Company registration number 08068803 (England and Wales)
PEARL YACHTS LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2024
PEARL YACHTS LTD
COMPANY INFORMATION
Directors
Mr P C Hannah
Mr I P Smallridge
Cenk Efe Yavuz
(Appointed 29 January 2025)
Company number
08068803
Registered office
Unit 4
St Georges Business Park
Lower Cape
Warwick
England
CV34 5DR
Auditor
BK Plus Audit Limited
2 Highlands Court
Cranmore Avenue
Solihull
West Midlands
B90 4LE
PEARL YACHTS LTD
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Profit and loss account
8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Statement of cash flows
12
Notes to the financial statements
13 - 24
PEARL YACHTS LTD
STRATEGIC REPORT
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 1 -

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

Principal activities

The principal activity of the company is the manufacture and sale of luxury motor yachts. The company operates in the UK and overseas, with its head office based in Warwick.

Business review and outlook

The company is a leading supplier of luxury motor yachts for the global market selling through an expanding network of dealers and distributors around the world.

2024 was a record year for Pearl Yachts LTD, with more deliveries, higher turnover and record profits. The company continued to gain market share and recognition with the introduction of its latest new model, Pearl 82. The Pearl 82 has been very well received by customers and the media alike, already winning the ‘Best Layout’ at the prestigious World Yachts Awards and the Best Flybridge yacht over 60ft at the Motor Boat Awards.

Outlook for 2025 onwards

The company continues to enjoy a positive outlook, with a strong order book on all models. In 2025 the company will continue to increase its with increased production volume and the introduction of another new model.

Key financial results

During 2024, the company aligned its financial and operational calendars by extending its financial year by 5 months to 31 December 2024. During the 17-month period it grew its revenue to £49.1 from £23.1m in the 12 months ended 31 July 2023. This represented annualised revenue growth of 37%. Gross profit for the period grew to £13.4m representing 27% of revenue and a two percentage point increase on FY23 levels. Overall profit before tax increased to £3.8m in FY24 from £0.9m in FY23. This represents consistent growth to a record level of revenue and profitability for the company.

Key performance indicators

The company operates using a small number of Key Performance Indicators to measure ongoing performance, allowing management to make timely and informed decisions.

 

A summary of these KPI's are provided with the prior year comparative.

 

 

 

FY24

(17 months to

31 December 2024)

FY23

(12 months ended 31 July 2023

Turnover

£000

49,097

23,100

Gross Profit

£000

13,313

5,701

Profit before tax

£000

3,792

920

 

 

 

 

Annualised Turnover growth

%

37.1%

30.5%

Gross profit percentage

%

27.1%

24.7%

Return on sales percentage

%

7.7%

4.0%

PEARL YACHTS LTD
STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 2 -

Principal risks and uncertainties

Adverse global economic and market risks could affect the luxury yacht industry and therefore the company’s performance, leading to a reduction in demand for its products. To manage these risks the company has developed a unique business model, focused around the hugely successful design collaboration of Dixon Yacht Design and Kelly Hoppen Interiors, that seeks to outsource the manufacture of a limited number of high-quality yachts.

 

Employing only a handful of people as well as using specialist industry sub-contractors Pearl can adapt to market conditions quickly and much more economically than its competitors.

 

Growth

In 2025 Pearl will continue to increase its production capacity in line with demand and expand its global dealer/distributor network to access new markets, reducing its dependency on the US and Europe. Pearl continues to develop and launch innovative new products and combine that with effective marketing campaigns whilst maintaining its relentless focus on customer service and experience.

 

Exchange rate risk

The Company’s activities expose it to the financial risks of movements in exchange rates for the US Dollar and the Euro. Such risk is currently mitigated by having both sales and purchases in the same currency as well as having GBP, Euro and USD bank accounts.

 

Credit risk

The risk of payment default is minimised by obtaining non-refundable deposits and stage payments aligned to the company’s performance obligations.

Liquidity risk

The company manages its cash resources to ensure it has sufficient liquid funds to meet the operating requirements of its business. At 31 December 2024 the company held £9.0m in a combination of GBP, USD and the Euro representing in excess of 35% of current assets.

 

Price risk

The company is exposed to sales price risk where competition in the market leads to pressure on its products. This risk is mitigated through product innovation and refreshment combined with a strong marketing presence.

 

The company is also exposed to supply chain price increases. This risk is managed by a close relationship with suppliers, a competitive tendering process and annual pricing reviews.

On behalf of the board

Mr I P Smallridge
Director
30 May 2025
PEARL YACHTS LTD
DIRECTORS' REPORT
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 3 -

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

Results and dividends

The results for the Period are set out on page 8.

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

No preference dividends were paid.

 

On 2 September 2024 the company passed a special resolution to approve the redemption of 3,000,000 redeemable preference shares of £1 each. The resolution resulted in a payment of £3,000,000 and a reduction in distributable reserves totalling £3,000,000.

Directors

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

Mrs M G Whittaker
(Resigned 2 February 2025)
Mr P C Hannah
Mr I P Smallridge
Cenk Efe Yavuz
(Appointed 29 January 2025)
Qualifying third party indemnity provisions

The Company has made qualifying third party indemnity provisions for the benefit of it's directors which were made during the year and continue to remain in force at the date of this report.

Statement of disclosure to auditor

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

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 I P Smallridge
Director
30 May 2025
PEARL YACHTS LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 4 -

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.

PEARL YACHTS LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PEARL YACHTS LTD
- 5 -
Opinion

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

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the 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:

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

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

 

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

Responsibilities of directors

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

Auditor's responsibilities for the audit of the financial statements

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

 

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.

 

From the preliminary stages of the audit, we ensure our understanding of the entity is up to date. This includes, but is not limited to, current knowledge of their activities, the business and control environments, and their compliance with the applicable legal and regulatory frameworks. This information supports our risk identification and the subsequent design of audit procedures to mitigate those risks; ensuring that the audit evidence obtained is sufficient and appropriate to support our opinion.

 

In response to the risks identified, specific to this entity, we designed procedures which included, but were not limited to:

 

 

PEARL YACHTS LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PEARL YACHTS LTD
- 7 -

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.

Paul Mannion FCCA, FCA
Senior Statutory Auditor
For and on behalf of BK Plus Audit Limited
30 May 2025
Chartered Certified Accountants
2 Highlands Court
Cranmore Avenue
Solihull
West Midlands
B90 4LE
PEARL YACHTS LTD
PROFIT AND LOSS ACCOUNT
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 8 -
Period
Year
ended
ended
31 December
31 July
2024
2023
Notes
£
£
Turnover
3
49,096,526
23,100,499
Cost of sales
(35,783,462)
(17,399,845)
Gross profit
13,313,064
5,700,654
Administrative expenses
(9,664,060)
(4,796,310)
Operating profit
4
3,649,004
904,344
Interest receivable and similar income
7
143,223
15,237
Profit before taxation
3,792,227
919,581
Tax on profit
8
-
0
-
0
Profit for the financial Period
3,792,227
919,581

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

PEARL YACHTS LTD
STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 9 -
Period
Year
ended
ended
31 December
31 July
2024
2023
£
£
Profit for the Period
3,792,227
919,581
Other comprehensive income
-
-
Total comprehensive income for the Period
3,792,227
919,581
PEARL YACHTS LTD
BALANCE SHEET
AS AT 31 DECEMBER 2024
31 December 2024
- 10 -
31 December 2024
31 July 2023
Notes
£
£
£
£
Fixed assets
Intangible assets
9
736,402
741,588
Tangible assets
10
1,365,743
1,407,249
2,102,145
2,148,837
Current assets
Stocks
11
6,135,258
7,128,826
Debtors
14
8,467,933
10,066,169
Cash at bank and in hand
8,958,440
6,383,697
23,561,631
23,578,692
Creditors: amounts falling due within one year
13
(9,163,204)
(10,019,184)
Net current assets
14,398,427
13,559,508
Net assets
16,500,572
15,708,345
Capital and reserves
Called up share capital
16
8,602,459
11,602,459
Profit and loss reserves
7,898,113
4,105,886
Total equity
16,500,572
15,708,345

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:
Mr I P Smallridge
Director
Company registration number 08068803 (England and Wales)
PEARL YACHTS LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 11 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 August 2022
11,602,459
3,186,305
14,788,764
Year ended 31 July 2023:
Profit and total comprehensive income
-
919,581
919,581
Balance at 31 July 2023
11,602,459
4,105,886
15,708,345
Period ended 31 December 2024:
Profit and total comprehensive income
-
3,792,227
3,792,227
Redemption of shares
16
(3,000,000)
-
0
(3,000,000)
Balance at 31 December 2024
8,602,459
7,898,113
16,500,572
PEARL YACHTS LTD
STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 12 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
21
6,079,011
706,248
Investing activities
Purchase of intangible assets
(240,432)
(224,011)
Purchase of tangible fixed assets
(407,059)
(69,490)
Interest received
143,223
15,237
Net cash used in investing activities
(504,268)
(278,264)
Financing activities
Redemption of shares
(3,000,000)
-
0
Net cash used in financing activities
(3,000,000)
-
Net increase in cash and cash equivalents
2,574,743
427,984
Cash and cash equivalents at beginning of Period
6,383,697
5,955,713
Cash and cash equivalents at end of Period
8,958,440
6,383,697
PEARL YACHTS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 13 -
1
Accounting policies
Company information

Pearl Yachts Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Unit 4, St Georges Business Park, Lower Cape, Warwick, England, CV34 5DR.

1.1
Reporting period

For commercial and strategic reasons, the directors have chosen to extend the period end to 31 December 2024. Therefore this report represents a seventeen month period.

 

As a result, the comparative amounts presented in these financial statements (including the related notes) are not entirely comparable.

1.2
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.

1.3
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.

1.4
Turnover

Revenue comprises sales of goods or services provided to customers net of value added tax and other sales taxes, less an appropriate deduction for actual and expected returns and discounts. Revenue is recognised when performance obligations are satisfied and the control of goods or services is transferred to the buyer. Where the performance obligation is satisfied over time, revenue is recognised in accordance with its progress towards complete satisfaction of that performance obligation.

 

When cash inflows are deferred and represent a financing arrangement, the promised consideration is adjusted for the effects of the time value of money, which is recognised as interest income.

Revenue for the provision of construction contracts is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated following a survey of work undertaken at the Balance Sheet date. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

1.5
Research and development expenditure

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

1.6
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and has been fully amortised this year.

PEARL YACHTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 14 -
1.7
Intangible fixed assets other than goodwill

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

 

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

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

Development costs
20% straight line from date of first sale of each yacht
1.8
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
Amortised evenly over the production life of each model of yacht, as yachts are produced
Office equipment
20% straight line
Motor vehicles
25% straight line
1.9
Impairment of fixed assets

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

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

 

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

PEARL YACHTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 15 -
1.10
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell.

 

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 the profit or loss. Reversals of impairment losses are also recognised in profit and loss.

 

Work in progress

 

Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the reporting end date. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.

 

When it is probable that total contract costs will exceed total contract turnover, the expected loss is recognised as an expense immediately.

 

Where the outcome of a construction contract cannot be estimated reliably, a review of work performed is undertaken and used as the basis of the stage of completion. If the review of work undertaken confirms that an accrual for costs is required this amount in included in creditors.

1.11
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand

1.12
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.

PEARL YACHTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 16 -
Impairment of financial assets

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

 

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

 

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

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

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

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, 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.

 

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.

PEARL YACHTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 17 -
1.13
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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

1.14
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.

1.15
Retirement benefits

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

1.16
Leases
As lessee

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.

1.17
Foreign exchange

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

2
Judgements and key sources of estimation uncertainty

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

 

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

PEARL YACHTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 18 -
3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by geographical market
Western Europe
28,608,812
17,127,328
North America
15,105,397
4,546,932
Asia Pacific
5,382,317
1,413,872
Other
-
12,367
49,096,526
23,100,499
2024
2023
£
£
Other revenue
Interest income
143,223
15,237
4
Operating profit
2024
2023
Operating profit for the period is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(34,314)
141,775
Research and development costs
33,366
3,576
Fees payable to the company's auditor for the audit of the company's financial statements
17,500
5,000
Depreciation of owned tangible fixed assets
641,757
306,035
Amortisation of intangible assets
245,618
113,073
Operating lease charges
63,573
29,717
5
Employees

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

2024
2023
Number
Number
8
7
PEARL YACHTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2024
5
Employees
(Continued)
- 19 -

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
1,144,896
564,126
Social security costs
134,290
60,229
Pension costs
20,123
8,720
1,299,309
633,075
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
691,676
339,584
Company pension contributions to defined contribution schemes
7,369
2,197
699,045
341,781

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2023 - 1).

Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
347,013
185,000
Company pension contributions to defined contribution schemes
3,119
2,197
7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
143,223
15,237
2024
2023
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
143,223
15,237
PEARL YACHTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 20 -
8
Taxation

The actual charge for the Period can be reconciled to the expected charge for the Period based on the profit or loss and the standard rate of tax as follows:

2024
2023
£
£
Profit before taxation
3,792,227
919,581
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 25.00%)
948,057
229,895
Tax effect of expenses that are not deductible in determining taxable profit
9,601
2,676
Tax effect of utilisation of tax losses not previously recognised
(846,567)
(199,975)
Permanent capital allowances in excess of depreciation
71,781
(32,596)
Development costs capitalised
(60,108)
-
0
Research and developement enhanced expenditure
(122,764)
-
0
Taxation charge for the period
-
-
9
Intangible fixed assets
Goodwill
Development costs
Total
£
£
£
Cost
At 1 August 2023
200,000
1,013,018
1,213,018
Additions - internally developed
-
0
240,432
240,432
At 31 December 2024
200,000
1,253,450
1,453,450
Amortisation and impairment
At 1 August 2023
200,000
271,430
471,430
Amortisation charged for the Period
-
0
245,618
245,618
At 31 December 2024
200,000
517,048
717,048
Carrying amount
At 31 December 2024
-
0
736,402
736,402
At 31 July 2023
-
0
741,588
741,588

 

PEARL YACHTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 21 -
10
Tangible fixed assets
Plant and equipment
Office equipment
Motor vehicles
Total
£
£
£
£
Cost
At 1 August 2023
2,235,707
31,818
274,878
2,542,403
Additions
600,251
-
0
-
0
600,251
At 31 December 2024
2,835,958
31,818
274,878
3,142,654
Depreciation and impairment
At 1 August 2023
1,001,087
7,365
126,702
1,135,154
Depreciation charged in the Period
554,829
9,014
77,914
641,757
At 31 December 2024
1,555,916
16,379
204,616
1,776,911
Carrying amount
At 31 December 2024
1,280,042
15,439
70,262
1,365,743
At 31 July 2023
1,234,620
24,453
148,176
1,407,249
11
Stocks
2024
2023
£
£
Work in progress
6,060,798
7,031,464
Finished goods and goods for resale
74,460
97,362
6,135,258
7,128,826
12
Construction contracts
2024
2023
£
£
Contracts in progress at the reporting date
Gross amounts owed by contract customers included in debtors
12,238,095
8,554,326

Advances received from customers for contract work amounted to £9,687,818 (2023 - £3,256,000).

13
Creditors: amounts falling due within one year
2024
2023
£
£
Payments received on account
173,365
2,394,310
Trade creditors
874,920
1,063,691
Other creditors
1,694
1,000,030
Accruals and deferred income
8,113,225
5,561,153
9,163,204
10,019,184
PEARL YACHTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 22 -
14
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
5,563,613
4,404,500
Gross amounts owed by contract customers
12,238,095
8,554,326
Advances received from contract customers
(9,687,818)
(3,256,000)
Other debtors
60,942
44,100
Prepayments and accrued income
293,101
319,243
8,467,933
10,066,169
15
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
20,123
8,720

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

16
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
of £1 each
100
100
100
100
2024
2023
2024
2023
Preference share capital
Number
Number
£
£
Issued and fully paid
of £1 each
8,602,359
11,602,359
8,602,359
11,602,359
Preference shares classified as equity
8,602,359
11,602,359
Total equity share capital
8,602,459
11,602,459

The preference shares were issued at par value and do not have a fixed redemption date. Redemption of the preference shares is enacted by the relevant shareholder issuing a redemption notice to the company.

On 2 September 2024 the company passed a special resolution to approve the redemption of 3,000,000 redeemable preference shares of £1 each. The resolution resulted in a payment of £3,000,000 and a reduction in distributable reserves totalling £3,000,000.

PEARL YACHTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 23 -
17
Operating lease commitments
As lessee

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

2024
2023
£
£
Within 1 year
48,464
40,500
Years 2-5
72,696
63,250
121,160
103,750
18
Capital commitments

Amounts contracted for but not provided in the financial statements:

2024
2023
£
£
Acquisition of tangible fixed assets
155,534
-
19
Related party transactions
Transactions with related parties
Sales
Sales
Purchases
Purchases
2024
2023
2024
2023
£
£
£
£
Entities with control, joint control or significant influence over the company
-
0
4,600,000
2,500,000
-
0

The following amounts were outstanding at the reporting end date:

2024
2023
Amounts due from related parties
£
£
Entities with control, joint control or significant influence over the company
-
4,400,000
Other information

The balance outstanding at 31 July 2023 is included in debtors due within one year.

20
Directors' transactions

Dividends totalling £0 (2023 - £0) were paid in the Period in respect of shares held by the company's directors.

PEARL YACHTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2024
- 24 -
21
Cash generated from operations
2024
2023
£
£
Profit after taxation
3,792,227
919,581
Adjustments for:
Investment income
(143,223)
(15,237)
Amortisation and impairment of intangible assets
245,618
113,073
Depreciation and impairment of tangible fixed assets
641,757
306,035
Movements in working capital:
Decrease/(increase) in stocks
993,568
(1,316,033)
Decrease/(increase) in debtors
1,598,236
(731,925)
(Decrease)/increase in creditors
(1,049,172)
1,430,754
Cash generated from operations
6,079,011
706,248
22
Analysis of changes in net funds
1 August 2023
Cash flows
31 December 2024
£
£
£
Cash at bank and in hand
6,383,697
2,574,743
8,958,440
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