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Registered number: 04594575









SMD (Holdings) Limited









Annual Report and Consolidated Financial Statements

For the Year Ended 30 September 2024

 
SMD (Holdings) Limited
 
 
Company Information


Directors
R J Kenworthy 
R J Hargreaves 
J E Pink 




Registered number
04594575



Registered office
Unit F2, Pittman Way
Fulwood

Preston

PR2 9ZD




Independent auditors
Hurst Accountants Limited
Chartered Accountants & Statutory Auditors

3 Stockport Exchange

Stockport

Cheshire

SK1 3GG




Bankers
Barclays Bank Plc
38 Fishergate

Preston

PR1 2DD





 
SMD (Holdings) Limited
 

Contents



Page
Group Strategic Report
 
1 - 2
Directors' Report
 
3 - 4
Independent Auditors' Report
 
5 - 8
Consolidated Profit and Loss Account
 
9
Consolidated Statement of Comprehensive Income
 
10
Consolidated Balance Sheet
 
11
Company Balance Sheet
 
12
Consolidated Statement of Changes in Equity
 
13 - 14
Company Statement of Changes in Equity
 
15
Consolidated Statement of Cash Flows
 
16
Consolidated Analysis of Net Debt
 
17
Notes to the Financial Statements
 
18 - 37


 
SMD (Holdings) Limited
 
 
Group Strategic Report
For the Year Ended 30 September 2024

Business review
 
The Group's balance sheet on page 11 reports shareholder funds of £7,143,112 (2023: £7,003,547).
Turnover declined by 9.4%, while gross margin decreased by 14.2% with the gross margin percentage decreasing from 37.6% to 35.6%, primarily due to increased investment in sampling and point-of-sale initiatives.
The Group remains committed to investing in the ILIV brand through targeted promotional and marketing activities. This strategic approach is facilitating growth in both new export markets and UK sales channels, driving increased sales.

Principal risks and uncertainties
 
Economic Downturn
The Group's performance is closely tied to consumer spending in soft furnishings and commercial expenditure within the healthcare, education, and hospitality sectors. Any downturn in these areas could negatively impact sales. Senior management continuously monitors economic conditions and, in the event of a severe downturn, adjusts marketing and pricing strategies accordingly.
Fixed Overheads as a Percentage of Turnover
A significant portion of the Group's overheads are fixed, presenting a risk to profitability if revenue declines. Management closely tracks fixed overheads against budgeted figures on a monthly basis and implements cost-saving measures when revenue downturns are anticipated.
Competitive Market Conditions
The Group operates in highly competitive markets, exerting continual pressure on margins. To maintain cost efficiency, the Group consistently refines its sourcing strategies to ensure optimal production costs.
Workforce Engagement and Retention
The Group prioritises employee engagement and retention through regular feedback mechanisms such as engagement surveys, newsletters, and town hall meetings. Additionally, initiatives like wellness weeks and hybrid working arrangements play a key role in fostering employee satisfaction and retention.
Foreign Currency Fluctuations
As a significant proportion of the Group’s purchases are made in foreign currencies, the business is exposed to exchange rate fluctuations. To mitigate this risk, the Group utilises forward contracts and other financial instruments. However, if hedging strategies fail to fully offset currency fluctuations, financial results may be adversely affected.

Financial key performance indicators
 
The Group views its banking covenants as a critical financial KPI. With a stable cash flow during the year, significant headroom exists to support future investments.

Page 1

 
SMD (Holdings) Limited
 

Group Strategic Report (continued)
For the Year Ended 30 September 2024

Other key performance indicators
 
The Group employs various KPIs to enhance working capital efficiency and customer service performance:
Working Capital KPIs: Debtor and creditor days, stock turnover, and cash flow are monitored against predefined budget targets.
Customer Service KPIs: Metrics such as customer retention, acquisition, and on-time delivery performance are tracked to ensure service excellence.

Financial Instruments
The Group primarily utilises an operational bank account, with minimal reliance on complex financial instruments. Its primary financial risks include ensuring sufficient liquidity, mitigating customer default risk, and managing interest rate and foreign exchange fluctuations.
Funding and Liquidity
The Group finances its operations through retained earnings, ensuring sufficient cash levels to meet ongoing business needs while maintaining flexibility for unforeseen circumstances. The policy is to proactively manage cash flow and secure funding ahead of anticipated requirements when necessary.
Credit Risk Management
To minimise exposure to customer default risk, the Group routinely assesses customer creditworthiness and utilises a credit insurance policy with Allianz.
Interest Rate Risk Management
The Group's exposure to interest rate fluctuations is limited, as its only secured bank borrowing is a bank overdraft. A structured policy is in place to manage interest rate risks.
Foreign Currency Risk Management
To mitigate exchange rate volatility, the Group employs forward contracts as part of its risk management strategy.


This report was approved by the board and signed on its behalf.



R J Hargreaves
Director

Date: 10 March 2025

Page 2

 
SMD (Holdings) Limited
 
 
 
Directors' Report
For the Year Ended 30 September 2024

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

Directors' responsibilities statement

The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 the Group 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 for the Group's financial statements and then apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.

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 the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Results and dividends

The profit for the year, after taxation, amounted to £614,188 (2023 - £1,119,967).

The directors do not recommend payment of a final dividend. 

Directors

The directors who served during the year were:

R J Kenworthy 
R J Hargreaves 
J E Pink 

Future developments

The directors review the critical success factors of the business on a regular basis to ensure all group companies can contribute successfully in the future.

Page 3

 
SMD (Holdings) Limited
 
 
 
Directors' Report (continued)
For the Year Ended 30 September 2024

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company and the Group's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company and the Group's auditors are aware of that information.

Auditors

The auditorsHurst Accountants Limitedwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board and signed on its behalf.
 





R J Hargreaves
Director

Date: 10 March 2025

Page 4

 
SMD (Holdings) Limited
 
 
 
Independent Auditors' Report to the Members of SMD (Holdings) Limited
 

Opinion


We have audited the financial statements of SMD (Holdings) Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 30 September 2024, which comprise the Consolidated Profit and Loss Account, the Consolidated Statement of Comprehensive Income, the Consolidated Balance Sheet, the Company Balance Sheet, the Consolidated Statement of Cash Flows, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe 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 of the parent Company's affairs as at 30 September 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.


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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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 or the 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.


Page 5

 
SMD (Holdings) Limited
 
 
 
Independent Auditors' Report to the Members of SMD (Holdings) Limited (continued)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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.


Opinion on other matters prescribed by the Companies Act 2006
 

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


the information given in the Group 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 Group Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.


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 its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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 set out on page 3, 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 Group's and 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 Group or the parent Company or to cease operations, or have no realistic alternative but to do so.


Page 6

 
SMD (Holdings) Limited
 
 
 
Independent Auditors' Report to the Members of SMD (Holdings) Limited (continued)


Auditors' 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 Auditors' 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 Group 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:

Identifying and assessing potential risks related to irregularities
 
In identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:
 
The nature of the industry and sector in which the company operates; the control environment and business performance including key drivers for directors' remuneration, bonus levels and performance targets.
The outcome of enquiries of local management and parent company management, including whether management was aware of any instances of non-compliance with laws and regulations, and whether management had knowledge of any actual, suspected, or alleged fraud. 
Supporting documentation relating to the Company's policies and procedures for:
°Identifying, evaluating, and complying with laws and regulations.
°Detecting and responding to the risks of fraud.
The internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations.
The outcome of discussions amongst the engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.
The legal and regulatory framework in which the Company operates, particularly those laws and regulations which have a direct effect on the financial statements, such as the Companies Act 2006, pensions and tax legislation, or which had a fundamental effect on the operations of the Company, including General Data Protection requirements, and Anti-bribery and Corruption.
 
Audit response to risks identified
 
Our procedures to respond to the risks identified included the following:
 
Reviewing the financial statements disclosures and testing to supporting documentation to assess compliance with the provisions of those relevant laws and regulations which have a direct effect on the financial statements.
Discussions with management, including consideration of known or suspected instances of non-compliance with laws and regulations and fraud.
Evaluation of the operating effectiveness of management’s controls designed to prevent and detect irregularities.
Enquiring of management about any actual and potential litigation and claims.
Performing analytical procedures to identify any unusual or unexpected relationships which may indicate risks of material misstatement due to fraud.
 
Page 7

 
SMD (Holdings) Limited
 
 
 
Independent Auditors' Report to the Members of SMD (Holdings) Limited (continued)


We have also considered the risk of fraud through management override of controls by:
 
Testing the appropriateness of journal entries and other adjustments. We have used data analytics software to identify accounting transactions which may pose a heightened risk of material misstatement, whether due to fraud or error.
Challenging assumptions made by management in their significant accounting estimates, and assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and
Evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
 
We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.


Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' Report.


Use of our report
 

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006Our 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 Auditors' 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.





Helen Besant-Roberts (Senior Statutory Auditor)
for and on behalf of
Hurst Accountants Limited
Chartered Accountants
Statutory Auditors
3 Stockport Exchange
Stockport
Cheshire
SK1 3GG

 
Date: 
10 March 2025
Page 8

 
SMD (Holdings) Limited
 
 
Consolidated Profit and Loss Account
For the Year Ended 30 September 2024

2024
2023
Note
£
£

  

Turnover
 4 
16,513,583
18,222,283

Cost of sales
  
(10,632,953)
(11,370,366)

Gross profit
  
5,880,630
6,851,917

Distribution costs
  
(714,765)
(753,689)

Administrative expenses
  
(4,399,644)
(4,679,138)

Other operating income
 5 
167,581
118,222

Operating profit
 6 
933,802
1,537,312

Interest payable and similar expenses
 10 
(99,670)
(91,789)

Profit before tax
  
834,132
1,445,523

Tax on profit
 11 
(219,944)
(325,556)

Profit for the financial year
  
614,188
1,119,967

Profit for the year attributable to:
  

Owners of the parent
  
614,188
1,119,967

  
614,188
1,119,967

The notes on pages 18 to 37 form part of these financial statements.

Page 9

 
SMD (Holdings) Limited
 

Consolidated Statement of Comprehensive Income
For the Year Ended 30 September 2024

2024
2023
Note
£
£


Profit for the financial year

  

614,188
1,119,967

Other comprehensive income
  


Fair value gains/(losses) on forward currency contracts
 20 
(68,075)
23,852

Transfer from cashflow hedge reserve to profit and loss account
 20 
(23,852)
(114,218)

Other comprehensive income for the year
  
(91,927)
(90,366)

Total comprehensive income for the year
  
522,261
1,029,601

Profit for the year attributable to:
  


Owners of the parent Company
  
614,188
1,119,967

Total comprehensive income attributable to:
  


Owners of the parent Company
  
522,261
1,029,601

The notes on pages 18 to 37 form part of these financial statements.

Page 10

 
SMD (Holdings) Limited
Registered number: 04594575

Consolidated Balance Sheet
As at 30 September 2024

2024
2023
Note
£
£

Fixed assets
  

Tangible assets
 14 
2,998,945
3,039,316

Current assets
  

Stocks
 16 
5,996,859
5,744,237

Debtors: amounts falling due within one year
 17 
2,640,448
2,878,282

Cash at bank and in hand
 18 
613,100
676,158

  
9,250,407
9,298,677

Creditors: amounts falling due within one year
 19 
(4,966,555)
(5,203,048)

Net current assets
  
 
 
4,283,852
 
 
4,095,629

Total assets less current liabilities
  
7,282,797
7,134,945

Provisions for liabilities
  

Deferred taxation
 21 
(139,685)
(131,398)

Net assets
  
7,143,112
7,003,547


Capital and reserves
  

Called up share capital 
 22 
51,000
51,000

Non-distributable reserve
 23 
429,218
452,294

Capital redemption reserve
 23 
49,000
49,000

Cash flow hedge reserve
 23 
(68,075)
23,852

Profit and loss account
 23 
6,681,969
6,427,401

  
7,143,112
7,003,547


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




R J Hargreaves
Director

Date: 10 March 2025

The notes on pages 18 to 37 form part of these financial statements.

Page 11

 
SMD (Holdings) Limited
Registered number: 04594575

Company Balance Sheet
As at 30 September 2024

2024
2023
Note
£
£

Fixed assets
  

Tangible assets
 14 
10,862
48,582

Investments
 15 
4,913,472
4,913,472

  
4,924,334
4,962,054

Current assets
  

Debtors: amounts falling due within one year
 17 
69,930
38,272

Cash at bank and in hand
 18 
566,151
668,286

  
636,081
706,558

Creditors: amounts falling due within one year
 19 
(3,348,696)
(3,351,150)

Net current liabilities
  
 
 
(2,712,615)
 
 
(2,644,592)

Total assets less current liabilities
  
2,211,719
2,317,462

  

Provisions for liabilities
  

Deferred taxation
 21 
(2,415)
(12,145)

Net assets
  
2,209,304
2,305,317


Capital and reserves
  

Called up share capital 
 22 
51,000
51,000

Capital redemption reserve
 23 
49,000
49,000

Profit and loss account brought forward
  
2,205,317
2,337,427

Profit for the year
  
286,683
473,367

Dividends

  

(382,696)
(605,477)

Profit and loss account carried forward
  
2,109,304
2,205,317

  
2,209,304
2,305,317


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 


R J Hargreaves
Director

Date: 10 March 2025

The notes on pages 18 to 37 form part of these financial statements.

Page 12

 
SMD (Holdings) Limited
 

Consolidated Statement of Changes in Equity
For the Year Ended 30 September 2024


Called up share capital
Capital redemption reserve
Non-distributable reserve
Cash flow hedge reserve
Profit and loss account
Total equity

£
£
£
£
£
£

At 1 October 2023
51,000
49,000
452,294
23,852
6,427,401
7,003,547


Comprehensive income for the year

Profit for the year
-
-
-
-
614,188
614,188

Fair value losses on forward currency contracts
-
-
-
(68,075)
-
(68,075)

Transfer from cash flow hedge reserve to profit and loss account
-
-
-
(23,852)
-
(23,852)
Total comprehensive income for the year
-
-
-
(91,927)
614,188
522,261


Contributions by and distributions to owners

Dividends: Equity capital
-
-
-
-
(382,696)
(382,696)

Transfer to/from profit and loss account
-
-
(23,076)
-
23,076
-


Total transactions with owners
-
-
(23,076)
-
(359,620)
(382,696)


At 30 September 2024
51,000
49,000
429,218
(68,075)
6,681,969
7,143,112


The notes on pages 18 to 37 form part of these financial statements.

Page 13

 
SMD (Holdings) Limited
 

Consolidated Statement of Changes in Equity
For the Year Ended 30 September 2023


Called up share capital
Capital redemption reserve
Non-distributable reserve
Cash flow hedge reserve
Profit and loss account
Total equity

£
£
£
£
£
£

At 1 October 2022
51,000
49,000
475,370
114,218
5,889,835
6,579,423


Comprehensive income for the year

Profit for the year
-
-
-
-
1,119,967
1,119,967

Fair value gains on forward currency contracts
-
-
-
23,852
-
23,852

Transfer from cash flow hedge reserve to profit and loss account
-
-
-
(114,218)
-
(114,218)
Total comprehensive income for the year
-
-
-
(90,366)
1,119,967
1,029,601


Contributions by and distributions to owners

Dividends: Equity capital
-
-
-
-
(605,477)
(605,477)

Transfer to/from profit and loss account
-
-
(23,076)
-
23,076
-


Total transactions with owners
-
-
(23,076)
-
(582,401)
(605,477)


At 30 September 2023
51,000
49,000
452,294
23,852
6,427,401
7,003,547


The notes on pages 18 to 37 form part of these financial statements.

Page 14

 
SMD (Holdings) Limited
 

Company Statement of Changes in Equity
For the Year Ended 30 September 2024


Called up share capital
Capital redemption reserve
Profit and loss account
Total equity

£
£
£
£

At 1 October 2022
51,000
49,000
2,337,427
2,437,427


Comprehensive income for the year

Profit for the year
-
-
473,367
473,367
Total comprehensive income for the year
-
-
473,367
473,367


Contributions by and distributions to owners

Dividends: Equity capital
-
-
(605,477)
(605,477)


Total transactions with owners
-
-
(605,477)
(605,477)


At 1 October 2023
51,000
49,000
2,205,317
2,305,317


Comprehensive income for the year

Profit for the year
-
-
286,683
286,683
Total comprehensive income for the year
-
-
286,683
286,683


Contributions by and distributions to owners

Dividends: Equity capital
-
-
(382,696)
(382,696)


Total transactions with owners
-
-
(382,696)
(382,696)


At 30 September 2024
51,000
49,000
2,109,304
2,209,304


Page 15

 
SMD (Holdings) Limited
 

Consolidated Statement of Cash Flows
For the Year Ended 30 September 2024

2024
2023
£
£

Cash flows from operating activities

Profit for the financial year
614,188
1,119,967

Adjustments for:

Depreciation of tangible assets
299,942
291,149

Interest paid
99,670
91,789

Taxation charge
219,944
325,556

(Increase)/decrease in stocks
(252,622)
694,052

Decrease in debtors
243,020
356,507

(Increase)/decrease in amounts owed by related parties
(29,038)
56,232

(Decrease) in creditors
(481,786)
(166,428)

Increase in amounts owed to related parties
472,171
526,198

Corporation tax (paid)
(414,840)
(168,368)

Net cash generated from operating activities

770,649
3,126,654


Cash flows from investing activities

Purchase of tangible fixed assets
(259,571)
(623,237)

Net cash from investing activities

(259,571)
(623,237)

Cash flows from financing activities

Repayment of/new finance leases
(9,449)
(71,659)

Dividends paid
(382,696)
(605,477)

Interest paid
(54,670)
(91,789)

Associates interest paid
(45,000)
-

Net cash used in financing activities
(491,815)
(768,925)

Net increase in cash and cash equivalents
19,263
1,734,492

Cash and cash equivalents at beginning of year
(766,846)
(2,501,338)

Cash and cash equivalents at the end of year
(747,583)
(766,846)


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
613,100
676,158

Bank overdrafts
(1,360,683)
(1,443,004)

(747,583)
(766,846)


The notes on pages 18 to 37 form part of these financial statements.

Page 16

 
SMD (Holdings) Limited
 

Consolidated Analysis of Net Debt
For the Year Ended 30 September 2024





At 1 October 2023
Cash flows
Other non-cash changes
At 30 September 2024
£

£

£

£

Cash at bank and in hand

676,158

(63,058)

-

613,100

Bank overdrafts

(1,443,004)

82,321

-

(1,360,683)

Debt due within 1 year

(177,554)

(52,178)

-

(229,732)

Finance leases

(9,449)

9,449

-

-

Liquid investments

23,852

-

(91,927)

(68,075)


(929,997)
(23,466)
(91,927)
(1,045,390)

The notes on pages 18 to 37 form part of these financial statements.

Page 17

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

1.


General information

SMD (Holdings) Limited is a private company limited by members capital incorporated in England. The address of the registered office and principal place of business is Pittman Way, Fulwood, Preston, PR2 9ZD. 
The nature of the group's operation and its principal activity is that of the design, manufacture and distribution of ready-made products and fabrics.  The principal activity of the company is that of a holding company which incurs central costs for the group.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention and  in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgement in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.

 
2.2

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Profit and Loss Account from the date on which control is obtained. They are deconsolidated from the date control ceases.
In accordance with the transitional exemption available in FRS 102, the Group has chosen not to retrospectively apply the standard to business combinations that occurred before the date of transition to FRS 102, being 01 October 2014.

On consolidation, the results of overseas operations are translated into Sterling at rates approximating to those ruling when the transactions took place. All assets and liabilites of overseas operations are translated at the rate ruling at the reporting date. Exchange differences arising on translating the opening net assets at the opening rate and the results of overseas operations at actual rate are recognised in other comprehensive income. 

Page 18

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

2.Accounting policies (continued)

 
2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
the Group has transferred the significant risks and rewards of ownership to the buyer;
the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the Group will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

 
2.4

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.5

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

 
2.6

Pensions

Defined contribution pension plan

The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Group in independently administered funds.

Page 19

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

2.Accounting policies (continued)

 
2.7

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company and the Group operate and generate income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits;
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Page 20

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

2.Accounting policies (continued)

 
2.8

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives. 

Depreciation is provided on the following basis:

Freehold property
-
2-33% straight line
Plant and machinery
-
25-50% straight line
Motor vehicles
-
25-33% straight line
Fixtures and fittings
-
20-100% straight line
Other fixed assets
-
33% straight line

 
2.9

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.10

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a weighted average basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

 
2.11

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.12

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Consolidated Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.

Page 21

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

2.Accounting policies (continued)

 
2.13

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.14

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Deferred tax liabilities are also presented within provisions but are measured in accordance with the accounting policy on taxation.
 
Increases in provisions are generally charged as an expense to profit or loss.

 
2.15

Financial instruments

The Group has elected to apply the provisions of Section 11 “Basic Financial Instruments” 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, 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 trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Other financial assets

Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.
 
Page 22

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

2.Accounting policies (continued)


2.15
Financial instruments (continued)


Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting date. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

Financial liabilities

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

Basic financial liabilities, which include trade and other payables, bank loans, other loans and loans due to fellow group companies are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.

Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

Other financial instruments

Derivatives, including forward exchange contracts, futures contracts and interest rate swaps, are not classified as basic financial instruments. These are initially recognised at fair value on the date the derivative contract is entered into, with costs being charged to the profit or loss. They are subsequently measured at fair value with changes in the profit or loss.

Debt instruments that do not meet the conditions as set out in FRS 102 paragraph 11.9 are subsequently measured at fair value through the profit or loss. This recognition and measurement would also apply to financial instruments where the performance is evaluated on a fair value basis as with a documented risk management or investment strategy.
 
Page 23

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

2.Accounting policies (continued)


2.15
Financial instruments (continued)


Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Group transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Group will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

Financial liabilities are derecognised when the Group's contractual obligations expire or are discharged or cancelled.

 
2.16

Hedge accounting

The Group uses foreign currency forward contracts to manage its exposure to cash flow risk on its future foreign currency stock purchases. These derivatives are measured at fair value at each balance sheet date.

To the extent the cash flow hedge is effective, movements in fair value are recognised in other comprehensive income and presented in a separate cash flow hedge reserve. Any ineffective portions of those movements are recognised in profit or loss for the year.

 
2.17

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.


3.


Judgements in applying accounting policies and key sources of estimation uncertainty

Preparation of the financial statements requires management to make significant judgements and estimates. The items in the financial statements where these judgements and estimates have been made include:
Provision for obsolete and slow moving stocks
The company reviews its stocks to assess loss on account of obsolescence on a regular basis. In determining whether provision for obsolescence should be recorded in the profit and loss account, the company makes judgements as to whether there is any observable data indicating that there is any future saleability of the product and the estimated net realisable value for such product. Accordingly, provision for impairment is made where the net realisable value is less than the cost based on best estimates by the management. The provision for obsolescence of stock is based on the ageing and historical sales pattern. The value of stock at the year end totalled £5,996,859 (2023: £5,744,237).
Should these estimates vary, the profit or loss and balance sheet of the following years could be impacted.

Page 24

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

4.


Turnover

An analysis of turnover by class of business is as follows:


2024
2023
£
£

Design, manufacture and resale of readymade homeware products and fabrics
16,513,583
18,222,283


Analysis of turnover by country of destination:

2024
2023
£
£

United Kingdom
14,586,725
16,029,813

Rest of Europe
1,151,320
1,330,912

Rest of the world
775,538
861,558

16,513,583
18,222,283



5.


Other operating income

2024
2023
£
£

Other operating income
167,581
118,222



6.


Operating profit

The operating profit is stated after charging/(crediting):

2024
2023
£
£

Exchange differences
98,088
(131,062)

Other operating lease rentals
71,425
75,098

Depreciation of tangible fixed assets
258,628
252,929

Page 25

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

7.


Auditors' remuneration

During the year, the Group obtained the following services from the Company's auditors:


2024
2023
£
£

Fees payable to the Group's auditors for the audit of the Group's annual accounts
7,770
7,375

2024
2023
£
£



The auditing of accounts of associates of the company
8,850
9,505

The auditing of accounts of subsidiaries of the company
11,510
10,910

All other services
7,425
4,100

27,785
24,515


8.


Employees

Staff costs, including directors' remuneration, were as follows:


Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£


Wages and salaries
2,937,325
3,279,509
35,070
38,424

Social security costs
306,389
351,769
3,106
3,943

Cost of defined contribution scheme
185,280
165,641
75,819
46,022

3,428,994
3,796,919
113,995
88,389


The average monthly number of employees, including the directors, during the year was as follows:



Group
Group
Company
Company
        2024
        2023
        2024
        2023
            No.
            No.
            No.
            No.









Warehouse and distribution staff
17
19
-
-



Sales, management and clerical staff
46
43
-
1



Directors
5
5
3
3

68
67
3
4

Page 26

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

9.


Directors remuneration

The directors' aggregate emoluments in respect of qualifying services were: 


2024
2023
£
£



Emoluments
407,280
501,071

Pension contributions to money purchase schemes
60,102
101,386

467,382
602,457

During the year retirement benefits were accruing to 3 directors (2023: 3) in respect of defined contribution pension schemes. 
The highest paid director received remuneration of £138,167 
(2023: £276,899).
The value of the company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £1,057 
(2023: £1,057).
There are no other key management personnel. 



10.


Interest payable and similar expenses

2024
2023
£
£


Bank interest payable
42,080
91,789

Associate loan interest payable
45,000
-

Other interest payable
12,590
-

99,670
91,789

Page 27

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

11.


Taxation


2024
2023
£
£

Corporation tax


Current tax on profits for the year
211,657
324,840


Total current tax
211,657
324,840

Deferred tax


Origination and reversal of timing differences
8,287
716

Total deferred tax
8,287
716


Taxation on profit on ordinary activities
219,944
325,556

Factors affecting tax charge for the year

The tax assessed for the year is higher than (2023 - lower than) the standard rate of corporation tax in the UK of 25% (2023 - 25%). The differences are explained below:

2024
2023
£
£


Profit on ordinary activities before tax
834,132
1,445,523


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 25%)
208,533
361,381

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
968
1,338

Capital allowances for year in excess of depreciation
(845)
(3,471)

Ineligible depreciation
11,288
11,323

Change in tax rates
-
(45,015)

Total tax charge for the year
219,944
325,556


Factors that may affect future tax charges

There were no factors that may affect future tax charges.

Page 28

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

12.


Dividends

2024
2023
£
£

Ordinary A


Dividends paid on equity capital
62,124
62,124

Ordinary B


Dividends paid on equity capital
320,572
543,353

382,696
605,477


13.


Intangible assets

Group and Company





Goodwill
Negative goodwill
Total

£
£
£



Cost


At 1 October 2023
297,953
(170,091)
127,862



At 30 September 2024

297,953
(170,091)
127,862



Amortisation


At 1 October 2023
297,953
(170,091)
127,862



At 30 September 2024

297,953
(170,091)
127,862



Net book value



At 30 September 2024
-
-
-



At 30 September 2023
-
-
-



Page 29

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

14.


Tangible fixed assets

Group






Freehold property
Plant and machinery
Motor vehicles
Fixtures and fittings
Other fixed assets
Total

£
£
£
£
£
£



Cost or valuation


At 1 October 2023
3,217,813
322,377
175,536
1,162,003
527,843
5,405,572


Additions
64,665
-
500
144,653
49,753
259,571


Disposals
-
(322,377)
-
(431,036)
(365,577)
(1,118,990)



At 30 September 2024

3,282,478
-
176,036
875,620
212,019
4,546,153



Depreciation


At 1 October 2023
477,425
322,377
126,954
959,987
479,513
2,366,256


Charge for the year
78,432
-
38,220
147,373
35,917
299,942


Disposals
-
(322,377)
-
(431,036)
(365,577)
(1,118,990)



At 30 September 2024

555,857
-
165,174
676,324
149,853
1,547,208



Net book value



At 30 September 2024
2,726,621
-
10,862
199,296
62,166
2,998,945



At 30 September 2023
2,740,388
-
48,582
202,016
48,330
3,039,316

The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2024
2023
£
£



Motor vehicles
-
48,582

Page 30

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

           14.Tangible fixed assets (continued)


Company






Motor vehicles
Fixtures and fittings
Total

£
£
£

Cost or valuation


At 1 October 2023
175,536
13,015
188,551


Additions
500
-
500



At 30 September 2024

176,036
13,015
189,051



Depreciation


At 1 October 2023
126,954
13,015
139,969


Charge for the year
38,220
-
38,220



At 30 September 2024

165,174
13,015
178,189



Net book value



At 30 September 2024
10,862
-
10,862



At 30 September 2023
48,582
-
48,582






The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2024
2023
£
£



Motor vehicles
-
48,582

Page 31

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

15.


Fixed asset investments

Company





Investments in subsidiary companies

£



Cost or valuation


At 1 October 2023
4,913,472



At 30 September 2024
4,913,472





Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Registered office

Class of shares

Holding

SMD Textiles Limited
Design and sales of furnishing textiles
Ordinary
100
SMD (Contracts) Limited
Dormant
Ordinary
100
Asia Home Furnishings (Shanghai) Ltd
Design and sales of furnishing textiles
Ordinary
100
Wood & Watkins Limited
Dormant
Ordinary
100
Advance Textile Products Limited
Dormant
Ordinary
100
Asia Home Furnishings Limited
Dormant
Ordinary
100

The registered office address for Asia Home Furnishings (Shanghai) Ltd is Room 1829, 333 Lujiazui Ring Road, Pudong New District, Shanghai, 200120.
The registered office address for each of the other subsidiaries is Unit F2, Pittman Way, Fulwood, Preston, PR2 9ZD.

Page 32

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

16.


Stocks

Group
Group
2024
2023
£
£

Raw materials and consumables
145,805
172,178

Work in progress (goods to be sold)
105,757
78,304

Finished goods and goods for resale
5,745,297
5,493,755

5,996,859
5,744,237


The difference between purchase price or production cost of stocks and their replacement cost is not material.

A loss of £145,316 (2023: £121,894) has been recognised in cost of sales against stock during the year due to slow-moving and obsolete stock.


17.


Debtors

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£


Trade debtors
2,395,033
2,679,375
-
-

Amounts owed by related parties
59,514
30,476
59,514
30,476

Other debtors
7,243
7,338
162
270

Prepayments and accrued income
178,658
137,241
10,254
7,526

Financial instruments
-
23,852
-
-

2,640,448
2,878,282
69,930
38,272


An impairment gain of £51,568 (2023: loss of £18,861) has been recognised against trade debtors.


18.


Cash and cash equivalents

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Cash at bank and in hand
613,100
676,158
566,151
668,286

Less: bank overdrafts
(1,360,683)
(1,443,004)
-
-

(747,583)
(766,846)
566,151
668,286


Page 33

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

19.


Creditors: Amounts falling due within one year

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Bank overdrafts
1,360,683
1,443,004
-
-

Trade creditors
1,615,536
1,631,529
700
700

Amounts owed to group undertakings
-
-
2,840,101
2,677,840

Amounts owed to related parties
1,006,134
533,963
-
-

Corporation tax
120,045
323,228
64,168
140,095

Other taxation and social security
194,023
225,902
1,145
1,200

Obligations under finance lease and hire purchase contracts
-
9,449
-
9,449

Other creditors
239,954
191,539
230,732
180,655

Accruals and deferred income
362,105
844,434
211,850
341,211

Financial instruments
68,075
-
-
-

4,966,555
5,203,048
3,348,696
3,351,150


The bank overdrafts are secured by a debenture over all of the assets of the group, both present and future. Interest is charged at a commercial rate as agreed with the bank. 
Finance lease and hire purchase liabilities are secured on the assets to which they relate. 


20.


Financial instruments

Group
Group
2024
2023
£
£

Financial assets

Financial assets measured at fair value through other comprehensive income
-
23,852


Financial liabilities

Financial liabilities measured at fair value through other comprehensive income
(68,075)
-


Financial assets measured at fair value through other comprehensive income comprise fair value gains on forward contracts. The company has elected to adopt hedging rules in accordance with FRS102 section 12. The company is hedging against exchange risk on future foreign currency stock purchases by using forward exchange contracts. The fair value gain on contracts in place at year end is held in reserves. 


Financial liabilities measured at fair value through other comprehensive income comprise fair value losses on forward contracts. The company has elected to adopt hedging rules in accordance with FRS102 section 12. The company is hedging against exchange risk on future foreign currency stock purchases by using forward exchange contracts. The fair value loss on contracts in place at year end is held in reserves. 

Page 34

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

21.


Deferred taxation


Group



2024


£






At beginning of year
(131,398)


Credited to the profit or loss
(8,287)



At end of year
(139,685)

Company


2024


£






At beginning of year
(12,145)


Charged to profit or loss
9,730



At end of year
(2,415)

The provision for deferred taxation is made up as follows:

Group
Group
Company
Company
2024
2023
2024
2023
£
£
£
£

Accelerated capital allowances
142,166
133,568
2,590
12,145

Pension surplus
(2,481)
(2,170)
(175)
-

139,685
131,398
2,415
12,145


22.


Share capital

2024
2023
£
£
Allotted, called up and fully paid



387,600 (2023 - 387,600) Ordinary A shares of £0.10 each
38,760
38,760
122,400 (2023 - 122,400) Ordinary B shares of £0.10 each
12,240
12,240

51,000

51,000

The Ordinary A and Ordinary B shares carry the right to a dividend at the rates to be declared by the company and are entitled to one vote per share. 


Page 35

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

23.


Reserves

Capital redemption reserve

The capital redemption reseve is a non-distributable reserve and represents paid up share capital. 

Profit and loss account

The profit and loss account includes all current and prior period retained profits and losses. 

Cashflow hedge reserve
The cashflow hedge reserve includes all gains and losses made on forward contracts. 
Non-distributable reserve
The non-distributable reserve includes revaluation gains and losses previously recognised. 


24.


Contingent liabilities

A guarantee exists in favour of HM Revenue & Customs for £125,000 in relation to the group VAT registration.


25.


Pension commitments

The group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the group in an independently administered fund. The pension cost charge represents contributions payable by the group to the fund and amounted to £175,009 (2023: £165,641). Contributions totalling £9,922 (2023: £8,678) were payable to the fund at the balance sheet date.


26.


Commitments under operating leases

At 30 September 2024 the Group had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Group
2024
2023
£
£

Not later than 1 year
59,955
69,332

Later than 1 year and not later than 5 years
25,899
100,446

85,854
169,778
Page 36

 
SMD (Holdings) Limited
 
 
 
Notes to the Financial Statements
For the Year Ended 30 September 2024

27.


Related party transactions

The group has taken advantage of the exemption available under FRS102 and opted not to disclose transactions with wholly-owned group companies. 


2024
2023
£
£

Dividends paid to directors
62,124
62,124
Dividends paid to close family members of directors
320,572
543,353
Amounts owed to directors
(229,732)
(177,554)
Sales to companies with a shared director
(171,971)
(368,775)
Interest paid to company with a shared director
45,000
-
Amounts owed to companies with a shared director
(946,620)
(503,487)


28.


Controlling party

The group was under the control of Mr R J Kenworthy throughout the current and previous period. Mr R J Kenworthy is the majority shareholder. 

 
Page 37