Company registration number:
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COMPANY INFORMATION
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CONTENTS
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GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
The directors present their strategic report and the audited financial statements for the 12 months period ended 31 March 2024.
Pozitive Holdings (PHL) was established in November 2019 and is the holding company for Pozitive Energy Ltd., Pozitive Water Limited (formerly First Business Water Ltd.), PE DOT Solutions Ltd., as well as Smart Pay Energy Ltd. (since April 2024), and it continues to be an investment holding company as well as new venture exploration company focused on the utilities market. In February 2024, all the subsidiaries re-branded their customer solutions to PE, the abbreviated but more nimble version of Pozitive Energy, with the objective of creating a brand that becomes the de facto for all our customers’ utilities requirements and not just energy.
During the year, PHL also established PE DOT Solutions Ltd. as a wholly-owned subsidiary to manage the direct sales operations of Pozitive Energy and Pozitive Water Limited alongside the sales of other PE-branded solutions. This was subsequently followed by the re-naming of First Business Water Ltd. as Pozitive Water Ltd. in late 2024.
Following the formal surrender of Pozitive Energy’s domestic license and the sale of the residual domestic customer book in 2024, we are now exclusively B2B suppliers offering competitively priced energy and water with value-added services. In addition, in early 2025, Ofgem granted Smart Pay Energy Ltd. a non-domestic energy supplier license and it is anticipated that Smart Pay Energy will commence operations in late 2025/early 2026 focusing on a fully-automated, direct-to-customer model primarily focused on the MSME market, a category not particularly targeted by Pozitive Energy.
The operating businesses of Pozitive Holdings continue to focus on leveraging technology to digitalise the traditional utilities business model by creating a robust low cost-to-acquire, low cost-to-serve business model in an otherwise challenging marketplace. The directors are pleased to report that significant progress continues to be made towards this mission with the subsidiaries completing another year of robust performance and continued profitability.
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GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
As a holding company, the majority of Pozitive Holdings' assets comprise of investments in, and/or loans to, subsidiary undertakings. Correspondingly, the principal risks of the Company relate to its inability to recover the carrying value of its investments and loans due to adverse conditions in markets where its subsidiaries operate. The performance of the underlying businesses is subject to a number of principal risks and uncertainties, and the company monitors these continuously, taking appropriate action where necessary.
The principal internal and external risks include, but are not limited to the following areas:
1. Wholesale commodity price risk: We mitigate increases in commodity prices in the energy markets by hedging our commodity purchases by using customers' EAC/AQ consumption over the contract term and fine tuning it through active management closer to the time of delivery to reduce our dependence on the imbalanced market. We continue to be subjected to multiple conflicts involving key energy supply chain sources/routes including Russia and the Middle East which have impacted wholesale prices, resulting in inflation and volatility in the price at which the company is able to sell energy to its customers. While we do not have any major exposure to flex contracts, we are looking to reduce the need for hedging where appropriate, by introducing framework-based products that offer monthly/daily variable pricing for customers that are not looking to lock themselves to a fixed price over their contract term. The water market has less exposure to commodity price risks given the pass-through nature of that industry’s costs.
2.Liquidity risks: Every subsidiary constantly monitors its cash position and maintains sufficient balances with wholesale/industry participants. Through a combination of hedging where appropriate, timely billing and effective collections, each company ensures that it is able to maintain a healthy cash balance to mitigate any need for unforeseen collateral requirements.
3.Macro-economic environment risk: Interest rates have started to come down in the last few months but remained relatively high during the reporting period backed by very high inflation levels. Although we are broadly shielded from any direct impact of this rise in interest rates due to the absence of any significant borrowings we continue to be impacted indirectly due to its impact on the creditworthiness of our customer base. This was further exacerbated by uncertainties surrounding the timing of UK general elections.
4.Technology risk: The use of proprietary technology solutions for our core operations, a private cloud environment for hosting our key software assets, AI and deep data capabilities have been key to our scalability and security. The Company also maintains a business continuity plan wherein all the systems are mirrored which ensures that they can all be re-started within 15 minutes, resulting in a return to 'business as usual' with no effect on operations.
5.Customer creditworthiness risk: Slower than expected recovery following COVID, geopolitical uncertainties and higher interests rates that have created uncertainties for the business sector. Whilst we do not have a single point of failure by virtue of reliance on any particular sector(s) or TPI(s), we are not immune to the challenges faced by our customer base. We are taking measures to enhance the credit quality of our portfolio by leveraging Open Banking not just for onboarding but also for ongoing real-time monitoring of the financial health of our customer base and better debt management through outsourcing of legal processes and debt collection to enhance our portfolio quality.
The business actively tracks the proportion of its supply for both power and gas that is hedged as a measure of risk mitigation in volatile markets. This is also a measure that is required to be reported to OFGEM, OFWAT and MOSL and our wholesale supply/trading partners on a monthly basis. Additionally, we continue to see significant growth in the number of meter points as a measure of revenue diversification across both electricity and gas.
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GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
The Board recognises the importance of the company's wider stakeholders when performing their duties under Section 172 (1) of the Companies Act 2006, and their duties to 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 members, and in doing so have regard (amongst other matters) to:
(a) the likely consequences of any decision in the long term; (b) the interests of the company's employees; (c) the need to foster the company's business relationships with suppliers, customers, and others; (d) the impact of the company's operations on the community and the environment; (e) the desirability of the company maintaining a reputation for high standards of business conduct, and (f) the need to act fairly between members of the company. The company has offices in UK and India. For its UK operations, the company is a low energy user.
This report was approved by the board and signed on its behalf.
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DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024
The Directors present their report and the financial statements for the year ended 31 March 2024.
The Directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the Directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgements and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The profit for the year, after taxation, amounted to £146,020,698 (2023 - £32,098,046).
No dividend was proposed or paid in the period (2023 - nil).
The Directors who served during the year were:
The Group is aiming to expand its market coverage through the roll-out of public EV chargers at customer sites, which has the potential to significantly enhance energy supplied over the coming years, as adoption of electric vehicles ramps up.
Further, the roll-out of smart meters across the customer base will progressively reduce the proportion of billing that is reliant on industry estimates, bringing down the reconciliation time from 14 months to 4 months and correspondingly better working capital management.
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
The Company has chosen in accordance with Section 414C(II) of the Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013 to set out within the Company’s Strategic Report, the information required by Schedule 7 of the Large and Medium Sized Companies and Groups (Accounts and Reports) Regulation 2008. This includes information that would have been included in the business review, details of the principal risks and uncertainties and the company's approach to compliance with Section 172(1) of the Companies Act 2006.
There have been no significant events affecting the Group since the year end.
The auditor, Menzies LLP, 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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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF POZITIVE HOLDINGS LTD
We have audited the financial statements of Pozitive Holdings Ltd (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 March 2024, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Statement of Financial Position, the Company Statement of Financial Position, the Consolidated Statement of Cash Flows, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and the related notes, including a summary of significant accounting 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 Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
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 or the 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.
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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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF POZITIVE HOLDINGS LTD (CONTINUED)
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Group Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Directors' Report.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF POZITIVE HOLDINGS LTD (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 Group 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 Group is subject to laws and regulations that directly affect the financial statements including financial reporting legislation. We determined that the following laws and regulations were most significant including:
∙Companies Act 2006;
∙Financial Reporting Standard 102;
∙Criminal Finances Act;
∙OFGEM regulations;
∙OFWAT regulations.
We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.
We understood how the Group is complying with those legal and regulatory frameworks by making inquiries to management and those responsible for legal and compliance procedures. We corroborated our inquiries through our review of relevant documentation.
The engagement partner assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations. No issues were identified in this area. We assessed the susceptibility of the financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the engagement team included:
∙Identifying and assessing the design effectiveness of controls management has in place to prevent and detect fraud;
∙Understanding how those charged with governance considered and addressed the potential for override of controls or
other inappropriate influence over the financial reporting process; and
∙Identifying and testing journal entries, in particular any journal entries posted with unusual account combinations.
As a result of the above procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas:
∙Posting of unusual journals and complex transactions; or
∙The use of management override of controls to manipulate results, or to cause the Group to enter into transactions
not in its best interests.
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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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF POZITIVE HOLDINGS LTD (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
Statutory Auditor
95 Gresham Street
EC2V 7AB
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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2024
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CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 17 to 29 form part of these financial statements.
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COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 17 to 29 form part of these financial statements.
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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
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COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
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CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2024
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CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
Pozitive Holdings Ltd is a private company limited by shares and incorporated in England and Wales. Its registered office and registered number are located on the Company Information page.
The principal activity of Pozitive Holdings Ltd is that of energy and water supplier to a range of businesses in the UK. The accounting period end was changed from 30 November 2022 to 31 March 2023 in last reporting period to be in line with the rest of the group. Therefore, the prior period of 16 months is not entirely comparable with the current period 12 months.
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 preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgement in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Statement of Financial Position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.
The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
∙the requirements of Section 7 Statement of Cash Flows;
∙the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
∙the requirements of Section 11 Financial Instruments paragraphs 11.41(b), 11.41(c), 11.41(e), 11.41(f), 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
∙the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
∙the requirements of Section 33 Related Party Disclosures paragraph 33.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
This includes an estimate of the sales value of units supplied to customers between the date of the last meter reading and the year-end. Any unbilled revenue is included in accrued income to the extent that is it considered recoverable, based on historical data.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
Goodwill
Other intangible assets
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.
The estimated useful lives range as follows:
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 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 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.
The Group has elected to apply the provisions of Section 11 “Basic Financial Instruments” 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, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. Accrued Income In making this judgement the company uses volume date provided by industry bodies which form the basis of the sales invoices raised. An adjustment is made for line-loss in respect of the electricity volumes and the net figure is used in the accrued income calculation. This is compared to the total value of invoices raised in the period and the difference is accrued, and assumes to be billable post year end. Bad Debt A provision against bad debt is calculated based on the aging of debts and other knowledge by management of the likelihood of debts being paid
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
11.Taxation (continued)
There were no factors that may affect future tax charges.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
Profit and loss account
22.Other financial commitments
There is a fixed and floating charge over the assets of the Group as security of continuing trading activity with a supplier and associated credit facility.
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