HARDWOOD SALES HOLDING LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Company Registration No. 09177666 (England and Wales)
HARDWOOD SALES HOLDING LIMITED
COMPANY INFORMATION
Directors
Mr M A Collins
Mr J McCoy
Company number
09177666
Registered office
Huyton Business Park
Ellis Ashton Street, Off Wilson Road
Huyton
Liverpool
L36 6BN
Auditor
DSG Audit
Castle Chambers
43 Castle Street
Liverpool
L2 9TL
HARDWOOD SALES HOLDING LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Group statement of comprehensive income
8
Group balance sheet
9
Company balance sheet
10 - 11
Group statement of changes in equity
12
Company statement of changes in equity
13
Group statement of cash flows
14
Notes to the financial statements
15 - 32
HARDWOOD SALES HOLDING LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 1 -
The directors present the strategic report for the year ended 31 December 2024.
Principal activities
The principal activity of the company is that of the holding company of Hardwood Sales Limited and of the group was that of a timber merchant.
Review of the business
The results for the year and the financial position at the end were considered satisfactory by the directors. The results for the group show a pre-tax profit of £510,310 (2023: £740,991) for the year and turnover of £19,648,591 (2023: £20,144,786). The group has net assets of £6,871,601 (2023: £6,723,259).
The group has performed in line with expectations in an uncertain economic environment.
Principal risks and uncertainties
We have set out below a number of risk factors that we believe could cause our actual future results to differ materially from expected results. However, other factors could adversely affect the results so the factors set out below should not be considered to be a complete set of all potential risks and uncertainties.
Business conditions and the general economy
The profitability of the group could be adversely affected by a worsening of general economic conditions in the United Kingdom. Whilst a short term worsening in the economic conditions in the United Kingdom should not significantly adversely impact profitability, a sustained downturn over a number of years would be likely to lead to reduced profit in this area.
Credit risk
Credit risk is a constant risk and all new customers are reviewed and their financial position assessed before acceptance. The debt from existing customers is monitored on a regular basis to reduce the cash flow risk.
Investments of cash surpluses, borrowings and derivative instruments are made through banks and companies which must fulfil credit rating criteria approved by the Board.
Liquidity risk
The group manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the group has sufficient liquid resources to meet the operating needs of the business.
Interest rate risk
The company is exposed to fair value interest rate risk on its fixed rate borrowings and cash flow interest rate risk on floating rate deposits, bank overdrafts and loans.
The current circumstances provide different challenges, but the directors feel that the group is in a strong position to cope with these challenges.
Development and performance
The group remains in a strong position, having broadened its customer base during recent years, and developed reliable lines of supply.
HARDWOOD SALES HOLDING LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 2 -
Key performance indicators
Measure 2024 2023
Turnover £19.6m £20.1m
Gross profit £5.2m £4.9m
Operating profit £0.6m £0.9m
The group has focussed on maintaining margins during this uncertain time, fulfilling its expectations and will continue to focus on this area in the forthcoming year.
Mr M A Collins
Director
2 June 2025
HARDWOOD SALES HOLDING LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 3 -
The directors present their annual report and financial statements for the year ended 31 December 2024.
Results and dividends
The results for the year are set out on page 8.
No ordinary dividends were paid. 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 M A Collins
Mr J McCoy
Future developments
The group will continue to seek new opportunities, and expand business, but also to maintain margins.
Auditor
DSG resigned as auditor on 11 September 2024. DSG Audit were appointed on 11 September 2024 as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the 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.
Strategic report
The cgroup has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the group's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. The group has done so in respect of its principal activities and financial instruments.
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 M A Collins
Director
2 June 2025
HARDWOOD SALES HOLDING LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR 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 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:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.
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.
HARDWOOD SALES HOLDING LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HARDWOOD SALES HOLDING LIMITED
- 5 -
Opinion
We have audited the financial statements of Hardwood Sales Holding Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2024 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, 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:
give a true and fair view of the state of the group's and the parent company's affairs as at 31 December 2024 and of the group's profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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.
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:
The information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
The strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
HARDWOOD SALES HOLDING LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HARDWOOD SALES HOLDING LIMITED
- 6 -
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:
adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
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.
Capabilitiy of the audit in detecting irregularities, including fraud
Discussions with and enquiries of management and those charged with governance were held with a view to identifying those laws and regulations that could be expected to have a material impact on the financial statements. During the engagement team briefing, the outcomes of these discussions and enquiries were shared with the team, as well as consideration as to where and how fraud may occur in the entity.
The following laws and regulations were identified as being of significance to the entity:
Those laws and regulations considered to have a direct effect on the financial statements include UK financial reporting standards, Company Law, Tax and Pensions legislation, and distributable profits legislation.
Those laws and regulations for which non-compliance may be fundamental to the operating aspects of the business and therefore may have a material effect on the financial statements include environmental regulations, health and safety legislation, trades description act and employment legislation.
Audit procedures undertaken in response to the potential risks relating to irregularities (which include fraud and non-compliance with laws and regulations) comprised of: inquiries of management and those charged with governance as to whether the entity complies with such laws and regulations; enquiries with the same concerning any actual or potential litigation or claims; inspection of relevant legal correspondence; review of board minutes; testing the appropriateness of journal entries; reviewing post year end payments for evidence of claims pay outs and the performance of analytical review to identify unexpected movements in account balances which may be indicative of fraud.
HARDWOOD SALES HOLDING LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HARDWOOD SALES HOLDING LIMITED
- 7 -
No instances of material non-compliance were identified. However, the likelihood of detecting irregularities, including fraud, is limited by the inherent difficulty in detecting irregularities, the effectiveness of the entity’s controls, and the nature, timing and extent of the audit procedures performed. Irregularities that result from fraud might be inherently more difficult to detect than irregularities that result from error. As explained above, there is an unavoidable risk that material misstatements may not be detected, even though the audit has been planned and performed in accordance with ISAs (UK).
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.
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.
Jean Ellis BA FCA CTA (Senior Statutory Auditor)
For and on behalf of DSG Audit, Statutory Auditor
Chartered Accountants
Castle Chambers
43 Castle Street
Liverpool
L2 9TL
2 June 2025
HARDWOOD SALES HOLDING LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
- 8 -
2024
2023
Notes
£
£
Turnover
3
19,648,591
20,144,786
Cost of sales
(14,451,574)
(15,216,271)
Gross profit
5,197,017
4,928,515
Administrative expenses
(4,594,401)
(4,055,526)
Other operating income
12,847
2,872
Operating profit
4
615,463
875,861
Interest receivable and similar income
7
2,460
Interest payable and similar expenses
8
(107,613)
(134,870)
Profit before taxation
510,310
740,991
Tax on profit
9
(189,491)
(280,829)
Profit for the financial year
320,819
460,162
Profit for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.
The notes on pages 15 to 32 form part of these financial statements.
HARDWOOD SALES HOLDING LIMITED
GROUP BALANCE SHEET
AS AT
31 DECEMBER 2024
31 December 2024
- 9 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
10
5,826,932
5,680,217
5,826,932
5,680,217
Current assets
Stocks
14
2,510,721
2,553,136
Debtors
15
4,407,200
4,000,291
Cash at bank and in hand
479,830
639,162
7,397,751
7,192,589
Creditors: amounts falling due within one year
16
(3,815,339)
(3,675,842)
Net current assets
3,582,412
3,516,747
Total assets less current liabilities
9,409,344
9,196,964
Creditors: amounts falling due after more than one year
17
(952,981)
(1,268,401)
Provisions for liabilities
Provisions
20
794,564
394,564
Deferred tax liability
23
790,198
810,740
(1,584,762)
(1,205,304)
Net assets
6,871,601
6,723,259
Capital and reserves
Called up share capital
24
200
206
Revaluation reserve
1,803,849
1,803,849
Capital redemption reserve
100
94
Profit and loss reserves
5,067,452
4,919,110
Total equity
6,871,601
6,723,259
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 2 June 2025 and are signed on its behalf by:
02 June 2025
Mr M A Collins
Director
Company registration number 09177666 (England and Wales)
HARDWOOD SALES HOLDING LIMITED
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2024
31 December 2024
- 10 -
2024
2023
Notes
£
£
£
£
Fixed assets
Investment property
11
4,779,404
4,743,521
Investments
12
300
300
4,779,704
4,743,821
Current assets
Debtors
15
360,368
486,827
Cash at bank and in hand
96,673
259,549
457,041
746,376
Creditors: amounts falling due within one year
16
(1,554,093)
(1,607,017)
Net current liabilities
(1,097,052)
(860,641)
Total assets less current liabilities
3,682,652
3,883,180
Creditors: amounts falling due after more than one year
17
(476,458)
(889,080)
Provisions for liabilities
Deferred tax liability
23
538,340
510,261
(538,340)
(510,261)
Net assets
2,667,854
2,483,839
Capital and reserves
Called up share capital
24
200
206
Capital redemption reserve
100
94
Profit and loss reserves
2,667,554
2,483,539
Total equity
2,667,854
2,483,839
HARDWOOD SALES HOLDING LIMITED
COMPANY BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2024
31 December 2024
- 11 -
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 £356,492 (2023 - £98,696 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 2 June 2025 and are signed on its behalf by:
02 June 2025
Mr M A Collins
Director
Company registration number 09177666 (England and Wales)
HARDWOOD SALES HOLDING LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
- 12 -
Share capital
Revaluation reserve
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
Balance at 1 January 2023
218
1,803,849
82
4,863,948
6,668,097
Year ended 31 December 2023:
Profit and total comprehensive income
-
-
-
460,162
460,162
Own shares acquired
-
-
-
(405,000)
(405,000)
Redemption of shares
24
(12)
-
12
-
Balance at 31 December 2023
206
1,803,849
94
4,919,110
6,723,259
Year ended 31 December 2024:
Profit and total comprehensive income
-
-
-
320,819
320,819
Own shares acquired
-
-
-
(172,477)
(172,477)
Redemption of shares
24
(6)
-
6
-
Balance at 31 December 2024
200
1,803,849
100
5,067,452
6,871,601
HARDWOOD SALES HOLDING LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
- 13 -
Share capital
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 January 2023
218
82
2,789,843
2,790,143
Year ended 31 December 2023:
Profit and total comprehensive income for the year
-
-
98,696
98,696
Own shares acquired
-
-
(405,000)
(405,000)
Redemption of shares
24
(12)
12
-
Balance at 31 December 2023
206
94
2,483,539
2,483,839
Year ended 31 December 2024:
Profit and total comprehensive income
-
-
356,492
356,492
Own shares acquired
-
-
(172,477)
(172,477)
Redemption of shares
24
(6)
6
-
Balance at 31 December 2024
200
100
2,667,554
2,667,854
HARDWOOD SALES HOLDING LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 14 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
28
1,217,640
2,397,330
Interest paid
(107,613)
(134,870)
Income taxes paid
(181,726)
(566,336)
Net cash inflow from operating activities
928,301
1,696,124
Investing activities
Purchase of tangible fixed assets
(293,790)
(325,132)
Proceeds from disposal of tangible fixed assets
-
11,000
Interest received
2,460
Net cash used in investing activities
(291,330)
(314,132)
Financing activities
Purchase of own shares
(172,477)
(405,000)
Repayment of bank loans
(349,750)
(561,095)
Payment of finance leases obligations
(274,076)
(7,818)
Net cash used in financing activities
(796,303)
(973,913)
Net (decrease)/increase in cash and cash equivalents
(159,332)
408,079
Cash and cash equivalents at beginning of year
639,162
231,083
Cash and cash equivalents at end of year
479,830
639,162
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 15 -
1
Accounting policies
Company information
Hardwood Sales Holding Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Huyton Business Park, Ellis Ashton Street, Off Wilson Road, Huyton, Liverpool, L36 6BN.
The group consists of Hardwood Sales Holding Limited and all of its subsidiaries.
The principal activities of the group and company are disclosed in the strategic report.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include investment properties at fair value. The principal accounting policies adopted are set out below.
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:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
1.2
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.
1.3
Basis of consolidation
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 16 -
1.4
Going concern
The directors have considered the impact of potential operational and financial challenges posed by the current economic situation, including but not restricted to, an assessment of the robustness of their supply chain and broader logistics arrangements. The directors have concluded that any operational and financial pressures caused directly by the current economic situation are unlikely to have a material impact on the group.
The directors have prepared forecasts and budgets which indicate that the group will continue to generate cash over the period considered by them which is at least twelve months from the date of approval of these financial statements, in their assessment of the appropriateness of adopting the going concern basis in preparation of these financial statements. The group has a strong asset base and cash reserves available.
Based on the above, the directors consider it appropriate to prepare these financial statements on a going concern basis.
1.5
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue 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.
1.6
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:
Freehold land and buildings
2% straight line
Plant and equipment
33% straight line
Fixtures and fittings
33% straight line
Motor vehicles
25% reducing balance
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.
1.7
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 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.
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 17 -
1.8
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.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.9
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.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.10
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.
1.11
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.
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 18 -
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the 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 and loans from fellow group companies, 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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 19 -
1.12
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.
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 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.
1.14
Provisions
Provisions are recognised when the group has a legal or constructive present obligation as a result of a past event, it is probable that the group will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
1.15
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.
1.16
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 20 -
1.17
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
1.18
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
2
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 and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Assessing operating lease commitments
The group has entered into leases as a leasee obtaining the use of land and buildings and other tangible fixed assets. The classification of such leases as operating or finance lease requires management to determine, based on an evaluation of the terms and conditions of the arrangements, whether it retains or acquires the significant risks and rewards of ownership of these assets and accordingly whether the lease requires an asset and liability to be recognised in the Balance Sheet.
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
2
Judgements and key sources of estimation uncertainty
(Continued)
- 21 -
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Estimating value in use
Where an indication of impairment exists, the directors will carry out an impairment review to determine the recoverable amount, being the higher of fair value less cost to sell and value in use. The value in use calculation requires the directors to estimate the future cash flows expected to arise from the asset or the cash generating unit and a suitable discount rate in order to calculate present value.
Recoverability of receivables
The group establishes a provision for receivables that are estimated not to be recoverable. When assessing recoverability the directors consider factors such as the ageing of the receivables, past experience of recoverability and the credit profile of individual or groups of customers.
Determining and reassessing residual values and useful economic lives of tangible assets
The group depreciates tangible assets over their estimated useful lives. In determining appropriate useful lives of assets, the directors have considered historic performance as well as future expectations for factors such as expected usage of the asset, physical wear and tear, technical and commercial obsolescence and legal limitations of the usage of the asset, such as lease terms. The actual lives of these assets can vary depending on a variety of factors, including technological innovation, product life cycles and maintenance programmes.
Judgement is applied to determine the residual values for tangible assets. When determining the residual values, the directors have assessed the amount that the group would currently obtain for the disposal of the asset, if it were already of the condition expected at the end of its useful economic life. At each reporting date, the directors have also assessed whether there have been any indicators, such as a change in how the asset is used, significant unexpected wear and tear and changes in market prices, which suggest previous estimates may differ from current expectations. Where this is the case, the residual value and/or useful life is amended and accounted for on a prospective basis.
3
Turnover and other revenue
An analysis of the group's turnover is as follows:
2024
2023
£
£
Turnover analysed by class of business
Sale of goods
19,648,591
20,144,786
2024
2023
£
£
Turnover analysed by geographical market
Sales - UK
18,908,553
19,564,616
Sales - Non EEC
740,038
580,170
19,648,591
20,144,786
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
3
Turnover and other revenue
(Continued)
- 22 -
2024
2023
£
£
Other revenue
Interest income
2,460
-
Grants released
2,872
2,872
4
Operating profit
2024
2023
£
£
Operating profit for the year is stated after charging/(crediting):
Government grants
(2,872)
(2,872)
Depreciation of owned tangible fixed assets
186,239
110,455
Depreciation of tangible fixed assets held under finance leases
326,823
19,369
Profit on disposal of tangible fixed assets
-
(11,000)
Operating lease charges
274,897
75,097
5
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
3,570
6,820
Audit of the financial statements of the company's subsidiaries
17,700
14,235
21,270
21,055
6
Employees
The average monthly number of persons (including directors) employed by the group and company during the year was:
Group
Company
2024
2023
2024
2023
Number
Number
Number
Number
Staff
47
48
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
6
Employees
(Continued)
- 23 -
Their aggregate remuneration comprised:
Group
Company
2024
2023
2024
2023
£
£
£
£
Wages and salaries
1,680,127
2,222,655
Social security costs
178,024
249,813
-
-
Pension costs
263,985
246,028
2,122,136
2,718,496
7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
1,788
Other interest income
672
-
Total income
2,460
8
Interest payable and similar expenses
2024
2023
£
£
Interest on bank overdrafts and loans
58,789
85,508
Interest on finance leases and hire purchase contracts
41,809
19,620
Other interest
7,015
29,742
Total finance costs
107,613
134,870
9
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
236,211
204,335
Adjustments in respect of prior periods
(26,178)
5,975
Total current tax
210,033
210,310
Deferred tax
Origination and reversal of timing differences
(20,542)
70,519
Total tax charge
189,491
280,829
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
9
Taxation
(Continued)
- 24 -
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2024
2023
£
£
Profit before taxation
510,310
740,991
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 25.00%)
127,578
185,248
Tax effect of expenses that are not deductible in determining taxable profit
27,748
14,913
Adjustments in respect of prior years
(26,178)
Effect of change in corporation tax rate
-
(19,035)
Permanent capital allowances in excess of depreciation
60,343
93,728
Under/(over) provided in prior years
5,975
Taxation charge
189,491
280,829
10
Tangible fixed assets
Group
Freehold land and buildings
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
Cost or valuation
At 1 January 2024
4,743,521
2,154,788
164,373
108,268
7,170,950
Additions
35,883
168,910
52,932
402,052
659,777
Disposals
(5,300)
(5,300)
At 31 December 2024
4,779,404
2,318,398
217,305
510,320
7,825,427
Depreciation and impairment
At 1 January 2024
94,870
1,244,031
132,463
19,369
1,490,733
Depreciation charged in the year
95,588
292,212
26,694
98,568
513,062
Eliminated in respect of disposals
(5,300)
(5,300)
At 31 December 2024
190,458
1,530,943
159,157
117,937
1,998,495
Carrying amount
At 31 December 2024
4,588,946
787,455
58,148
392,383
5,826,932
At 31 December 2023
4,648,651
910,757
31,910
88,899
5,680,217
The company had no tangible fixed assets at 31 December 2024 or 31 December 2023.
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
10
Tangible fixed assets
(Continued)
- 25 -
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
Group
Company
2024
2023
2024
2023
£
£
£
£
Plant and equipment
40,044
227,493
Motor vehicles
392,383
88,899
432,427
316,392
-
-
Land and buildings with a carrying amount of £4,648,651 were revalued at December 2022 by Lambeth Smith Hampton, independent valuers not connected with the company on the basis of market value. The valuation conforms to International Valuation Standards and was based on recent market transactions on arm's length terms for similar properties. The directors have reviewed this value at 31 December 2024 and confirm that there has been no material movement in the value.
If revalued assets were stated on an historical cost basis rather than a fair value basis, the total amounts included would have been as follows:
2024
2023
£
£
Group
Cost
2,769,885
2,734,002
Accumulated depreciation
521,669
(466,271)
Carrying value
3,291,554
2,267,731
11
Investment property
Group
Company
2024
2024
£
£
Fair value
At 1 January 2024
-
4,743,521
Additions through external acquisition
-
35,883
At 31 December 2024
-
4,779,404
Investment property comprises the premises from which the subsidiary trading company operates from. The properties were revalued at December 2022 by Lambeth Smith Hampton, independent valuers not connected with the company on the basis of market value. The valuation conforms to International Valuation Standards and was based on recent market transactions on arm's length terms for similar properties. The directors have reviewed this value at 31 December 2024 and confirm that there has been no material movement in the value.
For the Group financial statements the premises have been accounted for as tangible fixed assets, as the premises are used by the Group in the production and supply of goods and for administrative purposes.
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 26 -
12
Fixed asset investments
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Investments in subsidiaries
13
300
300
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 January 2024 and 31 December 2024
300
Carrying amount
At 31 December 2024
300
At 31 December 2023
300
13
Subsidiaries
Details of the company's subsidiaries at 31 December 2024 are as follows:
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Hardwood Sales Limited
Huyton Business Park Ellis Ashton Street, Off Wilson Road, Huyton, Merseyside, United Kingdom, L36 6
Ordinary
100.00
14
Stocks
Group
Company
2024
2023
2024
2023
£
£
£
£
Finished goods and goods for resale
2,510,721
2,553,136
An impairment loss of £387,366 (2023: £648,452) was recognised in cost of sales against stock during the year due to slow-moving and obsolete stock.
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 27 -
15
Debtors
Group
Company
2024
2023
2024
2023
Amounts falling due within one year:
£
£
£
£
Trade debtors
3,774,713
3,106,727
Other debtors
472,310
597,659
360,368
486,827
Prepayments and accrued income
160,177
295,905
4,407,200
4,000,291
360,368
486,827
Amounts owed by group undertakings are interest free, have no fixed date of repayment and are repayable upon demand.
16
Creditors: amounts falling due within one year
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Bank loans
18
164,000
104,000
164,000
104,000
Obligations under finance leases
19
248,330
253,621
Trade creditors
1,928,151
1,907,791
55,544
155,559
Amounts owed to group undertakings
1,264,280
1,281,130
Corporation tax payable
232,642
204,335
21,385
30,441
Other taxation and social security
440,651
418,972
-
-
Other creditors
137,712
253,242
24,723
31,887
Accruals and deferred income
663,853
533,881
24,161
4,000
3,815,339
3,675,842
1,554,093
1,607,017
Amounts owed to group undertakings are interest free, have no fixed date of repayment and are repayable upon demand.
17
Creditors: amounts falling due after more than one year
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Bank loans
18
358,561
768,311
358,561
768,311
Obligations under finance leases
19
476,523
379,321
Government grants
21
117,897
120,769
117,897
120,769
952,981
1,268,401
476,458
889,080
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 28 -
18
Loans and overdrafts
Group
Company
2024
2023
2024
2023
£
£
£
£
Bank loans
522,561
872,311
522,561
872,311
Payable within one year
164,000
104,000
164,000
104,000
Payable after one year
358,561
768,311
358,561
768,311
The bank loan is secured by way of a fixed and floating charge on the land and buildings of the company. The interest on this bank loan is charged 2.19% per annum over Base Rate. This loan is due to mature in November 2030.
19
Finance lease obligations
Group
Company
2024
2023
2024
2023
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
248,330
253,621
In two to five years
476,523
379,321
724,853
632,942
-
-
Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is four years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
The finance lease obligations are secured on the assets to which they relate.
20
Provisions for liabilities
Group
Company
2024
2023
2024
2023
£
£
£
£
Dilapidations provision
794,564
394,564
-
-
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
20
Provisions for liabilities
(Continued)
- 29 -
Movements on provisions:
Dilapidations provision
Group
£
At 1 January 2024
394,564
Additional provisions in the year
400,000
At 31 December 2024
794,564
21
Government grants
Group
Company
2024
2023
2024
2023
£
£
£
£
Arising from government grants
117,897
120,769
117,897
120,769
Government grants relate to funds received in respect of the construction of additional sheds, which has led to the creation of additional jobs
22
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
263,985
246,028
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.
23
Deferred taxation
Deferred tax assets and liabilities are offset where the group or company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
2024
2023
Group
£
£
ACAs
237,027
257,569
Revaluations
553,171
553,171
790,198
810,740
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
23
Deferred taxation
(Continued)
- 30 -
Liabilities
Liabilities
2024
2023
Company
£
£
ACAs
45,429
25,567
Revaluations
127,880
127,880
Investment property
365,031
356,814
538,340
510,261
Group
Company
2024
2024
Movements in the year:
£
£
Liability at 1 January 2024
810,740
510,261
(Credit)/charge to profit or loss
(20,542)
28,079
Liability at 31 December 2024
790,198
538,340
The deferred tax liability within the company has arisen following the transfer of the property from the subsidiary company to the holding company, being the accelerated capital allowances on the assets transferred.
24
Share capital
Group and company
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
170
170
170
170
B Ordinary shares of £1 each
15
15
15
15
C Ordinary shares of £1 each
15
15
15
15
D Ordinary shares of £1 each
-
6
-
6
200
206
200
206
During the year, the company repurchased 6 D Ordinary shares.
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 31 -
25
Operating lease commitments
Lessee
Operating lease payments represent rentals payable by the company for certain of its assets. Leases are negotiated for an average term of 4 years.
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
-
210,000
-
-
-
210,000
-
-
26
Related party transactions
The remuneration of key management personnel is as follows.
2024
2023
£
£
Aggregate compensation
525,147
1,166,132
At the year end an amount of £nil (2023: £89,418) was owed to a company owned with common ownership to the ultimate parent company.
At the year end an amount of £465,436 (2023: £154,043) was owed by companies with common ownership to the ultimate parent company.
The company has taken advantage of the reduced disclosure exemption available under Financial Reporting Standard 102 relating to the disclosure of related party transactions between wholly owned group companies.
No other transactions with related parties were undertaken such as are required to be disclosed Financial Reporting Standard 102.
27
Controlling party
The directors are of the opinion that there is no one ultimate controlling party.
HARDWOOD SALES HOLDING LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 32 -
28
Cash generated from group operations
2024
2023
£
£
Profit after taxation
320,819
460,162
Adjustments for:
Taxation charged
189,491
280,829
Finance costs
107,613
134,870
Investment income
(2,460)
Gain on disposal of tangible fixed assets
-
(11,000)
Depreciation and impairment of tangible fixed assets
513,062
129,824
Increase in provisions
400,000
-
Movements in working capital:
Decrease in stocks
42,415
1,728,622
(Increase)/decrease in debtors
(724,974)
1,075,979
Increase/(decrease) in creditors
374,546
(1,399,084)
Decrease in deferred income
(2,872)
(2,872)
Cash generated from operations
1,217,640
2,397,330
29
Analysis of changes in net debt - group
1 January 2024
Cash flows
New finance leases
31 December 2024
£
£
£
£
Cash at bank and in hand
639,162
(159,332)
-
479,830
Borrowings excluding overdrafts
(872,311)
349,750
-
(522,561)
Obligations under finance leases
(632,942)
274,076
(365,987)
(724,853)
(866,091)
464,494
(365,987)
(767,584)
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