Company registration number 01851465 (England and Wales)
COLORLITES LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PAGES FOR FILING WITH REGISTRAR
COLORLITES LIMITED
CONTENTS
Page
Statement of financial position
1
Notes to the financial statements
2 - 10
COLORLITES LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2023
31 December 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
4
39,981
Tangible assets
5
1,059,264
551,456
1,099,245
551,456
Current assets
Stocks
498,573
530,559
Debtors
6
833,299
846,217
Cash at bank and in hand
69,776
45,343
1,401,648
1,422,119
Creditors: amounts falling due within one year
7
(2,250,448)
(1,168,321)
Net current (liabilities)/assets
(848,800)
253,798
Total assets less current liabilities
250,445
805,254
Creditors: amounts falling due after more than one year
8
(497,481)
(194,702)
Provisions for liabilities
(78,521)
Net (liabilities)/assets
(247,036)
532,031
Capital and reserves
Called up share capital
163
163
Share premium account
104,320
104,320
Profit and loss reserves
(351,519)
427,548
Total equity
(247,036)
532,031
The directors of the company have elected not to include a copy of the income statement within the financial statements.true
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 3 April 2025 and are signed on its behalf by:
R Grieveson
Director
Company Registration No. 01851465
COLORLITES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
1
Accounting policies
Company information
Colorlites Limited is a private company limited by shares incorporated in England and Wales. The registered office is 1 McMillan Close, Saltwell Business Park, Low Fell, Gateshead, Tyne & Wear, United Kingdom, NE9 5BF.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
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.
COLORLITES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 3 -
1.2
Going concern
The financial statements have been prepared on a going concern basis.
The company meets its day to day working capital requirements through cash generated from operations and external/group borrowings.
The company’s forecasts and projections for the next twelve months show that the company should be able to continue in operational existence for that period, taking into account reasonable possible changes in trading performance.
The ultimate parent company, THF Holdings Ltd, has confirmed its intention to support the company for a period of at least twelve months from the date of approval of these financial statements. The directors are confident in the ability of THF Holdings Ltd to support the company on the basis that the parent company has itself obtained the support of its majority shareholder to provide short term working capital should this be necessary for a minimum period of 12 months from the date of approval of the financial statements.
The company relies on the support of is parent company, THF Holdings Ltd. The group was in breach of the financial covenants agreed with its bankers as at 31 December 2023 and thereafter. The bank has acknowledged the breaches but have not waived the breaches and have reserved any right or remedy that they have now, or in the future, in connection with, or arising from, a covenant breach.
The group is in regular communication with the group’s bankers and following a review of forecasts the bank has agreed additional finance to the group through to June 2025. Following on from the discussions with the bank, the directors have at present no reason to believe the bank would take any action to demand immediate repayment of any of the loans within 12 months of the approval of these financial statements nor withdraw their support of future funding.
In the assessment of going concern the directors have made the assumption that the bank will continue to be supportive, not recall the debt in advance of the original repayment terms and provide finance to the group should there be a need.
With this continued support, the company expects to retain sufficient financial resources to continue meeting its liabilities as they fall due.
Based on the factors set out above the directors believe that it remains appropriate to prepare the financial statements on a going concern basis. However, as the group have not had a formal waiver of the loan covenant breaches and are forecasting to rely on bank and shareholder support, this represents a material uncertainty that may cast significant doubt on the group’s ability to continue as a going concern and therefore to continue realising its assets and discharging its liabilities in the normal course of business. These financial statements do not include any adjustments that would result from the basis of preparation being inappropriate.
1.3
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.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
COLORLITES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 4 -
1.4
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Software
33% reducing balance
1.5
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Plant and machinery
10% reducing balance
Office equipment
10% - 25% reducing balance
Other tangible assets
33% reducing balance
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.6
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible 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.
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.
COLORLITES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 5 -
1.7
Stocks
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.
1.8
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.9
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 statement of financial position 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.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, 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.
COLORLITES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 6 -
1.10
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.
1.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current 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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the 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 when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.12
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.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the statement of financial position as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
COLORLITES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 7 -
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.
2
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
10,000
7,867
3
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
32
37
4
Intangible fixed assets
Software
£
Cost
At 1 January 2023
Additions
59,969
At 31 December 2023
59,969
Amortisation and impairment
At 1 January 2023
Amortisation charged for the year
19,988
At 31 December 2023
19,988
Carrying amount
At 31 December 2023
39,981
At 31 December 2022
COLORLITES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
5
Tangible fixed assets
Plant and machinery
Office equipment
Other tangible assets
Total
£
£
£
£
Cost
At 1 January 2023
972,810
145,484
14,229
1,132,523
Additions
610,355
4,838
615,193
Disposals
(10,336)
(1,019)
(11,355)
At 31 December 2023
1,572,829
150,322
13,210
1,736,361
Depreciation and impairment
At 1 January 2023
486,571
85,533
8,963
581,067
Depreciation charged in the year
90,397
13,445
1,415
105,257
Eliminated in respect of disposals
(9,227)
(9,227)
At 31 December 2023
567,741
98,978
10,378
677,097
Carrying amount
At 31 December 2023
1,005,088
51,344
2,832
1,059,264
At 31 December 2022
486,239
59,951
5,266
551,456
6
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
145,279
151,424
Corporation tax recoverable
4,941
Amounts owed by group undertakings
404,845
574,411
Other debtors
632
4,674
Prepayments and accrued income
84,943
115,708
640,640
846,217
Deferred tax asset
192,659
833,299
846,217
COLORLITES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
7
Creditors: amounts falling due within one year
2023
2022
£
£
Obligations under finance leases
162,241
60,000
Other borrowings
66,186
Trade creditors
1,051,850
943,601
Amounts owed to group undertakings
828,839
2,418
Corporation tax
19,899
Other taxation and social security
54,590
30,734
Other creditors
44,811
46,729
Accruals and deferred income
41,931
64,940
2,250,448
1,168,321
Obligations under hire purchase and finance leases are secured agains the assets to which they relate.
8
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Obligations under finance leases
497,481
194,702
Obligations under hire purchase and finance leases are secured agains the assets to which they relate.
9
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
Material uncertainty relating to going concern
We draw attention to note 1 in the financial statements which indicates that the directors have prepared forecasts based on their assessment of current and predicted operating conditions. The assumptions used in forecasting are extremely judgmental and difficult to predict and could be subject to significant variations. These factors 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.
Senior Statutory Auditor:
Claire Hinshaw ACCA
Statutory Auditor:
Azets Audit Services
COLORLITES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
10
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
2023
2022
£
£
1,165,872
1,378,360
11
Related party transactions
Transactions with related parties
The company is a wholly owned subsidiary of THF Holdings Ltd. As permitted by section 33.1A of FRS 102, the company has chosen not to disclose transactions with its parent company or any wholly owned subsidiaries of the parent company.
12
Parent company
The company's immediate parent is THF Holdings Ltd, incorporated in England & Wales.
The most senior parent entity producing publicly available financial statements is THF Holdings Ltd. These financial statements are available upon request from 1 Mcmillan Close, Saltwell Business Park, Low Fell, Gateshed, NE9 5BF.
The ultimate controlling party is Mr A Thompson and Mrs A L Thompson, the majority shareholders of THF Holdings Ltd.