Company Registration No. 02045868 (England and Wales)
PEARTREE CLEANING SERVICES LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
Affinia
19th Floor
1 Westfield Avenue
London
E20 1HZ
PEARTREE CLEANING SERVICES LIMITED
COMPANY INFORMATION
Directors
Mr B S Reames
Mrs C T Fowler
Mrs B Ayling
Mr S Conroy
Mr M Rowley
Mr S J Cooney
Secretary
Mrs C T Fowler
Company number
02045868
Registered office
Peartree House
1 Britannia Road
Brentwood
Essex
UK
CM14 5LD
Auditor
Affinia (Stratford)
19th Floor
1 Westfield Avenue
London
E20 1HZ
PEARTREE CLEANING SERVICES LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Directors' responsibilities statement
5
Independent auditor's report
6 - 9
Profit and loss account
10
Statement of comprehensive income
11
Balance sheet
12
Statement of changes in equity
13
Notes to the financial statements
14 - 25
PEARTREE CLEANING SERVICES LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 AUGUST 2024
- 1 -

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

Background

The company provides Sustainable commercial cleaning and support services to client locations across the UK. A customer centric business that delivers a sustainable service, social impact and employee benefits. Focussing on the recruitment, training, and retention of rewarded, motivated and ethically employed staff in a well-resourced management structure which provide outstanding levels of client service.

Goals and Objectives

We are focussed on producing environments that are sustainable, safe, clean and hygienic for our clients, their staff, customers and visitors. We achieve our goals of enhancing the quality of daily working life by delivering outstanding standards through our highly experienced management team and through ethical employment, a sustainable supply chain and investment in social value.

We re-invest a significant proportion of our profits back into our business, both in terms of innovation and people, which are Peartree core values. We embrace new technologies and strive to be at the forefront of all new developments evident in our proprietary Management system Peartree 360.

We have grown our business organically to date and constantly review our service, our marketplace and our client’s marketplace to ensure that we are offering the a service that aligns to the changing business environment.

Principal Risks

The principal short-term risks are:

 

In terms of negating the shortages in recruitment pool, we have altered our operating model to offer longer shifts to our existing staff, with improved benefits such as more staff being paid Citizens/Real Living Wage pay rates, an Employee Support Programme and a bespoke staff bonus scheme.

The board actively pursues a policy to ensure that no single client revenue represents more than 10% of our total revenues, and the way we are growing, and the market is changing, this may also slow our growth down, but the board is certain that this remains the correct strategy.

 

Review of the Year

The Board of Directors are satisfied with the year-end position, given that the company maintains a high level of liquidity with minimum borrowings and an excellent sales pipeline.

Sales Revenue has increased by 9% in the year, which has benefited from increases in Real Living Wage & National Living Wage increases combined with a client portfolio that funded these statutory and non-statutory wage increases 100%.

New client wins, and staff retention, were above target. Client Retention was a little below target this year, due to 3 Tier One clients retendering their cleaning services and selecting an alternative provider based on price. We have reviewed our processes for competitive tendering for existing clients and increased the involvement of our bid team to ensure we offer the most competitive solution.

We have invested in the Marketing team by adding a specialist graphic designer. Importantly, and in the field of ESG we have recruited an ESG manager, who is leading our commitments to the Science Based Targets Initiative (SBTi). To support SBTi we have installed Solar panels at Peartree HQ and continue to purchase All-Electric fleet vehicles. We maintain our accreditations to NCZ and EcoVadis, both recording improvements for year 2023.

PEARTREE CLEANING SERVICES LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 2 -
Key performance indicators

The Board regularly reviews key operational financial performance targets against actuals, as well as gross margin, debtors’ days and cash at bank. Gross margin is assessed on a contract-by-contract basis. These financial indicators are shared and discussed by the senior management team throughout the year.

The board also tracks and monitors client and staff retention, vital health and safety measures, HR performance issues as well as a wide range of ESG deliverables. All statistics show that we performed above our KPl's target for the year.

A summary of the key financial measures the board reports on are shown in the table below:

Again, we have been able to maintain gross margin cash values

2024                                                 2023

Gross Profit Margin                   21.43%                                              21.61%

EBITDA             £2,872,271                  £2,424,852

Future Outlook

In the coming financial year, we forecast a low double digit increase in sales revenue, due to a healthy order book and increases(circa 6-8%) in both Foundation Real Living Wage (70% of our client agreements) and National Living Wage (30% of our client agreements). For the Year 2024/25 we do have a number of Tier One & Tier Two clients that will tender or benchmark their cleaning services which (based on our success) will impact the year end revenues.

The Board are conservatively optimistic about the future, and believe as the economy enters a stable period, premium cleaning services will remain critical for all businesses in the UK and that Peartree is well placed to take advantage of the ongoing need for clean places of work.

The Board sees the investment and growth of our services across the UK as the glide path to our future revenue and profit targets. With our vision of being the leading Independently owned and operated commercial cleaning company in the UK. The Board believes that consistent low double digit organic growth is a realistic goal over the coming years.

On behalf of the board

Mr B S Reames
Director
28 May 2025
PEARTREE CLEANING SERVICES LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 AUGUST 2024
- 3 -

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

Principal activities

The principal activity of the company continued to be that of commercial contract cleaning.

Directors

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

Mr B S Reames
Mrs C T Fowler
Mrs B Ayling
Mr S Conroy
Mr M Rowley
Mr S J Cooney
Results and dividends

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

Ordinary dividends were paid amounting to £853,305. The directors do not recommend payment of a further dividend.

Financial instruments

Details of the company's financial risk management objectives and policies are included in note 1.8 to the accounts.

Disabled persons

The company gives full consideration to applications for employment from disabled persons where the requirements of the job can be adequately fulfilled by a handicapped or disabled person. Where existing employees become disabled, it is the company's policy wherever practicable to provide continuing employment under normal terms and conditions and to provide training and career development and promotion to disabled employees wherever appropriate.

Employee involvement

During the year, the policy of providing employees with information about the company has been continued through internal media methods in which employees have also been encouraged to present their suggestions and views on the company's performance. Regular meetings are held between local management and employees to allow a free flow of information and ideas. Employees participate directly in the success of the business through the company's profit sharing schemes and are encouraged to invest in the company through participation in share option schemes.

Auditor

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

 

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.

PEARTREE CLEANING SERVICES LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 4 -
On behalf of the board
Mr B S Reames
Director
28 May 2025
PEARTREE CLEANING SERVICES LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 AUGUST 2024
- 5 -

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.

PEARTREE CLEANING SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PEARTREE CLEANING SERVICES LIMITED
- 6 -
Opinion

We have audited the financial statements of Peartree Cleaning Services Limited (the 'company') for the year ended 31 August 2024 which comprise the profit and loss account, 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:

PEARTREE CLEANING SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PEARTREE CLEANING SERVICES LIMITED
- 7 -
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.

PEARTREE CLEANING SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PEARTREE CLEANING SERVICES LIMITED
- 8 -
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.

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:

 

  • the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;

  • we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the commercial cleaning sector;

  • we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including Companies Act 2006, taxation legislation, data protection, anti-bribery, environmental and health and safety legislation;

  • we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and

  • identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

 

We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

 

  • making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud.

  • considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

 

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

 

  • performed analytical procedures to identify any unusual or unexpected relationships;

  • tested journal entries to identify unusual transactions;

  • assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and

  • investigated the rationale behind significant or unusual transactions.

 

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

 

  • agreeing financial statement disclosures to underlying supporting documentation;

  • enquiring of management as to actual and potential litigation and claims.

 

PEARTREE CLEANING SERVICES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PEARTREE CLEANING SERVICES LIMITED
- 9 -

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 the 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.

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.

Andrew Runicles
Senior Statutory Auditor
For and on behalf of Affinia (Stratford)
28 May 2025
Chartered Accountants
Statutory Auditor
19th Floor
1 Westfield Avenue
London
E20 1HZ
PEARTREE CLEANING SERVICES LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 AUGUST 2024
- 10 -
2024
2023
Notes
£
£
Turnover
3
28,379,471
26,108,245
Cost of sales
(22,298,550)
(20,465,573)
Gross profit
6,080,921
5,642,672
Administrative expenses
(3,572,855)
(3,417,060)
Other operating income
100,000
-
0
Operating profit
4
2,608,066
2,225,612
Interest receivable and similar income
7
141,539
48,381
Interest payable and similar expenses
8
(25,317)
(4,838)
Profit before taxation
2,724,288
2,269,155
Tax on profit
(675,742)
(475,262)
Profit for the financial year
2,048,546
1,793,893

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

PEARTREE CLEANING SERVICES LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 AUGUST 2024
- 11 -
2024
2023
£
£
Profit for the year
2,048,546
1,793,893
Other comprehensive income
-
-
Total comprehensive income for the year
2,048,546
1,793,893
PEARTREE CLEANING SERVICES LIMITED
BALANCE SHEET
AS AT 31 AUGUST 2024
31 August 2024
- 12 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
10
964,773
744,487
Current assets
Stocks
26,004
47,386
Debtors
11
4,786,196
4,722,152
Cash at bank and in hand
6,168,758
5,030,298
10,980,958
9,799,836
Creditors: amounts falling due within one year
12
(3,752,453)
(3,704,267)
Net current assets
7,228,505
6,095,569
Total assets less current liabilities
8,193,278
6,840,056
Creditors: amounts falling due after more than one year
13
(165,818)
(40,269)
Provisions for liabilities
Deferred tax liability
15
77,895
77,895
(77,895)
(77,895)
Net assets
7,949,565
6,721,892
Capital and reserves
Called up share capital
17
35,624
35,184
Share premium account
300,316
268,324
Profit and loss reserves
7,613,625
6,418,384
Total equity
7,949,565
6,721,892
The financial statements were approved by the board of directors and authorised for issue on 28 May 2025 and are signed on its behalf by:
Mr B S Reames
Director
Company registration number 02045868 (England and Wales)
PEARTREE CLEANING SERVICES LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 AUGUST 2024
- 13 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 September 2022
34,757
242,025
5,618,039
5,894,821
Year ended 31 August 2023:
Profit and total comprehensive income
-
-
1,793,893
1,793,893
Issue of share capital
17
427
26,299
-
26,726
Dividends
-
-
(993,548)
(993,548)
Balance at 31 August 2023
35,184
268,324
6,418,384
6,721,892
Year ended 31 August 2024:
Profit and total comprehensive income
-
-
2,048,546
2,048,546
Issue of share capital
17
440
31,992
-
32,432
Dividends
-
-
(853,305)
(853,305)
Balance at 31 August 2024
35,624
300,316
7,613,625
7,949,565
PEARTREE CLEANING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
- 14 -
1
Accounting policies
Company information

Peartree Cleaning Services Limited is a private company limited by shares incorporated in England and Wales. The registered office is Peartree House, 1 Britannia Road, Brentwood, Essex, UK, CM14 5LD.

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.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

Revenue accounting policies as follows for each respective revenue stream:

 

 

 

1.4
Tangible fixed assets

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

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

Plant and machinery
6 years straight line
Fixtures, fittings & equipment
15% reducing balance
Motor vehicles
25% reducing balance
PEARTREE CLEANING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
1
Accounting policies
(Continued)
- 15 -

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

1.5
Impairment of fixed assets

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

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

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.

1.6
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.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

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.

1.7
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.

PEARTREE CLEANING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
1
Accounting policies
(Continued)
- 16 -
1.8
Financial instruments

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

 

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

 

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

 

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets

classified as receivable within one year are not amortised.

 

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

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.

PEARTREE CLEANING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
1
Accounting policies
(Continued)
- 17 -
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.

Derecognition of financial liabilities

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

1.9
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.

1.10
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.

PEARTREE CLEANING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
1
Accounting policies
(Continued)
- 18 -
Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where transactions or events have occurred at that date that will result in an obligation to pay more, or a right to pay less or to receive more tax, with the following exceptions:

 

Provision is made for tax on gains arising from the revaluation (and similar fair value adjustments) of fixed assets, and gains on disposal of fixed assets that have been rolled over into replacement assets, only to the extent that, at the balance sheet date, there is a binding agreement to dispose of the assets concerned. However, no provision is made where, on the basis of all available evidence at the balance sheet date, it is more likely than not that the taxable gain will be rolled over into replacement assets and charged to tax only where the replacement assets are sold.

 

Deferred tax assets are recognised only to the extent that the directors consider that it is more likely than not that there will be suitable taxable profits from which the future reversal of the underlying timing differences can be deducted.

 

Deferred tax is measured on an undiscounted basis at the tax rates that are expected to apply in the periods in which timing differences reverse, based on tax rates and laws enacted or substantively enacted at the balance sheet date.

1.11
Employee benefits

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

 

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

 

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

1.12
Retirement benefits

The company operates a defined contribution pension scheme for employees. The assets of the scheme are held separately from those of the company. The annual contributions payable are charged to the profit and loss account.

1.13
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.

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.

1.14
Foreign exchange

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

PEARTREE CLEANING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 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.

 

Bad debt provision

Trade debtors is material at year end.

Provisions made for bad debts require management's best estimate of receipts anticipated to be collected from customers in the future.

3
Turnover and other revenue

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

2024
2023
£
£
Turnover analysed by class of business
Office cleaning
26,091,990
23,926,096
Consumables
1,638,870
1,510,801
Emergency treatment
648,611
671,348
28,379,471
26,108,245
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
28,379,471
26,108,245
2024
2023
£
£
Other revenue
Interest income
141,539
48,381
4
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Depreciation of owned tangible fixed assets
264,205
199,240
Profit on disposal of tangible fixed assets
(9,126)
(3,332)
Operating lease charges
60,000
48,000
PEARTREE CLEANING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 20 -
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
20,000
20,000
For other services
Taxation compliance services
2,000
2,000
All other non-audit services
12,500
12,500
14,500
14,500
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
433,771
440,136
Company pension contributions to defined contribution schemes
70,788
103,740
504,559
543,876
Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
123,434
135,731
7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
141,539
48,381
2024
2023
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
141,539
48,381
PEARTREE CLEANING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 21 -
8
Interest payable and similar expenses
2024
2023
£
£
Other finance costs:
Interest on finance leases and hire purchase contracts
9,962
4,217
Other interest
15,355
621
25,317
4,838
9
Employees

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

2024
2023
Number
Number
Production staff
1,210
1,206
Administrative staff
49
47
Total
1,259
1,253

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
19,210,420
17,649,214
Social security costs
1,237,609
1,084,237
Pension costs
364,048
368,925
20,812,078
19,102,375
PEARTREE CLEANING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 22 -
10
Tangible fixed assets
Plant and machinery
Fixtures, fittings & equipment
Motor vehicles
Total
£
£
£
£
Cost
At 1 September 2023
849,506
259,438
711,288
1,820,232
Additions
155,971
26,017
353,059
535,047
Disposals
(128,248)
-
0
(134,934)
(263,182)
At 31 August 2024
877,229
285,455
929,413
2,092,097
Depreciation and impairment
At 1 September 2023
596,264
231,356
248,125
1,075,745
Depreciation charged in the year
98,346
5,146
160,713
264,205
Eliminated in respect of disposals
(129,977)
-
0
(82,649)
(212,626)
At 31 August 2024
564,633
236,502
326,189
1,127,324
Carrying amount
At 31 August 2024
312,596
48,953
603,224
964,773
At 31 August 2023
253,242
28,082
463,163
744,487

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
£
£
Motor vehicles
216,449
65,024
11
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
3,707,396
4,500,802
Other debtors
973,651
129,749
Prepayments and accrued income
105,149
91,601
4,786,196
4,722,152
PEARTREE CLEANING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 23 -
12
Creditors: amounts falling due within one year
2024
2023
£
£
Obligations under finance leases
14
26,923
11,592
Trade creditors
785,638
923,061
Corporation tax
316,418
123,531
Other taxation and social security
962,076
1,036,228
Other creditors
1,439,375
1,322,611
Accruals and deferred income
222,023
287,244
3,752,453
3,704,267
13
Creditors: amounts falling due after more than one year
2024
2023
£
£
Obligations under finance leases
14
165,818
40,269
14
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
26,923
11,592
In two to five years
165,818
40,269
192,741
51,861

Finance lease payments represent rentals payable by the company for certain motor vehicles. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is three years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

15
Deferred taxation

Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
77,895
77,895
There were no deferred tax movements in the year.

 

PEARTREE CLEANING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 24 -
16
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
364,048
368,925

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.

17
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
28,500
28,500
28,500
28,500
Ordinary A shares of £1 each
5,343
5,028
5,343
6,684
Ordinary B shares of £1 each
1,781
0
1,781
-
0
35,624
33,528
35,624
35,184

On 5 January 2024 there was an allotment of Ordinary A shares and Ordinary B shares.

 

66 Ordinary A shares were issued at a premium of £72.71.

374 Ordinary B shares were issued at a premium of £72.71.

18
Operating lease commitments

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

2024
2023
£
£
Within one year
60,000
48,000
60,000
48,000
19
Related party transactions

Peartree Asset Management Limited is a related party by virtue of common ownership. During the year the company paid £60,000 (2023: £48,000) to Peartree Asset Management Limited in rent for the year.

 

At the balance sheet date £945,812 (2023: £127,323) was owed by Peartree Asset Management Limited, a company related by the ultimate controlling party. This balance was interest free and repayable on demand.

 

At the year end an amount of £7,358 (2023: £7,358) was owed to the company by the directors. The amount due will be paid in full after the year end.

PEARTREE CLEANING SERVICES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 25 -
20
Ultimate controlling party

The ultimate and immediate parent company for the year was Peartree Cleaning Services Holdings Limited.

 

Peartree Cleaning Services Holdings Limited prepares consolidated financial statements, available at Companies House.

 

The ultimate controlling party during the year was Mr Bradley Reames by virtue of his shareholdings.

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