Company registration number 01013962 (England and Wales)
ELGATE PRODUCTS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
ELGATE PRODUCTS LIMITED
COMPANY INFORMATION
Directors
N Elliott (Chairman)
J Elliott (Chief Executive Officer)
G Askew
D Elliott
M S Elliott
Secretary
Company number
01013962
Registered office
1 Patricia Way
Pysons Road Industrial Estate
Broadstairs
Kent
United Kingdom
CT10 2LF
Auditor
Azets Audit Services
2nd Floor
32-33 Watling Street
Canterbury
Kent
United Kingdom
CT1 2AN
ELGATE PRODUCTS LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Statement of comprehensive income
7
Balance sheet
8
Statement of changes in equity
9
Statement of cash flows
16
Notes to the financial statements
10 - 23
ELGATE PRODUCTS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 1 -

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

Review of the business

Elgate Products Limited is a major importer and exporter of wholesale gifts, toys, garden products, souvenirs and homewares operating from 20,000 square foot of offices and showrooms and 126,000 square foot of warehousing in Broadstairs, Kent.

 

The company’s customer base is extremely diverse, ranging from multiple retailers, wholesalers and mail order clients to small independent retailers. In addition to supplying the UK gift market the company also supplies a number of clients in Europe, America and beyond with affordable design led giftware products to suit virtually every type of market. The company’s studio also offers the facility to design bespoke products exclusively for our clients.

Principal risks and uncertainties

The company continues to guard against its principal business risks being worldwide manufacturing and shipping costs, the supply chain and exchange rate movements. Ongoing negotiations are undertaken with all of the company’s suppliers in order to control the cost and delivery position with regard to the purchase of the company’s products whilst maintaining active exchange controls primarily through the use of forward exchange contracts to protect the company from exchange rate movements.

 

A further business risk is the continuation of support from the company’s bankers. The company protects against this risk by maintaining a close dialogue with the relationship managers dealing with the various aspects of the company’s funding package.

 

The exposure to the uncertainties that exist in relation to global currency markets and manufacturing costs remain a primary focus of the company’s management.

Development and performance

The company’s trading performance has continued at a similar level as last year with Turnover slightly decreasing from £11.6m to £10.6m, representing a decrease of 8.71%. The gross profit margins however have seen a slight increase from 50.98% in 2023 to 51.19%.

 

Despite the slight decrease in Turnover the company’s Administrative Expenses have seen a significant increase of 19.71%. Overall, Operating Profit has decreased from £2.6m in 2023 to £1.6m in 2024 and Profit Before Tax has decreased from £2.5m to £1.5m.

Future developments

The company will continue to develop new products and customers to meet with changes to the market conditions as they arise.

Key performance Indicators

The net current assets at the end of the year increased from £5.7m to £6.3m largely because of the additional stock held at the year end and repayment of bank laons. Total assets less liabilities increased from £6.9m to £8m and the current assets ratio has increased from 3.9 to 6.7.

 

On behalf of the board

J Elliott (Chief Executive Officer)
Director
25 June 2025
ELGATE PRODUCTS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 2 -

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

Principal activities

Elgate Products Limited is a major importer and exporter of wholesale gifts, toys, garden products, souvenirs and homewares.

Results and dividends

The results for the year are set out on page 7.

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

Directors

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

N Elliott (Chairman)
J Elliott (Chief Executive Officer)
G Askew
D Elliott
M S Elliott
Auditor

In accordance with the company's articles, a resolution proposing that Azets Audit Services be reappointed as auditor of the company will be put at a General Meeting.

Statement of directors' responsibilities

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

 

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

 

 

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

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.

ELGATE PRODUCTS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 3 -
On behalf of the board
J Elliott (Chief Executive Officer)
Director
25 June 2025
ELGATE PRODUCTS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ELGATE PRODUCTS LIMITED
- 4 -
Opinion

We have audited the financial statements of Elgate Products Limited (the 'company') for the year ended 31 December 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 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:

ELGATE PRODUCTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ELGATE PRODUCTS LIMITED
- 5 -
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.

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.

ELGATE PRODUCTS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ELGATE PRODUCTS LIMITED
- 6 -

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

 

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework.  Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.  This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

 

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

 

 

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 of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

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.

Catherine Cooper FCCA
Senior Statutory Auditor
For and on behalf of Azets Audit Services
27 June 2025
Chartered Accountants
Statutory Auditor
2nd Floor
32-33 Watling Street
Canterbury
Kent
United Kingdom
CT1 2AN
ELGATE PRODUCTS LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
- 7 -
2024
2023
Notes
£
£
Turnover
3
10,582,183
11,591,631
Cost of sales
(5,164,918)
(5,681,644)
Gross profit
5,417,265
5,909,987
Distribution costs
(550,054)
(559,400)
Administrative expenses
(3,290,248)
(2,748,410)
Operating profit
4
1,576,963
2,602,177
Interest receivable and similar income
7
-
0
898
Interest payable and similar expenses
8
(54,352)
(136,114)
Profit before taxation
1,522,611
2,466,961
Tax on profit
9
(400,863)
(560,885)
Profit for the financial year
1,121,748
1,906,076

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

ELGATE PRODUCTS LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2024
31 December 2024
- 8 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
10
1,778,692
1,835,592
Current assets
Stocks
11
5,115,596
4,423,928
Debtors
12
1,806,931
2,745,797
Cash at bank and in hand
495,162
400,528
7,417,689
7,570,253
Creditors: amounts falling due within one year
14
(1,108,607)
(1,905,346)
Net current assets
6,309,082
5,664,907
Total assets less current liabilities
8,087,774
7,500,499
Creditors: amounts falling due after more than one year
13
-
0
(534,473)
Net assets
8,087,774
6,966,026
Capital and reserves
Called up share capital
17
501
501
Capital redemption reserve
499
499
Other reserves
526,528
551,471
Profit and loss reserves
7,560,246
6,413,555
Total equity
8,087,774
6,966,026
The financial statements were approved by the board of directors and authorised for issue on 25 June 2025 and are signed on its behalf by:
J Elliott (Chief Executive Officer)
Director
Company Registration No. 01013962
ELGATE PRODUCTS LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
- 9 -
Share capital
Capital redemption reserve
Other reserves
Profit and loss reserves
Total
£
£
£
£
£
Balance at 1 January 2023
501
499
576,414
4,482,536
5,059,950
Year ended 31 December 2023:
Profit and total comprehensive income for the year
-
-
-
1,906,076
1,906,076
Other movements
-
-
(24,943)
24,943
-
Balance at 31 December 2023
501
499
551,471
6,413,555
6,966,026
Year ended 31 December 2024:
Profit and total comprehensive income for the year
-
-
-
1,121,748
1,121,748
Other movements
-
-
(24,943)
24,943
-
Balance at 31 December 2024
501
499
526,528
7,560,246
8,087,774
ELGATE PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 10 -
1
Accounting policies
Company information

Elgate Products Limited is a private company limited by shares incorporated in England and Wales. The registered office is 1 Patricia Way, Pysons Road Industrial Estate, Broadstairs, Kent, United Kingdom, CT10 2LF. The business operates from Unit 1, Patricia Way, St Peters, Kent, CT10 2LF.

1.1
Accounting convention

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

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

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

1.2
Going concern

These financial statements are prepared on the going concern basis. The directors have a reasonable expectation that the company will continue in operational existence for the foreseeable future.

1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:

 

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
2% on cost
Fixtures and fittings
25% reducing balance
Motor vehicles
10% to 33% reducing balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

ELGATE PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 11 -
1.5
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 (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.6
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Stock is recorded within the financial statements when it is shipped and the company has title to the goods.

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.

1.7
Cash and cash equivalents

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

1.8
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

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

 

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

ELGATE PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 12 -
Basic financial assets

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

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Derrivatives designated as hedging instruments in an effective hedge

The company uses derivative financial instruments to manage exposures to fluctuations in foreign currency exchange rates. These derivative financial instruments are recognised initially at fair value on the date on which a derivative contract is entered into and subsequently measured at fair value.

 

Hedge relationships are formally designated and documented at inception, together with the risk management objective and strategy for the undertaking the hedge. The documentation includes identification of the hedging instrument, the hedged item or transaction, the nature of the risk being hedged, and how the entity will assess the hedging instrument effectiveness in offsetting the exposure to changes in the hedged item's fair value attributable to the hedged risk. Such hedges are expected at inception to be highly effective in achieving offsetting changes in fair value.

 

The change in fair value of a hedging derivative is recognised in profit or loss. The change in the fair value of the hedged item attributable to the risk being hedged is recorded as part of the carrying value of the hedged item and is also recognised in profit or loss.

 

If the criteria for hedge accounting are no longer met the accumulated adjustment to the carrying amount of a hedged item at such time is then amortised to profit or loss over the remaining period to maturity.

Debt factoring

A credit facility is offered that permits the company to draw up to 85% of the face value of debts transferred. These advances are repaid when either the debt is repaid or 120 days elapse, whichever happens sooner.

 

The company has access to the benefits of the factored debts and exposure to the risks inherent in those benefits and also has a liability to repay amounts received by the factor.

 

The factored debts are treated as a current asset of the company and a corresponding liability is shown within current liabilities in respect of the proceeds received from the factor.

ELGATE PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 13 -
Impairment of financial assets

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

 

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

 

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

Derecognition of financial assets

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

Classification of financial liabilities

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

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

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

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

ELGATE PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 14 -
Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.9
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.

1.10
Taxation

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

Current tax

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

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

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 profit and loss account, 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.

1.11
Employee benefits

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

 

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

 

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

1.12
Retirement benefits

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

1.13
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

ELGATE PRODUCTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 15 -
1.14
Foreign exchange

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

ELGATE PRODUCTS LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 16 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
22
1,938,351
488,541
Interest paid
(54,352)
(136,114)
Income taxes paid
(748,385)
(190,365)
Net cash inflow from operating activities
1,135,614
162,062
Investing activities
Purchase of tangible fixed assets
(27,283)
(56,222)
Loan made to Director
(13,697)
-
0
Interest received
-
0
898
Net cash used in investing activities
(40,980)
(55,324)
Financing activities
Repayment of bank loans
(1,000,000)
(769,722)
Net cash used in financing activities
(1,000,000)
(769,722)
Net increase/(decrease) in cash and cash equivalents
94,634
(662,984)
Cash and cash equivalents at beginning of year
400,528
1,063,512
Cash and cash equivalents at end of year
495,162
400,528
ELGATE PRODUCTS LIMITED
STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 17 -
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.

 

Valuation of stock

The carrying value for stock includes an element of design and warehouse costs. These are based on past experience of what percentage of designs lead to finished products and time spend by the factory workers assigning stock into the warehouse.

 

Impairment of stock

Management review the stock holdings and selling prices and make provisions based on slow selling items or where items are being discounted.

3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
9,985,518
10,790,193
Rest of Europe
490,329
653,260
Rest of the World
106,336
148,178
10,582,183
11,591,631
2024
2023
£
£
Other revenue
Interest income
-
898
4
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
24
(435)
Fees payable to the company's auditor for the audit of the company's financial statements
16,750
16,950
Depreciation of owned tangible fixed assets
84,183
80,154
(Profit)/loss on disposal of tangible fixed assets
-
405
Operating lease charges
115,711
138,669
ELGATE PRODUCTS LIMITED
STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 18 -
5
Employees

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

2024
2023
Number
Number
Administrative
7
7
Management
5
5
Operative
21
20
Total
33
32

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
2,016,874
1,684,224
Social security costs
233,075
182,761
Pension costs
87,958
84,795
2,337,907
1,951,780
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
773,791
584,461
Company pension contributions to defined contribution schemes
45,924
46,974
819,715
631,435

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

Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
199,000
130,000
Company pension contributions to defined contribution schemes
-
8,600
ELGATE PRODUCTS LIMITED
STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 19 -
7
Interest receivable and similar income
2024
2023
£
£
Interest income
Other interest income
-
0
898
8
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
27,913
136,114
Other finance costs:
Other interest
26,439
-
0
54,352
136,114
9
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
400,863
560,885

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
1,522,611
2,466,961
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 25.00%)
380,653
616,740
Tax effect of expenses that are not deductible in determining taxable profit
5,576
3,066
Effect of change in corporation tax rate
-
0
(35,280)
Permanent capital allowances in excess of depreciation
11,385
3,666
Expenses deductable
-
0
(27,307)
S455 Loans to participators - timing difference
3,249
-
0
Taxation charge for the year
400,863
560,885
ELGATE PRODUCTS LIMITED
STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 20 -
10
Tangible fixed assets
Freehold land and buildings
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
Cost
At 1 January 2024
2,371,200
200,596
30,000
2,601,796
Additions
-
0
27,283
-
0
27,283
At 31 December 2024
2,371,200
227,879
30,000
2,629,079
Depreciation and impairment
At 1 January 2024
603,611
132,593
30,000
766,204
Depreciation charged in the year
60,362
23,821
-
0
84,183
At 31 December 2024
663,973
156,414
30,000
850,387
Carrying amount
At 31 December 2024
1,707,227
71,465
-
0
1,778,692
At 31 December 2023
1,767,589
68,003
-
0
1,835,592

Freehold land and buildings with a carrying amount of £1,707,227(2023 - £1,767,589) have been pledged to secure borrowings of the company. The company is not allowed to pledge these assets as security for other borrowings or to sell them to another entity.

11
Stocks
2024
2023
£
£
Finished goods and goods for resale
5,115,596
4,423,928
12
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
1,446,139
1,596,988
Other debtors
186,550
990,112
Prepayments and accrued income
174,242
158,697
1,806,931
2,745,797

A credit facility is offered that permits the company to draw up to 85% of the face value of debts transferred. These advances are repaid when either the debt is repaid or 120 days elapse, whichever happens sooner.

 

The company has access to the benefits of the factored debts and exposure to the risks inherent in those benefits and also has a liability to repay amounts received by the factor.

 

The factored debts of £1,474,687 (2023 - £1,615,193) are treated as a current asset and a corresponding liability of £nil (2022 - £Nil) is shown within current liabilities in respect of the proceeds received from the factor.

ELGATE PRODUCTS LIMITED
STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 21 -
13
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Bank loans and overdrafts
15
-
0
534,473
14
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loans
15
-
0
465,527
Trade creditors
294,673
276,620
Corporation tax
213,363
560,885
Other taxation and social security
186,977
219,664
Other creditors
14,330
12,970
Accruals and deferred income
399,264
369,680
1,108,607
1,905,346
15
Loans and overdrafts
2024
2023
£
£
Bank loans
-
0
1,000,000
Payable within one year
-
0
465,527
Payable after one year
-
0
534,473

As security for the loans the Bank are holding the following:-

 

-    charge over contract monies;

-    fixed charge over all property;

-    first fixed charge over book and other debts, chattels, goodwill and uncalled capital, both present

    and future;

-    first floating charge over all assets and undertaking both present and future;

-    first legal charge over 1 Patricia Way, Pysons Road Industrial Estate, Broadstairs, Kent.

-    General letter of pledge by way of a continuing security.

 

The company currently holds facilities in the form of a Class Guarantee facility of £350,000 and a guarantee of £350,000 in favour of HM Revenue and Customs.

ELGATE PRODUCTS LIMITED
STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 22 -
16
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
87,958
84,795

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.

17
Share capital
2024
2023
Ordinary share capital
£
£
Issued and fully paid
501 Ordinary of £1 each
501
501
18
Other reserves

The other reserve comprises of the difference between the deemed property cost and it's historical cost convention amount. This forms part of the company's profit and loss account but is not distributable and has been designated as a non distributable profit and loss account reserve.

19
Financial commitments, guarantees and contingent liabilities

At 31 December 2024 the company had entered into forward exchange contracts committing them to purchase $3.350m (2023: $0m) for £2.6m (2023: £0m) within 12 months (2023: 0 months) of the next financial year as part of the company's ongoing currency management policy.

20
Operating lease commitments
Lessee

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

2024
2023
£
£
Within one year
93,182
106,064
Between two and five years
16,314
46,005
109,496
152,069
21
Related party transactions
Transactions with related parties

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

ELGATE PRODUCTS LIMITED
STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
21
Related party transactions
(Continued)
- 23 -

Elgate Pension Scheme

Elgate Products Limited rent, on a short-term lease, Unit 4, 1 Patricia Way from the company's pension scheme for £64,000 for the year ended 31 December 2024 (2023 - £64,000).

 

Directors Loan

During the year a loan was made to a director of £13,500 for which interest is being charged at 2.25%. Interest in the year totalled £197. At the end of the year the loan balance was £13,697.

22
Cash generated from operations
2024
2023
£
£
Profit for the year after tax
1,121,748
1,906,076
Adjustments for:
Taxation charged
400,863
560,885
Finance costs
54,352
136,114
Investment income
-
0
(898)
(Gain)/loss on disposal of tangible fixed assets
-
405
Depreciation and impairment of tangible fixed assets
84,183
80,154
Movements in working capital:
Increase in stocks
(691,668)
(1,022,577)
Decrease/(increase) in debtors
952,563
(1,028,885)
Increase/(decrease) in creditors
16,310
(142,733)
Cash generated from operations
1,938,351
488,541
23
Analysis of changes in net funds/(debt)
1 January 2024
Cash flows
31 December 2024
£
£
£
Cash at bank and in hand
400,528
94,634
495,162
Borrowings excluding overdrafts
(1,000,000)
1,000,000
-
(599,472)
1,094,634
495,162
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