Company Registration No. 03916897 (England and Wales)
HYDRO CLEANSING LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
Affinia
19th Floor
1 Westfield Avenue
London
E20 1HZ
HYDRO CLEANSING LIMITED
COMPANY INFORMATION
Director
Mr S Hoad
Company number
03916897
Registered office
HCL House
Beddington Farm Road
Croydon
Surrey
CR0 4XB
Auditor
Affinia (Stratford)
19th Floor
1 Westfield Avenue
London
E20 1HZ
HYDRO CLEANSING LIMITED
CONTENTS
Page
Strategic report
1 - 2
Director's report
3
Director's responsibilities statement
4
Independent auditor's report
5 - 8
Profit and loss account
9
Balance sheet
10
Statement of changes in equity
11
Statement of cash flows
12
Notes to the financial statements
13 - 26
The following pages do not form part of the financial statements
Detailed profit and loss account
HYDRO CLEANSING LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 1 -

The director presents the strategic report for the year ended 31 March 2024.

 

Company status and principal activities

 

Hydro Cleansing Limited (‘the Company’) is a limited liability company domiciled and registered in England. The principal activity of the Company is the supply of professional drainage and environmental solution services.

Review of the business

The Company entered into a Company Voluntary Arrangement (CVA) in May 2019. As a result of the CVA, the company's prime objective in the forthcoming months was to improve sales while reviewing and significantly reducing operational expenditure. The company was able to improve cash flow and maintain a steady relationship with 98% of suppliers working on a 100% repayment program via the CVA and ensuring that all suppliers worked on a cash on delivery (COD) basis reducing the necessity for further credit.

 

The Company continues to operate in a challenging market, impacted by price risk and government initiatives including the ULEZ, the fluctuating price of diesel fuel and varying weather. Despite this, and continued intense market competition, the company are pleased to report sustainability in their market share.

 

The Company continues to invest in its plant and machinery. This is despite the availability of stock of new compliant vehicles being non-existent due to the mass shortage of semiconductors worldwide; this aside, the company have continued to ensure it stays ahead of market competition. Research and development activities remain a key priority to ensure the company will be able to meet the demands of an ever-growing population and more complex infrastructure in the market it operates within.

Principal risks and uncertainties

 

Compliance risk

 

The company continues to hold Environment Agency licences for the transport and treatment of waste. Within the last 12 months, the company has amended their licence capabilities, increasing quantities and capabilities of treatment, providing more opportunities for the company to tender. These licences are essential for the company to continue its objectives. Loss of any licence would leave the company disadvantaged in its capability of trade and is therefore a significant risk. The risk is mitigated by by regular compliance audits, obtaining accreditations and certificates from relevant industry bodies and continual oversight of controls and procedures to ensure all operations are conducted in line with relevant licence conditions and restraints.

 

Operational and market risk.

 

The regular availability of the company's fleet is essential to ensure turnover targets can be reached. Regular inhouse maintenance and repair is conducted to ensure vehicles are maintained to an excellent standard, and thus, unexpected off-road downtime is minimised.

 

The response to operational risks also mitigate market risks, as the ability to complete each job is directly linked to performance and customer satisfaction, which in turn helps to maintain the company's market share and position within the marketplace.

 

Interest rate risk

 

Hire purchase contracts are generally undertaken at fixed rates and are based on shorter terms than the useful economic life of the assets involved.

 

Credit risk

 

Regular credit checks are performed on new and existing customers using a credit referencing agency. Regular contact is maintained with customers and controls are in place to ensure payments are received within designated credit terms.

 

HYDRO CLEANSING LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 2 -
Key performance indicators

The director constantly monitors a number of key performance indicators (KPIs) to ensure optimal business performance. The director regards turnover, gross profit and operating profit as the key financial performance indicators of the Company.

 

· Turnover has decreased to £8,334,654 from £8,365,356

· Gross profit has increased to £3,678,839 from £3,435,510

· Operating profit has decreased to £356,458 from £389,493

 

At the year end, the Company held cash balance of £138,168 (2023: £167,050).

 

Non-financial KPIs include tracking the level of quotes Works Authorisation Forms (WAFS) issued and received by the employee. In total, the number of outgoing sales calls made per employee per day, emails dispatched, and individual and overall call time per day. For non-call centre activities, the acquisition and renewal of relevant accreditations and certifications are regularly monitored for relevance. The company maintained its Environment Agency licences during the year.

On behalf of the board

Mr S Hoad
Director
27 May 2025
HYDRO CLEANSING LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 3 -

The director presents his annual report and financial statements for the year ended 31 March 2024.

Principal activities

The principal activity of the company continued to be that of supply of professional drainage and environmental solution services.

Results and dividends

Business Review

 

During the year the company revenue decreased insignificantly in comparison to prior year as a result of difficult trading conditions in the period under review. Direct costs such as transport and fuel decreased and these were fully passed onto the customers, the effect of which was that the gross profit increased. Despite a fall in the overheads the company reported decreased operating profit in comparison to the prior year which was a result of reduction in recharges to related parties.

No ordinary dividends were paid. The director does not recommend payment of a final dividend.

Director

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

Mr S Hoad
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 S Hoad
Director
27 May 2025
HYDRO CLEANSING LIMITED
DIRECTOR'S RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2024
- 4 -

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

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is required to:

The director is 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. He is 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.

HYDRO CLEANSING LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HYDRO CLEANSING LIMITED
- 5 -
Opinion

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

In our opinion the financial statements:

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 director's 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 director 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 director is 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:

HYDRO CLEANSING LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HYDRO CLEANSING LIMITED (CONTINUED)
- 6 -
Matters on which we are required to report by exception

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

As explained more fully in the director's responsibilities statement, the director is 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 director determines 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 director is 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 director either intends to liquidate the company or to cease operations, or has 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. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

HYDRO CLEANSING LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HYDRO CLEANSING LIMITED (CONTINUED)
- 7 -
The extent to which the audit was considered capable of detecting irregularities including fraud

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including

fraud and non-compliance with laws and regulations, was as follows:

 

 

We assessed the susceptibility of the company’s financial statements to material misstatement, including

obtaining an understanding of how fraud might occur, by:

 

 

To address the risk of fraud through management bias and override of controls, we:

 

 

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures

which included, but were not limited to:

 

 

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of directors and other management and the inspection of regulatory and legal correspondence, if any.

 

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

 

 

HYDRO CLEANSING LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HYDRO CLEANSING LIMITED (CONTINUED)
- 8 -

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.

Mark Middleton (Senior Statutory Auditor)
For and on behalf of Affinia (Stratford), Statutory Auditor
Chartered Accountants
19th Floor
1 Westfield Avenue
London
E20 1HZ
27 May 2025
HYDRO CLEANSING LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2024
- 9 -
2024
2023
Notes
£
£
Turnover
3
8,334,654
8,365,356
Cost of sales
(4,655,815)
(4,929,846)
Gross profit
3,678,839
3,435,510
Administrative expenses
(3,487,746)
(3,657,156)
Other operating income
165,365
611,139
Operating profit
4
356,458
389,493
Interest receivable and similar income
8
-
0
554
Interest payable and similar expenses
9
(179,961)
(331,464)
Profit before taxation
176,497
58,583
Tax on profit
10
(75,000)
-
0
Profit for the financial year
101,497
58,583

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

HYDRO CLEANSING LIMITED
BALANCE SHEET
AS AT 31 MARCH 2024
31 March 2024
- 10 -
2024
2023
Notes
£
£
£
£
Fixed assets
Intangible assets
11
8,717
10,329
Tangible assets
12
3,518,642
3,944,094
3,527,359
3,954,423
Current assets
Stocks
13
26,506
26,506
Debtors
14
1,116,546
1,706,140
Cash at bank and in hand
138,168
167,050
1,281,220
1,899,696
Creditors: amounts falling due within one year
15
(1,825,356)
(2,553,909)
Net current liabilities
(544,136)
(654,213)
Total assets less current liabilities
2,983,223
3,300,210
Creditors: amounts falling due after more than one year
16
(942,743)
(1,436,227)
Provisions for liabilities
Deferred tax liability
18
471,754
396,754
(471,754)
(396,754)
Net assets
1,568,726
1,467,229
Capital and reserves
Called up share capital
20
100
100
Revaluation reserve
21
136,492
136,492
Capital redemption reserve
22
25
25
Profit and loss reserves
23
1,432,109
1,330,612
Total equity
1,568,726
1,467,229
The financial statements were approved and signed by the director and authorised for issue on 27 May 2025
Mr S Hoad
Director
Company registration number 03916897 (England and Wales)
HYDRO CLEANSING LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
- 11 -
Share capital
Revaluation reserve
Capital redemption reserve
Profit and loss reserves
Total
£
£
£
£
£
Balance at 1 April 2022
100
136,492
25
1,272,029
1,408,646
Year ended 31 March 2023:
Profit and total comprehensive income
-
-
-
58,583
58,583
Balance at 31 March 2023
100
136,492
25
1,330,612
1,467,229
Year ended 31 March 2024:
Profit and total comprehensive income
-
-
-
101,497
101,497
Balance at 31 March 2024
100
136,492
25
1,432,109
1,568,726
HYDRO CLEANSING LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2024
- 12 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
27
724,792
540,537
Interest received
-
0
554
Interest paid
(179,961)
(331,464)
Income taxes refunded/(paid)
39,798
(76,984)
Net cash inflow from operating activities
584,629
132,643
Investing activities
Purchase of tangible fixed assets
(232,931)
(1,003,242)
Repayment of loans
95,531
141,342
Net cash used in investing activities
(137,400)
(861,900)
Financing activities
Repayment of bank loans
(33,898)
(32,768)
Payment of finance leases obligations
(442,212)
477,747
Net cash (used in)/generated from financing activities
(476,110)
444,979
Net decrease in cash and cash equivalents
(28,882)
(284,278)
Cash and cash equivalents at beginning of year
167,050
451,328
Cash and cash equivalents at end of year
138,168
167,050
HYDRO CLEANSING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
- 13 -
1
Accounting policies
Company information

Hydro Cleansing Limited is a private company limited by shares incorporated in England and Wales. The registered office is HCL House, Beddington Farm Road, Croydon, Surrey, CR0 4XB.

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, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

1.2
Going concern

The Company's business activities together with its future developments are discussed within the strategictrue report and the Report of the Directors. The financial position of the company, its cashflow, liquidity and borrowings are presented in the financial statements and accompanying notes. At 31 March 2024, the Company had net current liabilities of £544,136 (2023: £654,213). Cash and cash equivalents decreased to £138,168 from £167,050.

 

On 3rd May 2019, the Company entered into a company voluntary arrangement (CVA) to enable the company to focus on trading profitably, protected from claims of existing creditors. To the date of signing these accounts, the company had fully complied with all the terms of the CVA.

 

The company meets its day to day working capital requirements through a combination of operating cash flows, and other third party facilities. The maturity dates of the facilities are disclosed in the notes to the accounts.

 

Should continuing trade not produce the necessary cash-flow required, there is material uncertainty which may cast significant doubt upon the company's ability to continue as a going concern, and as a result, the company may be unable to realise its assets and discharge its liabilities in the normal course of business. Nevertheless, the director has a reasonable expectation that the company will have adequate resources to continue in operational existence for a period of 12 months from the date of of approval of these financial statements and therefore the company has adopted the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

The whole of the company's revenue is attributable to its market in the United Kingdom and is derived from the principal activity of the supply of professional drainage and environmental services. The company has two main sources of revenue:

 

Drainage and Environmental Services

 

Revenue from drainage and environmental services is recognised in the period in which the services are provided (on completion of timesheet).

 

Related Party Recharges

 

Other income comprises of costs recovered from related company for whom the company is acting as a recharge centre for costs incurred. This is recognised based on actual cost incurred and stated at the fair value of the consideration received or receivable for services provided in the normal course of business.

HYDRO CLEANSING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 14 -
1.4
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

 

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

Amortisation 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:

Development costs
10 years straight line
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
100 years straight line
Leasehold land and buildings
over the length of the lease
Plant and equipment
25% reducing balance
Fixtures and fittings
25% reducing balance
Motor vehicles
18% & 25% 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.

1.6
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible 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.

HYDRO CLEANSING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 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.

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

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.

HYDRO CLEANSING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 16 -
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.

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.

HYDRO CLEANSING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 17 -
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.

1.12
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.

1.13
Retirement benefits

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

HYDRO CLEANSING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 18 -
1.14
Leases
As lessee

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.

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.

2
Judgements and key sources of estimation uncertainty

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

 

Critical judgements

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

 

Determining residual values and useful economic lives of property, plant and equipment

The estimation of the useful lives of assets is based on historic performance as well as expectations about future use and therefore requires estimates and assumptions to be applied by management. The actual lives of these assets can vary depending on a variety of factors, including technological innovation, product life cycles and maintenance programmes.

 

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.

 

Recoverability of receivables

The Company establishes a provision for receivables that are estimated not to be recoverable or recoupable. When assessing recoverability, the director considers factors such as the aging of the receivable, past experience of recoverability, and the credit profile of the debtor.

3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Drainage and Environmental Services
8,334,654
8,365,356
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
8,334,654
8,365,356
HYDRO CLEANSING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
3
Turnover and other revenue
(Continued)
- 19 -
2024
2023
£
£
Other revenue
Bank interest
-
554
Related Party Recharges
165,365
611,139
4
Operating profit
2024
2023
Operating profit for the year is stated after charging:
£
£
Depreciation of owned tangible fixed assets
658,383
677,023
Amortisation of intangible assets
1,612
2,310
Operating lease charges
252,828
415,953
5
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
16,000
15,750
6
Employees

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

2024
2023
Number
Number
Administrative staff
78
81

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
3,221,507
3,243,517
Social security costs
333,462
357,252
Pension costs
55,650
64,775
3,610,619
3,665,544
HYDRO CLEANSING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 20 -
7
Director's remuneration
2024
2023
£
£
Remuneration for qualifying services
87,701
89,580
8
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
-
0
554
2024
2023
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
-
0
554
9
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
9,424
9,195
Other finance costs:
Interest on finance leases and hire purchase contracts
79,806
223,099
Other interest
90,731
99,170
179,961
331,464
10
Taxation
2024
2023
£
£
Deferred tax
Origination and reversal of timing differences
75,000
-
0
HYDRO CLEANSING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
10
Taxation
(Continued)
- 21 -

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
176,497
58,583
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
44,124
11,131
Tax effect of expenses that are not deductible in determining taxable profit
149,514
128,913
Tax effect of utilisation of tax losses not previously recognised
(167,982)
103,680
Permanent capital allowances in excess of depreciation
(25,656)
(243,724)
Deferred tax charge
75,000
-
0
Taxation charge for the year
75,000
-
11
Intangible fixed assets
Development costs
£
Cost
At 1 April 2023 and 31 March 2024
80,207
Amortisation and impairment
At 1 April 2023
69,878
Amortisation charged for the year
1,612
At 31 March 2024
71,490
Carrying amount
At 31 March 2024
8,717
At 31 March 2023
10,329
HYDRO CLEANSING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 22 -
12
Tangible fixed assets
Freehold land and buildings
Leasehold land and buildings
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
£
Cost or valuation
At 1 April 2023
815,000
13,252
1,103,697
305,152
8,763,935
11,001,036
Additions
-
0
-
0
132,698
-
0
100,233
232,931
At 31 March 2024
815,000
13,252
1,236,395
305,152
8,864,168
11,233,967
Depreciation and impairment
At 1 April 2023
73,341
10,374
888,303
237,867
5,847,057
7,056,942
Depreciation charged in the year
8,150
1,325
85,969
16,825
546,114
658,383
At 31 March 2024
81,491
11,699
974,272
254,692
6,393,171
7,715,325
Carrying amount
At 31 March 2024
733,509
1,553
262,123
50,460
2,470,997
3,518,642
At 31 March 2023
741,659
2,878
215,394
67,285
2,916,878
3,944,094

Tangible fixed assets includes assets held under finance leases or hire purchase contracts, as follows:

2024
2023
£
£
Plant and equipment
68,281
91,042
Motor vehicles
1,623,192
1,925,131
1,691,473
2,016,173

Land and buildings with a carrying amount of £733,509 (2023: £741,659) were revalued as of 31 March 2016 and 31 March 2017, respectively, by the company director on the basis of market value.

The revaluation surplus of £136,492 is disclosed in the Statement of Changes in Equity.

13
Stocks
2024
2023
£
£
Finished goods
26,506
26,506
HYDRO CLEANSING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 23 -
14
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
981,365
1,152,159
Corporation tax recoverable
-
0
16,045
Other debtors
2,900
213,177
Prepayments and accrued income
132,281
324,759
1,116,546
1,706,140
15
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loan
53,755
42,663
Obligations under finance leases
17
508,157
501,876
Trade creditors
177,632
419,146
Corporation tax
23,753
-
0
Other taxation and social security
316,459
261,072
Other creditors
723,697
1,231,497
Accruals and deferred income
21,903
97,655
1,825,356
2,553,909

Included within other creditors is the CVA Creditors balance of £193,588 (2023: £403,588) and financing agreement of £520,111 (2023: £670,154) that is secured by a fixed and floating charge over the Company's assets.

The hire purchase and finance lease contracts are secured by personally guarantees provided by the director and shareholder of the Company.

16
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Bank loan
187,549
232,539
Obligations under finance leases
17
755,194
1,203,688
942,743
1,436,227
17
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
508,157
501,876
In two to five years
755,194
1,203,688
1,263,351
1,705,564
HYDRO CLEANSING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 24 -
18
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
649,641
683,255
Tax losses
(217,832)
(337,537)
Fair value adjustment on investment property
39,945
51,036
471,754
396,754
2024
Movements in the year:
£
Liability at 1 April 2023
396,754
Charge to profit or loss
75,000
Liability at 31 March 2024
471,754
19
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
55,650
64,775

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.

20
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
75
75
75
75
Ordinary A shares of £1 each
25
25
25
25
100
100
100
100
21
Revaluation reserve

This reserve records the value of asset revaluations and fair value movements on assets recognised in other comprehensive income.

HYDRO CLEANSING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 25 -
22
Capital redemption reserve

This reserve records the nominal value of shares repurchased by the company.

23
Profit and loss reserves

This reserve records retained earnings and accumulated losses.

24
Operating lease commitments
As 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 1 year
177,450
177,450
Years 2-5
1,209,475
207,025
1,386,925
384,475
25
Related party transactions

At the balance sheet date, HCL Fleet Services Limited, a related party owed £Nil to Hydro Cleansing Ltd (2023: £104,074). HCL Logistics Ltd, a related party, owed £Nil (2023: £1,800). HCL Recruitment Services Limited, a related party, owed £1,200 (2023: £Nil) and HCL Sweepers Ltd, a related party, owed £1,700 (2023: £1,830). All balances are unsecured and interest free.

 

At year end the related party loan owed by HCL Fleet Services Limited amounted to £80,175 was fully impaired as not considered to be recoverable.

 

During 2024 the Company recharged HCL Fleet Services Ltd £165,365 (2023: £611,139) for the proportion of the certain costs (mainly rent, rates & utilities and IT support & remuneration) incurred in relation to running the site where Hydro Fleet Services Ltd operates from.

 

Additionally, the Company was charged £75,000 (2023: £397,424) for consultancy services provided by Hydro Fleet Services Ltd.

 

At year end the total trade receivable (net off of trade creditors) amounted to £310,726 (2023: £Nil) was fully written off to profit and loss account as not considered to be recoverable.

 

Related party companies are under a common directorship and control.

 

See note 7 for disclosure of the director's remuneration.

26
Ultimate controlling party

The ultimate controlling party is Mr S Hoad, the Company director.

HYDRO CLEANSING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 26 -
27
Cash generated from operations
2024
2023
£
£
Profit after taxation
101,497
58,583
Adjustments for:
Taxation charged
75,000
-
0
Finance costs
179,961
331,464
Investment income
-
0
(554)
Amortisation and impairment of intangible assets
1,612
2,310
Depreciation and impairment of tangible fixed assets
658,383
677,023
Movements in working capital:
Increase in stocks
-
0
(10,000)
Decrease/(increase) in debtors
478,018
(202,218)
Decrease in creditors
(769,679)
(316,071)
Cash generated from operations
724,792
540,537
28
Charges on assets

The company's financing facility includes a loan secured by a fixed charge over the company's freehold property.

 

The company's financing facilities with their bank includes a term loan of £500,000 that accrued interest on a daily basis at a fixed rate of 2.5% plus Bank of England base rate per annum. The loan is repayable in equal annual instalments over 15 years.

29
Director's advances, credits and guarantees

During the year £95,530 was repaid by a director to his director's loan account. No amounts were outstanding at the balance sheet date (2023: £95,530).

30
Analysis of changes in net debt
1 April 2023
Cash flows
31 March 2024
£
£
£
Cash at bank and in hand
167,050
(28,882)
138,168
Borrowings excluding overdrafts
(275,202)
33,898
(241,304)
Lease liabilities
(1,705,564)
442,213
(1,263,351)
(1,813,716)
447,229
(1,366,487)
- 27 -
HYDRO CLEANSING LIMITED
MANAGEMENT INFORMATION
FOR THE YEAR ENDED 31 MARCH 2024
The following pages do not form part of the statutory financial statements.
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