Caseware UK (AP4) 2023.0.135 2023.0.135 2024-03-312024-03-312024-03-31false2023-04-01falsefalsefalse 14213157 2023-04-01 2024-03-31 14213157 2022-07-04 2023-03-31 14213157 2024-03-31 14213157 2023-03-31 14213157 2022-07-04 14213157 1 2023-04-01 2024-03-31 14213157 d:Director1 2023-04-01 2024-03-31 14213157 d:Director2 2023-04-01 2024-03-31 14213157 d:RegisteredOffice 2023-04-01 2024-03-31 14213157 c:Buildings 2023-04-01 2024-03-31 14213157 c:Buildings c:LongLeaseholdAssets 2023-04-01 2024-03-31 14213157 c:PlantMachinery 2023-04-01 2024-03-31 14213157 c:MotorVehicles 2023-04-01 2024-03-31 14213157 c:FurnitureFittings 2023-04-01 2024-03-31 14213157 c:OfficeEquipment 2023-04-01 2024-03-31 14213157 c:ComputerEquipment 2023-04-01 2024-03-31 14213157 c:PatentsTrademarksLicencesConcessionsSimilar 2023-04-01 2024-03-31 14213157 c:DevelopmentCostsCapitalisedDevelopmentExpenditure 2023-04-01 2024-03-31 14213157 c:Goodwill 2023-04-01 2024-03-31 14213157 c:CopyrightsPatentsTrademarksServiceOperatingRights 2023-04-01 2024-03-31 14213157 c:CurrentFinancialInstruments 2024-03-31 14213157 c:CurrentFinancialInstruments 2023-03-31 14213157 c:CurrentFinancialInstruments 1 2024-03-31 14213157 c:CurrentFinancialInstruments 1 2023-03-31 14213157 c:Non-currentFinancialInstruments 2024-03-31 14213157 c:Non-currentFinancialInstruments 2023-03-31 14213157 c:CurrentFinancialInstruments c:WithinOneYear 2024-03-31 14213157 c:CurrentFinancialInstruments c:WithinOneYear 2023-03-31 14213157 c:Non-currentFinancialInstruments c:AfterOneYear 2024-03-31 14213157 c:Non-currentFinancialInstruments c:AfterOneYear 2023-03-31 14213157 c:Non-currentFinancialInstruments c:BetweenOneTwoYears 2024-03-31 14213157 c:Non-currentFinancialInstruments c:BetweenOneTwoYears 2023-03-31 14213157 c:Non-currentFinancialInstruments c:BetweenTwoFiveYears 2024-03-31 14213157 c:Non-currentFinancialInstruments c:BetweenTwoFiveYears 2023-03-31 14213157 c:ShareCapital 2024-03-31 14213157 c:ShareCapital 2023-03-31 14213157 c:ShareCapital 2022-07-04 14213157 c:SharePremium 2023-04-01 2024-03-31 14213157 c:SharePremium 2024-03-31 14213157 c:SharePremium 2023-03-31 14213157 c:SharePremium 2022-07-04 14213157 c:RetainedEarningsAccumulatedLosses 2023-04-01 2024-03-31 14213157 c:RetainedEarningsAccumulatedLosses 2024-03-31 14213157 c:RetainedEarningsAccumulatedLosses 2022-07-04 2023-03-31 14213157 c:RetainedEarningsAccumulatedLosses 2023-03-31 14213157 c:RetainedEarningsAccumulatedLosses 2022-07-04 14213157 c:FinancialAssetsDesignatedFairValueThroughProfitOrLoss 2024-03-31 14213157 c:FinancialAssetsDesignatedFairValueThroughProfitOrLoss 2023-03-31 14213157 c:FinancialLiabilitiesFairValueThroughProfitOrLoss c:ListedExchangeTraded 2024-03-31 14213157 c:FinancialLiabilitiesFairValueThroughProfitOrLoss c:ListedExchangeTraded 2023-03-31 14213157 d:OrdinaryShareClass1 2023-04-01 2024-03-31 14213157 d:OrdinaryShareClass1 2024-03-31 14213157 d:OrdinaryShareClass1 2023-03-31 14213157 d:OrdinaryShareClass2 2023-04-01 2024-03-31 14213157 d:OrdinaryShareClass2 2024-03-31 14213157 d:OrdinaryShareClass2 2023-03-31 14213157 d:OrdinaryShareClass3 2023-04-01 2024-03-31 14213157 d:OrdinaryShareClass3 2024-03-31 14213157 d:OrdinaryShareClass3 2023-03-31 14213157 d:FRS102 2023-04-01 2024-03-31 14213157 d:Audited 2023-04-01 2024-03-31 14213157 d:FullAccounts 2023-04-01 2024-03-31 14213157 d:PrivateLimitedCompanyLtd 2023-04-01 2024-03-31 14213157 c:Subsidiary1 2023-04-01 2024-03-31 14213157 c:Subsidiary1 1 2023-04-01 2024-03-31 14213157 c:Subsidiary2 2023-04-01 2024-03-31 14213157 c:Subsidiary2 1 2023-04-01 2024-03-31 14213157 c:Subsidiary3 2023-04-01 2024-03-31 14213157 c:Subsidiary3 1 2023-04-01 2024-03-31 14213157 c:Subsidiary4 2023-04-01 2024-03-31 14213157 c:Subsidiary4 1 2023-04-01 2024-03-31 14213157 c:Subsidiary5 2023-04-01 2024-03-31 14213157 c:Subsidiary5 1 2023-04-01 2024-03-31 14213157 c:Subsidiary6 2023-04-01 2024-03-31 14213157 c:Subsidiary6 1 2023-04-01 2024-03-31 14213157 c:Subsidiary7 2023-04-01 2024-03-31 14213157 c:Subsidiary7 1 2023-04-01 2024-03-31 14213157 c:Subsidiary8 2023-04-01 2024-03-31 14213157 c:Subsidiary8 1 2023-04-01 2024-03-31 14213157 c:Subsidiary9 2023-04-01 2024-03-31 14213157 c:Subsidiary9 1 2023-04-01 2024-03-31 14213157 c:Subsidiary10 2023-04-01 2024-03-31 14213157 c:Subsidiary10 1 2023-04-01 2024-03-31 14213157 c:Subsidiary11 2023-04-01 2024-03-31 14213157 c:Subsidiary11 1 2023-04-01 2024-03-31 14213157 c:Subsidiary12 2023-04-01 2024-03-31 14213157 c:Subsidiary12 1 2023-04-01 2024-03-31 14213157 c:Subsidiary13 2023-04-01 2024-03-31 14213157 c:Subsidiary13 1 2023-04-01 2024-03-31 14213157 d:Consolidated 2024-03-31 14213157 d:ConsolidatedGroupCompanyAccounts 2023-04-01 2024-03-31 14213157 6 2023-04-01 2024-03-31 14213157 f:PoundSterling 2023-04-01 2024-03-31 xbrli:shares iso4217:GBP xbrli:pure

Registered number: 14213157










WALNUT NEWCO LIMITED










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2024

 
WALNUT NEWCO LIMITED
 

COMPANY INFORMATION


DIRECTORS
N Stephenson 
R A Schofield 




REGISTERED NUMBER
14213157



REGISTERED OFFICE
C/O Roxburgh Milkins Limited
Merchants House North

Wapping Road

Bristol

BS1 4RW




INDEPENDENT AUDITORS
Price Bailey LLP
Chartered Accountants & Statutory Auditors

Dashwood House

69 Old Broad Street

London

EC2M 1QS





 
WALNUT NEWCO LIMITED
 

CONTENTS



Page
Group Strategic Report
 
1 - 2
Directors' Report
 
3 - 6
Independent Auditors' Report
 
7 - 10
Consolidated Statement of Comprehensive Income
 
11
Consolidated Statement of Financial Position
 
12
Company Statement of Financial Position
 
13
Consolidated Statement of Changes in Equity
 
14
Company Statement of Changes in Equity
 
15
Consolidated Statement of Cash Flows
 
16 - 17
Consolidated Analysis of Net Debt
 
18
Notes to the Financial Statements
 
19 - 47


 
WALNUT NEWCO LIMITED
 

GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024

INTRODUCTION
 
The directors present their Strategic Report and the audited consolidated financial statements of Walnut Newco Limited (the “Company”) and its subsidiaries (the “Group”) for the year ended 31 March 2024.
The Company’s subsidiaries supply a range of products and services to the logistics, material handling and other industrial sectors, including impact protection and safety products, labeling, signage and visual communication solutions, racking, storage and training. 

BUSINESS REVIEW
 
Markets served by the Group, in particular the market for newbuild warehouses, continued to trade at levels significantly below expectations. Higher UK interest rates impacted wider consumer confidence and investment in new warehouse build projects was subdued.  The Group took action to widen the customer base, reduce costs and improve operational efficiency, but this was not enough to offset these market effects, and the Group traded below expectations.
The reported loss before taxation of £21.5m (2023: £39.4m) is after charging for the amortisation of intangible assets of £2.5m (2023: £3.8m), an impairment of intangible assets of £10.8m (2023: £32.5m) and interest costs of £7.8m (2023: £4.4m), of which £5.6m relates to investor loan notes (2023: £3.2m) and £2.2m relates to bank interest (2023: £1.2m). Bank interest is payable in cash on a quarterly basis. Interest on investor loan notes is non-cash paid, and the accrued interest is only payable on redemption of the loan notes, which are due for repayment on 31st December 2029, unless positive financial conditions allow for earlier payment. 
The Group continued to reduce operating costs and with careful management of working capital has continued to service its liabilities and bank interest as they fell due. 
The impact on the business of the current level of bank interest costs is dealt with more fully in the directors’ report.

Page 1

 
WALNUT NEWCO LIMITED
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

PRINCIPAL RISKS AND UNCERTAINTIES
 
Risk Management
The risk management framework for the Group is established by the directors. The framework is reviewed and amended to reflect specific industry and business risks. Mitigation measures are put in place, where appropriate, to limit the impact of any risk which could directly impact the business.
Health and Safety
The Group ensures that its subsidiaries have health and safety at the top of their agendas, with regular reviews of health and safety KPIs. The Group mitigates risk by having strong procedures in place and by ensuring best practice in all areas of the business. 
Credit risk
The Group’s credit risk is primarily attributable to the trade receivables of its subsidiaries. The directors regularly review the level of trade receivables to assess the recoverability of that debt. In the event of an identified loss event an allowance would be made to cover the risk of non-recovery.
Finance and liquidity risk
Despite trading at levels below expectations in 2024, the Group remained cash generative and able to service its liabilities as they fell due.  The directors believe that the Group has sufficient financing facilities available to mitigate liquidity risk and continues to review its forecasts on a regular basis to ensure there is sufficient working capital and facilities for continuing day-to-day operations.  
Interest rate risk
Interest rate risk refers to potential higher interest costs on external borrowings that could arise as a result of increases in market interest rates. Interest on the Group’s bank debt is not hedged and is therefore subject to fluctuations in market interest rates.  Interest accrued on investor loan notes is fixed and only payable on redemption of the loan notes in 2029, unless positive financial conditions allow for earlier payment. 

FINANCIAL KEY PERFORMANCE INDICATORS
 
The performance of the business is measured by Key Performance Indicators (“KPIs”), which include the monitoring of financial results against budget, at group level and on an entity basis.
Examples of KPIs used are sales, gross margin, EBITDA and working capital.
Sales in the year to 31 March 2024 were £20.7m (comparative of £15.1m is for the 8-month period to 31 March 2023) and gross margin was 44.3%, compared to 41.0% in 2023. The KPI ratio in working capital is the current ratio, which was 1.81 in March 2024, compared to 2.80 at 31 March 2023. In the year, the Group generated an EBITDA of negative £0.3m (2023: positive EBITDA of £1.5m).


This report was approved by the board and signed on its behalf.



N Stephenson
Director

Date: 17 April 2025

Page 2

 
WALNUT NEWCO LIMITED
 

 
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.

DIRECTORS' RESPONSIBILITIES STATEMENT

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.
 
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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 the Group and of the profit or loss of the Group for that period.

 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 judgments 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 2006They 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.

PRINCIPAL ACTIVITY

The principal activity of the Company is that of a holding company.
The principal activity of the Group is the supply of a range of products and services to the logistics, material handling and other industrial sectors, including impact protection and safety products, labelling, signage and visual communication, racking, storage and training.

RESULTS AND DIVIDENDS

The loss for the year, after taxation, amounted to £21,515,780 (2023 - loss £39,490,688).

As noted in the strategic report this loss is after charging the amortisation of intangible assets of £2.5m (2023: £3.8m), an impairment of intangible assets of £10.8m (2023: £32.5m), bank interest paid of £2.2m (2023: £1.2m) and interest on investor loan notes of £5.6m (2023: £3.2m). The interest on investor loan notes is non-cash paid, and the accrued interest is payable on redemption of the loan notes, which are due for repayment on 31st December 2029, unless positive financial conditions allow for earlier payment. 
The directors have not proposed or paid a dividend for the year ended 31 March 2024 (2023: no dividends proposed or paid)

DIRECTORS

The directors who served during the year were:

N Stephenson 
R A Schofield 

Page 3

 
WALNUT NEWCO LIMITED
 

 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

FUTURE DEVELOPMENTS

Market conditions remain challenging for the Group, with continuing higher interest rates deterring investment in its key markets and the continued uncertainty over the impact of new government policies does not help with business confidence.
Despite these challenges, the Group continues to invest in its people, in exploring new markets and developing new products to ensure that it can continue to offer the best service to its customers.
The Group continues to review its cost base to ensure that the level of overhead is supported by the current level of business.

GOING CONCERN 
Markets served by the Group remained subdued in 2023/2024, especially the market for newbuild warehouses. However, newbuild is only part of the Group’s offering and in the wider market trading continued more or less in line with expectations. 
The Group continued to reduce operating costs and with careful management of working capital has been able to service all of its liabilities as they fell due.
Although the underlying businesses continued, and continue to trade profitably, the level of profit fell below the leverage covenant test attached to the bank debt. As a result, in December 2023, the Group signed a Forbearance Agreement with the bank. Since that date, the Group has again breached its covenants and has subsequently signed a new Forbearance Agreement which is valid until 30th April 2026. The Forbearance Agreement means that the Lender has agreed to forbear and not take any enforcement action against the Group in relation to such historic defaults of its bank covenants.
The Forbearance Agreement includes a restructuring of the £21m of bank senior debt into £10m of senior debt, interest cash paid, and £11m of debt where interest is rolled up and is therefore non-cash paid. The £10m senior debt can be serviced by the Group based on its current trading forecasts, which show that the Group is able to settle its cash-paid liabilities as they fall due for at least the next twelve months. The Forbearance Agreement also resets the covenants to reflect the current trading forecasts with an appropriate level of headroom. The forecasts are based on assumptions about initiatives to support growth, the general economic outlook and specific factors impacting the Group’s markets, while recognizing the inherent uncertainty with forecasting in the current economic climate. 
The Forbearance Agreement includes certain non-financial conditions, which the directors are obligated, and expect to be able to deliver. Non-financial conditions include inter-alia, the appointment of a new independent non-executive director (“Chair”) within 14 days of signing the new Forbearance Agreement, changing certain board members of the companies in the group to also include the new non-executive director, facilitating the amendment of the Facilities Agreement to reflect the terms of the Forbearance Agreement, and, on request from the bank, permitting the appointment of a further non-executive director, with the Chair having the casting vote in any Board decisions.  
The bank debt referred to above is serviced by the operating profits of the business. The Group also has a significant loan note liability in the balance sheet of Walnut Newco Ltd, the ultimate holding company of the Group. Interest on the loan notes is non-cash paid and rolled up with the loan notes, which are redeemable in 2029. The loan notes are subordinated to the bank debt. Profitability would have to improve considerably for the loan notes to be redeemed in full or the Group would have to be refinanced and/or restructured prior to redemption. 
The directors have assessed the appropriateness of the going concern assumption, having considered the risks inherent in the forecast, the revised structure of the bank senior debt, the new suite of banking covenants and the covenant headroom included.
Based on that assessment, the directors have a reasonable expectation that the Group has adequate liquidity and resources to continue to trade and to meet its day-to-day liabilities as they fall due for at least the next 12 months. Beyond that, on current trading trends and market conditions, the directors believe that it is unlikely that
Page 4

 
WALNUT NEWCO LIMITED
 

 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024

the Group would be able to redeem the loan notes in full and that a significant refinancing or restructuring is likely to be required before 2029. The directors intend to undertake further work during the term of the Forbearance Agreement to evaluate what options are available to effect such a restructuring or refinancing following expiry of the forbearance period. 

ECONOMIC IMPACT OF GLOBAL EVENTS
UK businesses are facing many uncertainties and challenges caused by political, economic, social, technological, legal and environmental factors. These uncertainties have contributed to an environment where there exists a range of issues and risks, including inflation, rising interest rates, labour shortages, disrupted supply chains and new ways of working.
The directors have carried out an assessment of the potential impact of these uncertainties on the business, including the impact of mitigation measures, and concluded that the greatest impact on the business is expected to be from the economic ripple effect on the global economy. The directors have taken account of these potential impacts in their going concern assessment.
The Group continues to work with its partners to minimize any impacts of these events and maximise the realization of any opportunities they may provide to the business.

QUALIFYING THIRD PARTY INDEMNITY PROVISIONS

As permitted by the Companies Act 2006, the Group has indemnified the directors and officers in respect of proceedings which may be brought by third parties and such indemnification was in place throughout the period and at the date of approval of these financial statements. Neither the Group's indemnity nor insurance provides cover in the event that a director or officer is proved to have acted fraudulently or dishonestly.

MATTERS COVERED IN THE STRATEGIC REPORT

As permitted by Paragraph 1A of Schedule 7 to the Large and Medium-sized Companies and Group (Accounts and Reports) Regulations 2008 certain matters which are required to be disclosed in the directors' report have been omitted as they are included in the strategic report on pages 1 and 2. These matters relate to financial instruments.

DISCLOSURE OF INFORMATION TO AUDITORS

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the directors are aware, there is no relevant audit information of which the Company and the Group's auditors are unaware, and

the directors have taken all the steps that ought to have been taken as directors in order to be aware of any relevant audit information and to establish that the Company and the Group's auditors are aware of that information.

POST BALANCE SHEET EVENTS

Relevant post balance sheet events are noted above and within note 30 of the financial statements.

Page 5

 
WALNUT NEWCO LIMITED
 

 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024


AUDITORS

The auditorsPrice Bailey LLPwill 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.
 





N Stephenson
Director

Date: 17 April 2025

Page 6

 
WALNUT NEWCO LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WALNUT NEWCO LIMITED
 

OPINION


We have audited the financial statements of Walnut Newco Limited (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 policiesThe 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 Group's and of the parent Company's affairs as at 31 March 2024 and of the Group's 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.


BASIS FOR OPINION


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 Auditors' 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.


MATERIAL UNCERTAINTY RELATED TO GOING CONCERN


We draw attention to Note 2.3 in the financial statements, which outlines the Group’s significant loan note liability, the directors’ belief that it is unlikely that the Group would be able to redeem the loan notes in full and that a significant refinancing or restructuring is likely to be required before 2029.  It also outlines the director intention to undertake further work during the term of the Forbearance Agreement to evaluate what options are available to effect such a restructuring or refinancing following expiry of the forbearance period.  These events or conditions, along with other matters as set forth in Note 2.3, indicate that a material uncertainty exists that may cast significant doubt on the Group and Company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.


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.


Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.


Page 7

 
WALNUT NEWCO LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WALNUT NEWCO LIMITED (CONTINUED)


OTHER INFORMATION


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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.


OPINION ON OTHER MATTERS PRESCRIBED BY THE COMPANIES ACT 2006
 

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.


MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION
 

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.


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 by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent Company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' 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 set out on page 3, 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 Group's and the parent 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 Group or the parent Company or to cease operations, or have no realistic alternative but to do so.


Page 8

 
WALNUT NEWCO LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WALNUT NEWCO LIMITED (CONTINUED)


AUDITORS' 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 Auditors' 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:

We gained an understanding of the legal and regulatory framework applicable to the Company and the industry in which it operates and considered the risk of the Company not complying with the applicable laws and regulations including fraud in particular those that could have a material impact on the financial statements. This included those regulations directly related to the financial statements, including financial reporting and tax legislation. non-compliance. The risks were discussed with the audit team and we remained alert to any indications of throughout the audit. We carried out specific procedures to address the risks identified as follows:
 - Reviewing legal fees incurred; 
 - Agreeing the financial statement disclosures to underlying supporting documentation; 
 - Enquiring of management including those responsible for the key regulations and;
 - Reviewing the key accounting policies and estimates 
To address the risk of management override of controls, we carried out testing of journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business. 
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 Auditors' Report.


Page 9

 
WALNUT NEWCO LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WALNUT NEWCO LIMITED (CONTINUED)


USE OF OUR REPORT
 

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006Our 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 Auditors' 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.





Darren Amott (Senior Statutory Auditor)
for and on behalf of
Darren Amott (Senior Statutory Auditor)
 
for and on behalf of
Price Bailey LLP
Chartered Accountants
Statutory Auditors
Dashwood House
69 Old Broad Street
London
EC2M 1QS

17 April 2025
Page 10

 
WALNUT NEWCO LIMITED
 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2024

Year ended 31 March 2024
Period 4 July 2022 to 31 March 2023
Note
£
£

  

Turnover
 4 
20,684,238
15,221,636

Cost of sales
  
(11,521,116)
(8,641,397)

GROSS PROFIT
  
9,163,122
6,580,239

Administrative expenses
  
(12,279,417)
(9,092,598)

Other operating income
 5 
-
2,002

Impairment of goodwill
  
(10,750,621)
(32,504,962)

OPERATING LOSS
 6 
(13,866,916)
(35,015,319)

Interest receivable and similar income
 10 
4,685
2,951

Interest payable and similar expenses
 11 
(7,823,111)
(4,418,531)

LOSS BEFORE TAXATION
  
(21,685,342)
(39,430,899)

Tax on loss
 12 
169,562
(59,789)

LOSS FOR THE FINANCIAL YEAR
  
(21,515,780)
(39,490,688)

LOSS FOR THE YEAR ATTRIBUTABLE TO:
  

Owners of the parent Company
  
(21,515,780)
(39,490,688)

  
(21,515,780)
(39,490,688)

The Consolidated Statement of Comprehensive Income has been prepared on the basis that all operations are continuing operations.

The notes on pages 19 to 47 form part of these financial statements.

Page 11

 
WALNUT NEWCO LIMITED
REGISTERED NUMBER: 14213157

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2024

2024
 2023
Note
£
£

FIXED ASSETS
  

Intangible assets
 13 
10,886,979
24,083,709

Tangible assets
 14 
2,470,447
2,377,282

  
13,357,426
26,460,991

CURRENT ASSETS
  

Stocks
 16 
3,547,566
3,767,022

Debtors: amounts falling due within one year
 17 
4,638,233
5,601,295

Cash at bank and in hand
 18 
1,258,829
2,368,578

  
9,444,628
11,736,895

Creditors: amounts falling due within one year
 19 
(3,462,906)
(4,221,629)

NET CURRENT ASSETS
  
 
 
5,981,722
 
 
7,515,266

TOTAL ASSETS LESS CURRENT LIABILITIES
  
19,339,148
33,976,257

Creditors: amounts falling due after more than one year
 20 
(79,689,007)
(72,841,148)

Deferred taxation
 23 
(249,558)
(218,746)

  
 
 
(249,558)
 
 
(218,746)

NET LIABILITIES
  
(60,599,417)
(39,083,637)


CAPITAL AND RESERVES
  

Called up share capital 
 24 
156,306
156,306

Share premium account
 25 
250,745
250,745

Profit and loss account
 25 
(61,006,468)
(39,490,688)

TOTAL EQUITY
  
(60,599,417)
(39,083,637)


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




N Stephenson
Director

Date: 17 April 2025

The notes on pages 19 to 47 form part of these financial statements.

Page 12

 
WALNUT NEWCO LIMITED
REGISTERED NUMBER: 14213157

COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2024

2024
2023
Note
£
£

FIXED ASSETS
  

Investments
 15 
202,041
202,041

CURRENT ASSETS
  

Debtors: amounts falling due within one year
 17 
312,562
25,513,889

  
312,562
25,513,889

Creditors: amounts falling due within one year
 19 
(418,953)
(443,728)

NET CURRENT (LIABILITIES)/ASSETS
  
 
 
(106,391)
 
 
25,070,161

TOTAL ASSETS LESS CURRENT LIABILITIES
  
95,650
25,272,202

  

Creditors: amounts falling due after more than one year
 20 
(58,141,534)
(52,674,738)

  

NET LIABILITIES
  
(58,045,884)
(27,402,536)


CAPITAL AND RESERVES
  

Called up share capital 
 24 
156,306
156,306

Share premium account
 25 
250,745
250,745

Profit and loss account
  
(58,452,935)
(27,809,587)

  
(58,045,884)
(27,402,536)


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 loss after tax of the parent Company for the period was £30,643,348 (2023: £27,809,587).
The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 


N Stephenson
Director

Date: 17 April 2025

The notes on pages 19 to 47 form part of these financial statements.

Page 13
 

 
WALNUT NEWCO LIMITED


 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024



Called up share capital
Share premium account
Profit and loss account
Total equity


£
£
£
£



At 4 July 2022
156,306
250,745
-
407,051





Loss for the period
-
-
(39,490,688)
(39,490,688)





At 1 April 2023
156,306
250,745
(39,490,688)
(39,083,637)





Loss for the year
-
-
(21,515,780)
(21,515,780)



AT 31 MARCH 2024
156,306
250,745
(61,006,468)
(60,599,417)



The notes on pages 19 to 47 form part of these financial statements.

Page 14

 

 
WALNUT NEWCO LIMITED


 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024



Called up share capital
Share premium account
Profit and loss account
Total equity


£
£
£
£



At 4 July 2022
156,306
250,745
-
407,051





Loss for the period
-
-
(27,809,587)
(27,809,587)





At 1 April 2023
156,306
250,745
(27,809,587)
(27,402,536)





Loss for the year
-
-
(30,643,348)
(30,643,348)



AT 31 MARCH 2024
156,306
250,745
(58,452,935)
(58,045,884)



The notes on pages 19 to 47 form part of these financial statements.

Page 15
 
WALNUT NEWCO LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2024

2024
2023
£
£

CASH FLOWS FROM OPERATING ACTIVITIES

(Loss) for the financial year/period
(21,515,780)
(39,490,688)

ADJUSTMENTS FOR:

Amortisation of intangible assets
2,460,604
3,845,507

Depreciation of tangible assets
329,125
149,927

Impairments of fixed assets
10,750,621
32,504,961

Loss on disposal of tangible assets
7,615
-

Interest payable
7,823,112
4,494,941

Interest receivable
(4,685)
(2,951)

Taxation charge
(169,562)
-

Decrease/(increase) in stocks
219,456
(280,543)

Decrease in debtors
908,949
612,112

Increase/(decrease) in creditors
241,277
(1,293,993)

Corporation tax received/(paid)
254,487
(242,663)

NET CASH GENERATED FROM OPERATING ACTIVITIES

1,305,219
296,610


CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of intangible fixed assets
(14,495)
(42,852)

Purchase of tangible fixed assets
(449,976)
(165,056)

Sale of tangible fixed assets
20,071
-

Consideration paid for acquisition of subsidiary
-
(27,766,087)

Cash acquired on acquisition
-
2,257,668

Interest received
4,685
2,951

NET CASH FROM INVESTING ACTIVITIES

(439,715)
(25,713,376)

CASH FLOWS FROM FINANCING ACTIVITIES

Issue of ordinary shares
-
407,051

Repayment of bank loans and existing loan notes at acquisition
-
(15,150,000)

Credit facility acquired (note 21)
250,000
21,000,000

Payment of deferred consideration recognised at acquisition
(1,000,000)
(1,474,998)

Cash received from loan notes
1,000,000
25,110,032

Loan financing fees
-
(910,000)

Bank interest paid
(2,214,886)
(1,184,424)

Other interest paid
(10,367)
(12,317)

NET CASH USED IN FINANCING ACTIVITIES
(1,975,253)
27,785,344
Page 16

 
WALNUT NEWCO LIMITED
 

CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024


2024
2023

£
£



(DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS
(1,109,749)
2,368,578

Cash and cash equivalents at beginning of year
2,368,578
-


Cash and cash equivalents at the end of the year
1,258,829
2,368,578


The notes on pages 19 to 47 form part of these financial statements.

Page 17

 
WALNUT NEWCO LIMITED
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 MARCH 2024





At 1 April 2023
Cash flows
Other movements
At 31 March 2024
£

£

£

£

Cash at bank and in hand

2,368,578

(1,109,749)

-

1,258,829

Debt due after 1 year

(69,619,358)

-

(1,381,063)

(71,000,421)



(67,250,780)
(1,109,749)
(1,381,063)
(69,741,592)

The notes on pages 19 to 47 form part of these financial statements.

Page 18

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

1.


GENERAL INFORMATION

Walnut Newco Limited (the 'Company') is a private company limited by shares, and incorporated in England and Wales, United Kingdom. The address of its registered office is C/O Roxburgh Milkins Limited, Merchants House North, United Kingdom, BS1 4RW.
The principal activity of the Company is that of a holding company.
The principal activity of the Group during the period was the supply of a range of products and services to the logistics, material handling and other industrial sectors, including impact protection and safety products, labelling, signage and visual communication solutions, racking, storage and training.

The Company was incorporated on 4 July 2022 and the prior period comparatives are presented from 4 July 2022 to 31 March 2023.

2.ACCOUNTING POLICIES

 
2.1

BASIS OF PREPARATION OF FINANCIAL STATEMENTS

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 judgment 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 Company is a qualifying entity for the purposes of FRS 102 and has elected to take the exemption under FRS 102. para 1.12 (b) not to present the company statement of cash flows.
The financial statements have been presented in Pounds Sterling as this is the currency of the primary economic environment in which the Group and company operates and is rounded to the nearest pound.

The following principal accounting policies have been applied:

 
2.2

BASIS OF CONSOLIDATION

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.
In accordance with the transitional exemption available in FRS 102, the Group has chosen not to retrospectively apply the standard to business combinations that occurred before the date of transition to FRS 102. 

Page 19

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.ACCOUNTING POLICIES (CONTINUED)

 
2.3

GOING CONCERN

Markets served by the Group remained subdued in 2023/2024, especially the market for newbuild warehouses. However, newbuild is only part of the Group’s offering and in the wider market trading continued more or less in line with expectations. 
The Group continued to reduce operating costs and with careful management of working capital has been able to service all of its liabilities as they fell due.
Although the underlying businesses continued, and continue to trade profitably, the level of profit fell below the leverage covenant test attached to the bank debt. As a result, in December 2023, the Group signed a Forbearance Agreement with the bank. Since that date, the Group has again breached its covenants and has subsequently signed a new Forbearance Agreement which is valid until 30th April 2026. The Forbearance Agreement means that the Lender has agreed to forbear and not take any enforcement action against the Group in relation to such historic defaults of its bank covenants.
The Forbearance Agreement includes a restructuring of the £21m of bank senior debt into £10m of senior debt, interest cash paid, and £11m of debt where interest is rolled up and is therefore non-cash paid. The £10m senior debt can be serviced by the Group based on its current trading forecasts, which show that the Group is able to settle its cash-paid liabilities as they fall due for at least the next twelve months. The Forbearance Agreement also resets the covenants to reflect the current trading forecasts with an appropriate level of headroom. The forecasts are based on assumptions about initiatives to support growth, the general economic outlook and specific factors impacting the Group’s markets, while recognizing the inherent uncertainty with forecasting in the current economic climate. 
The Forbearance Agreement includes certain non-financial conditions, which the directors are obligated, and expect to be able to deliver. Non-financial conditions include inter-alia, the appointment of a new independent non-executive director (“Chair”) within 14 days of signing the new Forbearance Agreement, changing certain board members of the companies in the group to also include the new non-executive director, facilitating the amendment of the Facilities Agreement to reflect the terms of the Forbearance Agreement, and, on request from the bank, permitting the appointment of a further non-executive director, with the Chair having the casting vote in any Board decisions.  
The bank debt referred to above is serviced by the operating profits of the business. The Group also has a significant loan note liability in the balance sheet of Walnut Newco Ltd, the ultimate holding company of the Group. Interest on the loan notes is non-cash paid and rolled up with the loan notes, which are redeemable in 2029. The loan notes are subordinated to the bank debt. Profitability would have to improve considerably for the loan notes to be redeemed in full or the Group would have to be refinanced and/or restructured prior to redemption. 
The directors have assessed the appropriateness of the going concern assumption, having considered the risks inherent in the forecast, the revised structure of the bank senior debt, the new suite of banking covenants and the covenant headroom included.
Based on that assessment, the directors have a reasonable expectation that the Group has adequate liquidity and resources to continue to trade and to meet its day-to-day liabilities as they fall due for at least the next 12 months. Beyond that, on current trading trends and market conditions, the directors believe that it is unlikely that the Group would be able to redeem the loan notes in full and that a significant refinancing or restructuring is likely to be required before 2029. The directors intend to undertake further work during the term of the Forbearance Agreement to evaluate what options are available to effect such a restructuring or refinancing following expiry of the forbearance period.
 
The directors therefore conclude that the Group can continue to adopt the going concern principle,
Page 20

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.ACCOUNTING POLICIES (CONTINUED)


2.3
GOING CONCERN (CONTINUED)

however they note that the conditions above, relating to the redemption of loan notes in 2029, give rise to material uncertainty that may cast significant doubt on Walnut Newco Limited’s ability, in its current organisation structure, to continue as a going concern beyond the forbearance period. 

 
2.4

FOREIGN CURRENCY TRANSLATION

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Consolidated Statement of Comprehensive Income except when deferred in other comprehensive income as qualifying cash flow hedges.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Consolidated Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in Consolidated Statement of Comprehensive Income within 'other operating income'.

 
2.5

TURNOVER

Turnover is recognised to the extent that it is probable that the economic benefits will flow to the Group and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before turnover is recognised:

Sale of goods

Turnover from the sale of goods is recognised when all of the following conditions are satisfied:
the Group has transferred the significant risks and rewards of ownership to the buyer;
the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of turnover can be measured reliably;
it is probable that the Group will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Rendering of services

Turnover from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
Page 21

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.ACCOUNTING POLICIES (CONTINUED)


2.5
TURNOVER (CONTINUED)

the amount of turnover can be measured reliably;
it is probable that the Group will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

 
2.6

OPERATING LEASES: THE GROUP AS LESSEE

Rentals paid under operating leases are charged to Consolidated Statement of Comprehensive Income on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

  
2.7

INTEREST RECEIVABLE AND SIMILAR INCOME

Interest receivable and similar income is recognised in the Statement of comprehensive income using the effective interest method.

  
2.8

INTEREST PAYABLE AND SIMILAR EXPENDITURE

Interest payable and similar expenses are charged to the Consolidated Statement of Comprehensive Income over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.9

BORROWING COSTS

All borrowing costs are recognised in Consolidated Statement of Comprehensive Income in the year in which they are incurred.

 
2.10

PENSIONS

DEFINED CONTRIBUTION PENSION PLAN

The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.

The contributions are recognised as an expense in the Consolidated Statement of Comprehensive Income when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Group in independently administered funds.

Page 22

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.ACCOUNTING POLICIES (CONTINUED)

 
2.11

CURRENT AND DEFERRED TAXATION

The tax expense for the year comprises current and deferred tax. Tax is recognised in the Consolidated Statement of Comprehensive Income except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current corporation tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company and the Group operate and generate income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits;
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.


  
2.12

BUSINESS COMBINATIONS

Business combinations are accounted for by applying the purchase method.
The cost of a business combination is the fair value of the consideration given, liabilities incurred or assumed and of equity instruments issued plus the costs directly attributable to the business combination. Where control is achieved in stages the cost is the consideration at the date of each transaction. 
On acquisition of a business, fair values are attributed to the identifiable assets, liabilities and contingent liabilities unless the fair value cannot be measured reliably, in which case the value is incorporated in goodwill. Intangible assets are only recognised separately from goodwill where they are separable and arise from contractual or other legal rights. Where the fair value of contingent liabilities cannot be reliably measured they are disclosed on the same basis as other contingent liabilities.

Page 23

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.ACCOUNTING POLICIES (CONTINUED)

 
2.13

INTANGIBLE ASSETS

GOODWILL

Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Consolidated Statement of Comprehensive Income over its useful economic life of 10 years.

OTHER INTANGIBLE ASSETS

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.

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:

Patents
-
20
years
Development expenditure
-
3
years
Goodwill
-
10
years
Trademarks
-
20
years

Amortisation is charged to 'administrative expenses' in the Statement of comprehensive income.

 
2.14

TANGIBLE FIXED ASSETS

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

At each reporting date the Group assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.

Page 24

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.ACCOUNTING POLICIES (CONTINUED)


2.14
TANGIBLE FIXED ASSETS (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 and the reducing balance method.

Depreciation is provided on the following basis:

Freehold property
-
2%
straight line
Long-term leasehold property
-
10%
to 30% straight line
Plant and machinery
-
20%
straight line and reducing balance
Motor vehicles
-
25%
to 33% straight line and reducing balance
Fixtures and fittings
-
20%
to 25% straight line and reducing balance
Office equipment
-
20%
straight line
Computer equipment
-
20%
to 33% straight line

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 the Consolidated Statement of Comprehensive Income.

Depreciation is charged to 'administrative expenses' in the Statement of comprehensive income.

 
2.15

IMPAIRMENT OF FIXED ASSETS AND GOODWILL

Assets that are subject to depreciation or amortisation are assessed at each reporting date to determine whether there is any indication that the assets are impaired. Where there is any indication that an asset may be impaired, the carrying value of the asset (or cash-generating unit to which the asset has been allocated) is tested for impairment. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's (or CGU's) fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (CGUs). Non-financial assets that have been previously impaired are reviewed at each reporting date to assess whether there is any indication that the impairment losses recognised in prior periods may no longer exist or may have decreased.

 
2.16

VALUATION OF INVESTMENTS

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.17

STOCKS

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a weighted average basis. Work in progress and finished goods include labour and attributable overheads.

At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in the Consolidated Statement of Comprehensive Income.

Page 25

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.ACCOUNTING POLICIES (CONTINUED)

 
2.18

DEBTORS

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.19

CASH AND CASH EQUIVALENTS

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Consolidated Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.

 
2.20

CREDITORS

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.21

PROVISIONS FOR LIABILITIES

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are charged as an expense to the Consolidated Statement of Comprehensive Income.

When payments are eventually made, they are charged to the provision carried in the Statement of Financial Position.

 
2.22

FINANCIAL INSTRUMENTS

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.
Page 26

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.ACCOUNTING POLICIES (CONTINUED)


2.22
FINANCIAL INSTRUMENTS (CONTINUED)


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.

Impairment of financial assets

At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in the Consolidated Statement of Comprehensive Income. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the Consolidated Statement of Comprehensive Income.

Basic 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 Group after the deduction of all its liabilities.

Basic financial liabilities, which include trade and other creditors, bank loans, other loans and loans due to fellow group companies are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.

Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.

Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade creditors are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Group transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Group will continue to recognise the value of the portion of the risks and rewards retained.
Page 27

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

2.ACCOUNTING POLICIES (CONTINUED)


2.22
FINANCIAL INSTRUMENTS (CONTINUED)


Derecognition of financial liabilities

Financial liabilities are derecognised when the Group's contractual obligations expire or are discharged or cancelled.


3.



JUDGEMENTS IN APPLYING ACCOUNTING POLICIES AND KEY SOURCES OF ESTIMATION UNCERTAINTY

Critical judgements in applying the Group's accounting policies
The Group makes certain estimates and assumptions regarding the future. Management also needs to exercise judgement in applying the Group's accounting policies. Estimates and judgements are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Our key judgements and estimations are as follows:
Judgements
(i) Assessing indicators of impairment
In assessing whether there have been any indicators of impairment assets, the directors have considered both external and internal sources of information such as market conditions, counterparty credit ratings and experience of recoverability. A goodwill impairment charge of £10,750,621 has been recognised in the year (2023: £32,504,962). In addition, a Walnut Newco Limited company intercompany receivable impairment of £22,900,000 has been recognised in the year (2023: £nil).
Key sources of estimation uncertainty
(i) Determining useful economic lives of tangible fixed assets and intangible assets
The Group depreciates tangible fixed assets and amortises intangible assets over their estimated useful lives. The estimation of the useful lives of assets is based on historic performance as well as expectations about future use and therefore requires estimates and assumptions to be applied by management. The actual lives of these assets can vary depending on variety of factors, including technological innovation, product life cycles and maintenance programmes.
(ii) Recoverability of debtors
The Group establishes a provision for debtors that are estimated not to be recoverable. When assessing recoverability the directors have considered factors such as the aging of the debtors, past experience of recoverability, and the credit profile of individual or groups of customers.
(iii) Stock provision
Stock is reviewed annually with reference to current and new products along with recent sales history of the related products.
(iv) Stock valuation
The Directors have considered whether the net realisable value of inventory was lower than the carrying value. Slow-moving, excess and obsolete inventory are reviewed and provided for as necessary. The Directors, having reviewed the run off of inventory subsequent to the period end and the prices achieved have concluded that its net realisable value was not materially lower than the net carrying value at period end.

Page 28

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

4.


TURNOVER

An analysis of turnover by class of business is as follows:


Year ended 31 March 2024
Period 4 July 2022 to 31 March 2023
£
£

Supply and installation
15,466,812
11,987,108

Product sales and training
2,691,864
1,840,177

Inspection and repairs
2,358,742
1,196,789

Other
166,820
197,562

20,684,238
15,221,636


Analysis of turnover by country of destination:

Year ended 31 March 2024
Period 4 July 2022 to 31 March 2023
£
£

United Kingdom
19,966,496
12,496,048

Rest of Europe
714,277
2,381,291

Rest of the world
3,465
344,297

20,684,238
15,221,636



5.


OTHER OPERATING INCOME

Year ended 31 March 2024
Period 4 July 2022 to 31 March 2023
£
£

Other operating income
-
2,002


Page 29

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

6.


OPERATING LOSS

The operating loss is stated after charging:

Year ended 31 March 2024
Period 4 July 2022 to 31 March 2023 
£
£

Depreciation charged on tangible fixed assets
329,125
149,927

Amortisation charged on intangible fixed assets
2,460,604
3,828,540

Impairment charged on intangible assets
10,750,621
32,504,962

Exchange differences
17,128
12,704

Other operating lease rentals
552,490
371,525


7.


AUDITORS' REMUNERATION

During the year, the Group obtained the following services from the Company's auditors:


Year ended 31 March 2024
Period 4 July 2022 to 31 March 2023
£
£

Fees payable to the Company's auditors for the audit of the consolidated and parent Company's financial statements
61,750
90,000

Fees payable to the Company's auditors in respect of:

    Taxation compliance services
19,750
25,150

    All other services
29,500
48,540

Page 30

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

8.


EMPLOYEES

Staff costs, including directors' remuneration, were as follows:


Group
Group
Year ended 31 March 2024
Period 4 July 2022 to 31 March 2023
£
£


Wages and salaries
5,244,051
4,282,552

Social security costs
547,865
353,696

Cost of defined contribution scheme
128,702
86,251

5,920,618
4,722,499


The average monthly number of employees, including the directors, during the year was as follows:


Year ended 31 March 2024
Period 4 July 2022 to 31 March 2023
            No.
            No.







Operations
132
88



Management
4
6

136
94

The Company has no employees other than the directors, who did not receive any remuneration (2023 - £NIL)

9.


DIRECTORS' REMUNERATION

Year ended 31 March 2024
Period 4 July 2022 to 31 March 2023
£
£

Directors' emoluments
154,282
311,503


The highest paid director received remuneration of £154,282 (2023 - £146,000).

The value of the Group's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £NIL (2023 - £NIL).

The Directors are considered to be the only key management personnel of the Company and Group for the 2024 and 2023 financial periods.

Page 31

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

10.


INTEREST RECEIVABLE AND SIMILAR INCOME

Year ended 31 March 2024
Period 4 July 2022 to 31 March 2023
£
£


Other interest receivable
4,685
2,951


11.


INTEREST PAYABLE AND SIMILAR EXPENSES

Year ended 31 March 2024
Period 4 July 2022 to 31 March 2023
£
£


Interest payable on loan notes (note 21)
5,466,795
3,221,790

Bank interest payable (note 21)
2,356,316
1,196,741

7,823,111
4,418,531


12.


TAXATION


Year ended 31 March 2024
Period 4 July 2022 to 31 March 2023
£
£

CORPORATION TAX


Current tax on profits for the year
-
62,555

Adjustments in respect of previous periods
(237,599)
-


TOTAL CURRENT TAX
(237,599)
62,555

DEFERRED TAX


Origination and reversal of timing differences
68,037
(2,766)

TOTAL DEFERRED TAX
68,037
(2,766)


TAX ON LOSS
(169,562)
59,789
Page 32

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
 
12.TAXATION (CONTINUED)


FACTORS AFFECTING TAX CHARGE FOR THE YEAR/PERIOD

The tax assessed for the year/period is higher than (2023 - higher than) the standard rate of corporation tax in the UK of 25% (2023 - 19%). The differences are explained below:

Year ended 31 March 2024
Period 4 July 2022 to 31 March 2023
£
£


Loss on ordinary activities before tax
(21,685,342)
(39,430,899)


Loss on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 19%)
(5,421,335)
(7,491,871)

EFFECTS OF:


Fixed asset differences
86,504
(6,478)

Expenses not deductible for tax purposes
4,434,292
6,766,781

Capital allowances for year/period in excess of depreciation
(18,467)
(14,090)

Movement in deferred tax not recognised
987,043
805,447

Adjustments to tax charge in respect of prior periods
(237,599)
-

TOTAL TAX CHARGE FOR THE YEAR/PERIOD
(169,562)
59,789


FACTORS THAT MAY AFFECT FUTURE TAX CHARGES

At the year end the group had losses of £3,948,172 (2023: £3,221,788). A deferred tax asset of £987,043 (2023: £805,447) was not recognised.

Page 33

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

13.


INTANGIBLE ASSETS

Group and Company





Patents
Development expenditure
Goodwill
Total

£
£
£
£



COST


At 1 April 2023
48,630
152,046
60,233,502
60,434,178


Additions
-
14,495
-
14,495



At 31 March 2024

48,630
166,541
60,233,502
60,448,673



AMORTISATION 
AND 
IMPAIRMENT CHARGE


At 1 April 2023
6,387
10,580
36,333,502
36,350,469


Amortisation charge for the year on owned assets
5,077
65,527
2,390,000
2,460,604


Impairment charge
-
-
10,750,621
10,750,621



At 31 March 2024

11,464
76,107
49,474,123
49,561,694



NET BOOK VALUE



At 31 March 2024
37,166
90,434
10,759,379
10,886,979



At 31 March 2023
42,243
141,466
23,900,000
24,083,709



The Company had no intangible assets at both the 2024 and 2023 year ends.
The amortisation and impairment charge as at 31 March 2024 is £2,460,604 and £10,750,621 (2023: £3,828,540 and £32,504,962).

Page 34
 


 
WALNUT NEWCO LIMITED


 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024


14.


TANGIBLE FIXED ASSETS


Group







Freehold property
Long-term l/hold property
Plant and machinery
Motor vehicles
Fixtures and fittings
Office equipment
Computer equipment
Total

£
£
£
£
£
£
£
£



COST OR VALUATION


At 1 April 2023
1,840,474
153,980
261,105
42,672
96,995
84,931
47,052
2,527,209


Additions
3,175
143,228
114,532
28,445
100,137
3,379
57,080
449,976


Transfers intra group
-
-
-
9
-
-
-
9


Disposals
(2,200)
-
(6,333)
(3,014)
(34,793)
-
-
(46,340)



At 31 March 2024

1,841,449
297,208
369,304
68,112
162,339
88,310
104,132
2,930,854



DEPRECIATION


At 1 April 2023
19,172
11,788
29,549
9,171
17,033
56,415
6,799
149,927


Charge for the year on owned assets
28,788
31,146
114,326
23,827
72,361
4,384
54,293
329,125


Transfers intra group
-
-
-
9
-
-
-
9


Disposals
(48)
-
(1,718)
(655)
(16,233)
-
-
(18,654)



At 31 March 2024

47,912
42,934
142,157
32,352
73,161
60,799
61,092
460,407



NET BOOK VALUE



At 31 March 2024
1,793,537
254,274
227,147
35,760
89,178
27,511
43,040
2,470,447



At 31 March 2023
1,821,302
142,192
231,556
33,501
79,962
28,516
40,253
2,377,282
Page 35

 


 
WALNUT NEWCO LIMITED


 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

           14.TANGIBLE FIXED ASSETS (CONTINUED)


The Company had no tangible assets at both the 2024 and 2023 year ends.



15.


FIXED ASSET INVESTMENTS


Company






Investments in subsidiary companies

£



COST OR VALUATION


At 1 April 2023
202,041



At 31 March 2024
202,041




The Company acquired 100% of the ordinary share capital in Walnut Bidco Limited during the period ended 31 March 2023 for consideration of £202,041. Walnut Bidco Limited acquired 100% of the ordinary share capital of Sansom Holdings Limited.

Page 36
 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

SUBSIDIARY UNDERTAKINGS


The following were subsidiary undertakings of the Company:

Name

Registered office

Principal activity

Class of shares

Holding

Walnut Bidco Limited
C/O Roxburgh Milkins Limited, Merchants House North, United Kingdom, BS1 4RW
Holding company
Ordinary
100%
Sansom Holdings Limited*
C/O Roxburgh Milkins Limited, Merchants House North, United Kingdom, BS1 4RW
Holding company
Ordinary
100%
Industrial Workspace Specialists Limited (IWS Group)*
C/O Roxburgh Milkins Limited, Merchants House North, United Kingdom, BS1 4RW
Holding company
Ordinary
100%
Brandsafe Protection Limited*
Unit 4, Io Centre Fingle Drive, United Kingdom, MK13 0AT
Supply and installation of impact protection and safety equipment
Ordinary
100%
Brandsafe Limited*
Unit 4, Io Centre Fingle Drive, United Kingdom, MK13 0AT
Dormant
Ordinary
100%
Beaverswood Supply Co. Limited*
Unit 8 Metro Centre, Toutley Road, United Kingdom, RG41 1QW
Supply of labelling, signage and visual communication products
Ordinary
100%
Rittenhouse Holdings Limited*
C/O Roxburgh Milkins Limited, Merchants House North, United Kingdom, BS1 4RW
Dormant
Ordinary
100%
Rack Management Limited*
C/O Roxburgh Milkins Limited, Merchants House North, United Kingdom, BS1 4RW
Dormant
Ordinary
100%
The Rack Group Limited*
Unit 3 Shawfield Road,  United Kingdom S71 3HS
Supply and construction of industrial racking, partitioning, engineering and retail of storage equipment
Ordinary
100%
Pro-Store Limited*
Unit 3 Shawfield Road,  United Kingdom S71 3HS
Supply and construction of industrial racking, partitioning, engineering and retail of storage equipment
Ordinary
100%
Rack Armour Limited*
Unit 3 Shawfield Road,  United Kingdom S71 3HS
Supply and construction of industrial racking, partitioning, engineering and retail of storage equipment
Ordinary
100%
Rack Training Limited*
Unit 3 Shawfield Road,  United Kingdom S71 3HS
Manufacture of protective casing for industrial racking
Ordinary
100%
Anco Storage Equipment Limited*
C/O Roxburgh Milkins Limited, Merchants House North, United Kingdom, BS1 4RW
Sale of shelving and racking equipment, exlusively through its trade only distribution channel
Ordinary
100%
Page 37

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
SUBSIDIARY UNDERTAKINGS (CONTINUED)


* denotes indirectly owned subsidiaries through Walnut Bidco Limited.
The financial statements for the year ended 31 March 2024 for the following subsidiaries have not been audited. These subsidiaries have taken an exemption under section 479A of the Companies Act 2006 relating to the subsidiary undertakings:

Name

Walnut Bidco Limited (registration number: 14220956)

Sansom Holdings Limited* (registration number: 13081994)

Industrial Workspace Specialists Limited (IWS Group)* (registration number: 12089294)

Brandsafe Protection Limited* (registration number: 07112068)

Brandsafe Limited* (registration number: 06998333)

Beaverswood Supply Co. Limited* (registration number: 01784234)

Rittenhouse Holdings Limited* (registration number: 11415258

Rack Management Limited* (registration number: 01613614)

The Rack Group Limited* (registration number: 01617900)

Pro-Store Limited* (registration number: 02120288)

Rack Armour Limited* (registration number: 04912798)

Rack Training Limited* (registration number: 06870177)

Anco Storage Equipment Limited* (registration number: 03344169)


16.


STOCKS

Group
Group
2024
2023
£
£

Raw materials and consumables
1,498,781
1,757,234

Work in progress
163,670
138,949

Finished goods and goods for resale
1,885,115
1,870,839

3,547,566
3,767,022


The difference between purchase price or production cost of stocks and their replacement cost is not material.

Stocks are stated after provisions for impairment of £95,626 (2023: £212,010)
The Company had no stocks at either 2024 or 2023 period end dates.


17.


DEBTORS

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£


Trade debtors
3,802,727
4,288,603
-
-

Amounts owed by group undertakings
-
-
286,946
23,900,000
Page 38

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

17.DEBTORS (CONTINUED)


Other debtors
53,519
37,927
25,616
27,855

Prepayments and accrued income
777,553
1,216,218
-
1,586,034

Tax recoverable
4,434
58,547
-
-

4,638,233
5,601,295
312,562
25,513,889


Trade debtors are stated after a provision for impairment of £113,066 (2023: £8,439)
Amounts owed by group undertakings are unsecured, repayable on demand, interest free and disclosed net of provisions.


18.


CASH AND CASH EQUIVALENTS

Group
Group
2024
2023
£
£

Cash at bank and in hand
1,258,829
2,368,578


The Company had no cash and cash equivalents at both the 2024 and 2023 period ends.


19.


CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Trade creditors
2,662,033
2,364,802
418,953
107,484

Amounts owed to group undertakings
-
-
-
298,685

Corporation tax
-
-
-
37,559

Other taxation and social security
222,601
332,194
-
-

Deferred consideration
-
1,000,000
-
-

Other creditors
36,427
29,824
-
-

Accruals and deferred income
541,845
494,809
-
-

3,462,906
4,221,629
418,953
443,728


Amounts owed to group undertakings are unsecured, repayable on demand, interest free and disclosed net of provisions.

Page 39

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

20.


CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Bank loans (note 21)
20,547,473
20,166,410
-
-

Loan notes (note 21)
50,452,948
49,452,948
49,452,948
49,452,948

Loan note interest accrual
8,688,586
3,221,790
8,688,586
3,221,790

79,689,007
72,841,148
58,141,534
52,674,738




Page 40

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

21.


LOANS


Analysis of the maturity of loans is given below:


Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£


AMOUNTS FALLING DUE 1-2 YEARS

Bank loans
250,000
-
-
-

Loan notes
50,452,948
49,452,948
49,452,948
49,452,948

AMOUNTS FALLING DUE 2-5 YEARS

Bank loans
20,297,473
20,166,410
-
-


71,000,421
69,619,358
49,452,948
49,452,948


Page 41

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
 
21.LOANS (CONTINUED)

Bank loans of £20,297,473 (2023: £20,166,410) relate to a term loan provided by HSBC UK Bank PLC, due for full repayment on 22 August 2029 and attracting an interest rate of SONIA + 4.5% to 5.25%. The loan is secured on the assets of the group. 
Bank loans of £250,000 (2023: £NIL) relate to a revolving credit facility provided by HSBC UK Bank PLC, due for full repayment on 22 August 2028 and attracting an interest of 4.5%. The loan is secured on the assets of the group.
On the 11 August 2022, the Company issued £12,149,985 of secured A1 investor loan notes, attracting a fixed rate of 10%. This loan note is due for repayment on 31 December 2029. 
On the 11 August 2022, the Company issued £12,149,983 of secured A2 investor loan notes, attracting a fixed rate of 10%. 
On the 11 August 2022, the Company issued £6,084,312 of secured B1 investor loan notes, attracting a fixed rate of 10%. 
On the 11 August 2022, the Company issued £18,820,709 of unsecured B2 investor loan notes, attracting a fixed rate of 10% 
On the 11 August 2022, the Company issued £123,980 of secured C1 investor loan notes, attracting a fixed rate of 10%. 
On the 11 August 2022, the Company issued £123,979 of secured C2 investor loan notes, attracting a fixed rate of 10%. 
On the 28 December 2023, the Group issued £1,000,000 of secured investor loan notes, attracting a fixed rate of 10%.
All loan notes are due for repayment on 31 December 2029. 
Interest on the loan notes is accrued and not payable until they mature in 2029. The loan interest accrued amounts to £8,688,586 (2022: £3,221,790) and is included within accruals due after one year. 
Bank loans are net of arrangement fees which are amortised at the effective interest rate over the period of the loan. 
On 11 August 2022 Alter Domus Trustees (UK) Limited registered a fixed and floating charge, containing a negative pledge clause, over the property of the Company and Group. 
On 11 August 2022, LDC (Managers) Limited registered a fixed and floating charge, containing a negative pledge clause, over the property of the Company and Group. 
On 28 December 2023, LDC (Managers) Limited registered a fixed and floating charge, containing a negative pledge clause, over the property of the Company and Group.

Page 42

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

22.


FINANCIAL INSTRUMENTS

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

FINANCIAL ASSETS

Cash at bank
1,258,829
2,368,578
-
-

Financial assets that are debt instruments measured at amortised cost
4,015,373
4,844,859
286,946
25,479,929

5,274,202
7,213,437
286,946
25,479,929


FINANCIAL LIABILITIES

Financial liabilities measured at amortised cost
82,929,312
76,730,583
58,560,487
53,080,907


Financial assets that are debt instruments measured at amortised cost comprise trade debtors, amounts owed by group undertakings and other debtors


Financial liabilities measured at amortised cost comprise trade creditors, amounts owed to group undertakings, other creditors, bank loans, bank overdrafts and other loans


23.


DEFERRED TAXATION


Group



2024
2023


£

£






At beginning of year
(218,746)
-


Charged to the Consolidated Statement of Comprehensive Income
(30,812)
2,766


Arising on business combinations
-
(221,512)



AT END OF YEAR
(249,558)
(218,746)

Page 43

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
 
23.DEFERRED TAXATION (CONTINUED)

The Company had no deferred tax at the 2024 and 2023 period ends





The provision for deferred taxation is made up as follows:

Group
Group
2024
2023
£
£

Accelerated capital allowances
(117,100)
(86,288)

Fair value of property on acquisition
(132,458)
(132,458)

(249,558)
(218,746)


24.


SHARE CAPITAL

2024
2023
£
£
ALLOTTED, CALLED UP AND FULLY PAID



435,664 (2023 - 435,664) Ordinary A shares of £0.10 each
43,566
43,566
446,513 (2023 - 446,513) Ordinary B1 shares of £0.25 each
111,628
111,628
4,445 (2023 - 4,445) Ordinary B2 shares of £0.25 each
1,112
1,112

156,306

156,306

Each ordinary share entitles the shareholders full voting, dividend and capital distribution rights and they do not confer any rights of redemption.



25.


RESERVES

Share premium account

This reserve records the amount above the nominal value received for shares sold, less transaction costs.

Profit and loss account

This reserve represents the cumulative losses of the Group and the Company.


26.


CAPITAL COMMITMENTS

At 31 March 2024 the Group and Company did not have any capital commitments.





Page 44

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

27.


PENSION COMMITMENTS

The Group operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pensions cost charge represents contributions payable by the Group to the fund and amounts to £128,702 (2023: £86,251). Contributions totaling £19,370 (2023: £25,076) were payable to the scheme at the end of the period and are included within other creditors.


28.


COMMITMENTS UNDER OPERATING LEASES

At 31 March 2024 the Group  had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
2024
2023
£
£

Not later than 1 year
682,197
336,839

Later than 1 year and not later than 5 years
1,896,582
720,108

Later than 5 years
1,365,535
467,500

3,944,314
1,524,447

The Company does not have any commitments under operating leases (2023: no commitments).

Page 45

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

29.


RELATED PARTY TRANSACTIONS

Transactions between group companies which are related parties, have been eliminated on consolidation and are not disclosed in this note.
During the year the following transactions occurred between an entity included within the Walnut Newco Limited Group and an external company in which R A Schofield was a director. There were no prior period transactions in relation to this entity.
In the prior period the following transactions occurred between entities included within the Walnut Newco Limited Group and an external company in which former directors J Van Den Berge and T Lacey were directors and shareholders. There were no current year transactions in relation to this entity.


2024
2023
£
£

Purchases made by Group entities from The Pallet Network Ltd and Specialist Industrials Ltd
Purchases by Brandsafe Protection Ltd from The Pallet Network Ltd
22,996
-
Purchases by Brandsafe Protection Ltd from Specialist Industrials Ltd
-
68,349
Purchases by Beaverswood Supply Co. Ltd from Specialist Industrials Ltd
-
11,167
Purchases by The Rack Group Limited from Specialist Industrials Ltd
-
1,279
22,996
80,795
Sales made by Group entities from Specialist Industrials Ltd
Sales by Brandsafe Protection Ltd to Specialist Industrials Ltd
-
34,857
Sales by Beaverswood Supply Co. Ltd to Specialist Industrials Ltd
-
16,745
Sales by The Rack Group Ltd to Specialist Industrials Ltd
-
2,517
-
54,119

A1 and A2 loan notes as disclosed in note 21 were issued in the prior period to LDC (Nominees) Ltd and LDC Parallel (Nominees) Ltd, a minority shareholder of the Group.
During the year to 31 March 2024 £NIL (2023: £6,084,312 and £12,168,622) of B1 and B2 loan notes were issued to J Van Den Berge, a former director of the Company.
During the year to 31 March 2024 £NIL (2023: £6,652,087) of B2 loan notes were issued to T E Lacey, a former director of the Company.
During the year to 31 March 2024 £20,000 (2023: £NIL) of loan notes were issued to R Harden, a current director of a Group subsidiary.
During the year to 31 March 2024 £10,000 of loan notes were issued to N Stephenson, a current director of the Company. In the prior period, £123,980 and £123,979 of C1 and C2 loan notes were issued to N Stephenson, a current director of the Company.
During the year a transaction occurred between an entity included within the Walnut Newco Limited Group and N Stephenson, a current director of the Company. The entity sold a motor vehicle to N Stephenson for £2,000 (2023: £NIL). The net book value at the time of disposal was £2,359, resulting in a loss on disposal of £359. 

Page 46

 
WALNUT NEWCO LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024

30.


POST BALANCE SHEET EVENTS

Subsequent to the year-end, a Group subsidiary has sold a freehold building. The sale was completed on 22 November 2024, with the property being sold for a total consideration of £1,150,000. The net book value at the year-end was £407,437. The gain will be reflected in the financial statements for the period in which the sale occurred. The transaction does not materially impact the Group's financial position or performance for the current year.


31.


CONTROLLING PARTY

During the period, a majority interest was not held by any of the shareholders, thus no ultimate controlling party existed.


Page 47