 3.2% to 31.2% and operational costs reduced by 9.6% highlighting the benefits from strategic decisions taken.
Rapid’s future success is through our employees. The management team maintains a focus on employee engagement through our Great Place to Work and Growth, Performance, Success initiatives as evidenced by an excellent engagement score in the annual employee survey.
There were significant operational investments throughout 2024 increasing leadership level resources to drive towards the group’s strategic goals. These included additional headcount within the leadership and management team, sales and digital marketing resources. System infrastructure was a key part of the transformation with a robust review and simplification of core business processes.
Moving into 2025 Rapid will leverage group product and service solutions for the UK market and this will enhance Rapid as an attractive proposition for our suppliers who hold the Rapid brand and go to market model as a key component of their own brand development and commercial success. Rapid have a growing number of supplier engagements that enable us to provide an expanding choice to our targeted customers in the Industrial and Educational sectors. Our continued pursuit of a significant proportion of the UK customer base will result in profitable growth and expanded brand recognition for our suppliers and provide the platform for additional supplier and brand additions in 2025 and beyond.
Rapid continues to have a strong statement of financial position coupled with good short-term liquidity.
Risk |
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General Economic instability |
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General Economic instability or a downturn in a particular market or region can affect customers and their demand for products. |
| Fall in sales due to reduced consumer confidence. Increase in bad debt as customers are unable to trade and meet previous obligations. Inability to meet stock requirements due to supply chain restrictions. |
| Macro economic environment is discussed as part of our Steering Group meetings making it a continuous management focus. Reduction in sales can be mitigated due to balanced customer portfolio across multiple sectors. Mix of cash and credit sales coupled with strong cash position and Group backing for short term loans. |
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Reliance on Key Suppliers |
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We work with key strategic partners to support our business and help deliver our products. A failure in key counterparty relationships or services could affect the delivery of certain business activities and trading. |
| Impacting customer satisfaction. Fall in supplies due to supplier difficulties. |
| Key suppliers are subject to additional due diligence and partner engagement and our diverse product range reduces the reliance on a few suppliers. |
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Business Disruption |
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Rapid could be exposed to disruption caused by fire or failure of essential IT equipment. |
| Temporary cessation of operations could adversely impact the results. |
| Robust disaster recovery procedures are in place. Insurance level covers business interruption and stock damage whilst alternative premises were sought. |
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Fraud |
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The risk that an employee or group of employees could obtain funds or products through deception either directly or with external assistance. |
| Significant financial fraud could deplete the company's assets and affect the financial results. |
| Rapid has robust control procedures in place that are designed to minimise the risk. Segregation of duties are a key component within these controls. |
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Foreign Exchange |
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The risk that the fair value of financial instruments or future cash flows will fluctuate because of changes in foreign exchange rates. Our trading in Europe and Asia, and thus exposure to USO and Euro are the key risk areas. |
| Significant fluctuation in USD or Euro exchange rates could adversely impact the results. |
| An element of natural hedging for Euro transactions is undertaken. Significant purchases are hedged in advanced. Transaction values tend to be relatively low and therefore significant exchange rate exposure is normally less than 30 days.
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Credit risk |
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The inability of trade receivables to pay exposes Rapid to credit risk. |
| Insufficient funds could result in the company not being able to fund its operations. |
| Third party agents are used to assess credit risk and credit limits are set in accordance to these risk assessments and customer historic payment profile. Orders are held if payment terms are exceeded. |
Liquidity risk |
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The risk that Rapid will not have sufficient funds to meet its obligations as they fall due. |
| Insufficient funds could result in the company not being able to fund its operations. |
| Rapid has a strong working capital ratio in conjunction with good Group and Bank relationships that could be used to support any short-term liquidity issues. |
Inadequate response to major incidents |
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Major incidents such as those caused by extreme weather, military action, terrorism or disease outbreaks have the potential to impact our operations. |
| Cause business interruption. Inadequate response could cause reputational damage. |
| Our customer and supplier base are mixed, and we are not exposed in any one industry sector or location. The Steering Group continually monitors the macro-economic conditions and a specific crisis council will be convened to respond to any specific incidents. |
The key performance indicators are discussed in the review of the business section of this report.
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 December 2024.
The results for the year are set out on page 9.
No ordinary dividends were paid. The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
At the time of approving the financial statements, the Directors have a reasonable expectation that the company and group have adequate resources to continue in operational existence for the foreseeable future, a period of at least 12 months from the approval of the financial statements. As part of the assessment, the Directors have prepared detailed profit and loss and cash flow forecasts for the group which take into account their best estimate of the macro-economic environment, and these demonstrate that the company has sufficient cash for the foreseeable future. It is expected that the company and group will continue to operate as a going concern and as such the Directors continue to adopt the going concern basis of accounting in preparing the financial statements.
Information is not shown within the Director's Report as it is instead included within the Strategic Report under S414c(11).
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
We have audited the financial statements of Rapid Electronics Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2024 which comprise the group income statement, the group statement of comprehensive income, the group statement of financial position, the company statement of financial position, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
Basis for opinion
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
The information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
The strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team:
obtained an understanding of the nature of the industry and sector, including the legal and regulatory framework that the company operates in and how the company are complying with the legal and regulatory framework;
inquired of management, and those charged with governance, about their own identification and assessment of the risks of irregularities, including any known actual, suspected or alleged instances of fraud;
discussed matters about non-compliance with laws and regulations and how fraud might occur including assessment of how and where the financial statements may be susceptible to fraud.
Audited the risk of management override of controls, including through testing journal entries, accounting estimates and other adjustments for appropriateness.
However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £0 (2023 - £0 profit).
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
Rapid Electronics Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Severalls Hall, Severalls Lane, Colchester, CO4 5JS.
The group consists of Rapid Electronics Holdings Limited and all of its subsidiaries.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006. The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 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 consolidated group financial statements consist of the financial statements of the parent company Rapid Electronics Holdings Limited together with all material entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.
All financial statements are made up to 31 December 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases, unless such subsidiaries are considered immaterial to the group results.
At the time of approving the financial statements, the Directors have a reasonable expectation that the company and group have adequate resources to continue in operational existence for the foreseeable future, a period of at least 12 months from the approval of the financial statements. As part of the assessment, the Directors have prepared detailed profit and loss and cash flow forecasts for the group which take into account their best estimate of the macro-economic environment, and these demonstrate that the company has sufficient cash for the foreseeable future. It is expected that the company and group will continue to operate as a going concern and as such the Directors continue to adopt the going concern basis of accounting in preparing the financial statements.
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.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the income statement.
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's statement of financial position when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, 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.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Freehold property is revalued to the fair value at each reporting date. There is a degree of subjectivity involved in estimating the fair value of the property. In order to mitigate the impact of this subjectivity the investment property has been valued by Fenn Wright Chartered Surveyors, who are not connected to the company.
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.
The Group has recognised provisions for impairment of stocks, impairment of trade debtors, employee bonuses and corporation tax in its financial statements which requires management to make judgements. The judgements, estimates and associated assumptions necessary to calculate these provisions are based on historical experience and other reasonable factors.
The charge in respect of periodic depreciation is derived after determining an estimate of an asset's expected useful life and the expected residual value at the end of its life. The useful lives of the Group's assets are determined by management at the time the asset is acquired and reviewed at least annually for appropriateness. The lives are based on historical experience with similar assets as well as anticipation of future events which may impact their life, such as changes in technology.
The average monthly number of persons employed by the group and company during the year was:
Their aggregate remuneration comprised:
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
Included in cost or valuation of land and buildings is freehold land of £1,300,000 (2023: £1,300,000) which is not depreciated.
Freehold land and buildings were valued on an open market basis at 31 December 2024 by Fenn Wright Chartered Surveyors, who are not connected to the group. The valuation was made on an open market value basis by reference to market evidence of transaction prices for similar properties.
The following assets are carried at valuation. If the assets were measured using the cost model, the carrying amounts would be as follows:
Details of the company's subsidiaries at 31 December 2024 are as follows:
Registered office addresses (all UK unless otherwise indicated):
Rapid Electronics Limited and Rapid Properties Limited are fully included in the consolidation. Replenishh Ltd has been excluded from the consolidation on the grounds that the results are immaterial to the group.
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
The group is contingently liable for £20,000 (2022: £20,000) in respect of HM Revenue & Customs duty deferment guarantee given to enable release of imports prior to payment of duty.
The remuneration of key management personnel is as follows.