The directors present the strategic report for the year ended 31 January 2025.
The key financial and other performance indicators during the year were as follows:
2025 2024 %
Vehicle sales £333.8m £347.8m (4.0)%
Units sold 8,380 8,285 1.1%
After sales £30.9m £30.6m 1.0%
Service hours sold 62,489 62,076 0.7%
Gross profit margin 9.9% 10.2% (3.5)%
Profit before tax £10.0m £13.6m (26.2)%
Net profit margin 2.1% 2.7% (23.7)%
Net assets £56.8m £49.6m 14.5%
Vehicle sales have decreased £14.0m (-4.0%) driven by a decrease in the average price of vehicles sold (-5.1%) offset slightly by an increased volume (+1.1%)
After sales increased during the year by £0.3m (+1.0%) driven by an increased rate (+2.4%) on increased sold hours (+0.7%).
Profit before tax has decreased by £3.6m (-26.2%) driven from reduced margin on both new and used cars.
The total net assets of the group have increased by £7.2m (+14.5%) as a result of profit after tax for the year of £7.5m less an ordinary dividend of £0.3m.
The principal risks and uncertainties facing the group are as follows:
Operational risk
The Group’s ability to supply quality vehicles at the right price for sale to the public is largely reliant on the vehicle manufacturers. Any failure in the supply chain would present a risk to the Group’s ability to meet customer requirements and financial goals. Risk is managed through regular and proactive dialogue with suppliers to ensure customer demand is met through reliable delivery of vehicles and associated products.
Market and strategic risks
The Group’s profitability and cash flow are affected by changes in market conditions and the Group’s ability to accurately predict these in advance. In a challenging economic environment, the Group places increasing emphasis on the careful management of used vehicle activity, both in terms of ensuring appropriate stock levels and values attributed to used and traded vehicles. This provides the Group with protection against any shortfall in new vehicle demand.
Competitive risk
The market place continues to be competitive but the business is well placed to benefit from its leading reputation in the regions in which it operates. The Group aims to mitigate the risk by ensuring it offers competitively priced products and delivers a high standard of service to all its customers.
Regulatory compliance risk
The Group is subject to regulatory compliance risk being failure to comply with laws, regulations and codes set by the Health and Safety Executive, Financial Conduct Authority and local authorities. Non-compliance could lead to fines, public reprimand or the suspension from selling general insurance and consumer credit products.
Management risk
The Group is dependent on the members of its senior management team and the loss of such individuals could have an adverse effect on the business. Furthermore, failure to attract, develop and retain staff of a sufficient calibre could affect the ability of the business to grow.
Information risk
The Group is dependent on the continuous operation of its information technology and computer systems which are vulnerable to damage, failure and sabotage. Whilst safeguards, such as insurance, anti-virus software and employee awareness, are in place such a disaster could have a detrimental effect on the business.
Financial risk
The group is funded by a bank loan and overdraft. It is therefore exposed to the level and types of borrowing that in the event of anticipated interest rate rises would significantly affect the stability of the business.
The board of directors of McLean & Appleton (Holdings) Limited consider that they have acted in a way that they consider would be most likely to promote the success of the company for the benefit of its members as a whole in the decisions taken. During the year ended 31 January 2025, key decisions taken by the board included:
Continuing to adopt the Real Living Wage rate for employees over the age of 23 and additional utility support payments to the lowest paid employees as an investment in our people with the business benefit of increasing the motivation and productivity of staff whilst helping the business to retain and recruit the best people.
The company increased the employee holiday entitlement for employees with over 2 years service in recognition of their service and reduced the hours worked by certain roles in recognition of the increased importance on an individual's free time.
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 January 2025.
The results for the year are set out on page 11.
Ordinary dividends were paid amounting to £288,500. The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
The group's current policy concerning the payment of trade creditors is to follow the CBI's Prompt Payers Code (copies are available from the CBI, Centre Point, 103 New Oxford Street, London, WC1A 1DU).
The group's current policy concerning the payment of trade creditors is to:
settle the terms of payment with suppliers when agreeing the terms of each transaction;
ensure that suppliers are made aware of the terms of payment by inclusion of the relevant terms in contracts; and
pay in accordance with the group's contractual and other legal obligations.
As a business we do not have standard payment terms for qualifying contracts. The most frequently used payment terms for purchase ledger are 30 days from the end of the month of the invoice date.
For vehicle purchases the most frequently used terms are those with the vehicle manufacturer. For new vehicle purchases this is 1 year from date of adoption unless the vehicle is registered within the year at which point the registration date would be the due date. For used vehicle purchases payment is due immediately. Vehicle payments to the manufacturer are taken automatically by direct debit therefore payment dates are controlled by the supplier.
The business does not have a formal dispute resolution process for qualifying contracts. Any complaint or concern will be considered by the accounts department at each dealership and escalated to the dealership Head of Business or Head Office as appropriate. We strive to resolve any dispute amicably and as quickly as possible.
The directors intend that the group continues to evaluate each opportunity to grow the business. The geographical location being the logical driver.
In accordance with the company's articles, a resolution proposing that Barlow Andrews LLP be reappointed as auditor of the company and group will be put at a General Meeting.
This section includes our mandatory reporting of energy and greenhouse gas emissions for the period 1st February 2024 to 31st January 2025, pursuant to the Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018, implementing the government’s Streamlined Energy and Carbon Reporting (SECR) policy.
Our methodology to calculate our greenhouse gas emissions is based on the 'Environmental Reporting Guidelines: Including streamlined energy and carbon reporting guidance (March 2019)’, using DESNZ's 2023 and 2024 conversion factors as applicable. In some cases consumption has been extrapolated from available data or direct comparison made to a comparable period.
We report using a financial control approach to define our organisational boundary. We have reported all material emission sources required by the regulations for which we deem ourselves to be responsible and have maintained records of all source data and calculations.
The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2t per turnover £m, which is commonly used in this sector.
During the reporting period we have invested £5.3k in LED lighting upgrades. Our energy management programme, which includes monitoring and targeted reporting of energy consumption on a daily basis at the majority of sites, remains ongoing. Through the service provided by our energy consultants, the energy management programme we run enables us to identify and address any consumption issues as and when they arrive, allowing us to eliminate unnecessary energy waste.
The table above includes total energy consumption (reported as kWh) and greenhouse gas emissions for the sources required by the regulations, along with our intensity ratio. Turnover has been selected as our Intensity Metric, this is consistent with the majority of the motor trade sector. The Intensity Ratio is therefore calculated as total gross emissions in metric tonnes of CO2 equivalent per turnover £m.
We have audited the financial statements of McLean & Appleton (Holdings) Limited (the ‘parent company’) and its subsidiaries (the ‘group’) for the year ended 31 January 2025 which comprise the group statements of comprehensive income, the group and parent company statement of financial position, the group and parent company statement of changes in equity, the group statement of cash flows and the group and parent company notes to the financial statements, including significant accounting policies.
The group financial statements have been prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006. The financial reporting framework that has been applied in the preparation of the parent company financial statements is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 101 'Reduced Disclosure Framework’ (United Kingdom Generally Accepted Accounting Practice).
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
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.
In the light of the knowledge and understanding of the group and 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.
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.
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;
the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
we identified the laws and regulations applicable to the group through discussions with directors and other management, and from our commercial knowledge and experience of the automotive sector;
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the group, including the Companies Act 2006, taxation legislation, the Financial Conduct Authority, employment and health and safety legislation;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the group’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.
To address the risk of fraud through management bias and override of controls, we:
performed analytical procedures to identify any unusual or unexpected relationships;
tested journal entries to identify unusual transactions; and
assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
agreeing financial statement disclosures to underlying supporting documentation; and
enquiring of management as to actual and potential litigation and claims.
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
A further description of our responsibilities is available on the Financial Reporting Council's website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
The income statement has been prepared on the basis that all operations are continuing operations.
McLean & Appleton (Holdings) Limited is a private company limited by shares incorporated in England and Wales. The registered office is Hatfields, Thornton Road, Pickering, North Yorkshire, England. The company's principal activities and nature of its operations are disclosed in the directors' report.
The group consists of McLean & Appleton (Holdings) Limited and all of its subsidiaries.
The financial statements are prepared in sterling, which is the functional currency of the group. Monetary amounts in these financial statements are rounded to the nearest £'000.
The following exemptions from the requirements of IFRS have been applied in the preparation of the individual parent company's financial statements, in accordance with FRS 101:
Cash flow statement and related notes
Comparative period reconciliations for property and equipment under operating leases, other property and equipment and intangible assets
Disclosures in respect of transactions with wholly owned subsidiaries
Disclosures in respect of capital management
The effects of new but not yet effective IFRSs
Disclosures in respect of the compensation of Key Management Personnel
Disclosures of key assumptions (including sensitivities) and valuation technique used in the determination of recoverable amount for impairment purpose.
The consolidated group financial statements consist of the financial statements of the parent company McLean & Appleton (Holdings) Limited together with all entities controlled by the parent company (its subsidiaries).
All financial statements are made up to 31 January 2025.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Generally, there is a presumption that a majority of voting rights results in control. To support this presumption, the Group considers all relevant facts and circumstances in assessing whether it has power over an investee, including:
The contractual arrangement with the other vote holders of the investee;
Rights arising from other contractual arrangements; and
The Group’s voting rights and potential voting rights.
The Group reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary.
Profit or loss and each component of other comprehensive income (OCI) are attributed to the equity holders of the parent of the Group and to the non-controlling interests, even if this results in the non-controlling interests having a deficit balance.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying value is greater than its estimated recoverable amount.
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 consolidated income statement.
Investment property, which is property held to earn rentals and/or for capital appreciation, is measured using the fair value model and stated at its fair value at the reporting end date. Changes in fair value are recognised in profit or loss.
Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for indicators of impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the parent company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
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.
Net realisable value is the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution. Provision is made where necessary for obsolete, slow moving and defective inventory.
Financial liabilities are derecognised when, and only when, the group’s obligations are discharged, cancelled, or they expire.
Equity instruments issued by the parent company are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer payable at the discretion of the company.
The tax expense represents the sum of the tax currently payable and deferred tax.
At inception, the group assesses whether a contract is, or contains, a lease within the scope of IFRS 16. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Where a tangible asset is acquired through a lease, the group recognises a right-of-use asset and a lease liability at the lease commencement date. Right-of-use assets are included within property, plant and equipment, apart from those that meet the definition of investment property.
The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date plus any initial direct costs and an estimate of the cost of obligations to dismantle, remove, refurbish or restore the underlying asset and the site on which it is located, less any lease incentives received.
The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of other property, plant and equipment. The right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.
The lease liability is initially measured at the present value of the lease payments that are unpaid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the group's incremental borrowing rate. Lease payments included in the measurement of the lease liability comprise fixed payments, variable lease payments that depend on an index or a rate, amounts expected to be payable under a residual value guarantee, and the cost of any options that the group is reasonably certain to exercise, such as the exercise price under a purchase option, lease payments in an optional renewal period, or penalties for early termination of a lease.
The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in: future lease payments arising from a change in an index or rate; the group's estimate of the amount expected to be payable under a residual value guarantee; or the group's assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.
The group has elected not to recognise right-of-use assets and lease liabilities for short-term leases of machinery that have a lease term of 12 months or less, or for leases of low-value assets including IT equipment. The payments associated with these leases are recognised in profit or loss on a straight-line basis over the lease term.
When the group acts as a lessor, leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees, over the major part of the economic life of the asset. All other leases are classified as operating leases. If an arrangement contains lease and non-lease components, the group applies IFRS 15 to allocate the consideration in the contract.
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
Operating segments
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker.
The chief operating decision maker has been identified as the directors.
The Board considers that the group’s activity constitutes one operating and one reporting segment, as defined under IFRS 8. Management reviews the performance of the group by reference to total results against budget.
The total profit measures are operating profit and profit for the period, both disclosed on the face of the Group Statement of Comprehensive Income. No differences exist between the basis of preparation of the performance measures used by management and the figures in the group financial information.
Financial risk management
The Group's activities expose it to a variety of financial risks, including the effects of changes in debt market prices and interest rates, The Board adopts an ongoing process for identifying, evaluating and managing the significant risks faced by the Group.
Market risk - Cash flow interest rate risk
The Group's interest rate risk arises from long-term borrowings, which are issued at a variable rate that exposes the Group to cash flow interest rate risk. The Group's borrowings are denominated in sterling.
The interest rate exposure of the Group is managed within the constraints of the Group's business plan and the financial covenant under its facilities.
Credit risk
Credit risk arises from cash and deposits with banks as well as credit exposures to customers. Individual customer risk limits are set and the utilisation of these credit limits is regularly monitored.
Liquidity risk
Ultimate responsibility for liquidity risk rests with the Board of Directors, which has built an appropriate liquidity risk management framework for the management of the Group's short, medium and long-term funding and liquidity management requirements.
The Group manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities by continuously monitoring forecast and actual cash flows, and matching the maturity profiles of financial assets and liabilities.
At the date of authorisation of these financial statements, there are no amended standards and interpretations issued by the IASB that impact the group, as they are either not relevant to the group’s activities or require accounting which is consistent with the group’s current accounting policies.
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are outlined below.
The lease payments have been discounted using the incremental borrowing rate. The group has used rates of 2% for property leases and 5% for motor vehicle leases. These are the rates that management have assessed to be secured if funds were borrowed for assets of a similar nature with similar terms, security and conditions.
In determining the lease term, management considers all facts and circumstances that create an economic incentive to exercise an extension option, or not to exercise a termination option. Extension and termination options are only included in the lease term if the lease is reasonably certain to be extended or not terminated.
When a business combination takes place, the Group is required to assess whether there are any additional intangible assets arising separately from goodwill. Management judgement is required to determine whether an intangible asset can be separately identified, what fair value should be ascribed to the asset and its attributable useful life.
The group tests annually whether goodwill has suffered any impairment, in accordance with the accounting policy. The recoverable amounts of cash generating units have been determined based on value in use calculations. These calculations require the use of estimates.
Details of the key assumptions used for the impairment testing for the year ended 31 January 2025 are provided in note 13.
The average monthly number of persons (including directors) employed by the group during the year was:
Their aggregate remuneration comprised:
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 4 (2024 - 4).
The Directors are also considered to be key management personnel.
The rate of corporation tax increased from 19% to 25% from 1 April 2023.
The charge for the year can be reconciled to the loss per the income statement as follows:
Impairment tests for cash generating units containing goodwill or intangible assets with an indefinite life
In accordance with IAS 36, 'Impairment of Assets', the group tests goodwill for impairment annually.
For the purposes of impairment testing of goodwill and other indefinite life assets, the directors recognise the group's Cash Generating Units ("CGU"s) to be connected groupings of dealerships acquired together.
2025 2024
£'000 £'000
Jaguar dealerships - 50
Land Rover dealerships 220 220
Shrewsbury Land Rover dealership 4,300 4,300
Other 1,029 1,029
───── ─────
5,549 5,599
───── ─────
The recoverable amount of a CGU is determined based on value-in-use calculations. These calculations use post-tax cash flow projections in perpetuity.
The key assumptions for the value in use calculations are those regarding the discount rates, growth rates and expected changes to gross profits and direct costs during the year:
Management estimate discount rates using post-tax rates that reflect current market assessments and the time value of money and the risks specific to the CGUs.
Growth rates are based upon industry forecasts.
Changes in gross profits and direct costs are based on past practices and expectations of future changes in the market.
The Group has considered and assessed reasonably possible changes to the key assumptions. A growth rate of 3% for the 5 years remaining has been assumed, with a terminal value applied. A risk adjusted post-tax discount rate reflecting the group's Weighted Average Cost of Capital ("WACC") of 13.3% (2024: 13.8%) is applied. A post-tax WACC of 34% has to be applied before any impairment arises. A negative growth rate of 21% has to be applied before any impairment arises. The sensitivities do not reflect a number of mitigating actions that would be available to management in such circumstances.
Included within land and buildings above is land with a value of £10.0m (2024: £10.6m) which is not depreciated.
Included within land and buildings above is leasehold land and building, with a net book value of £10.5m (2024: £10.7m).
The historical cost of the investment property held throughout the year is £220,000.
Also included in investment property is a transfer from fixed assets with a historical cost of £936,450.
The directors have assessed the fair value of the investment properties as at the reporting date and believe that the carrying amount approximates fair value. This assessment was based on market data, recent transactions, and other relevant valuation inputs.
Fair value hierarchy for investments
2025 2024
£'000 £'000
Basis of valuation
Level 1 - Quoted prices - -
Level 2 - Observable market data 268 308
Level 3 - Unobservable data - -
The intention of a fair value measurement is to estimate the price at which an asset or liability could be exchanged in the market conditions prevailing at the measurement date. The measurement assumes the exchange is an orderly transaction (that is, it is not a forced transaction, involuntary liquidation or distress sale) between knowledgeable, willing participants on an independent basis.
The purpose of the fair value hierarchy is to prioritise the inputs that should be used to measure the fair value of assets and liabilities. The highest priority is given to quoted prices at which a transaction can be entered into and the lowest priority to unobservable inputs.
In accordance with IFRS, the group classifies fair value measurement under the following levels:-
Level 1 - Unadjusted quoted price in an active market for an identical instrument.
Level 2 - Valuation techniques using observable inputs other than quoted prices within level 1.
Level 3 - Valuation techniques using unobservable inputs.
Details of the company's subsidiaries at 31 January 2025 are as follows:
All of the subsidiaries have the same registered office being Hatfields, Thornton Road, Pickering, North Yorkshire.
Halifax Garages Limited was dissolved on 15 April 2025.
A corresponding liability amounting to £38,483k (2024: £45,344k) is held in trade payables in respect of vehicle stocks invoiced not yet paid.
Inventories are stated after unrealised provisions for impairment at 31 January 2025 of £392k (2024: £404k).
2.4% (2024: 1.1%) of trade receivables relate to balances held >90 days. This excludes balances owed from employees relating to the Employee Car Ownership Scheme.
The directors consider that the carrying amount of trade and other receivables is approximately equal to their fair value.
The company applies the simplified approach under IFRS 9 to measure expected credit losses (ECLs) on trade receivables, using a lifetime ECL basis.
At the reporting date, the company assessed the ECLs based on historical default rates, the aging of balances, and forward-looking information.
The majority of trade receivables are current and relate to long-standing customers with a history of timely payments. Based on this assessment, the company concluded that the expected credit losses on trade receivables are not material and therefore no loss allowance has been recognised.
Analysis of borrowings
All bank loans are secured by unscheduled mortgage debentures incorporating a fixed and floating charge over all current and future assets of the group. The bank also holds a first legal charge over a number of the company's properties.
Bank loans are repayable in quarterly instalments with final payment in 2027. Interest is charged on a floating rate basis, under which the interest rate will never be less than 1.45%.
Other loans are non-interest bearing and have no fixed repayment terms. These loans are recognised initially at fair value, which is determined by discounting expected future cash flows using a market rate of interest. Subsequently, they are measured at amortised cost using the effective interest method. Where there is no expectation of repayment, the loans are classified as equity.
Lease liabilities are classified based on the amounts that are expected to be settled within the next 12 months and after more than 12 months from the reporting date, as follows:
The following are the major deferred tax liabilities and assets recognised by the group and movements thereon during the current and prior reporting period.
The holders of all ordinary shares are entitled to receive dividends and are entitled to one vote per share at meetings of the Company. All ordinary shares rank equally with regard to the Company's residual assets.
Rent was paid to JSW A&M Settlement (21/11/97) of £180k. At the year end a balance of £83k was owed to the trust (2024: £164k).
The group owes amounts to the directors and their family members. At the year end these balances totaled £0.4m (2024: £0.6m). During the year, dividends amounting to £226k were paid (2024: £226k) to a director and his wife.
At the year end amounts were owed to companies controlled by the directors and their family members of £3.1m (2024: £3.1m). No interest is payable on the loans which are repayable on demand. A dividend of £nil (2024: £8m) was declared, of which £nil (2024: £nil) was paid.
During the year, immediate family members of directors received employee benefits of £160k (2024: £164k).
During the year, a group company declared a dividend of £63k (2024: £110k) to key management personnel.
During the year, key management personnel excluding directors were remunerated £94k (2024: £93k).
The ultimate controlling party of the company is Mr G S Williams.
McLean & Appleton (Holdings) Limited is a private company limited by shares incorporated in England and Wales. The registered office is Hatfields, Thornton Road, Pickering, North Yorkshire, England. The company's principal activities and nature of its operations are disclosed in the directors' report.
The financial statements have been prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework (FRS 101) and in accordance with applicable accounting standards.
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 company applies accounting policies consistent with those applied by the group. To the extent that an accounting policy is relevant to both group and parent company financial statements, please refer to the group financial statements for disclosure of the relevant accounting policy.
The directors have at the time of approving the financial statements, a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
The average monthly number of persons (including directors) employed by the company during the year was:
Except as detailed below the directors believe that the carrying amounts of financial assets carried at amortised cost in the financial statements approximate to their fair values.
Details of the company's principal operating subsidiaries are included in note 17.
During the year, McLean & Appleton (Holdings) Limited received dividends of £226k (2024: £8,226k) from companies within the group. At the year end they were owed £4,663k (2024: £12,663k) from a subsidiary.
During the year, dividends amounting to £226k were paid (2024: £226k) to a director and his wife.
A dividend of £nil (2024: £8m) was also declared, of which £nil (2024: £nil) was paid, to companies controlled by the directors and their family members.