The directors present the strategic report for the year ended 31 March 2024.
Executive Summary
The Marine Civil Engineering and Contracting Division within the group is a specialised marine civil engineering contractor, and has rooted history of providing robust, safe and efficient solutions for marine infrastructure in the United Kingdom. The services provided by our associated company Hesselberg Hydro (UK) Limited, (“HH”) which original business was founded in Norway in 1986, specialises in the extensive use of Asphalt Coatings to provide protection to dams, rivers, and coastal erosion projects.
The group offers a broad range of Maritime Civil Engineering solutions, including coastal defence works, quay wall construction, under water concreting, dredging, installation of pontoons and marine piling. Our broadly based engineering expertise, a sterling safety record, and a commitment to quality, have combined to make TMS a dependable partner across the market in the United Kingdom.
The Statement of Income, which forms page 11 to these financial statements, records that the financial results for the year ended 31 March 2024, showing a Profit before taxation of £8,080,294 were a record. Within those results is the sum of £750,000 being a dividend received from our associated company HH.
The Current Year
The group's current financial year has started in an encouraging manner with contracts, either in progress or secured, amounting to £10.2 million. In addition, the contracts team have £10.5 million of contracts almost secured and the team believe that in respect of further tenders already submitted, the Group has a high expectancy of securing some £5.3 million.
Over the past year, our dedicated and highly experienced team of Estimators and Quantity Surveyors have been and are continuing to work to their capacity.
As reported in last year’s Strategic Review, HH (an associated company of Teignmouth Maritime Services Limited) started that year with the benefit of a £20 million contract. This project, of which the first phase has now been completed, forms a part of the Southern Shoreline project at Canvey Island in Essex, undertaken to strengthen the Southern Sea Wall and provide erosion protection. The works, which are expected to be completed over the next twelve months are being carried out by HH on behalf of the main contractor, Balfour Beatty. This project is incremental to HH’s other normal business opportunities, which continue to be pursued.
Overall Performance Review
Again, as reported last year, the Group continues to see growth in demand for its services, including, but not limited to, failing coastal and port infrastructures together with longer term environmental concerns.
Market Analysis
Current indicators suggest that the UK Maritime Civil Engineering Services market, where the Group is a well-positioned niche operator, is poised for sustained long-term growth. This optimistic outlook is underpinned by a diverse array of requirements. These include the reinstatement of failed river crossing structures, reservoir maintenance, coastal and sea defence projects, and the rehabilitation of neglected Military and Naval Port infrastructures. Additionally, significant opportunities exist in the redevelopment of Ports and Harbours and the restoration of deteriorating Coastal and Victorian Maritime facilities.
Moreover, the concept of Island Working - involving specialized projects on islands and remote coastal areas around the UK - further underscores the potential for expansion and the strategic importance of the Group in addressing these unique challenges.
Assessment of principal risks and uncertainties
The group's principal operational risks include the potential cost impact of adverse weather, difficult and unforeseen construction site conditions. Where those risks are capable of being identified at an early stage in the construction programme, the group seeks to introduce strategies to implement controls aimed to minimise the worst effects upon the individual project concerned. The strategies employed include, an in-depth investigation of the risk and its potential effects, followed wherever possible by the introduction of operational alternatives to manage and mitigate the financial impact, accompanied, whenever possible by resorting to less unfavourable contractual terms associated with the project.
The group’s risks also include its reliance upon the underlying financial and commercial strength of both its immediate customer base and the group’s specialist sub-contractors, employed in key support roles in the construction process. This risk is managed by a robust credit control approach.
UK Economy risk
The degree of risk primarily relates to the extent and speed of the group’s ability to react where there is an economic downturn, affecting those sectors within the construction industry we traditionally serve.
Historically, the group has managed to mitigate the worst elements of risk by always aiming to spread the workload over a broad number of sectors within our industry, including major civil engineering contractors, local authorities, port owners and operators, water utilities and a range of private clients.
To further manage this area of risk in times of a slowdown, and at the same time retain our dedicated workforce, the group seeks to redeploy members of its skilled workforce, freed from completed civil engineering projects, to carry out planned and preventative maintenance of the vessel fleet and major plant assets owned and operated by Marine Plant Hire (UK) Limited. Since the acquisition of Hesselberg Hydro, a sharing of resource has been adopted which further evens the utilisation of the workforce and which works in both directions.
Significant focus and attention are placed on minimising potential bad debt risk. The group maintains a dedicated credit control department where strict criteria are applied to the recovery of all debts within agreed credit terms. New customers are carefully vetted, including the use of credit agency references, and ensuring credit terms are only agreed within strict limits, approved by the Directors.
Change of government in the UK presents an opportunity for the Group to leverage its size and flexibility within the marine civil engineering sector. Regardless of shifts in policy or budget allocations, the Group's ability to adapt and pivot across various segments of the maritime market positions us advantageously. Should a new administration prioritise environmental sustainability, we are prepared to expand our involvement in coastal defence and climate resilience projects. Conversely, if the focus shifts towards infrastructure modernisation or defence, our expertise in refurbishing Naval and Military ports ensures we can capitalize on those opportunities. Our strategic adaptability allows us to thrive under varying governmental policies, making any changes in spending work to our benefit.
Margin risk
This risk relates to our ability to accurately assess the costs of projects at the tendering stage and the subsequent control of those costs down to the final delivery of a completed project. In addition, there are inherent risks, which arise as a result of specific contractual terms and conditions being imposed within a particular contract. The group’s ability to manage and mitigate this area of risk is achieved through a formalised bid review process and contractual control procedures, overseen by the Commercial Director’s department.
To maintain and improve margins and, at the same time mitigate risk, the group carries out systematic reviews of the methodology and cost implications of work tendered for. These include situation reviews (SWOT analysis) conducted by the directors as part of a process involving meetings with the estimators, project managers and other members of the project management team. An extension of this process is carried through to contract completion, involving continuous reviews of actual costs to forecasts. The results of the reviews are interrogated during a project to see what variations to working methodologies it may be possible to employ to secure the required margin over the lifespan of the project.
Inflation risk
At the present time there are fewer signs of a continuation of the recent trend in inflationary pressures upon certain of the key areas within the group's cost base.
The group seeks various ways to mitigate the full impact of cost inflation upon our margins. These include maintaining a close contact with our key suppliers, contemporaneously reducing lead times between the award of a contract and the start date of a project and, where possible, committing to early ordering of raw materials, as opposed to a “Just in time” approach.
As a result of the group’s strong liquidity position, some mitigation of the full effects of cost inflation has been possible, where our bids for raw materials, involving significant quantities of timber and or steel, the subject of short periods in the validity of supplier prices, is, in most cases, capable of being satisfactorily negotiated, agreed, and the price locked in.
Nevertheless, the unpredictability of cost inflation always remains a source of concern and vigilance.
Skilled Workforce Shortages
The need to train and retain a skilled workforce is of paramount importance to ensure the overall longer-term success of the business. We seek to mitigate this risk by monitoring the training requirements of each of our individual employees. An essential part of this process is to provide our employees with the best practical experience available and to ensure that individuals are given the opportunity to develop their professional engineering and other relevant skills, which in turn provides them with worthwhile opportunities for progression within the group.
As a part of the group’s training programme, regular reviews are conducted to ensure the most appropriate personnel are deployed to projects. This monitoring process is completed by a dedicated member of staff logging and managing a bespoke training database.
Supply Chain Risks
The UK marine civil engineering sector faces several supply chain risks that could impact project timelines and costs. A significant risk is the diversion of goods shipped to the UK due to the increased activity of African pirates targeting major shipping lanes. These disruptions can lead to delays in the delivery of critical materials and equipment, which are essential for large-scale projects such as port redevelopments, coastal defences, and maritime facility restorations. The unpredictability of such attacks necessitates rerouting ships through longer, safer routes, thereby increasing shipping times and costs.
This risk area is managed in a similar manner to the Inflation Risk, where the importance of early procurement of materials and bought in services are key.
Health and Safety
The management of Health and Safety includes both internal and external audits and inspections. Contributions from regular weekly meetings within the Health & Safety Department, Health & Safety Committee meetings and Monthly Operational Management Meetings track and plan company progression and education of health and safety within our organisation. Internal annual, bi-annual & GAP audits ensure that all Health & Safety documentation within the organisation are up to date and in line with current government legislation.
Periodic reviews carried out by external accreditation bodies contribute to improvements in Health and Safety within our organisation. The entire process is monitored by our dedicated Director of Health and Safety.
The group always seeks to comply with relevant Government guidelines, in order to provide a framework for operations to be carried out in a safe manner. This applies in our Offices, Workshops, on board our owned and chartered Vessels and throughout our construction sites.
The group recognises the paramount importance of the safety and wellbeing of the Company’s employees and to that end is continuously seeking to improve the management of the risks associated with Health, Safety and Wellbeing, in an effective manner.
Legislative Risks
The group always strives to comply with applicable legislation, including various Construction Industry and the Maritime Coastguard Agency Schemes.
Competitive risks The group recognises that it is always exposed to competitive third-party civil engineering businesses operating within our traditional market. The group aims to mitigate these risks through a combination of early-stage personal interaction with our customers. This includes advice aimed at cost reduction, often through the adoption of construction methodology with a view to achieving a competitive price advantage. |
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Financial instruments
The group's principal financial instruments comprise Trade Debtors and Trade Creditors, together with Bank and other loans. Due to the nature of the financial instruments used by the group, there is no exposure to price risk. The group's approach to managing other risks applicable to the financial instruments it employed, is summarised below:
Liquidity risk is managed by the directors' monitoring cash flow forecasts and maintaining a balance between available cash resources and payment terms with third party suppliers and other creditors.
In respect of loans, these comprise loans from financial institutions. The interest rate on all bank loans is fixed. The group manages the liquidity risk by ensuring there are sufficient funds to meet both the capital and interest repayments, as they become due.
Trade debtors are managed through the strict control of credit and by the implementation of policies that require appropriate credit checks on both existing and potential new customers.
Trade creditors risk is managed by ensuring that there are sufficient funds available to meet amounts as they fall due.
Bank and other loans are short-term in nature, with other borrowings secured on an investment property owned by the group. Interest is charged at 9.5%-12.5% per annum.
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 March 2024. Information required to be disclosed under schedule 7 of the Companies Act 2006 is set out in the Strategic Report on pages 1-5.
The results for the year are set out on page 11.
Ordinary dividends were paid amounting to £163,665. The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
The directors remain very optimistic and upbeat as they continue their assertive focus on reducing costs and improving margins, whilst striving to expand the group's operations and maintain turnover in the upcoming financial year.
The auditor, Darnells Audit Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
We have audited the financial statements of Teignmouth Maritime and Property Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2024 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows, the company statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
Basis for opinion
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
The information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
The strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below:
the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
we identify the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the company and sector in which it operates;
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation, data protection, employment, environmental and health and safety regulation;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
The primary responsibility for the prevention and detection of fraud rests with those charged with governance of the company and management.
We assessed the susceptibility of the company's and the group's financial statements to material misstatement, including how fraud might occur, by:
making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations
We evaluated the conditions in the context of incentives and/or pressure to commit fraud, considering the opportunity to commit fraud and the potential rationalisation of the fraudulent act.
Based on this understanding, we designed our audit procedures to detect material misstatements in respect of irregularities, including fraud, and to identify non-compliance with the laws and regulations above, as follows:
Enquiry of management and those charged with governance around actual and potential litigation and claims.
Enquiry of management in tax and compliance functions to identify any instances of non-compliance with laws and regulations.
Reviewing compliance with employment, environmental and health and safety legislation.
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.
Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business.
Investigated the rationale behind significant or unusual transactions.
We corroborated our enquiries through inspection of supporting documentation and records, as well as reviewing correspondence with regulatory bodies where available.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £1,605,248 (2023: £479,117 profit).
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
Teignmouth Maritime and Property Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Unit 20, Dawlish Business Park, Dawlish, Devon, EX7 0NH.
The group consists of Teignmouth Maritime and Property Holdings Limited and all of its subsidiaries.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The consolidated group financial statements consist of the financial statements of the parent company Teignmouth Maritime and Property Holdings Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.
All financial statements are made up to 31 March 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.
Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.
If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.
Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.
At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.
Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.
In the parent company financial statements, investments in associates are accounted for at cost less impairment.
Entities in which the group has a long-term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the equity instruments granted. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to equity.
The expense in relation to options over the parent company’s shares granted to employees of a subsidiary is recognised by the company as a capital contribution, and presented as an increase in the company’s investment in that subsidiary.
When the terms and conditions of equity-settled share-based payments at the time they were granted are subsequently modified, the fair value of the share-based payment under the original terms and conditions and under the modified terms and conditions are both determined at the date of the modification. Any excess of the modified fair value over the original fair value is recognised over the remaining vesting period in addition to the grant date fair value of the original share-based payment. The share-based payment expense is not adjusted if the modified fair value is less than the original fair value.
Cancellations or settlements (including those resulting from employee redundancies) are treated as an acceleration of vesting and the amount that would have been recognised over the remaining vesting period is recognised immediately.
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term.
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Valuations which include an estimate of costs to complete and remaining revenues are carried out monthly with particular consideration at the year end. These assessments may include a degree of inherent uncertainty when estimating contract profitability and any impairment provision that may be required.
At 31 March 2024 the accrual for further costs to come on contracts included in Gross amounts due to contract customers under Creditors falling due within one year totalled £553,718 (2023: £464,400).
All of the group's turnover derives from its principal activity in the UK. An analysis of the group's turnover is as follows:
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
Included in the Goodwill above is negative goodwill arising on the acquisition of Teignmouth Maritime Services Limited with a cost of £685,622 (2023: £685,622) and a net book value of £438,350 (2023: £512,432).
The investment properties were valued by the directors at 31 March 2024 based on open market value for existing use. In the opinion of the directors the carrying value of investment properties is not significantly different from their open market value.
The carrying value of land and buildings comprises:
Details of the leasing arrangements relating to investment properties are set out in note 29 to the financial statements.
Details of the company's subsidiaries at 31 March 2024 are as follows:
The group acquired 32.4% of the issued share capital of Teignmouth Maritime Services Limited which, excluding the treasury shares held in itself by Teignmouth Maritime Services Limited, gives the group 56.6% of the voting rights.
Details of associates at 31 March 2024 are as follows:
The investment in Teignmouth Maritime Properties Limited has been accounted for by the Group using the equity method of accounting.
Details of joint ventures at 31 March 2024 are as follows:
The investment in Hesselberg Hydro (UK) Limited is held by Teignmouth Maritime Services Limited, and has been accounted for by the Group using the equity method of accounting.
Group
Obligations under finance leases and hire purchase contracts are secured upon the assets acquired.
Other borrowings comprise a short-term loan repayable within 12 months, which is secured (see note 24 to the financial statements.
Company
Other borrowings comprise a short-term loan repayable within 12 months, which is secured (see note 24 to the financial statements.
Obligations under finance leases and hire purchase contracts are secured upon the assets acquired.
Group
Included in the bank loans above are:
a Covid Bounce Back loan of £24,948 which is unsecured, repayable by monthly instalments of £887 and bearing interest at 2.5%.
Other borrowings comprise a short-term loan repayable within 12 months, secured upon an investment property owned by the group and bearing interest at 8% above the bank base rate.
Company
Other borrowings comprise a short-term loan repayable within 12 months, secured upon an investment property owned by the company and bearing interest at 8% above the bank base rate.
Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 3-4 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
The deferred tax liability set out above is expected to reverse within the foreseeable future, and relates to accelerated capital allowances that are expected to mature within the same period.
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
The group owns a long leasehold flat as an investment property for rental purposes (see note 14 to the financial statements. The property is let under an assured shorthold tenancy for the next 3 months.
At the reporting end date the group had contracted with tenants for the following minimum lease payments:
Prior to 6 November 2024, the company held a majority shareholding in both Teignmouth Maritime Services Limited and Marine Plant Hire (UK) Limited.
On 6 November 2024, Teignmouth Maritime Services Limited acquired the remaining issued share capital of Marine Plant Hire (UK) Limited, resulting in it becoming a wholly-owned subsidiary.
On 24 March 2025, the company completed the disposal of its principal trading subsidiary, Teignmouth Maritime Services Limited, together with its subsidiary Marine Plant Hire (UK) Limited.
The remuneration of key management personnel is as follows.
During the year the group entered into the following transactions with related parties:
Other related parties include entities in which the directors and their close family members have an interest.
The following amounts were outstanding at the reporting end date:
The following amounts were outstanding at the reporting end date:
Group
During the year the group received rent from a share in an investment property, jointly owned by a close family member of one of the directors. Included in the figures above are the group's share of the rent received of £6,700 (2023: £5,500), and rent of £6,600 (2023: £6,600) paid to the close family member.
Company
During the year the company received rent from a share in an investment property, jointly owned by a close family member of one of the directors. The company's share of the rent received was £6,700 (2023: £5,500), and rent of £6,600 (2023: £6,600) was paid to the close family member.