Company registration number 03770985 (England and Wales)
NEWLYN PLC
FINANCIAL STATEMENTS
FOR THE YEAR ENDED
31 DECEMBER 2024
Century House
Wargrave Road
Henley-on-Thames
Oxfordshire
United Kingdom
RG9 2LT
NEWLYN PLC
CONTENTS
Page
Company information
1
Strategic report
2 - 4
Directors' report
5 - 6
Independent auditor's report
7 - 10
Statement of comprehensive income
11
Balance sheet
12
Statement of changes in equity
13
Notes to the financial statements
14 - 28
NEWLYN PLC
COMPANY INFORMATION
- 1 -
Directors
Mr. T. Durant
Ms. M. Fenner
Ms. L. Sargent
Mr. D. Smith
Ms. C. Vickers
Mr. A. White
Secretary
Mr. I. Whittingham
Company number
03770985
Registered office
Century House
Wargrave Road
Henley-on-Thames
Oxfordshire
United Kingdom
RG9 2LT
Auditor
Verallo
Century House
Wargrave Road
Henley-on-Thames
Oxfordshire
United Kingdom
RG9 2LT
NEWLYN PLC
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 2 -

The directors present the strategic report for the year ended 31 December 2024.

Fair review of the business

The company continues to focus on its core activity, being debt recovery and enforcement services, principally to Local Authorities.

As reported in the company's profit and loss account on page 11. These figures show a marked increase on the previous year’s performance which underlines the success of the Board’s decisions and strategic planning for developing the company’s market share of the enforcement recovery industry.

Post year end, in order to future proof and strengthen the position of the group, Newlyn Group Holding Ltd established a trust, Newlyn Employee Ownership Trust, to be constituted as an employee-ownership trust. On 2 April 2025, the Newlyn Employee Ownership Trust purchased 89.86% of the shares of Newlyn Group Holding Ltd.

Principal risks and uncertainties

The enforcement recovery industry has seen a change in recent times with consolidation and mergers of numerous company’s within the market place.  This provides both challenges and opportunities which the board at Newlyn are keen to embrace with a view to establishing an independent, service driven product that will be aimed at meeting clients requirements.  In essence this is not dissimilar to our current trading aims but we believe we can offer agility into this service delivery that large multi service company’s cannot or will not be able to deliver.

The board continue to meet on a monthly basis to discuss trading activities and new business opportunities.

Economic Position - The importance of maintaining close relationships with all of its customers has never been more important, during the last year understanding our clients needs and requirements has helped the company maintain its strong trading position and seen its market share increase with some key new business gains.

Competitor pressure - The market remains highly competitive, and the directors believe the market will continue to be subject to amalgamations and takeovers. Our very strong performance has seen the company expand its market share and we believe we are in a unique position to offer the Local Authority customers a bespoke, crafted service delivery that corporate agency's cannot offer.

Key performance indicators

Management use a range of performance measures to monitor and manage the business. The KPIs used to determine the progress and performance of the company are set out below.

Turnover

Turnover has increased by 5.0% compared to the prior year

Gross profit margin

The company's gross profit margin has decreased in the year from 42.0% to 38.3%.

Financial position at the reporting date

The balance sheet shows that the company's net assets at the year end have decreased from £16,264,699 to £8,202,403, as a result of a distribution to Newlyn Group Holding Ltd.

NEWLYN PLC
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 3 -
Other information and explanations

The company retained all key operating personnel and recruited several new members of staff to strategic roles within the operation.  Management continues to seek to ensure that key personnel are appropriately remunerated to ensure that good performance is recognised and that the level of staff turnover is kept to a minimum.  The company has resumed and maintained service of the bank loan repayments including interest payments.

The company has continued to win new business during the last trading period and is intent on increasing its market share through strategic tender submissions based on service delivery and a quality product.

172 STATEMENT

This S172 statement, explains how the Directors: have engaged with employees, suppliers, customers and others have had regard to employee interests, the need to foster the company’s business relationships with suppliers, customers and other, and the effect of that regards, including on the principal decisions taken by the company during the financial year. The S172 statement focuses on matters of strategic importance to Newlyn PLC, and the level of information disclosed is consistent with the size and the complexity of the business. Newlyn PLC’s Board has a clear framework for determining the matters within its remit and has approved Terms of Reference. Certain financial and strategic thresholds have been determined to identify matters requiring Board consideration and approval. When making decisions, each Director ensures that he acts in the way he considers are in good faith, would most likely promote the Company’s success for the benefit of its members as a whole, and in doing so have regard (among other matters) to

NEWLYN PLC
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 4 -

In doing so, our Directors act fairly, between the Company’s members. The Board recognises that it has an important role in assessing and monitoring that our desired culture is embedded in the values, attitudes and behaviours we demonstrate, including in our activities and stakeholder relationships.

On behalf of the board

Mr. D. Smith
Director
14 May 2025
NEWLYN PLC
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 5 -

The directors present their annual report and financial statements for the year ended 31 December 2024.

Principal activities

The principal activity of the company continued to be that of debt collection services.

Results and dividends

The results for the year are set out on page 11.

Ordinary dividends were paid amounting to £13,090,000. The directors do not recommend payment of a further dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Ms. M. Coyne
(Resigned 1 February 2025)
Mr. T. Durant
Ms. M. Fenner
Ms. L. Sargent
Mr. D. Smith
Ms. C. Vickers
Mr. A. White
Qualifying third party indemnity provisions

The company has made qualifying third party indemnity provisions for the benefit of its directors during the year. These provisions remain in force at the reporting date.

Financial instruments
Liquidity risk

The company manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the company has sufficient liquid resources to meet the operating needs of the business.

Credit risk

All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

Auditor

In accordance with the company's articles, a resolution proposing that Verallo be reappointed as auditor of the company will be put at a General Meeting.

NEWLYN PLC
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 6 -
Statement of directors' responsibilities

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Strategic report

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

On behalf of the board
Mr. D. Smith
Director
14 May 2025
NEWLYN PLC
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF NEWLYN PLC
- 7 -
Opinion

We have audited the financial statements of Newlyn PLC (the 'company') for the year ended 31 December 2024 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

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 Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

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

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

NEWLYN PLC
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF NEWLYN PLC
- 8 -

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report and the directors' report.

 

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

 

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

 

Irregularities, including fraud, are instances of non-compliance with laws and regulations. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

 

Extent to which the audit was considered capable of detecting irregularities, including fraud

The objectives of our audit, in respect to fraud, are: to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and its management.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

NEWLYN PLC
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF NEWLYN PLC
- 9 -

Our approach was as follows:

 

 

Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Where the risk was considered to be higher, we performed audit procedures to address each identified fraud risk. These procedures included: testing manual journals; reviewing the financial statement disclosures and testing to supporting documentation; performing analytical procedures; and enquiring of management, and were designed to provide reasonable assurance that the financial statements were free from fraud or error.

 

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

 

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditors/audit-assurance/auditor-s-responsibilities-for-the-audit-of-the-fi/description-of-the-auditor%E2%80%99s-responsibilities-for. This description forms part of our auditor’s report.

NEWLYN PLC
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF NEWLYN PLC
- 10 -
Use of report

This report is made solely to the company's member in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's member those matters we are required to state to the member in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's member, for our audit work, for this report, or for the opinions we have formed.

Michelle Hewitt-Dutton FCCA (Senior Statutory Auditor)
For and on behalf of Verallo
Statutory Auditor
Office: Henley-On-Thames
14 May 2025
NEWLYN PLC
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
- 11 -
2024
2023
Notes
£
£
Turnover
3
28,781,643
27,422,149
Cost of sales
(17,841,732)
(15,918,342)
Gross profit
10,939,911
11,503,807
Administrative expenses
(4,822,638)
(4,109,461)
Other operating income
175,025
93,950
Operating profit
4
6,292,298
7,488,296
Interest receivable and similar income
7
213,497
197,821
Profit before taxation
6,505,795
7,686,117
Tax on profit
8
(1,478,091)
(731,438)
Profit for the financial year
5,027,704
6,954,679

The profit and loss account has been prepared on the basis that all operations are continuing operations.

The notes on pages 14 to 28 form part of these financial statements
NEWLYN PLC
BALANCE SHEET
AS AT 31 DECEMBER 2024
31 December 2024
- 12 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
10
590,420
541,951
Current assets
Debtors
11
9,612,092
14,331,468
Cash at bank and in hand
6,845,928
10,697,786
16,458,020
25,029,254
Creditors: amounts falling due within one year
12
(8,534,816)
(9,154,992)
Net current assets
7,923,204
15,874,262
Total assets less current liabilities
8,513,624
16,416,213
Provisions for liabilities
Provisions
13
200,000
54,739
Deferred tax liability
14
111,221
96,775
(311,221)
(151,514)
Net assets
8,202,403
16,264,699
Capital and reserves
Called up share capital
16
51,000
51,000
Profit and loss reserves
17
8,151,403
16,213,699
Total equity
8,202,403
16,264,699
The financial statements were approved by the board of directors and authorised for issue on 14 May 2025 and are signed on its behalf by:
Mr. D. Smith
Director
Company Registration No. 03770985
The notes on pages 14 to 28 form part of these financial statements
NEWLYN PLC
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
- 13 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 January 2023
51,000
14,259,020
14,310,020
Year ended 31 December 2023:
Profit and total comprehensive income for the year
-
6,954,679
6,954,679
Dividends
9
-
(5,000,000)
(5,000,000)
Balance at 31 December 2023
51,000
16,213,699
16,264,699
Year ended 31 December 2024:
Profit and total comprehensive income for the year
-
5,027,704
5,027,704
Dividends
9
-
(13,090,000)
(13,090,000)
Balance at 31 December 2024
51,000
8,151,403
8,202,403
The notes on pages 14 to 28 form part of these financial statements
NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 14 -
1
Accounting policies
Company information

Newlyn PLC (03770985) is a private company limited by shares incorporated in England and Wales. The registered office is Century House, Wargrave Road, Henley-on-Thames, Oxfordshire, United Kingdom, RG9 2LT.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

 

 

The financial statements of the company are consolidated in the financial statements of Newlyn Group Holding Ltd. These consolidated financial statements are available from Companies House.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation, based upon future forecasts, that the company 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.

 

The financial statements have been prepared on a going concern basis, which assumes the company will continue in operational existence, and will be able to meet its liabilities as they fall due, for a period of at least twelve months from the date of approval of the financial statements.

NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 15 -
1.3
Turnover

Turnover represents revenue earned (excluding value added tax) under contracts to provide professional services from bailiff and related activities.

 

Bailiff service income is recognised on remittance of fees to the clients' debtors, as it is only at this point that the economic benefits are guaranteed to flow to the company.

 

Rent receivable is recognised on the accruals basis. Rent received in advance is carried forward as deferred income and released to the income statement in the period to which it relates.

1.4
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Plant and equipment
33% straight line
Fixtures and fittings
15% on reducing balance
Motor vehicles
33% on reducing balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

1.5
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss.

NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 16 -
1.6
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.7
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

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.

Impairment of financial assets

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.

NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 17 -
Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company 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.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors, 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.

Other financial liabilities

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.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.8
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 18 -
1.9
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.10
Provisions

Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

 

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

1.11
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 19 -
1.12
Retirement benefits

The company operates a money purchase (defined contribution) pension scheme. Contributions payable to the scheme are charged to the profit and loss account in the period to which they relate. The contributions are invested separately from the company's assets.

1.13
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

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.

1.14
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Assessing indicators of impairment

In assessing whether there have been any indicators of impairment of financial assets, the directors have considered both external and internal sources of information such as market conditions, counterparty credit ratings and experience of recoverability. There have been no material indicators of impairments identified during the current financial year.

NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
2
Judgements and key sources of estimation uncertainty
(Continued)
- 20 -
Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Recoverability of receivables

Directors assess the recoverability of receivables on a monthly basis, through the review of the ageing profile of the current debtors, along with past knowledge of the client and recoverability. At the year end, it was concluded by the directors that no provision would be required. A 1% bad debt provision would give rise to a £14,247 impact on the financial statements.

Determining residual and useful economic life of tangible assets

The company depreciates tangible assets over their estimated useful lives. The estimation on the useful life 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 a variety of factors, including technological innovation, product life cycles and maintenance programs.

 

Judgement is applied by management when determining the residual values for tangible fixed assets. When determining the residual value management aim to assess the amount that the company would currently obtain for the disposal of the asset, if it were already of the condition expected at the end of its useful economic life. Where possible this is done with reference to external market prices.

Added Value

Within the contractual agreements between Newlyn PLC and the local councils, there is potential for a contractual obligation to provide added value services.

    

The agreements do not specify a cash value, therefore the directors estimate the cost of the obligations, based on the stage of the agreement at the year end. Assessing previous experiences with the customer and the anticipated cost over the life of the agreement. Any amendment to the accrual is made through the profit and loss on an annual basis.

 

An amount of £560,825 (2023: £524,452) has been included in the financial statements in relation to the added value.

 

Legal Provision

Management are aware that the risk of litigation against the company is high in the sector they operate in. As such, they employ the use of legal professionals to ensure accurate estimation of the potential exposure they may face in relation to such legal proceedings.

 

An amount of £200,000 (2023: £54,739) has been included in the financial statements in relation to the legal provision.

NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 21 -
3
Turnover and other revenue

An analysis of the company's turnover is as follows:

2024
2023
£
£
Turnover analysed by class of business
Debt Collection
28,781,643
27,422,149
2024
2023
£
£
Other revenue
Interest income
213,497
197,821
Rent received
40,000
40,000
4
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
39,500
29,500
Depreciation of owned tangible fixed assets
249,381
226,110
Profit on disposal of tangible fixed assets
(48,955)
(87,084)
Operating lease charges
273,486
265,859
5
Employees

The average monthly number of persons (including directors) employed by the company during the year was 80 (2023 - 76)

2024
2023
Number
Number
Directors
7
7
Bailiffs
15
14
Admin
49
47
Sales & Marketing
9
8
Total
80
76
NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
5
Employees
(Continued)
- 22 -

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
4,561,028
4,408,870
Social security costs
517,833
369,144
Pension costs
57,278
50,571
5,136,139
4,828,585
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
1,565,690
1,626,407
Company pension contributions to defined contribution schemes
9,576
7,925
1,575,266
1,634,332

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 7 (2023 - 7). The directors are also considered to be the key management personnel.

Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
261,522
246,010
Company pension contributions to defined contribution schemes
1,321
-
7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
208,404
184,055
Other interest income
5,093
13,766
Total income
213,497
197,821
NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 23 -
8
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
1,463,645
953,325
Adjustments in respect of prior periods
-
0
(252,409)
Total current tax
1,463,645
700,916
Deferred tax
Origination and reversal of timing differences
14,446
30,522
Total tax charge
1,478,091
731,438

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:

2024
2023
£
£
Profit before taxation
6,505,795
7,686,117
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 23.50%)
1,626,449
1,806,237
Tax effect of expenses that are not deductible in determining taxable profit
102,179
69,605
Effect of change in corporation tax rate
-
0
3,189
Group relief
(250,537)
(1,144,092)
Super deduction
-
0
(3,501)
Taxation charge for the year
1,478,091
731,438
9
Dividends
2024
2023
£
£
Final paid
13,090,000
5,000,000
NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 24 -
10
Tangible fixed assets
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
Cost
At 1 January 2024
1,042,238
13,650
242,903
1,298,791
Additions
342,556
-
0
-
0
342,556
Disposals
(271,196)
(13,650)
(13,206)
(298,052)
At 31 December 2024
1,113,598
-
0
229,697
1,343,295
Depreciation and impairment
At 1 January 2024
615,719
7,843
133,278
756,840
Depreciation charged in the year
212,712
564
36,105
249,381
Eliminated in respect of disposals
(232,670)
(8,407)
(12,269)
(253,346)
At 31 December 2024
595,761
-
0
157,114
752,875
Carrying amount
At 31 December 2024
517,837
-
0
72,583
590,420
At 31 December 2023
426,519
5,807
109,625
541,951
11
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
7,022,194
7,833,865
Amounts owed by group undertakings
2,400,000
6,350,000
Other debtors
19,045
2,349
Prepayments and accrued income
170,853
145,254
9,612,092
14,331,468

Included within trade debtors is an amount of £4,704,220 (2023 - £5,480,930), that relates to designated client money (note 12).

 

The bank holds a £100,000 bond against the client money by way of security.

NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 25 -
12
Creditors: amounts falling due within one year
2024
2023
£
£
Trade creditors
5,047,616
5,657,972
Amounts owed to group undertakings
520,539
604,944
Corporation tax
379,046
480,645
Other taxation and social security
642,301
477,365
Other creditors
19,547
52,715
Accruals and deferred income
1,925,767
1,881,351
8,534,816
9,154,992

Included within trade creditors is an amount of £4,704,220 (2023 - £5,480,930) that relates to designated client money (note 11).

 

13
Provisions for liabilities
2024
2023
£
£
Legal Provision
200,000
54,739
Movements on provisions:
Legal Provision
£
At 1 January 2024
54,739
Additional provisions in the year
145,261
At 31 December 2024
200,000

Management are aware that the risk of litigation against the company is high in the sector they operate in. As such, they employ the use of legal professionals to ensure accurate estimation of the potential exposure they may face in relation to such legal proceedings.

 

The provision relates to known, ongoing cases, that are anticipated but not guaranteed to be settled over the next twelve months.

NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 26 -
14
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
111,221
96,775
2024
Movements in the year:
£
Liability at 1 January 2024
96,775
Charge to profit or loss
14,446
Liability at 31 December 2024
111,221

The deferred tax liability set out above is expected to reverse and relates to accelerated capital allowances that are expected to mature.

15
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
57,278
50,571

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

16
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary Shares of £1 each
51,000
51,000
51,000
51,000

The company has one class of ordinary shares. The ordinary shares each carry one voting right.

17
Reserves
NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
17
Reserves
(Continued)
- 27 -
Profit and loss reserves

The Profit and loss account represents cumulative profits or losses, net of dividends paid and other adjustments.

18
Financial commitments, guarantees and contingent liabilities

Due to the nature of the business, the company is subject to small claims litigation from time to time. At the year end the directors are not aware of any cases, both individually or collectively, that would have a material impact on the financial statements. A general estimate of £200,000 (2023 - £54,739) has been recognised within accruals.

 

On 1 February 2023, Newlyn Group Holding Limited entered into a new loan agreement with National Westminster Bank PLC, for the principal amount of £20,005,000, the loan is secured by a charge held by National Westminster Bank PLC over the share capital of Newlyn PLC.

19
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2024
2023
£
£
Within one year
237,435
252,856
Between two and five years
642,176
718,456
In over five years
774,400
929,600
1,654,011
1,900,912
20
Events after the reporting date

On 2 April 2025, the parent company Newlyn Group Holding Limited established a trust, Newlyn Employee Ownership Trust, to be constituted as an employee-ownership trust. The Trust has been set up by the existing company owners, for the benefit of all employees and for the purposes of section 236H of the Taxation of Chargeable Gains Act 1992.

On the same date Newlyn Group Holding Ltd entered into a loan agreement with National Westminster Bank PLC, for £32,500,000. The loan is secured by a fixed and floating charge over the assets of Newlyn PLC.

NEWLYN PLC
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 28 -
21
Related party transactions
Transactions with related parties

During the year the company entered into the following transactions with related parties:

Other information

The company has taken advantage of the exemption conferred by paragraph 33.1A of FRS 102 "Related Party Disclosures" not to disclose transactions with other group entities whose voting rights are 100% controlled within the group, and where consolidated financial statements of the group are publicly available.

 

During the year the company entered into transactions with four companies related by virtue of mutual directors. In total, sales of £40,176 (2023 - £38,425) and purchases of £192,286 (2023 - £187,237) were made with these entities. At the year end, the company was owed £1,901 (2023 - £Nil) from these related parties.

 

 

22
Ultimate controlling party

The immediate and ultimate parent undertaking is Newlyn Group Holding Ltd which prepares group financial statement. The registered office of Newlyn Group Holding Ltd in Century House, Wargrave Rd, Henley-on-Thames, RG9 2LT

During the year the company considered there to be no ultimate controlling party. On 2 April 2025, Newlyn Group Holding Ltd set up and sold 89.86% of its shares to Newlyn Group EOT Trustees Limited, from this point forward the ultimate controlling party is Newlyn Group EOT Trustees Limited.

 

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