Company registration number 01210027 (England and Wales)
Matthew Homes Limited
Annual Report and Financial Statements
For the year ended 30 September 2024
Matthew Homes Limited
Contents
Page
Company information
1
Strategic report
2 - 3
Directors' report
4 - 6
Directors' responsibilities statement
7
Independent auditor's report
8 - 10
Statement of comprehensive income
11
Balance sheet
12
Statement of changes in equity
13
Statement of cash flows
14
Notes to the financial statements
15 - 26
Matthew Homes Limited
Company Information
- 1 -
Directors
Mr C H Gallagher
Mr D P Gallagher
Mr J M Wragg
Mr N W Hutchinson
Mr D A Gallagher
Mr B J Gallagher
Mr B M Jordan
Mr D J Pennington
Secretary
Mr D P Gallagher
Company number
01210027
Registered office
Pendragon House
65 London Road
St Albans
Herts
AL1 1LJ
Auditor
Just Audit Limited
Strelley Hall
Main Street
Strelley
Nottingham
NG8 6PE
Business address
Matthew House
45-47 High Street
Potters Bar
Hertfordshire
EN6 5AW
Matthew Homes Limited
Strategic Report
For the year ended 30 September 2024
- 2 -

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

Business review

The directors are satisfied with the company's performance in 2024.

 

The turnover for the year was £75,335,703 (2023 - £48,162,884).

 

Gross Profit increased in the year from £10,318,211 in 2023 to £15,358,649 in 2024. This was the result of increased unit sales in the year and a change in the size of properties sold during the year.

 

Overall the company generated an operating profit of £6,992,619 (2023 - £2,786,077).

 

The company seeks to maintain its land stocks at a level that provides a flow of sites available for development, that can supply sufficient plots for the ensuing three years. The value of land stock at the year end was £84,036,331 compared to £69,814,984 in 2023. It is equally important that the company has sufficient units in the process of construction to allow for a steady flow of units available for sale and the Directors are satisfied that the level of work in progress at year end meets this requirement.

 

The company has no external debt financing, other than that from other group companies and other related parties, and no significant debts outside of those arising from normal trading operations. The Directors consider that the company holds sufficient funds to meet all its ongoing financing requirements, and continue to maintain the required levels of land stock and work in progress.

 

The Statement of Changes in Equity on Page 13 of the Financial Statements details the movement in Total Equity during the year and the balance at the year end. At the year end the shareholders' funds had increased to £90,329,188 (2023 - £86,472,617), due to an increase in retained distributable earnings for 2024 of £3,856,571.

Future developments

The Directors are of the view that economic uncertainty caused by inflation and higher interest rates has had an impact on consumer confidence and in turn affected the residential housing market. Current factors such as the recently reduced stamp duty rate being withdrawn and yet further economic uncertainty are likely to have an adverse effect on future unit sales.

Key performance indicators

Measurement of the company's performance is consistently applied and control is exercised by company management. The company uses the following key performance indicators to evaluate its performance:

 

1. Financial Performance Compared to Budget. The company has a budgeting system in place whereby actual performance is measured against budget, both financial and non-financial, on a monthly reporting timetable. The company sold more units than had been budgeted, this has meant that the net profit margin has increased this year, however due to units sold at a lower margin in the year the gross profit margin has decreased.

 

2. Unit reservations. The company reviews the weekly net house sales reservations and weekend site visitor numbers.

 

3. Development Site Profit Margin. The company prepares annually a budget for each development site. Actual building costs incurred and production levels achieved are compared to budgets on a monthly basis and variances are investigated. Sales revenue is budgeted at the beginning of each financial year on a site by site basis and monitored against actual revenues achieved.

 

4. Building Land. The company aims to hold an adequate stock of land to ensure sufficient development sites are available to provide a continuous building programme.

 

Events after the reporting date

After the year end a group restructuring took place - see note 23

Matthew Homes Limited
Strategic Report (Continued)
For the year ended 30 September 2024
- 3 -
Principal risks and uncertainties

The principal risks and uncertainties faced by the company include the following:

- Operating in competitive markets

- The risky nature of speculative housing development

- Changes in interest rates

- Introduction of legislation having an adverse impact on property development

- Government economic policy, including increases in taxation, levies and business costs

- Availability of suitable development land

- Reductions in economic growth

- Changes to regulations and standards under which the company operates

 

The company monitors these areas on an ongoing basis and seeks to forward plan to minimise the impact of these risks and uncertainties.

Section 172 (1) Statement

The Board of Directors aims to drive growth and employ a business model that balances the demands of the Company’s main customers with the principal risks and uncertainties faced by the business.

 

The Board of Directors recognises that the long-term success of the Company, for the benefit of its member, relies upon good relations with its various stakeholders including suppliers, subcontractors and customers. To achieve this the directors regularly review all aspects of the company's operations by receiving reports from the relevant business areas and discussing, revising or approving current and future operations and plans.

The company recognises that maintaining a reputation for high standards of business conduct is essential for any business. The directors are very aware of the need to keep up to date with all applicable regulations - such as planning, building, environmental and health and safety regulations. The company achieves this by memberships of and subscription to various organisations and publications that provide opportunities for training and professional development. In particular for health and safety issues senior management regularly arranges visits to sites to ensure site managers are fully aware of health and safety policies and that these policies are being followed. A report on health and safety on sites is produced regularly for the directors.

The continuing Company policy with regard to employee consultation and involvement is that there should be effective communication with all employees who, subject to practical and commercial considerations, should be consulted on and involved in decisions that affect their current jobs and future prospects. The achievement of this policy has to be treated flexibly in accordance with the varying circumstances and need in the Company but, in all cases, the emphasis is on communication at the local level.

The Company is aware of its responsibilities to the local communities in which it operates and seeks to minimize disruption caused by the developments it undertakes. The company also supports various charities and events local to both its head office and its development sites.

On behalf of the board

Mr J M Wragg
Director
17 June 2025
Matthew Homes Limited
Directors' Report
For the year ended 30 September 2024
- 4 -

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

Principal activities

The principal activity of the company continued to be that of residential property development.

Results and dividends

The results for the year are set out on page 11.

No ordinary dividends were paid, nor recommended by the directors during the current year.

 

On 3rd October 2024 the directors declared and paid a dividend of £85,000,000.

Directors

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

Mr C H Gallagher
Mr D P Gallagher
Mr J M Wragg
Mr N W Hutchinson
Mr D A Gallagher
Mr B J Gallagher
Mr B M Jordan
Mr D J Pennington
Auditor

The auditor, Just Audit Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Energy and carbon report

The company is required to report on its Greenhouse Gas (GHG) Emissions under the Environmental Reporting Guidelines (March 2019).

2024
2023
Energy consumption
kWh
kWh
Aggregate of energy consumption in the year
2,659,331
2,555,406
Matthew Homes Limited
Directors' Report (Continued)
For the year ended 30 September 2024
- 5 -
2024
2023
Emissions of CO2 equivalent
metric tonnes
metric tonnes
Scope 1 - direct emissions
- Gas combustion
120.05
77.22
- Fuel consumed for owned transport
352.72
363.90
472.77
441.12
Scope 2 - indirect emissions
- Electricity purchased
41.68
73.12
Scope 3 - other indirect emissions
- Fuel consumed for transport not owned by the company
101.23
83.20
Total gross emissions
615.68
597.44
Intensity ratio
Tonnes CO2 per £m of turnover
8.17
12.4
Quantification and reporting methodology

We have followed the 2019 HM Government Environmental Reporting Guidelines. We have also used the GHG Reporting Protocol – Corporate Standard and have used the 2024 UK Government’s Conversion Factors for Company Reporting.

Intensity measurement

The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per £m of turnover, the recommended ratio for the sector.

Measures taken to improve energy efficiency

The company is moving towards the use of zero emission vehicles for transport purposes where practical, or in situations where such vehicles would currently be impractical, hybrid vehicles. The company continues to review and consider the use of zero emission plant on site and the generation of electricity from renewable sources while undertaking construction projects.

The company is incorporating energy efficient materials and equipment in the construction of new homes in accordance with prevailing building regulations.

Strategic report

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of the future developments of the company and section 172(1) disclosure requirements in respect of the need to foster business relationships.

Statement of disclosure to auditor

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

Directors responsibilities statement

The directors' responsibilities statement that the directors agree to is detailed on page 7.

Matthew Homes Limited
Directors' Report (Continued)
For the year ended 30 September 2024
- 6 -
On behalf of the board
Mr J M Wragg
Director
17 June 2025
Matthew Homes Limited
Directors' Responsibilities Statement
For the year ended 30 September 2024
- 7 -

The directors are responsible for preparing the strategic report, the directors' report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

In preparing these financial statements, the directors are required to:

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Matthew Homes Limited
Independent Auditor's Report
To the Member of Matthew Homes Limited
- 8 -
Opinion

We have audited the financial statements of Matthew Homes Limited (the 'company') for the year ended 30 September 2024 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

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

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

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

Other information

The directors are responsible for the other information. The other information comprises the information included in the strategic report and the directors' report, other than the financial statements and our auditor’s report thereon. 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.

 

In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is 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:

Matthew Homes Limited
Independent Auditor's Report (Continued)
To the Member of Matthew Homes Limited
- 9 -
Matters on which we are required to report by exception

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

 

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

Responsibilities of directors

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

Auditor's responsibilities for the audit of the financial statements

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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed in our approach below:

We gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates and considered the risk of acts by the company that were contrary to applicable laws and regulations, including fraud. We designed audit procedures to respond to the risk, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. We focused on laws and regulations which could give rise to a material misstatement in the financial statements, including, but not limited to, the Companies Act 2006 and UK tax legislation. Our tests included agreeing the financial statement disclosures to underlying supporting documentation and enquiries with management. There are inherent limitations in the audit procedures described above and, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. We did not identify any key audit matters relating to irregularities, including fraud. As in all our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.

 

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.

Matthew Homes Limited
Independent Auditor's Report (Continued)
To the Member of Matthew Homes Limited
- 10 -

Use of our report

This report is made solely to the company's member 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 member those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.

Rachel Davis BA FCA (Senior Statutory Auditor)
For and on behalf of Just Audit Limited
Chartered Accountants and Statutory Auditors
Strelley Hall
Main Street
Strelley
Nottingham
NG8 6PE
17 June 2025
Matthew Homes Limited
Statement of Comprehensive Income
For the year ended 30 September 2024
- 11 -
2024
2023
Notes
£
£
Turnover
5
75,335,703
48,162,884
Cost of sales
(59,977,054)
(37,844,673)
Gross profit
15,358,649
10,318,211
Selling expenses
(2,835,195)
(1,979,252)
Administrative expenses
(5,586,194)
(6,611,267)
Other operating income
55,359
1,058,385
Operating profit
3
6,992,619
2,786,077
Interest receivable and similar income
8
449,736
582,719
Interest payable and similar expenses
11
(2,355,940)
(1,591,186)
Fair value adjustment of investment properties
9
(1,970)
(17,677)
Profit before taxation
5,084,445
1,759,933
Tax on profit
10
(1,227,874)
(392,896)
Profit for the financial year
3,856,571
1,367,037

The Statement of Comprehensive Income has been prepared on the basis that all operations are continuing operations.

Matthew Homes Limited
Balance Sheet
As at 30 September 2024
- 12 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
12
2,025,007
1,972,476
Investment property
13
224,729
226,699
2,249,736
2,199,175
Current assets
Stocks
15
132,285,078
114,889,881
Debtors
14
3,375,357
5,587,192
Cash at bank and in hand
15,353,364
12,488,598
151,013,799
132,965,671
Creditors: amounts falling due within one year
17
(62,934,347)
(48,692,229)
Net current assets
88,079,452
84,273,442
Net assets
90,329,188
86,472,617
Capital and reserves
Called up share capital
20
100,100
100,100
Profit and loss reserves
90,229,088
86,372,517
Total equity
90,329,188
86,472,617
The financial statements were approved by the board of directors and authorised for issue on 17 June 2025 and are signed on its behalf by:
Mr C H Gallagher
Mr J M Wragg
Director
Director
Company registration number 01210027 (England and Wales)
Matthew Homes Limited
Statement of Changes in Equity
For the year ended 30 September 2024
- 13 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 October 2022
100,100
85,005,480
85,105,580
Year ended 30 September 2023:
Profit and total comprehensive income
-
1,367,037
1,367,037
Balance at 30 September 2023
100,100
86,372,517
86,472,617
Year ended 30 September 2024:
Profit and total comprehensive income
-
3,856,571
3,856,571
Balance at 30 September 2024
100,100
90,229,088
90,329,188
Matthew Homes Limited
Statement of Cash Flows
For the year ended 30 September 2024
- 14 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
24
6,986,960
(17,580,710)
Interest paid
(2,355,940)
(1,591,186)
Income taxes paid
(87,808)
(1,018,502)
Net cash inflow/(outflow) from operating activities
4,543,212
(20,190,398)
Investing activities
Purchase of tangible fixed assets
(154,032)
(77,767)
Proceeds on disposal of tangible fixed assets
25,850
18,920
Interest received
449,736
582,719
Net cash generated from investing activities
321,554
523,872
Financing activities
Loan (repaid to) / received from parent undertaking
(2,000,000)
10,000,000
Net cash (used in)/generated from financing activities
(2,000,000)
10,000,000
Net increase/(decrease) in cash and cash equivalents
2,864,766
(9,666,526)
Cash and cash equivalents at beginning of year
12,488,598
22,155,124
Cash and cash equivalents at end of year
15,353,364
12,488,598
Matthew Homes Limited
Notes to the Financial Statements
For the year ended 30 September 2024
- 15 -
1
Accounting policies
Company information

Matthew Homes Limited is a private company limited by shares incorporated in England and Wales. The registered office is Pendragon House, 65 London Road, St Albans, Herts, AL1 1LJ. The principal place of business is Matthew House, 45-47 High Street, Potters Bar, Hertfordshire, EN6 5AW.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in pound sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, modified to include the valuation at fair value of investment properties. The principal accounting policies adopted are set out below.

1.2
Going concern

In light of the current economic uncertainty caused by inflation and higher interest rates the directors have reviewed and revised their forecasts of future activity. They however remain confident in theirtrue reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Revenue from residential housing developments and the respective profits are recognised when the property is structurally complete and legally transferred to the purchaser.

1.4
Tangible fixed assets

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

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

Freehold land and buildings
None
Office Equipment
20% straight line
Motor vehicles
33% straight line

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 credited or charged to profit or loss.

No depreciation is provided on freehold properties as the amount involved is not material because of the high residual value of the assets.

1.5
Investment property

Investment property consists of multiple ground rents. Ground rents are valued by the directors of the company at one years rent receivable. The directors consider this a fair estimate of the value to the company of the right to receive ground rents.

Matthew Homes Limited
Notes to the Financial Statements (Continued)
For the year ended 30 September 2024
1
Accounting policies
(Continued)
- 16 -
1.6
Impairment of fixed assets

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

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 is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior years. A reversal of an impairment loss is recognised immediately in profit or loss.

1.7
Stocks

Building land is valued at the lower of cost and net realisable value less an appropriate proportion relating to plots sold in the case of estates in the course of development. Regular reviews are carried out to identify any impairment in the value of the land by comparing the total estimated selling price less estimated selling expenses against the book cost of the land plus estimated costs to complete. Provision is made for any irrecoverable amounts. Any increase in the value of land previously written down to net realisable value is recognised immediately. At the year-end no provision for impairment against original cost was necessary.

 

Incomplete and unsold new houses are stated at cost, comprising direct labour and material costs and an appropriate proportion of site overhead expenses. No profit is recognised until houses are conveyed to third parties.

 

Stocks and work in progress are stated at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items. Net realisable value represents the estimated selling price less the estimated costs of disposal.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.8
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks and other short-term liquid investments with original maturities of three months or less.

Matthew Homes Limited
Notes to the Financial Statements (Continued)
For the year ended 30 September 2024
1
Accounting policies
(Continued)
- 17 -
1.9
Financial instruments

The company has elected to apply the provisions of Section 11 and Section 12 of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

 

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

 

Basic financial liabilities

Basic financial liabilities, which include trade and other payables, are initially measured at transaction price and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest.

1.10
Equity instruments

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

1.11
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the Statement of Comprehensive Income because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

 

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

Matthew Homes Limited
Notes to the Financial Statements (Continued)
For the year ended 30 September 2024
1
Accounting policies
(Continued)
- 18 -
1.12
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.13
Retirement benefits

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

1.14
Leases

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.

2
Judgements and key sources of estimation uncertainty

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

 

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

Key sources of estimation uncertainty

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

Carrying value of land and work in progress

The company holds inventories of land and work in progress at the lower of cost and net realisable value, as residential development is largely speculative by nature these inventories are rarely covered by forward sales contracts. Additionally due to the scale and length of developments the company has to allocate site wide development costs between units being built and/or completed in the current year and those for future years, such development costs are allocated to units on a standard costing basis. The company also has to forecast the costs to complete such developments and provide, as necessary, for variances arising in the year where such variances are identified.

 

In making such assessments and allocations there is a degree of inherent estimation uncertainty. The company has developed systems to effectively assess and review carrying values and the appropriateness of estimations made. These estimations and assessments evolve and consequently may lead to alterations in the effective cost per unit recognised each financial year over the course of a development.

 

In addition the ongoing estimations and assessments are reviewed to consider whether they may indicate a general impairment of land held for future development. If such a general impairment is identified an estimate of recoverable amount is made, if this is less than the carrying amount then the inventory is considered impaired and is written down to its recoverable amount.

Matthew Homes Limited
Notes to the Financial Statements (Continued)
For the year ended 30 September 2024
- 19 -
3
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Depreciation of owned tangible fixed assets
95,837
90,458
Profit on disposal of tangible fixed assets
(20,186)
(9,560)
4
Auditor's remuneration
2024
2023
Fees payable to the company's auditor:
£
£
For audit services
Audit of the financial statements of the company
36,000
36,736
5
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Residential property development
75,335,703
48,162,884
2024
2023
£
£
Other significant revenue
Interest income
449,736
582,719

The whole of the turnover is attributable to the principal activity of the company wholly undertaken in the United Kingdom.

6
Employees

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

2024
2023
Number
Number
Management and administration
30
36
Building and site support
21
16
Total
51
52
Matthew Homes Limited
Notes to the Financial Statements (Continued)
For the year ended 30 September 2024
6
Employees
(Continued)
- 20 -

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
4,141,612
4,681,496
Social security costs
550,514
652,603
Pension costs
166,407
232,534
4,858,533
5,566,633
7
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
1,403,569
2,105,037
Company pension contributions to defined contribution schemes
59,925
59,688
1,463,494
2,164,725

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2023 - 4).

Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
353,204
620,693
Company pension contributions to defined contribution schemes
30,600
-
8
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
444,931
582,108
Other interest income
4,805
611
Total income
449,736
582,719
Matthew Homes Limited
Notes to the Financial Statements (Continued)
For the year ended 30 September 2024
- 21 -
9
Amounts written off investments
2024
2023
£
£
Changes in the fair value of investment properties
(1,970)
(17,677)
10
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
1,223,466
394,628
Adjustments in respect of prior periods
(15,370)
-
0
Total current tax
1,208,096
394,628
Deferred tax
Origination and reversal of timing differences
19,778
(1,732)
Total tax charge
1,227,874
392,896

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

2024
2023
£
£
Profit before taxation
5,084,445
1,759,933
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 22.01%)
1,271,111
387,330
Tax effect of expenses that are not deductible in determining taxable profit
17,646
13,293
Permanent capital allowances in excess of depreciation
(14,585)
1,447
Enhanced tax relief
(50,706)
(7,442)
Prior year adjustments to current tax
(15,370)
-
0
Movement in deferred taxation
19,778
(1,732)
Taxation charge for the year
1,227,874
392,896

The tax rate paid by the company has increased with effect from 1st April 2023 with the introduction of the Corporation Tax main rate of 25%, an increase from the previous Corporation Tax rate of 19%.

Matthew Homes Limited
Notes to the Financial Statements (Continued)
For the year ended 30 September 2024
- 22 -
11
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities
Interest payable to group undertakings
2,346,386
1,499,796
Other finance costs:
Other interest
9,554
91,390
2,355,940
1,591,186
12
Tangible fixed assets
Freehold land and buildings
Office Equipment
Motor vehicles
Total
£
£
£
£
Cost
At 1 October 2023
1,860,274
386,371
303,724
2,550,369
Additions
-
0
7,098
146,934
154,032
Disposals
-
0
-
0
(116,164)
(116,164)
At 30 September 2024
1,860,274
393,469
334,494
2,588,237
Depreciation and impairment
At 1 October 2023
-
0
371,842
206,051
577,893
Depreciation charged in the year
-
0
11,127
84,710
95,837
Eliminated in respect of disposals
-
0
-
0
(110,500)
(110,500)
At 30 September 2024
-
0
382,969
180,261
563,230
Carrying amount
At 30 September 2024
1,860,274
10,500
154,233
2,025,007
At 30 September 2023
1,860,274
14,529
97,673
1,972,476
13
Investment property
2024
£
Fair value
At 1 October 2023
226,699
Net gains or losses through fair value adjustments
(1,970)
At 30 September 2024
224,729

Investment properties are comprised of multiple ground rents which are valued by the directors, with the latest valuation carried out at the end of the financial year.

Matthew Homes Limited
Notes to the Financial Statements (Continued)
For the year ended 30 September 2024
- 23 -
14
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
15,097
16,968
Corporation tax recoverable
559,085
1,679,373
Amounts owed by group undertakings
23,025
2,212,681
Other debtors
2,203,616
1,253,293
Prepayments and accrued income
514,049
344,614
3,314,872
5,506,929
Deferred tax asset (note 18)
60,485
80,263
3,375,357
5,587,192
15
Stocks
2024
2023
£
£
Raw materials and consumables
545,742
798,496
Work in progress
47,703,005
44,276,401
Development land
84,036,331
69,814,984
132,285,078
114,889,881
16
Loans and overdrafts
2024
2023
£
£
Loans from group undertakings
27,000,000
29,000,000
Payable within one year
27,000,000
29,000,000
17
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Borrowings from parent undertaking
16
27,000,000
29,000,000
Trade creditors
8,101,974
7,672,617
Amounts owed to group undertakings
3,154,213
1,114,844
Taxation and social security
220,366
254,227
Other creditors
11,101,003
8,935,393
Accruals and deferred income
13,356,791
1,715,148
62,934,347
48,692,229
Matthew Homes Limited
Notes to the Financial Statements (Continued)
For the year ended 30 September 2024
- 24 -
18
Deferred taxation

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

Assets
Assets
2024
2023
Balances:
£
£
Accelerated capital allowances
60,485
80,263
2024
Movements in the year:
£
Asset at 1 October 2023
(80,263)
Charge to profit or loss
19,778
Asset at 30 September 2024
(60,485)
19
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
166,407
232,534

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

20
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100,100
100,100
100,100
100,100
21
Contingent liabilities

There are contingent liabilities in respect of conditional undertaking bonds totalling £6,512,233 (2023 - £8,386,544). A claim on a bond would result in a sum of money being paid to allow the beneficiary to complete the work concerned. The claim so paid would be recovered from the company. There are no active bonds at the year end where the company considers that the work required will not be completed and therefore the bonds are not expected to give rise to any loss.

22
Related party transactions
Transactions with related parties

During the year the company entered into the following transactions with related parties:

Matthew Homes Limited
Notes to the Financial Statements (Continued)
For the year ended 30 September 2024
22
Related party transactions
(Continued)
- 25 -
Purchases
Purchases
2024
2023
£
£
Company Related by Virtue of Common Ownership
665,722
610,786
Key management personnel
135,731
174,261
Loan Advances
Loan Repayments
2024
2023
2024
2023
£
£
£
£
Family of a Company Director
543,006
125,734
1,893,426
285,489

Purchases from the Company Related by Virtue of Common Ownership relate to transactions undertaken in the normal course of business.

2024
2023
Amounts due to related parties
£
£
Company Related by Virtue of Common Ownership
60,630
55,370
Family of a Company Director
320,189
1,670,609
Key management personnel
19,833
21,601

The amount outstanding to the Family of a Company Director relates to a loan received by the company. Interest is payable on the loan at a rate of 3% over the Barclays Base Rate per annum. The interest charged for the year was £101,305 (2023: £125,734). The loan is repayable on demand, with no fixed repayment terms.

23
Parent / subsidiary relationship

At the year end, the directors considered the immediate and ultimate parent undertaking of the Company to be Shrewsbury Holdings Limited, a company registered in Jersey.

 

After the year end, there was a group restructuring and the company's immediate parent undertaking became Gallagher Holdings Limited. The ultimate parent undertaking continues to be Shrewsbury Holdings Limited.

Matthew Homes Limited
Notes to the Financial Statements (Continued)
For the year ended 30 September 2024
- 26 -
24
Cash generated from/(absorbed by) operations
2024
2023
£
£
Profit after taxation
3,856,571
1,367,037
Adjustments for:
Taxation charged
1,227,874
392,896
Finance costs
2,355,940
1,591,186
Investment income
(449,736)
(582,719)
Gain on disposal of tangible fixed assets
(20,186)
(9,560)
Fair value loss on investment properties
1,970
17,677
Depreciation and impairment of tangible fixed assets
95,837
90,458
Movements in working capital:
Increase in stocks
(17,395,197)
(24,974,267)
Decrease/(increase) in debtors
1,071,769
(919,128)
Increase in creditors
16,242,118
5,445,710
Cash generated from/(absorbed by) operations
6,986,960
(17,580,710)
25
Analysis of changes in net debt
1 October 2023
Cash flows
30 September 2024
£
£
£
Cash at bank and in hand
12,488,598
2,864,766
15,353,364
Borrowings excluding overdrafts
(29,000,000)
2,000,000
(27,000,000)
(16,511,402)
4,864,766
(11,646,636)
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