Company registration number 08527303 (England and Wales)
DAIRY PARTNERS (CYMRU WALES) LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
DAIRY PARTNERS (CYMRU WALES) LIMITED
COMPANY INFORMATION
Directors
Mr C J Bennett
Mr W J Bennett
Mr R W Peel
Mr S M Welch
Secretary
Mrs C McTernan
Company number
08527303
Registered office
Dairy Partners
Oldends Lane
Oldends
Stonehouse
Gloucestershire
United Kingdom
GL10 3RL
Auditor
Azets Audit Services
Epsilon House
The Square
Gloucester Business Park
Gloucester
United Kingdom
GL3 4AD
DAIRY PARTNERS (CYMRU WALES) LIMITED
CONTENTS
Page
Strategic report
1 - 4
Directors' report
5 - 6
Independent auditor's report
7 - 9
Statement of comprehensive income
10
Balance sheet
11
Statement of changes in equity
12
Notes to the financial statements
13 - 26
DAIRY PARTNERS (CYMRU WALES) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 1 -

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

Review of the business

We aim to present a balanced and comprehensive review of the development and performance of our business during the year and its position at the year end. Our review is consistent with the size and non-complex nature of our business and is written within the context of the risks and uncertainties we face.

 

2024 was an excellent year which saw the company return to profitability. Worldwide uncertainty caused challenges for the business, with market conditions still uncertain, but the underlying strengths and resilience of the company is reflected in the results.

 

Turnover was £107.93m, up from £79.45m in 2023, an increase of 35.8%. Profits rose to £5.19m from losses of £2.68m in 2023.

 

Despite the ongoing global uncertainties, the company continues to maintain a strong financial position, and 2025 has seen turnover continue to rise.

 

Principal risks and uncertainties

Regulatory risk

The company is required to comply with various regulatory regimes in areas such health & safety and environmental

regulation. This is achieved through the adoption of appropriate policies and structures, risk assessments, monitoring and review of performance, recruitment and training of suitably qualified staff and support from external consultants, where appropriate.

 

Input cost risk

The company is exposed to market price movements for commodities, including electricity, plastics, and cardboard. This risk is mitigated in relation to many input costs by maintaining awareness of markets and minimising the use of such commodities wherever possible. Energy is bought on the wholesale market, with assistance from energy consultants, thus reducing the exposure to rising energy costs.

 

Market and product price risk

The group is exposed to fluctuations in market prices of dairy products, with this position continually monitored.

 

Market risk is minimised by keeping a low stock holding as possible and by following the market. Milk prices are benchmarked against competitors using www.milkprices.com Milk prices paid to farmers are amended monthly throughout the year, reflecting changes in commodity prices. Sales prices are primarily driven by following competitors.

 

Competitive market risk is managed in two ways:

1.    Use of production cost control programme to ensure we are low-cost producers

2.    Use of up to date and modern plant and equipment together with keeping abreast of new technologies

 

New product development and new markets play important roles in managing competitive risk.

The company is exposed to fluctuations in market prices of dairy products. This position is continually monitored. The directors' ability to assess the market risks depends largely on in-depth market knowledge and keeping abreast of global trends including milk and cheese production, tariffs, subsidies, political and natural events affecting existing markets and new markets and or products that could alter the business.

 

Financial risks

The company's activities expose it to a number of financial risks including price, credit, foreign currency, interest rate, liquidity and fraud risk. The directors review and agree policies for managing these risks as described below.

DAIRY PARTNERS (CYMRU WALES) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 2 -
Principal risks and uncertainties - continued

Credit risk

The principal financial assets are trade and other receivables, bank balances and cash. The company's credit risk is primarily attributable to its trade receivables. As it only trades with the group we do not consider there is any current exposure to credit risk.

 

Foreign currency risk

Currency risk is handled by the group so there is no current exposure to that risk.

 

Interest rate risk

This is minimal due to more use of asset backed finance which has resulted in greater security of fixed interest rate and time periods.

 

Liquidity risk

It is the company's policy to finance its operations through a mixture of cash and borrowings and to review periodically the mix of these instruments with regard to the projected cash flow requirements of the company and an acceptable level of risk exposure.

 

Fraud risk

Dairy Partners recognises the risk of fraud. This risk is mitigated through regular reviews of control systems and internal audits. An Anti-bribery Policy has been adopted.

Key performance indicators

The table below provides key financial performance indicators ("KPls") relating to the company's performance during the year.

 

Dairy Partners (Cymru Wales) Limited monitors the business performance and measures it against strategic objectives. The main performance indicators are product quality, health and safety, yields, overheads and cashflow. Key Financial Performance indicators for 2024 were as follows:

 

Financial KPI            2024        2023

Sales Turnover            £107.93m    £79.45m

Gross Profit Margin         6.90%        (3.34%)

Net Profit Margin            4.81%        (3.37%)

Operating Profit            £7.28m        (£3.25m)

Profit for the year             £7.08m        (£3.42m)

Working Capital Ratio        2.27        1.72

Total Capital and Reserves        £21.00m        £15.81m

Employee numbers        83        80

Future developments

2025 will see the business further grow its position as a supplier of mozzarella cheese to the food manufacturing market. The company will continue with its Research and Development plans, working on cost and quality optimisation, as well as the development of new products.

DAIRY PARTNERS (CYMRU WALES) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 3 -
Reporting on compliance with Section 172 requirements

The directors are aware of their responsibilities to the shareholders and key stakeholders of the business and any decisions made are only taken after due consideration is given to the potential impact of that decision on the key stakeholders.

 

In line with their duties under S172 of the Companies Act 2006 the Board of Directors are required to act in a way they consider in good faith would most likely promote the success of the group for the benefit of the shareholders and key stakeholders. In doing this they should have regard to a range of matters and the likely consequence of any decisions in the long term.

 

The following matters are set out in Section 172:

 

-    likely consequences of any decision in the long term

-    interests of the company's employees

-    need to foster the company's business relationships with suppliers, customers and others

-    impact of the company's operations on the community and the environment

-    the desirability of the company maintaining a reputation for high standards of business conduct

-    the need to act fairly as between members of the company

 

Employees

Our employees are our most valuable asset and are key to our success.

The company engages with employees on a regular basis, covering a range of topics such as health and safety, financial performance and training and development. Our people are of significant importance in implementing our long-term strategies and it therefore key that they are informed.

 

Environmental responsibility

The company considers the external environment in several ways and recognizes that it has a responsibility to continually reduce its environmental impact. It attempts to do this by striving for continuous reduction of its impact through,compliance with regulations, energy reduction projects, green energy investments, and streamlined logistics.

 

The company has a number of live energy reduction projects including the following:

-    brine cooling optimization, through energy efficiency intervention

-    fossil fuel partial replacement on milk collection fleet to HVO (plant-based oil)

 

In addition, recruiting from the local area is prioritised to further reduce carbon footprint on our milk collections.

 

In recent years the company has invested in green energy solutions, including solar panels, LED lighting and switching from Kerosene Oil to LNG (liquid natural gas). We have also invested in low energy pumps, motors and compressed air equipment. Our logistics team continue to look for ways to streamline the delivery process in order to minimise environmental impact.

Customers

Our aim is to deliver a best-in-class service to all our customers. The company seeks to do this by primarily delivering a quality product. As well as this we work on developing long term customer relationships through regular communication, so we have a full understanding of their needs.

 

Suppliers

The long-term success of the company depends on building strong relationships with its suppliers. Regular meetings are held which gives both parties the opportunity to discuss challenges and opportunities. This helps ensure continued and timely supply of raw materials.

 

Government and regulators

The directors ensure the company is compliant with all regulatory requirements, in particular Health and Safety regulations and the Modern Slavery Act.

DAIRY PARTNERS (CYMRU WALES) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 4 -

On behalf of the board

Mr R W Peel
Director
23 May 2025
DAIRY PARTNERS (CYMRU WALES) LIMITED
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 the supply and manufacture of wholesale cheese.

Results and dividends

The results for the year are set out on page 10.

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

Directors

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

Mr C J Bennett
Mr W J Bennett
Mr R W Peel
Mr S M Welch
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. It has done so in respect of financial instruments and future developments.

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.

DAIRY PARTNERS (CYMRU WALES) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 6 -
On behalf of the board
Mr R W Peel
Director
23 May 2025
DAIRY PARTNERS (CYMRU WALES) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF DAIRY PARTNERS (CYMRU WALES) LIMITED
- 7 -
Opinion

We have audited the financial statements of Dairy Partners (Cymru Wales) Limited (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.

Opinions on other matters prescribed by the Companies Act 2006

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

DAIRY PARTNERS (CYMRU WALES) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF DAIRY PARTNERS (CYMRU WALES) LIMITED
- 8 -
Matters on which we are required to report by exception

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

 

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

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.

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.

DAIRY PARTNERS (CYMRU WALES) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF DAIRY PARTNERS (CYMRU WALES) LIMITED
- 9 -

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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

 

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework.  Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.  This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

 

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

 

 

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation.  This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.  The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

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.

Steve Burke
Senior Statutory Auditor
For and on behalf of Azets Audit Services
23 May 2025
Chartered Accountants
Statutory Auditor
Epsilon House
The Square
Gloucester Business Park
Gloucester
United Kingdom
GL3 4AD
DAIRY PARTNERS (CYMRU WALES) LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
- 10 -
2024
2023
Notes
£
£
Turnover
3
107,934,113
79,453,705
Cost of sales
(100,530,024)
(82,141,992)
Gross profit/(loss)
7,404,089
(2,688,287)
Administrative expenses
(574,929)
(563,589)
Exceptional item
4
450,000
-
0
Operating profit/(loss)
5
7,279,160
(3,251,876)
Interest receivable and similar income
9
186
-
0
Interest payable and similar expenses
10
(194,909)
(164,083)
Profit/(loss) before taxation
7,084,437
(3,415,959)
Tax on profit/(loss)
11
(1,898,045)
735,142
Profit/(loss) for the financial year
5,186,392
(2,680,817)

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

DAIRY PARTNERS (CYMRU WALES) LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2024
31 December 2024
- 11 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
12
14,553,925
15,741,418
Current assets
Stocks
13
1,948,228
2,459,922
Debtors
14
20,517,750
14,034,169
Cash at bank and in hand
72,293
271,247
22,538,271
16,765,338
Creditors: amounts falling due within one year
15
(9,948,552)
(9,738,466)
Net current assets
12,589,719
7,026,872
Total assets less current liabilities
27,143,644
22,768,290
Creditors: amounts falling due after more than one year
16
(2,463,744)
(3,834,069)
Provisions for liabilities
Provisions
18
-
0
450,000
Deferred tax liability
19
3,681,025
2,671,738
(3,681,025)
(3,121,738)
Net assets
20,998,875
15,812,483
Capital and reserves
Called up share capital
20
15
15
Profit and loss reserves
21
20,998,860
15,812,468
Total equity
20,998,875
15,812,483
The financial statements were approved by the board of directors and authorised for issue on 23 May 2025 and are signed on its behalf by:
Mr R W Peel
Director
Company Registration No. 08527303
DAIRY PARTNERS (CYMRU WALES) LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
- 12 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2023
15
18,493,285
18,493,300
Year ended 31 December 2023:
Loss and total comprehensive income for the year
-
(2,680,817)
(2,680,817)
Balance at 31 December 2023
15
15,812,468
15,812,483
Year ended 31 December 2024:
Profit and total comprehensive income for the year
-
5,186,392
5,186,392
Balance at 31 December 2024
15
20,998,860
20,998,875
DAIRY PARTNERS (CYMRU WALES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 13 -
1
Accounting policies
Company information

Dairy Partners (Cymru Wales) Limited is a private company limited by shares incorporated in England and Wales. The registered office is Dairy Partners, Oldends Lane, Oldends, Stonehouse, Gloucestershire, United Kingdom, GL10 3RL. The company's principal activities and nature of its operations are disclosed in the directors' report.

 

The company's principal place of business is The Creamery, Aberarad, Newcastle Emlyn, SA38 9DQ.

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 Dairy Partners Limited. These consolidated financial statements are available from its registered office, Dairy Partners, Oldends Lane, Oldends, Stonehouse, Gloucestershire, GL10 3RL.

1.2
Going concern

The directors have at the time of approving the financial statements, a reasonable expectation that the truecompany 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.

DAIRY PARTNERS (CYMRU WALES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 14 -
1.3
Turnover

Revenue is measured based on the consideration specified in a contract with a customer and excludes amounts collected on behalf of third parties. The company recognises revenue when it transfers control of a product to a customer, the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the company and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

The company does not expect to have any revenue where the period between the transfer of the promised goods to the customer and payment by the customer exceeds one year. As a consequence, the company does not adjust any of the transaction prices for the time value of money.

1.4
Research and development expenditure

Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.

1.5
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:

Freehold land and buildings
2% to 4% on cost
Plant and equipment
6.67% to 20% on cost
Fixtures and fittings
20% to 33% on cost

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.

1.6
Impairment of fixed assets

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

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

DAIRY PARTNERS (CYMRU WALES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 15 -

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

1.7
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Fixed production overheads are absorbed based on normal capacity.

 

Variable production overheads are absorbed based on actual use of the production facilities.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.8
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and 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.

1.9
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.

DAIRY PARTNERS (CYMRU WALES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 16 -

Trade receivables, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as loans and receivables. Loans and receivables are measured at amortised cost using the effective interest method, less any impairment.

 

Interest is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial. The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating the interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the debt instrument to the net carrying amount on initial recognition.

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.

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, 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.

DAIRY PARTNERS (CYMRU WALES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 17 -
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.

1.10
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.

1.11
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.

DAIRY PARTNERS (CYMRU WALES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 18 -
1.12
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.

1.13
Employee benefits

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

 

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

 

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

1.14
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.15
Leases

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.

1.16
Government grants

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

 

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

1.17

Related party exemption

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

1.18

Exceptional items

Exceptional items are those which are separately identified by virtue of their size or nature to allow a full understanding of the underlying performance of the company.

DAIRY PARTNERS (CYMRU WALES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 19 -
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.

Depreciation, residual values and carrying amounts of property, plant and equipment

Calculating the depreciation charge and hence the carrying value for property, plant and equipment requires estimation to be made of the useful lives and residual value of the assets. These estimates are based on the directors' and company's experience of similar assets.

 

See the fixed asset note for the carrying amount of each class of assets.

3
Turnover

Turnover is attributable entirely to sales to UK entities under the principal activity of the company.

4
Exceptional item
2024
2023
£
£
Expenditure
Exceptional items
(450,000)
-

Exceptional items of £450,000 are in relation to the reversal of an impairment of the company's freehold property originally recognised in 2016. Further detail is included in notes 12 and 18.

5
Operating profit/(loss)
2024
2023
Operating profit/(loss) for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(446)
734
Research and development costs
56,284
200,000
Government grants
(108,961)
(108,961)
Depreciation of owned tangible fixed assets
1,328,991
1,105,890
Depreciation of tangible fixed assets held under finance leases
365,510
658,324
Loss on disposal of tangible fixed assets
16,822
12,428
DAIRY PARTNERS (CYMRU WALES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 20 -
6
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
13,000
12,000
For other services
Taxation compliance services
1,500
1,350
All other non-audit services
4,080
6,686
5,580
8,036
7
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2024
2023
Number
Number
Director
4
4
Adminstration
3
4
Production
76
72
Total
83
80

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
2,736,124
2,536,869
Social security costs
229,389
210,055
Pension costs
57,118
51,308
3,022,631
2,798,232
8
Directors' remuneration

Directors' emoluments are borne by the immediate parent company, Dairy Partners Limited and are recharged as part of a management charge. Directors' emoluments are disclosed within the financial statements of Dairy Partners Limited.

9
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
186
-
0
DAIRY PARTNERS (CYMRU WALES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 21 -
10
Interest payable and similar expenses
2024
2023
£
£
Interest on finance leases and hire purchase contracts
194,909
164,083
11
Taxation
2024
2023
£
£
Current tax
Group tax relief
888,758
(10,450)
Deferred tax
Origination and reversal of timing differences
1,009,287
(724,692)
Total tax charge/(credit)
1,898,045
(735,142)

The actual charge/(credit) for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:

2024
2023
£
£
Profit/(loss) before taxation
7,084,437
(3,415,959)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 25.00% (2023: 23.50%)
1,771,109
(802,750)
Tax effect of expenses that are not deductible in determining taxable profit
139,037
131,205
Effect of change in corporation tax rate
-
0
(43,482)
Research and development tax credit
(12,101)
(9,665)
Under/(over) provided in prior years
-
0
(10,450)
Taxation charge/(credit) for the year
1,898,045
(735,142)

Factors that may affect future tax charges

A rate of 25% (2023: 25%) has been used for purposes of providing for the effects of deferred taxation, in line with the main rate of UK Corporation tax effective from 1 April 2023.

DAIRY PARTNERS (CYMRU WALES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 22 -
12
Tangible fixed assets
Freehold land and buildings
Plant and equipment
Fixtures and fittings
Total
£
£
£
£
Cost
At 1 January 2024
3,759,662
22,695,394
78,868
26,533,924
Additions
9,902
512,756
1,828
524,486
Disposals
(463,945)
(214,598)
(1,784)
(680,327)
At 31 December 2024
3,305,619
22,993,552
78,912
26,378,083
Depreciation and impairment
At 1 January 2024
1,139,336
9,586,636
66,534
10,792,506
Depreciation charged in the year
104,510
1,584,374
5,617
1,694,501
Eliminated in respect of disposals
(463,945)
(197,073)
(1,831)
(662,849)
At 31 December 2024
779,901
10,973,937
70,320
11,824,158
Carrying amount
At 31 December 2024
2,525,718
12,019,615
8,592
14,553,925
At 31 December 2023
2,620,326
13,108,758
12,334
15,741,418

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

2024
2023
£
£
Plant and equipment
7,912,466
8,363,693

During the year, the anticipated decommissioning costs for the freehold property owned by the company have been re-assessed as being £Nil (2023: £450,000) as these works are no longer expected to be required. As such, an amount of £450,000 has been recognised as a disposal for the year.

 

As part of the directors' annual review of the carrying value of all items of property, plant and equipment, the above noted disposal has resulted in the reversal of a previous impairment of £450,000 on this asset, which has been recognised in the statement of comprehensive income as an exceptional item.

 

The total carrying amount of tangible fixed assets is pledged as security for the bank borrowings of both the company and its parent company under a fixed and floating charge.

 

The obligations under lease agreements are secured on the underlying assets.

DAIRY PARTNERS (CYMRU WALES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 23 -
13
Stocks
2024
2023
£
£
Raw materials and consumables
560,787
579,756
Work in progress
192,212
100,746
Finished goods and goods for resale
1,195,229
1,779,420
1,948,228
2,459,922

The total carrying amount of stock pledged as security for the bank borrowings of both the company and its parent company under a fixed and floating charge.

14
Debtors
2024
2023
Amounts falling due within one year:
£
£
Amounts owed by group undertakings
20,010,594
13,469,961
Other debtors
141,733
302,042
Prepayments and accrued income
365,423
262,166
20,517,750
14,034,169

The total carrying amount of trade debtors pledged as security for the bank borrowings of both the company and its parent company under a fixed and floating charge.

15
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Obligations under finance leases
17
1,330,105
1,395,052
Trade creditors
7,110,046
7,407,857
Taxation and social security
55,722
62,621
Other creditors
24,653
31,391
Accruals and deferred income
1,428,026
841,545
9,948,552
9,738,466
16
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Obligations under finance leases
17
2,463,744
3,778,417
Accruals and deferred income
-
0
55,652
2,463,744
3,834,069
DAIRY PARTNERS (CYMRU WALES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 24 -
17
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
1,330,105
1,395,054
In two to five years
2,463,744
3,620,758
In over five years
-
0
157,657
3,793,849
5,173,469

Amounts owing under lease agreements are secured over the assets to which they relate.

18
Provisions for liabilities
2024
2023
£
£
Other Provisions
-
450,000
Movements on provisions:
£
At 1 January 2024
450,000
Reversal of provision
(450,000)
At 31 December 2024
-

A provision had previously been recognised for the anticipated cost to return freehold land and buildings owned by the company to a condition that is fit for use. It is the directors' current expectation that no such works will be required and accordingly the provision has been reduced to £Nil.

 

The expected cash outflows were previously discounted at what the directors consider to be an appropriate discount rate and after taking into account the expected annual inflation, no finance charge has arisen for the year.

DAIRY PARTNERS (CYMRU WALES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 25 -
19
Deferred taxation

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

Liabilities
Liabilities
2024
2023
Balances:
£
£
Difference between cost and carrying amount of property, plant and equipment on acquisition
1,074,276
1,074,276
Tax losses
-
(870,967)
Accelerated capital allowances
2,607,954
2,582,221
Other timing differences
(1,205)
(113,792)
3,681,025
2,671,738
2024
Movements in the year:
£
Liability at 1 January 2024
2,671,738
Charge to profit or loss
1,009,287
Liability at 31 December 2024
3,681,025

Deferred tax assets and liabilities are offset in the financial statements only where the company has a legally enforceable right to do so.

 

A rate of 25% (2023: 25%) has been used for purposes of providing for the effects of deferred taxation, in line with the main rate of UK Corporation Tax effective from 1 April 2023.

20
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
15
15
15
15

Each Ordinary share is entitled to:

 

a) one vote in any circumstances;

b) equal rights to dividends; and

c) participate in the winding up of the company.

DAIRY PARTNERS (CYMRU WALES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 26 -
21
Profit and loss reserves
2024
2023
£
£
At the beginning of the year
15,812,468
18,493,285
Profit/(loss) for the year
5,186,392
(2,680,817)
At the end of the year
20,998,860
15,812,468

Retained earnings include all current and prior period retained profits and losses.

22
Contingent liabilities

As at 31 December 2024, the company had total guarantees and commitments of £4,700,000 (2023: £5,300,000) in respect of group companies.

23
Capital commitments

Amounts contracted for but not provided in the financial statements:

2024
2023
£
£
Acquisition of tangible fixed assets
-
58,918
24
Ultimate controlling party

The ultimate parent company of the only group of which the company is a member is Dairy Partners Limited, a company incorporated and registered in England and Wales, with its registered office of Dairy Partners, Oldends Lane, Oldends, Stonehouse, Gloucestershire, GL10 3RL. The financial statements for Dairy Partners Limited consolidate the results of the company and are publicly available.

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