Company registration number 05909529 (England and Wales)
K Steels Holdings Limited
Group strategic report, report of the directors and
consolidated financial statements for the year
ended 30 September 2024
K Steels Holdings Limited
Company information
Directors
Mr S Kay
Mrs K Kay
Mrs L Navan
Mrs S Connolly
Mr A J Kay
(Appointed 22 May 2024)
Company number
05909529
Registered office
Jubilee Works
Holme Lane
Rawtenstall
Rossendale
Lancashire
United Kingdom
BB4 6JF
Auditor
DJH Audit Limited
The Exchange
5 Bank Street
Bury
Lancashire
BL9 0DN
K Steels Holdings Limited
Contents
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Group statement of income and retained earnings
7
Group statement of comprehensive income
8
Group balance sheet
9
Company balance sheet
10
Group statement of cash flows
11
Notes to the financial statements
12 - 25
K Steels Holdings Limited
Strategic report
For the year ended 30 September 2024
- 1 -

The directors present the strategic report for the year ended 30 September 2024.

Review of the business

The year to 30 September 2024 has seen K Steels Limited maintain its position as one of the main independent steel stockholders in the North of England.

Turnover for the year to 30 September 2024 decreased £2.4m (18%) to £10.7m in comparison to 2023.

Gross profit for 2024 decreased £0.4m (14%) to £2.2m in comparison to 2023.

Overhead expenditure is monitored, and savings are obtained wherever possible. In the period, administrative overheads increased by £81k (3.3%) in comparison to 2023, to £2.5m.

Bad debts for 2024 increased £2,832 to £12,028 in comparison to the previous year and credit control is strictly monitored.

The business continues to invest in new steel processing and handling equipment. This investment, combined with continued staff training and development is having a positive impact on the efficiency and range of services that the business can offer.

All the matters mentioned above have resulted in the loss on ordinary activities before taxation of £201,414 for the financial year.

Principal risks and uncertainties

Management believes that the principal risks and uncertainties for K Steels Limited continue to be the fluctuation in commodity prices and bad debt exposure. The uncertainty in steel and oil prices particularly affect the company as energy costs form a large proportion of steel production costs.

Despite such risks and uncertainty, the directors consider the company to be adequately financed with net assets of c.£4.0 million including cash balance of c.£2.7 million and no debt finance. The directors believe they have sufficient resources to sustain the level of trading activity in a stable economic environment for the foreseeable future. The financial statements have therefore been prepared on a going concern basis.

Key performance indicators

Key financial indicators for senior management include sales levels, gross profit, net profit and bad debt occurrence together with working capital levels, cash flow and cash balances, the results of which are noted above and can be obtained from the financial statements.

On behalf of the board

Mr S Kay
Director
30 May 2025
K Steels Holdings Limited
Directors' report
For the year ended 30 September 2024
- 2 -

The directors present their annual report and financial statements for the year ended 30 September 2024.

Principal activities

The principal activity of the company continued to be that of a holding company. The principal activity of the subsidiary was that of steel stockholders.

Results and dividends

The results for the year are set out on page 7.

Ordinary dividends were paid amounting to £30,734. The directors do not recommend payment of a further dividend.

Directors

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

Mr S Kay
Mrs K Kay
Mrs L Navan
Mrs S Connolly
Mr A J Kay
(Appointed 22 May 2024)
Auditor

DJH Audit Limited has indicated its willingness to be reappointed for another term and appropriate arrangements are being made for it to be deemed reappointed as auditor in the absence of an Annual 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 auditor of the company 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 auditor of the company is aware of that information.

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
Mr S Kay
Director
30 May 2025
K Steels Holdings Limited
Directors' responsibilities statement
For the year ended 30 September 2024
- 3 -

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 group and company, and of the profit or loss of the group 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 group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

K Steels Holdings Limited
Independent auditor's report
To the members of K Steels Holdings Limited
- 4 -
Opinion

We have audited the financial statements of K Steels Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 September 2024 which comprise the group statement of income and retained earnings, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group 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 group and parent 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 group's and parent company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

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

Other information

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.

K Steels Holdings Limited
Independent auditor's report (continued)
To the members of K Steels Holdings Limited
- 5 -

Opinions on other matters prescribed by the Companies Act 2006

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

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and their 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 parent 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 parent company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

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

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

 

K Steels Holdings Limited
Independent auditor's report (continued)
To the members of K Steels Holdings Limited
- 6 -

The key procedures we undertook to detect irregularities including fraud during the course of the audit included:

 

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.

Mr Richard Bell (Senior Statutory Auditor)
For and on behalf of
30 May 2025
DJH Audit Limited
Accountants
Statutory Auditor
The Exchange
5 Bank Street
Bury
Lancashire
BL9 0DN
K Steels Holdings Limited
Group statement of income and retained earnings
For the year ended 30 September 2024
- 7 -
2024
2023
Notes
£
£
Turnover
5
10,682,381
13,040,906
Cost of sales
(8,456,426)
(10,442,530)
Gross profit
2,225,955
2,598,376
Administrative expenses
(2,525,227)
(2,444,366)
Other operating income
5,793
30,806
Operating (loss)/profit
6
(293,479)
184,816
Interest receivable and similar income
8
92,065
56,955
(Loss)/profit before taxation
(201,414)
241,771
Tax on (loss)/profit
9
55,915
(42,732)
(Loss)/profit for the financial year
(145,499)
199,039
Retained earnings brought forward
4,211,369
4,073,798
Dividends
(30,734)
(61,468)
Retained earnings carried forward
4,035,136
4,211,369
(Loss)/profit for the financial year is all attributable to the owners of the parent company.
K Steels Holdings Limited
Group statement of comprehensive income
For the year ended 30 September 2024
- 8 -
2024
2023
£
£
(Loss)/profit for the year
(145,499)
199,039
Other comprehensive income
-
-
Cash flow hedges gain arising in the year
-
0
-
0
Total comprehensive income for the year
(145,499)
199,039
Total comprehensive income for the year is all attributable to the owners of the parent company.
K Steels Holdings Limited
Group balance sheet
As at 30 September 2024
- 9 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
11
923,082
794,004
Current assets
Stocks
14
1,815,942
1,939,582
Debtors
15
1,860,824
1,892,553
Cash at bank and in hand
2,681,105
2,863,246
6,357,871
6,695,381
Creditors: amounts falling due within one year
16
(3,015,043)
(3,071,030)
Net current assets
3,342,828
3,624,351
Total assets less current liabilities
4,265,910
4,418,355
Provisions for liabilities
Deferred tax liability
17
230,772
206,984
(230,772)
(206,984)
Net assets
4,035,138
4,211,371
Capital and reserves
Called up share capital
19
61,468
61,468
Other reserves
(61,466)
(61,466)
Profit and loss reserves
4,035,136
4,211,369
Total equity
4,035,138
4,211,371

These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.

The financial statements were approved by the board of directors and authorised for issue on 30 May 2025 and are signed on its behalf by:
30 May 2025
Mr S Kay
Director
Company registration number 05909529 (England and Wales)
K Steels Holdings Limited
Company balance sheet
As at 30 September 2024
30 September 2024
- 10 -
2024
2023
Notes
£
£
£
£
Fixed assets
Investments
12
61,468
61,468
Current assets
Investments
732
732
Net current assets
732
732
Net assets
62,200
62,200
Capital and reserves
Called up share capital
19
61,468
61,468
Profit and loss reserves
732
732
Total equity
62,200
62,200

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company's profit for the year was £732 (2023 - £61,468 profit).

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved by the board of directors and authorised for issue on 30 May 2025 and are signed on its behalf by:
30 May 2025
Mr S Kay
Director
Company registration number 05909529 (England and Wales)
K Steels Holdings Limited
Group statement of cash flows
For the year ended 30 September 2024
- 11 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
1
40,525
126,697
Income taxes paid
(6,432)
(208,866)
Net cash inflow/(outflow) from operating activities
34,093
(82,169)
Investing activities
Purchase of tangible fixed assets
(277,565)
(331,209)
Proceeds from disposal of tangible fixed assets
-
8,199
Interest received
92,065
56,955
Net cash used in investing activities
(185,500)
(266,055)
Financing activities
Dividends paid to equity shareholders
(30,734)
(61,468)
Net cash used in financing activities
(30,734)
(61,468)
Net decrease in cash and cash equivalents
(182,141)
(409,692)
Cash and cash equivalents at beginning of year
2,863,246
3,272,938
Cash and cash equivalents at end of year
2,681,105
2,863,246
K Steels Holdings Limited
Group statement of cash flows (continued)
For the year ended 30 September 2024
- 12 -
1
Cash generated from group operations
2024
2023
£
£
(Loss)/profit for the year after tax
(145,499)
199,039
Adjustments for:
Taxation (credited)/charged
(55,915)
42,732
Investment income
(92,065)
(56,955)
Gain on disposal of tangible fixed assets
-
(216)
Depreciation and impairment of tangible fixed assets
148,487
147,453
Movements in working capital:
Decrease in stocks
123,640
657,425
Decrease in debtors
111,278
624,981
Decrease in creditors
(49,401)
(1,487,762)
Cash generated from operations
40,525
126,697
2
Analysis of changes in net funds - group
1 October 2023
Cash flows
30 September 2024
£
£
£
Cash at bank and in hand
2,863,246
(182,141)
2,681,105
3
Accounting policies
Company information

K Steels Holdings Limited is a private company, limited by shares, registered in England and Wales. The company's registered number is 05909529 and registered office address is Jubilee Works, Holme Lane, Rawtenstall, Rossendale, Lancashire, BB4 6JF.

3.1
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.

K Steels Holdings Limited
Notes to the group financial statements
For the year ended 30 September 2024
3
Accounting policies
(Continued)
- 13 -

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

 

 

3.2
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

3.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company K Steels Holdings Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 30 September 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

K Steels Holdings Limited
Notes to the group financial statements (continued)
For the year ended 30 September 2024
3
Accounting policies
(Continued)
- 14 -

Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

 

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

 

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

3.4
Going concern

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

3.5
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.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

3.6
Tangible fixed assets

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

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

Plant and equipment
15% on reducing balance
Fixtures and fittings
10% on reducing balance
Computers
33% on reducing balance
Motor vehicles
25% on reducing balance

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

K Steels Holdings Limited
Notes to the group financial statements (continued)
For the year ended 30 September 2024
3
Accounting policies
(Continued)
- 15 -
3.7
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

 

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

 

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

 

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

3.8
Impairment of fixed assets

At each reporting period end date, the group 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.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

K Steels Holdings Limited
Notes to the group financial statements (continued)
For the year ended 30 September 2024
3
Accounting policies
(Continued)
- 16 -

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.

3.9
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.

3.10
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.

3.11
Financial instruments

The group 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 group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

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

Basic financial assets

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.

K Steels Holdings Limited
Notes to the group financial statements (continued)
For the year ended 30 September 2024
3
Accounting policies
(Continued)
- 17 -
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 group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

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 group 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.

K Steels Holdings Limited
Notes to the group financial statements (continued)
For the year ended 30 September 2024
3
Accounting policies
(Continued)
- 18 -
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 group's contractual obligations expire or are discharged or cancelled.

3.12
Equity instruments

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

3.13
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 group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

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

 

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

K Steels Holdings Limited
Notes to the group financial statements (continued)
For the year ended 30 September 2024
3
Accounting policies
(Continued)
- 19 -
3.14
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.

3.15
Retirement benefits

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

3.16
Leases

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

4
Judgements and key sources of estimation uncertainty

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

 

The estimates are continually evaluated. Revisions to accounting estimates are recognised in the period in which the estimate is revised.

 

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

 

Estimating the useful economic life of an asset and the anticipated residual value are considered key judgements in calculating an appropriate depreciation charge.

 

Making judgement based on historical experience on the level of provision required for impairment of inventories. Further information received after the statement of financial position date may impact on the level of provision required.

 

Making judgement based on historical experience on the level of provision required for bad debts. Further information received after the statement of financial position date may impact on the level of provision required.

5
Turnover and other revenue

The revenue and profit before taxation are attributable to the one principal activity of the group.

 

All revenue is generated in the United Kingdom

K Steels Holdings Limited
Notes to the group financial statements (continued)
For the year ended 30 September 2024
- 20 -
6
Operating (loss)/profit
2024
2023
£
£
Operating (loss)/profit for the year is stated after charging/(crediting):
Fees payable to the group's auditor for the audit of the group's financial statements
12,000
12,000
Depreciation of owned tangible fixed assets
148,487
147,453
Profit on disposal of tangible fixed assets
-
(216)
Operating lease charges
7,829
8,869
7
Employees

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

2024
2023
Number
Number
Management and administration
14
13
Warehousing and drivers
27
26
Total
41
39

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
1,133,712
1,083,127
Social security costs
96,315
86,964
Pension costs
47,442
28,075
1,277,469
1,198,166
8
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
92,065
56,955
9
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
(79,702)
6,586
K Steels Holdings Limited
Notes to the group financial statements (continued)
For the year ended 30 September 2024
9
Taxation
2024
2023
£
£
(Continued)
- 21 -
Deferred tax
Origination and reversal of timing differences
23,787
36,146
Total tax (credit)/charge
(55,915)
42,732

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

2024
2023
£
£
(Loss)/profit before taxation
(201,414)
241,771
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 25.00%)
(50,354)
60,443
Tax effect of expenses that are not deductible in determining taxable profit
2,922
(3,538)
Effect of change in corporation tax rate
-
(1,677)
Permanent capital allowances in excess of depreciation
(8,483)
(12,496)
Taxation (credit)/charge
(55,915)
42,732
10
Dividends
2024
2023
Recognised as distributions to equity holders:
£
£
Interim paid
30,734
61,468
K Steels Holdings Limited
Notes to the group financial statements (continued)
For the year ended 30 September 2024
- 22 -
11
Tangible fixed assets
Group
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 October 2023
698,565
320,222
195,602
721,855
1,936,244
Additions
54,263
105,675
3,427
114,200
277,565
Disposals
(38,812)
-
0
(42,620)
-
0
(81,432)
At 30 September 2024
714,016
425,897
156,409
836,055
2,132,377
Depreciation and impairment
At 1 October 2023
319,057
159,073
182,592
481,518
1,142,240
Depreciation charged in the year
60,846
22,964
4,924
59,753
148,487
Eliminated in respect of disposals
(38,812)
-
0
(42,620)
-
0
(81,432)
At 30 September 2024
341,091
182,037
144,896
541,271
1,209,295
Carrying amount
At 30 September 2024
372,925
243,860
11,513
294,784
923,082
At 30 September 2023
379,508
161,149
13,010
240,337
794,004
The company had no tangible fixed assets at 30 September 2024 or 30 September 2023.
12
Fixed asset investments
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Investments in subsidiaries
13
-
0
-
0
61,468
61,468
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 October 2023 and 30 September 2024
61,468
Carrying amount
At 30 September 2024
61,468
At 30 September 2023
61,468
K Steels Holdings Limited
Notes to the group financial statements (continued)
For the year ended 30 September 2024
- 23 -
13
Subsidiaries

Details of the company's subsidiaries at 30 September 2024 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
K Steels Limited
United Kingdom
Ordinary
100.00
14
Inventories
Group
Company
2024
2023
2024
2023
£
£
£
£
Inventories
1,815,942
1,939,582
-
-
15
Debtors
Group
Company
2024
2023
2024
2023
Amounts falling due within one year:
£
£
£
£
Trade debtors
1,690,380
1,805,593
-
0
-
0
Corporation tax recoverable
79,549
-
0
-
0
-
0
Other debtors
943
200
-
0
-
0
Prepayments and accrued income
89,952
86,760
-
0
-
0
1,860,824
1,892,553
-
-
16
Creditors: amounts falling due within one year
Group
Company
2024
2023
2024
2023
£
£
£
£
Trade creditors
2,599,709
2,486,650
-
0
-
0
Corporation tax payable
-
0
6,586
-
0
-
0
Other taxation and social security
137,596
189,337
-
-
Other creditors
8,259
693
-
0
-
0
Accruals and deferred income
269,479
387,764
-
0
-
0
3,015,043
3,071,030
-
0
-
0
K Steels Holdings Limited
Notes to the group financial statements (continued)
For the year ended 30 September 2024
- 24 -
17
Deferred taxation

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

Liabilities
Liabilities
2024
2023
Group
£
£
Accelerated capital allowances
230,772
206,984
The company has no deferred tax assets or liabilities.
Group
Company
2024
2024
Movements in the year:
£
£
Liability at 1 October 2023
206,984
-
Charge to profit or loss
23,788
-
Liability at 30 September 2024
230,772
-
18
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
47,442
28,075

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

19
Share capital
Group and company
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
61,468
61,468
61,468
61,468
K Steels Holdings Limited
Notes to the group financial statements (continued)
For the year ended 30 September 2024
- 25 -
20
Operating lease commitments
Lessee

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

Group
Company
2024
2023
2024
2023
£
£
£
£
Within one year
15,538
11,564
-
-
Between two and five years
22,638
29,640
-
-
In over five years
-
2,182
-
-
38,176
43,386
-
-
21
Capital commitments

Amounts contracted for but not provided in the financial statements:

Group
Company
2024
2023
2024
2023
£
£
£
£
Acquisition of tangible fixed assets
40,510
-
-
-
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