Company registration number 12730539 (England and Wales)
GCB COCOA UK LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
GCB COCOA UK LIMITED
COMPANY INFORMATION
Directors
Mr Hia Cheng
Ms Tay See Min
Mr Yau Tee Wan
Company number
12730539
Registered office
Lower Road
Glemsford
Sudbury
Suffolk
CO10 7QR
Auditor
Ensors Accountants LLP
Connexions
159 Princes Street
Ipswich
IP1 1QJ
GCB COCOA UK LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Profit and loss account
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 24
GCB COCOA UK LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 1 -
The directors present the strategic report for the year ended 31 December 2024.
Fair Review of the Business
GCB Cocoa UK Limited is a new player into the highly competitive chocolate manufacturing industry. In 2024, cocoa bean prices soared to unprecedented heights, fuelled by a global deficit caused by adverse weather conditions and widespread diseases in origin countries. The higher cocoa prices directly affect the cost of raw materials, particularly cocoa butter and liquor which are derived from cocoa beans. The company may need to adjust pricing strategies to ensure it remains competitive while managing the financial impact of the rising raw material costs.
As a relatively new entrant, the company is taking careful, strategic steps to grow its market presence, focusing on delivering high-quality industrial chocolates while gradually expanding its reach.
GCB Cocoa UK Limited was unable to operate at full capacity throughout 2024 due to the ongoing process of securing essential certifications and licenses required for chocolate manufacturing. These certifications, including food safety and hygiene, quality control, and health and safety approvals, were progressively obtained over the course of the year. In October 2024, the company successfully passed the M&S supplier approval audit, demonstrating its adherence to the high-quality standards and ethical requirements set by M&S, particularly in areas such as product quality, food safety, hygiene, and regulatory compliance. This achievement opens the door to a larger customer base, enhances the company's reputation in the marketplace, and creates opportunities for scaling operations and long-term growth.
Principal Risks and Uncertainties
GCB Cocoa UK faces several risks and uncertainties that could impact its business operations and performance:
Market Fluctuations: The global cocoa market can be volatile, with price fluctuations affecting the cost of raw materials. Changes in supply and demand dynamics, as well as geopolitical factors, may influence cocoa prices and profitability.
Regulatory and Compliance Risks: Changes in food safety regulations, environmental laws, or labour regulations in the UK and EU could impact production processes or lead to increased operational costs.
Operational Risks: The company’s operational efficiency is tied to its manufacturing capabilities. Any issues with plant operations, technology, or staffing could affect production schedules and product quality.
Sustainability and Ethical Practices: Public concerns about environmental sustainability and the ethical sourcing of ingredients (especially cocoa) can harm a company's reputation if it is perceived as not meeting high standards, particularly in light of the EU Deforestation Regulation (EUDR), which mandates that companies ensure their products are not linked to deforestation. Non-compliance with the EUDR could further exacerbate negative perceptions, leading to loss of consumer trust and brand value.
Development and Performance
Since its establishment, GCB Cocoa UK Limited has made significant strides in developing its chocolate manufacturing capacity and expanding its market presence in the UK and Ireland. The company has diligently worked to acquire the necessary certificates, licenses, and approval required to operate in the UK and Ireland market. The company’s operations have been geared towards offering high-quality industrial chocolate, backed by strong sustainable practices. The factory in Sudbury has ramped up production, with the ability to cater to a diverse set of customer needs.
GCB Cocoa UK Limited is currently progressing with the construction of cocoa butter and liquor melting facilities which are expected to commission by first quarter of 2026. The company will be sourcing solid cocoa butter and liquor from sister company in Ivory Coast and further process into liquid cocoa butter and liquor, which can either be utilized internally for chocolate manufacturing or sold in the UK market for trading purposes. Cocoa processing is the core business activity of the group, and these new facilities will align with the group’s broader strategic objectives and open up new market opportunities in the UK. Furthermore, the addition of these facilities will enable the sharing of overhead costs, thereby optimizing operational efficiency and enhancing cost-effectiveness.
GCB COCOA UK LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 2 -
Financial Results
In the latest financial results, GCB Cocoa UK Limited has shown positive progress, marking a significant step forward in its operations. Revenue increased from £2.8 million to £14.4 million, a notable rise driven by the ramp-up of production following the completion of its chocolate manufacturing facility. This rise in revenue is largely due to the ramp-up of production following the completion of its chocolate manufacturing facility, which has enabled the company to meet the increasing demand for its industrial chocolate from its expanded customer base.
The company also experienced a significant turnaround in its gross profit, moving from a £0.5million loss to a £0.3million profit. This improvement can be largely attributed to economies of scale achieved as production volumes increased, which allowed the company to improve operational efficiencies, and optimize the use of its manufacturing facility. As a result, GCBUK was able to improve its profit margins while maintaining a strong level of production output.
Furthermore, the company reduced its net loss from £2.7 million to £0.3 million, as a result of the company’s hedging initiative and improvement in cost management. This hedging initiative is part of the company’s broader approach to manage financial risks, providing greater predictability and reducing exposure to market fluctuations.
Mr Hia Cheng
Director
11 April 2025
GCB COCOA UK LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 3 -
The directors present their annual report and financial statements for the year ended 31 December 2024.
Principal activities
The principal activities of the company are trading of cocoa powder and chocolate and manufacturing of chocolate.
Results and dividends
The results for the year are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr Hia Cheng
Ms Tay See Min
Mr Yau Tee Wan
Auditor
Ensors Accountants LLP were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
On behalf of the board
Mr Hia Cheng
Director
11 April 2025
GCB COCOA UK LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 4 -
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law, the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period.
In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent; and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
GCB COCOA UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF GCB COCOA UK LIMITED
- 5 -
Opinion
We have audited the financial statements of GCB Cocoa UK Limited (the 'company') for the year ended 31 December 2024 which comprise the profit and loss account, the balance sheet, the statement of changes in equity, the 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).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 December 2024 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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 UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
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 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.
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.
GCB COCOA UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF GCB COCOA UK LIMITED (CONTINUED)
- 6 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue 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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Our audit was designed to include tests of detail together with an assessment of the control environment to enable us to obtain reasonable assurance about whether the financial statements are free from material misstatement due to fraud.
In planning and designing our audit procedures we assessed the risks of material misstatement due to fraud. Our assessment concluded that the areas of highest risk are non-compliance with laws and regulations and management override of controls. The company also has a high number of intercompany transactions and balances with fellow group companies and companies under common ownership.
We obtained an understanding of the legal and regulatory frameworks that the company operates in through discussions with management, and from our commercial knowledge and experience of the sector in which the company operates. This enabled us to identify the key laws and regulations applicable to the company. We focussed on specific laws and regulations which we considered may have a direct impact on the financial statements including the Companies Act 2006, food safety and hygiene, taxation legislation, data protection, anti-bribery and employment laws.
GCB COCOA UK LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF GCB COCOA UK LIMITED (CONTINUED)
- 7 -
To address the risk of fraud we performed the following audit procedures:
There are, however, inherent limitations to our above audit procedures. Material misstatements that arise due to fraud can be harder to detect then those that arise from error as they are likely to involve deliberate concealment or collusion.
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.
This report is made solely to the company's member 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 member those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.
Malcolm McGready (Senior Statutory Auditor)
For and on behalf of Ensors Accountants LLP, Statutory Auditor
Chartered Accountants
Connexions
159 Princes Street
Ipswich
IP1 1QJ
14 April 2025
GCB COCOA UK LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 8 -
2024
2023
Notes
£
£
Turnover
3
14,352,809
2,756,944
Cost of sales
(14,035,847)
(3,287,627)
Gross profit/(loss)
316,962
(530,683)
Administrative expenses
(2,538,669)
(2,242,553)
Other operating income
96,531
97,908
Operating loss
4
(2,125,176)
(2,675,328)
Interest receivable and similar income
7
46
Interest payable and similar expenses
8
(1,000,570)
Other gains or losses
9
2,875,000
-
Loss before taxation
(250,700)
(2,675,328)
Tax on loss
Loss for the financial year
(250,700)
(2,675,328)
The profit and loss account has been prepared on the basis that all operations are continuing operations.
GCB COCOA UK LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2024
31 December 2024
- 9 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
10
50,543,492
45,965,842
Investments
11
600,000
600,000
51,143,492
46,565,842
Current assets
Stocks
13
7,543,868
2,707,943
Debtors
14
6,846,463
1,831,852
Cash at bank and in hand
543,497
71,788
14,933,828
4,611,583
Creditors: amounts falling due within one year
15
(12,542,760)
(36,531,211)
Net current assets/(liabilities)
2,391,068
(31,919,628)
Total assets less current liabilities
53,534,560
14,646,214
Creditors: amounts falling due after more than one year
16
(19,139,046)
Net assets
34,395,514
14,646,214
Capital and reserves
Called up share capital
19
40,000,000
20,000,000
Profit and loss reserves
(5,604,486)
(5,353,786)
Total equity
34,395,514
14,646,214
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
The financial statements were approved by the board of directors and authorised for issue on 11 April 2025 and are signed on its behalf by:
Mr Hia Cheng
Director
Company registration number 12730539 (England and Wales)
GCB COCOA UK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
- 10 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 January 2023
20,000,000
(2,678,458)
17,321,542
Year ended 31 December 2023:
Loss and total comprehensive income
-
(2,675,328)
(2,675,328)
Balance at 31 December 2023
20,000,000
(5,353,786)
14,646,214
Year ended 31 December 2024:
Loss and total comprehensive income
-
(250,700)
(250,700)
Issue of share capital
19
20,000,000
-
20,000,000
Balance at 31 December 2024
40,000,000
(5,604,486)
34,395,514
GCB COCOA UK LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 11 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
25
(15,516,911)
10,001,704
Interest paid
(1,000,570)
Net cash (outflow)/inflow from operating activities
(16,517,481)
10,001,704
Investing activities
Purchase of tangible fixed assets
(5,386,941)
(10,635,706)
Proceeds from disposal of tangible fixed assets
247,522
Investment in subsidiary
(300,000)
Interest received
46
Net cash used in investing activities
(5,139,373)
(10,935,706)
Financing activities
Proceeds from new bank loans
22,701,789
Repayments of bank loans
(573,226)
Net cash generated from financing activities
22,128,563
-
Net increase/(decrease) in cash and cash equivalents
471,709
(934,002)
Cash and cash equivalents at beginning of year
71,788
1,005,790
Cash and cash equivalents at end of year
543,497
71,788
GCB COCOA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 12 -
1
Accounting policies
Company information
GCB Cocoa UK Limited is a private company limited by shares incorporated in England and Wales. The registered office is Lower Road, Glemsford, Sudbury, Suffolk, CO10 7QR.
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.
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 has taken advantage of the exemption under section 399 of the Companies Act 2006 not to prepare consolidated accounts, on the basis that the group of which this is the parent qualifies as a small group. The financial statements present information about the company as an individual entity and not about its group.
1.2
Going concern
The financial statements have been prepared on the going concern basis which the directors consider to be appropriate. The company is still in the development stage and has not yet started trading at full capacity but substantial financial support is available from the parent company and fellow group undertakings. true
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, 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.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:
Freehold buildings
2% straight line
Plant and equipment
5% straight line
Fixtures and fittings
10% straight line
Computer equipment
20% straight line
Motor vehicles
20% straight line
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.
GCB COCOA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 13 -
1.5
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
1.6
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible 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.
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 are entirely made up of cash at bank and in hand.
GCB COCOA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 14 -
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 balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
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.
1.10
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 profit and loss account 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.
GCB COCOA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 15 -
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 profit and loss account, 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.
1.11
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.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
1.14
Related party transactions
FRS 102 (paragraph 33.1A) does not require disclosure of related party transactions with other companies that are wholly owned within the same group.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
GCB COCOA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
2
Judgements and key sources of estimation uncertainty
(Continued)
- 16 -
Key sources of estimation uncertainty
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.
Depreciation
The company estimates the rates of deprecation used to write down the different classes of assets that the company owns. This is based on industry knowledge and prior experience of asset lives whilst also taking into account any additional factors. Once fully depreciated over its useful life an asset is stated at its residual value or £nil if there is no residual value.
Carrying value of tangible fixed assets
The company has made significant investment into developing its factory. The project is nearing completion, but the factory is yet to become fully operational to its intended level. Therefore, the carrying value of the company’s tangible fixed assets is subject to significant estimation and judgement as their ability to generate returns cannot yet be assessed with certainty.
3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Manufacturing orders
11,736,707
1,130,240
Sales finished/third party goods
2,616,102
1,626,704
14,352,809
2,756,944
2024
2023
£
£
Turnover analysed by geographical market
UK
12,534,945
2,716,724
Europe
1,817,864
40,220
14,352,809
2,756,944
2024
2023
£
£
Other revenue
Interest income
46
-
4
Operating loss
2024
2023
Operating loss for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
13,591
11,036
Depreciation of owned tangible fixed assets
473,297
101,703
Loss on disposal of tangible fixed assets
88,472
1,000
GCB COCOA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 17 -
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Employees
63
35
Directors
3
3
Total
66
38
Their aggregate remuneration comprised:
2024
2023
£
£
Wages and salaries
1,924,213
927,662
Social security costs
193,850
92,923
Pension costs
181,146
84,735
2,299,209
1,105,320
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
20,400
22,848
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 0 (2023: 0).
7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
46
2024
2023
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
46
GCB COCOA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 18 -
8
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank loans
1,000,570
-
9
Other gains or losses
2024
2023
£
£
Fair value gains/(losses) on financial instruments
Gain on hedged item in a fair value hedge
2,875,000
GCB COCOA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 19 -
10
Tangible fixed assets
Freehold buildings
Assets under construction
Plant and equipment
Fixtures and fittings
Computer equipment
Motor vehicles
Total
£
£
£
£
£
£
£
Cost
At 1 January 2024
8,204,500
37,614,176
358,000
1,063
61,412
31,762
46,270,913
Additions
32,429
5,267,956
21,570
33,069
31,917
5,386,941
Disposals
(273,994)
(62,000)
(335,994)
Transfers
21,687,271
(40,229,608)
18,463,108
79,229
At 31 December 2024
29,924,200
2,378,530
18,780,678
1,063
173,710
63,679
51,321,860
Depreciation and impairment
At 1 January 2024
285,416
337
18,789
529
305,071
Depreciation charged in the year
199,140
243,452
106
18,927
11,672
473,297
At 31 December 2024
484,556
243,452
443
37,716
12,201
778,368
Carrying amount
At 31 December 2024
29,439,644
2,378,530
18,537,226
620
135,994
51,478
50,543,492
At 31 December 2023
7,919,084
37,614,176
358,000
726
42,623
31,233
45,965,842
GCB COCOA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 20 -
11
Fixed asset investments
2024
2023
Notes
£
£
Investments in subsidiaries
12
600,000
600,000
12
Subsidiaries
Details of the company's subsidiary at 31 December 2024 are as follows:
Name of undertaking
Address
Class of
% Held
shares held
Direct
GCB UK Property Limited
1
Ordinary
100.00
Registered office addresses (all UK unless otherwise indicated):
1
Lower Road, Glemsford, Sudbury, Suffolk, CO10 7QR
The aggregate capital and reserves and the result for the year of the subsidiaries noted above was as follows:
Name of undertaking
Capital and Reserves
Profit/(Loss)
£
£
GCB UK Property Limited
442,001
(77,154)
13
Stocks
2024
2023
£
£
Finished goods, raw materials and work in progress
7,543,868
2,707,943
14
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
3,213,954
1,440,315
Amounts owed by group undertakings
3,234,198
73,474
Other debtors
257,594
306,945
Prepayments and accrued income
140,717
11,118
6,846,463
1,831,852
GCB COCOA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 21 -
15
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loans
17
2,989,517
Trade creditors
271,843
81,809
Amount due to holding company (Trade)
6,463,118
2,953,030
Amount due to holding company (Non trade)
948,665
32,858,426
Amount due to related company (Trade)
675,757
100,026
Amount due to related company (Non trade)
-
25,256
Taxation and social security
113,296
84,583
Other creditors
626,099
320,023
Accruals and deferred income
454,465
108,058
12,542,760
36,531,211
16
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Bank loans
17
19,139,046
17
Loans and overdrafts
2024
2023
£
£
Bank loans
22,128,563
Payable within one year
2,989,517
Payable after one year
19,139,046
The long-term loans are secured by guarantee from Parent company, Guan Chong Berhad, in Malaysia over plant and equipment.
18
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
181,146
84,735
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
GCB COCOA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 22 -
19
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
40,000,000
20,000,000
40,000,000
20,000,000
20
Operating lease commitments
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2024
2023
£
£
Within one year
5,760
5,760
Between two and five years
10,079
15,839
15,839
21,599
21
Capital commitments
Amounts contracted for but not provided in the financial statements:
2024
2023
£
£
Acquisition of tangible fixed assets
1,416,668
2,167,963
At the year end the company had the above capital commitments in relation to development of the factory and site at Glemsford.
22
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel is as follows.
2024
2023
£
£
Aggregate compensation
419,833
412,981
Other information
FRS 102 (paragraph 33.1A) does not require disclosure of related party transactions with other companies that are wholly owned within the same group.
There were no other related party transactions during the period.
GCB COCOA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 23 -
23
Ultimate controlling party
The company's immediate parent company is GCB Cocoa Singapore Pte Ltd, a company incorporated in Singapore, whose registered office is 2 Venture Drive, 11-12 Vision Exchange, Singapore 608526.
Guan Chong Berhad is the intermediate holding company of GCB Cocoa UK Limited, a company incorporated in Malaysia, whose registered office is No. 7 (1st Floor) Jalan Pesta 1/1, Taman Tun Dr. Ismail 1, Jalan Bakri, 84000 Muar Johor, Malaysia.
The ultimate controlling party is Guan Chong Resources Sdn Bhd, a company incorporated in Malaysia, whose registered office is No. 7 (1st Floor) Jalan Pesta 1/1, Taman Tun Dr. Ismail 1, Jalan Bakri, 84000 Muar Johor, Malaysia.
24
Global minimum tax
The company is part of a Large Multinational Corporation (MNC), which is subject to Global Minimum Tax (GMT). At the year end, the company had accumulated tax losses of £4,507,646 (2023: £6,898,486) and unutilised capital allowances of £19,378,336 (2023: £6,620,596) giving rise to a deferred tax asset of £5,971,496 (2023: £3,379,771) (calculated at current tax rate). This deferred tax asset has not been recognised in these financial statements as at the time of approval there is not sufficient certainty of future taxable profits for the deferred tax asset to be utilised against.
25
Cash (absorbed by)/generated from operations
2024
2023
£
£
Loss after taxation
(250,700)
(2,675,328)
Adjustments for:
Finance costs
1,000,570
Investment income
(46)
Loss on disposal of tangible fixed assets
88,472
1,000
Depreciation and impairment of tangible fixed assets
473,297
101,703
Other gains and losses
(2,875,000)
-
Movements in working capital:
Increase in stocks
(4,835,925)
(2,221,018)
Increase in debtors
(2,139,611)
(355,721)
(Decrease)/increase in creditors
(6,977,968)
15,151,068
Cash (absorbed by)/generated from operations
(15,516,911)
10,001,704
GCB COCOA UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 24 -
26
Analysis of changes in net funds/(debt)
1 January 2024
Cash flows
31 December 2024
£
£
£
Cash at bank and in hand
71,788
471,709
543,497
Borrowings excluding overdrafts
-
(22,128,563)
(22,128,563)
71,788
(21,656,854)
(21,585,066)
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