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Registration number: SC181331

Easy Heat Systems Limited

Annual Report and Consolidated Financial Statements

for the Year Ended 30 April 2024

 

Easy Heat Systems Limited

Contents

Company Information

1

Strategic Report

2 to 3

Directors' Report

4 to 5

Statement of Directors' Responsibilities

6

Independent Auditor's Report

7 to 9

Consolidated Statement of Income and Retained Earnings

10

Consolidated Balance Sheet

11

Balance Sheet

12

Consolidated Statement of Cash Flows

13

Statement of Cash Flows

14

Notes to the Financial Statements

15 to 35

 

Easy Heat Systems Limited

Company Information

Directors

Mr D McDermott

Mr W McDermott

Mr J McDermott

Mr I Muir

Registered office

McDermott House
Tweed Place
PERTH
PH1 1TJ

Auditors

Morris & Young, Statutory Auditor
Chartered Accountants
6 Atholl Crescent
PERTH
PH1 5JN

 

Easy Heat Systems Limited

Strategic Report for the Year Ended 30 April 2024

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

Principal activity

Our company's core operations revolve around providing a comprehensive range of services encompassing building, mechanical, electrical, engineering, fire safety, and facility management solutions. Additionally, we maintain a substantial property portfolio comprising both commercial and residential properties, along with various medium-term business investments.

Fair review of the business

The fiscal landscape of 2023/24 presented formidable challenges, marked notably by significant inflationary pressures and uncertainty surrounding investments in both public and private sectors. A significant proportion of our revenue is generated from public contracts supported by government incentives, as a direct result of the political landscape during the financial year these projects were all placed on hold which led to a significant reduction in turnover.

Our turnover experienced a significant decrease to £6.77m (from £14.57m in 2023), our net profits before tax were also reduced. While a decrease was forecast in 2023, this was compounded by the political landscape. Our key during this financial year was to monitor costs and ensure that we remained profitable. This achievement was made possible through a blend of operational efficiency enhancements and strategic renegotiations of contracts within our supply chain.

Operationally, we have excelled, evidenced by yet another robust year in terms of health and safety performance, boasting an Accident Frequency Rate of 0.00, consistent with the previous year.

We remain committed to reinvesting our earnings back into the business, primarily through property acquisitions and meticulously selected investments. This strategic approach necessitated a short-term increase in financing during the period, the company’s balance sheet remains strong, showing a slight increase to £25.3m compared to £24.39m in 2023. Several investments the company has made over the past few years are expected to show significant returns in 2025/26.

Our proactive approach to business development has borne fruit, with a robust order book comprising several major projects and our mid-term investment portfolio showing excellent forecasted returns, expected to far outperform our initial expectations with initial returns expected in early 2025.

The company's key financial and other performance indicators during the year were as follows:

Unit

2024

2023

Revenue

£

6,771,000

14,577,394

Gross profit

%

26

34

Profit before taxation

£

500,008

3,167,086

Total Equity

£

25,322,016

24,391,594

During the period the company purchased the entire share capital of E-Type Fabs Limited for the nominal fee of £1.

The company's prinicpal activity is bespoke restoration and maintenance of motor vehicles.

The company's key financial and other performance indicators from acquisition were as follows:

 

Easy Heat Systems Limited

Strategic Report for the Year Ended 30 April 2024

Unit

2024

Revenue

£

1,055,734

Gross loss

%

178

Loss before taxation

£

(1,632,391)

Total Equity

£

(2,092,027)

Principal risks and uncertainties

It is our company's steadfast policy to maintain a vigilant and proactive stance in evaluating and managing risks inherent in the operation of construction projects at every stage, from tendering to project completion.

The Board is acutely cognizant of the imperative to mitigate risks associated with securing new contracts, engaging in joint ventures, acquiring businesses, and making strategic investments. To this end, our company has instituted rigorous protocols for managing exposure within defined opportunities, underpinned by a robust risk management framework that permeates all facets of our operations, encompassing:

Building Risk: Each year, we engage in the bidding process for a multitude of contracts on a discerning basis. Our tendering procedures adhere to stringent processes for estimating, identifying, and assessing risks, with thorough reviews conducted before submission.

Delivery Risk: The execution of contract works is meticulously controlled and managed through our operational structures, with paramount consideration for health and safety imperatives. Our procedural framework entails regular reviews of practical issues, costs, and forecasted revenues.

Delivery Risk: The execution of contract works is meticulously controlled and managed through our operational structures, with paramount consideration for health and safety imperatives. Our procedural framework entails regular reviews of practical issues, costs, and forecasted revenues.

Joint Venture Risk: Joint ventures are forged strategically to fortify the quality of our bids and enhance the prospects of successfully delivering contracts. The Board assumes responsibility for the meticulous selection of joint venture partners, ensuring alignment with our organizational objectives and values.

Approved and authorised by the Board on 26 June 2025 and signed on its behalf by:
 

.........................................
Mr D McDermott
Director

.........................................
Mr I Muir
Director

 

Easy Heat Systems Limited

Directors' Report for the Year Ended 30 April 2024

The directors present their report and the for the year ended 30 April 2024.

Directors of the group

The directors who held office during the year were as follows:

Mr D McDermott

Mr W McDermott

Mr J McDermott

Mr I Muir (appointed 14 September 2023)

Financial instruments

Objectives and policies

The company has adopted the disclosure and presentational requirements of FRS 102. When a financial asset or liability is disclosed initially it is measured at its fair value plus or minus transaction costs. The company regularly monitors its exposure to risks including pricing, credit, liquidity and cash flow.

Price risk, credit risk, liquidity risk and cash flow risk

The company has tightened up controls over collection of trade debtors and has agreed payment terms with its suppliers.

The company is satisfied with the level of cash flow being maintained after taking into consideration the timing aspect of debtor recoverability and the payment of trade creditors and other business expenses.

The bank is currently satisfied with the company's financial performance and the directors do not consider there to be any risks of their facilities being withdrawn. The company's deposits are all in place with major UK financial institutions which are regulated by the Financial Conduct Authority.

Credit Risk - The company has a robust procedure to assess the credit risk applicable to customers, both new and ongoing.

Liquidity Risk - Liquidity risk reflects the risk that the company will have insufficient reserves to meet its financial liabilities as they fall due. The Board's objective is to ensure adequate funding is available within the company to financeits business although limited use is made of hire purchase finance and banking facilities.

Environmental matters

The company is in the process of developing a Corporate and Social Responsibility policy and the directors are fully aware that it not only has a responsibility for all of its employees’ wellbeing but also that of the environment and community as a whole.

Social and community issues

The company's policy is to consult and discuss with employees at meetings matters likely to affect employees' interests.

Information or matters of concern to employees are also communicated through email bulletins and team briefings.

 

Easy Heat Systems Limited

Directors' Report for the Year Ended 30 April 2024

Future developments

The company intends to continue to focus on its core activities it will continue to invests in its staff and systems toensure it is able to provide excellent levels of service to its customers across the country.

Research and development

We are a leading multi discplinary heating solutions company that specialises in a range of disciplines, including renewable energy, fire safety and energy efficiency. We seek to achieve scientific and technologial advancements where possible.

Disclosure of information to the auditor

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditor is unaware.

Reappointment of auditors

In accordance with section 485 of the Companies Act 2006, a resolution for the re-appointment of Morris & Young, Statutory Auditor as auditors of the company is to be proposed at the forthcoming Annual General Meeting.

Approved and authorised by the Board on 26 June 2025 and signed on its behalf by:
 

.........................................
Mr D McDermott
Director

.........................................
Mr I Muir
Director

 

Easy Heat Systems Limited

Statement of Directors' Responsibilities

The directors acknowledge their responsibilities for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

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

select suitable accounting policies and apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group's and the company's transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

 

Easy Heat Systems Limited

Independent Auditor's Report to the Members of Easy Heat Systems Limited

Opinion

We have audited the financial statements of Easy Heat Systems Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 April 2024, which comprise the Consolidated Statement of Income and Retained Earnings, Consolidated Balance Sheet, Balance Sheet, Consolidated Statement of Cash Flows, Statement of Cash Flows, and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

give a true and fair view of the state of the group's and the parent company's affairs as at 30 April 2024 and of the group's loss for the year then ended;

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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 director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

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

 

Easy Heat Systems Limited

Independent Auditor's Report to the Members of Easy Heat Systems Limited

Opinion on other matter prescribed by the Companies Act 2006

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

the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

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

Matters on which we are required to report by exception

In the light of our 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 and the Directors' Report.

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

adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

the parent company financial statements are not in agreement with the accounting records and returns; or

certain disclosures of directors' remuneration specified by law are not made; or

we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities [set out on page 6], 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 Responsibilities for the audit of the financial statements

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

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

 

Easy Heat Systems Limited

Independent Auditor's Report to the Members of Easy Heat Systems Limited

Use of our report
This report is made solely to the group and parent 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 group and parent 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 group and the parent company's members as a body, for our audit work, for this report, or for the opinions we have formed.

......................................
Alexander J Fyfe M.A.A.T., C.A., DChA (Senior Statutory Auditor)
For and on behalf of Morris & Young, Statutory Auditor, Statutory Auditor

Chartered Accountants
6 Atholl Crescent
PERTH
PH1 5JN

27 June 2025

 

Easy Heat Systems Limited

Consolidated Statement of Income and Retained Earnings for the Year Ended 30 April 2024

Note

2024
£

2023
£

Turnover

3

7,151,826

14,577,394

Cost of sales

 

(7,293,474)

(9,666,104)

Gross (loss)/profit

 

(141,648)

4,911,290

Administrative expenses

 

(1,695,128)

(2,144,591)

Other operating income

4

1,033,588

595,351

Operating (loss)/profit

5

(803,188)

3,362,050

Other interest receivable and similar income

6

20,362

12,415

Interest payable and similar charges

7

(395,782)

(207,379)

 

(375,420)

(194,964)

(Loss)/profit before tax

 

(1,178,608)

3,167,086

Taxation

11

433,028

(810,683)

(Loss)/profit for the financial year

 

(745,580)

2,356,403

Profit/(loss) attributable to:

 

Owners of the company

 

(745,580)

2,356,403

Retained earnings brought forward

 

14,244,409

11,888,006

Retained earnings carried forward

 

13,498,829

14,244,409

 

Easy Heat Systems Limited

(Registration number: SC181331)
Consolidated Balance Sheet as at 30 April 2024

Note

2024
£

2023
£

Fixed assets

 

Intangible assets

12

416,026

-

Tangible assets

13

27,147,019

26,147,295

Investments

14

2,210,776

2,210,776

 

29,773,821

28,358,071

Current assets

 

Stocks

15

4,431,205

3,566,968

Debtors

16

8,428,869

8,857,135

Cash at bank and in hand

 

14,250

47,765

 

12,874,324

12,471,868

Creditors: Amounts falling due within one year

18

(11,640,065)

(11,231,279)

Net current assets

 

1,234,259

1,240,589

Total assets less current liabilities

 

31,008,080

29,598,660

Creditors: Amounts falling due after more than one year

18

(5,327,116)

(3,070,676)

Provisions for liabilities

19

(2,034,950)

(2,136,390)

Net assets

 

23,646,014

24,391,594

Capital and reserves

 

Called up share capital

21

200

200

Revaluation reserve

10,146,985

10,146,985

Retained earnings

13,498,829

14,244,409

Equity attributable to owners of the company

 

23,646,014

24,391,594

Shareholders' funds

 

23,646,014

24,391,594

Approved and authorised by the Board on 26 June 2025 and signed on its behalf by:
 

.........................................
Mr D McDermott
Director

.........................................
Mr I Muir
Director

 

Easy Heat Systems Limited

(Registration number: SC181331)
Balance Sheet as at 30 April 2024

Note

2024
£

2023
£

Fixed assets

 

Tangible assets

13

27,020,398

26,147,295

Investments

14

2,210,777

2,210,776

 

29,231,175

28,358,071

Current assets

 

Stocks

15

3,781,011

3,566,968

Debtors

16

8,284,576

8,857,135

Cash at bank and in hand

 

12,278

47,765

 

12,077,865

12,471,868

Creditors: Amounts falling due within one year

18

(8,745,357)

(11,231,279)

Net current assets

 

3,332,508

1,240,589

Total assets less current liabilities

 

32,563,683

29,598,660

Creditors: Amounts falling due after more than one year

18

(5,206,717)

(3,070,676)

Provisions for liabilities

19

(2,034,950)

(2,136,390)

Net assets

 

25,322,016

24,391,594

Capital and reserves

 

Called up share capital

21

200

200

Revaluation reserve

10,146,985

10,146,985

Retained earnings

15,174,831

14,244,409

Shareholders' funds

 

25,322,016

24,391,594

The company made a profit after tax for the financial year of £930,422 (2023 - profit of £2,356,403).

Approved and authorised by the Board on 26 June 2025 and signed on its behalf by:
 

.........................................
Mr D McDermott
Director

.........................................
Mr I Muir
Director

 

Easy Heat Systems Limited

Consolidated Statement of Cash Flows for the Year Ended 30 April 2024

Note

2024
£

2023
£

Cash flows from operating activities

(Loss)/profit for the year

 

(745,580)

2,356,403

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

5

594,282

331,038

Profit on disposal of tangible assets

(70,106)

(29,307)

Finance income

6

(20,362)

(12,415)

Finance costs

7

395,782

207,379

Income tax expense

11

(433,028)

810,683

 

(279,012)

3,663,781

Working capital adjustments

 

Increase in stocks

15

(864,237)

(844,186)

Decrease/(increase) in trade debtors

16

428,266

(724,462)

Decrease in trade creditors

18

(313,954)

(1,040,664)

Cash generated from operations

 

(1,028,937)

1,054,469

Income taxes paid

11

(21,124)

(234,187)

Net cash flow from operating activities

 

(1,050,061)

820,282

Cash flows from investing activities

 

Interest received

20,362

12,415

Acquisitions of tangible assets

(1,720,866)

(1,000,410)

Proceeds from sale of tangible assets

 

243,191

67,762

Acquisition of intangible assets

12

(462,251)

-

Acquisition of investments in joint ventures and associates

14

-

(2,210,776)

Net cash flows from investing activities

 

(1,919,564)

(3,131,009)

Cash flows from financing activities

 

Interest paid

7

(395,782)

(207,379)

Proceeds from bank borrowing draw downs

 

(70,087)

(176,119)

Repayment of other borrowing

 

2,674,440

-

Payments to finance lease creditors

 

599,663

13,768

Net cash flows from financing activities

 

2,808,234

(369,730)

Net decrease in cash and cash equivalents

 

(161,391)

(2,680,457)

Cash and cash equivalents at 1 May

 

(1,737,328)

943,129

Cash and cash equivalents at 30 April

 

(1,898,719)

(1,737,328)

 

Easy Heat Systems Limited

Statement of Cash Flows for the Year Ended 30 April 2024

Note

2024
£

2023
£

Cash flows from operating activities

Profit for the year

 

930,422

2,356,403

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

5

523,082

331,038

Profit on disposal of tangible assets

(68,212)

(29,307)

Finance income

(20,362)

(12,415)

Finance costs

393,394

207,379

Income tax expense

11

(430,414)

810,683

 

1,327,910

3,663,781

Working capital adjustments

 

Increase in stocks

15

(214,043)

(844,186)

Decrease/(increase) in trade debtors

16

572,559

(724,462)

Decrease in trade creditors

18

(3,208,662)

(1,040,664)

Cash generated from operations

 

(1,522,236)

1,054,469

Income taxes paid

11

(23,738)

(234,187)

Net cash flow from operating activities

 

(1,545,974)

820,282

Cash flows from investing activities

 

Interest received

20,362

12,415

Acquisition of subsidiaries

14

(1)

-

Acquisitions of tangible assets

(1,445,524)

(1,000,410)

Proceeds from sale of tangible assets

 

117,551

67,762

Acquisition of investments in joint ventures and associates

14

-

(2,210,776)

Net cash flows from investing activities

 

(1,307,612)

(3,131,009)

Cash flows from financing activities

 

Interest paid

(393,394)

(207,379)

Proceeds from bank borrowing draw downs

 

(190,486)

(176,119)

Repayment of other borrowing

 

2,674,440

-

Payments to finance lease creditors

 

599,663

13,768

Net cash flows from financing activities

 

2,690,223

(369,730)

Net decrease in cash and cash equivalents

 

(163,363)

(2,680,457)

Cash and cash equivalents at 1 May

 

(1,737,328)

943,129

Cash and cash equivalents at 30 April

 

(1,900,691)

(1,737,328)

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

1

General information

The company is a private company limited by share capital, incorporated in Scotland.

The address of its registered office is:
McDermott House
Tweed Place
PERTH
PH1 1TJ

These financial statements were authorised for issue by the Board on 26 June 2025.

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.

Basis of preparation

These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.

Basis of consolidation

The consolidated financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 30 April 2024.

No Profit and Loss Account is presented for the company as permitted by section 408 of the Companies Act 2006. The company made a profit after tax for the financial year of £930,422 (2023 - profit of £2,356,403).

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

2

Accounting policies (continued)

A subsidiary is an entity controlled by the company. Control is achieved where the company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.

The results of subsidiaries acquired or disposed of during the year are included in the Profit and Loss Account from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the group.

The purchase method of accounting is used to account for business combinations that result in the acquisition of subsidiaries by the group. The cost of a business combination is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the business combination. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Any excess of the cost of the business combination over the acquirer’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised is recorded as goodwill.

Inter-company transactions, balances and unrealised gains on transactions between the company and its subsidiaries, which are related parties, are eliminated in full.

Intra-group losses are also eliminated but may indicate an impairment that requires recognition in the consolidated financial statements.

Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group. Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the group’s equity therein. Non-controlling interests consist of the amount of those interests at the date of the original business combination and the non-controlling shareholder’s share of changes in equity since the date of the combination.

Going concern

The financial statements have been prepared on a going concern basis.

Revenue recognition

Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the group’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts and after eliminating sales within the group.

The group recognises revenue when:
The amount of revenue can be reliably measured;
it is probable that future economic benefits will flow to the entity;
and specific criteria have been met for each of the group's activities.

Tax

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

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the group operates and generates taxable income.

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

2

Accounting policies (continued)

Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the consolidated financial statements.

Unrelieved tax losses and other deferred tax assets are recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference.

Tangible assets

Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class

Depreciation method and rate

Freehold property

Not provided for

Plant and machinery

25% reducing balance

Fixtures and fittings

15% reducing balance

Motor vehicles

25% reducing balance

Computer equipment

25% reducing balance

Business combinations

Business combinations are accounted for using the purchase method. The consideration for each acquisition is measured at the aggregate of the fair values at acquisition date of assets given, liabilities incurred or assumed, and equity instruments issued by the group in exchange for control of the acquired, plus any costs directly attributable to the business combination. When a business combination agreement provides for an adjustment to the cost of the combination contingent on future events, the group includes the estimated amount of that adjustment in the cost of the combination at the acquisition date if the adjustment is probable and can be measured reliably.

Goodwill

Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is held in the currency of the acquired entity and revalued to the closing rate at each reporting period date. Goodwill is amortised over its useful life, which shall not exceed ten years if a reliable estimate of the useful life cannot be made.

Amortisation

Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:

Asset class

Amortisation method and rate

Goodwill

Over 10 years

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

2

Accounting policies (continued)

Investments

Investments in subsidiaries are accounted for at cost less accumulated impairment losses.

Interest income on debt securities, where applicable, is recognised in income using the effective interest method. Dividends on equity securities are recognised in income when receivable.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits.

Trade debtors

Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the group does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Borrowings

Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the profit and loss account over the period of the relevant borrowing.

Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.

Borrowings are classified as current liabilities unless the group has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

2

Accounting policies (continued)

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee.

Assets held under finance leases are recognised at the lower of their fair value at inception of the lease and the present value of the minimum lease payments. These assets are depreciated on a straight-line basis over the shorter of the useful life of the asset and the lease term. The corresponding liability to the lessor is included in the balance sheet as a finance lease obligation.

Lease payments are apportioned between finance costs in the profit and loss account and reduction of the lease obligation so as to achieve a constant periodic rate of interest on the remaining balance of the liability.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the group has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

3

Turnover

The analysis of the group's Turnover for the year from continuing operations is as follows:

2024
£

2023
£

Sale of goods

7,151,826

14,577,394

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

4

Other operating income

The analysis of the group's other operating income for the year is as follows:

2024
£

2023
£

Rental income

190,781

76,295

Miscellaneous other operating income

842,807

519,056

1,033,588

595,351

5

Operating (loss)/profit

Arrived at after charging/(crediting)

2024
£

2023
£

Depreciation expense

548,057

331,038

Amortisation expense

46,225

-

Profit on disposal of property, plant and equipment

(70,106)

(29,307)

6

Other interest receivable and similar income

2024
£

2023
£

Interest income on bank deposits

334

542

Other finance income

20,028

11,873

20,362

12,415

7

Interest payable and similar expenses

2024
£

2023
£

Interest on bank overdrafts and borrowings

296,463

144,158

Interest on obligations under finance leases and hire purchase contracts

62,601

48,078

Interest expense on other finance liabilities

36,718

15,143

395,782

207,379

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

8

Staff costs

The aggregate payroll costs (including directors' remuneration) were as follows:

2024
£

2023
£

Wages and salaries

1,458,346

1,282,881

Social security costs

136,480

124,555

Pension costs, defined contribution scheme

26,863

22,112

Other employee expense

5,416

8,766

1,627,105

1,438,314

The average number of persons employed by the group (including directors) during the year, analysed by category was as follows:

2024
No.

2023
No.

Production

13

24

Administration and support

41

26

54

50

9

Directors' remuneration

The directors' remuneration for the year was as follows:

2024
£

2023
£

Remuneration

66,375

25,500

Contributions paid to money purchase schemes

439

-

66,814

25,500

10

Auditors' remuneration

2024
£

2023
£

Audit of these financial statements

10,000

7,650


 

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

11

Taxation

Tax charged/(credited) in the consolidated profit and loss account

2024
£

2023
£

Current taxation

UK corporation tax

67,509

730,512

UK corporation tax adjustment to prior periods

(396,483)

4,423

(328,974)

734,935

Deferred taxation

Arising from origination and reversal of timing differences

(104,054)

75,748

Tax (receipt)/expense in the income statement

(433,028)

810,683

The tax on profit before tax for the year is the same as the standard rate of corporation tax in the UK (2023 - the same as the standard rate of corporation tax in the UK) of 25% (2023 - 25%).

The differences are reconciled below:

2024
£

2023
£

(Loss)/profit before tax

(1,178,608)

3,167,086

Corporation tax at standard rate

(294,652)

791,772

Tax increase/(decrease) from effect of capital allowances and depreciation

89,540

(60,660)

Decrease from effect of different UK tax rates on some earnings

-

(17,843)

Effect of expense not deductible in determining taxable profit (tax loss)

13,824

7,612

Effect of tax losses

191,288

-

Deferred tax (credit)/expense from unrecognised tax loss or credit

(104,054)

75,748

Tax (decrease)/increase from effect of adjustment in research and development tax credit

(396,483)

14,054

Further item of tax increase

67,509

-

Total tax (credit)/charge

(433,028)

810,683

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

11

Taxation (continued)

Deferred tax

Group

Deferred tax assets and liabilities

2024

Asset
£

Liability
£

Capital allowances

-

118,182

Revaluation of investment property

-

1,916,768

-

2,034,950

2023

Asset
£

Liability
£

Capital allowances

-

224,859

Revaluation of investment property

-

1,916,768

-

2,141,627

The amount of the net reversal of deferred tax assets and deferred tax liabilities expected to occur during the year beginning after the reporting period is £169,408 (2023 - £75,748).

Company

Deferred tax assets and liabilities

2024

Asset
£

Liability
£

Capital allowances

-

118,182

Revalued investment property

-

1,916,768

-

2,034,950

2023

Asset
£

Liability
£

Capital allowances

-

224,859

Revalued investment property

-

1,916,768

-

2,141,627

The amount of the net reversal of deferred tax assets and deferred tax liabilities expected to occur during the year beginning after the reporting period is £101,440 (2023 - £75,748).

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

12

Intangible assets

Group

Goodwill
 £

Total
£

Cost or valuation

At 1 May 2023

290,000

290,000

Additions acquired separately

462,251

462,251

At 30 April 2024

752,251

752,251

Amortisation

At 1 May 2023

290,000

290,000

Amortisation charge

46,225

46,225

At 30 April 2024

336,225

336,225

Carrying amount

At 30 April 2024

416,026

416,026

Company

Goodwill
 £

Total
£

Cost or valuation

At 1 May 2023

290,000

290,000

At 30 April 2024

290,000

290,000

Amortisation

At 1 May 2023

290,000

290,000

At 30 April 2024

290,000

290,000

Carrying amount

At 30 April 2024

-

-

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

13

Tangible assets

Group

Land and buildings
£

Furniture, fittings and equipment
 £

Motor vehicles
 £

Total
£

Cost or valuation

At 1 May 2023

25,138,362

919,969

1,447,933

27,506,264

Additions

452,223

134,174

1,134,469

1,720,866

Disposals

(121,384)

(4,283)

(209,228)

(334,895)

At 30 April 2024

25,469,201

1,049,860

2,373,174

28,892,235

Depreciation

At 1 May 2023

-

458,081

900,888

1,358,969

Charge for the year

2,838

137,171

408,048

548,057

Eliminated on disposal

(850)

(1,071)

(159,889)

(161,810)

At 30 April 2024

1,988

594,181

1,149,047

1,745,216

Carrying amount

At 30 April 2024

25,467,213

455,679

1,224,127

27,147,019

At 30 April 2023

25,138,362

461,888

547,045

26,147,295

Included within the net book value of land and buildings above is £25,467,213 (2023 - £25,138,362) in respect of freehold land and buildings.
 

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

13

Tangible assets (continued)

Company

Land and buildings
£

Furniture, fittings and equipment
 £

Motor vehicles
 £

Total
£

Cost or valuation

At 1 May 2023

25,138,362

919,969

1,447,933

27,506,264

Additions

298,157

12,898

1,134,469

1,445,524

Disposals

-

-

(209,228)

(209,228)

At 30 April 2024

25,436,519

932,867

2,373,174

28,742,560

Depreciation

At 1 May 2023

-

458,081

900,888

1,358,969

Charge for the year

-

115,034

408,048

523,082

Eliminated on disposal

-

-

(159,889)

(159,889)

At 30 April 2024

-

573,115

1,149,047

1,722,162

Carrying amount

At 30 April 2024

25,436,519

359,752

1,224,127

27,020,398

At 30 April 2023

25,138,362

461,888

547,045

26,147,295

Included within the net book value of land and buildings above is £25,436,519 (2023 - £25,138,362) in respect of freehold land and buildings.
 

Revaluation

The fair value of the company's Land and buildings was revalued on 31 January 2023. An independent valuer was not involved.
The revaluation was applied to the financial statements for the year ended 30 April 2022 and the assets were revalued on different dates on a market value basis.
Had this class of asset been measured on a historical cost basis, the carrying amount would have been £13,372,996 (2023 - £13,074,839).
 

Restriction on title and pledged as security

Plant & machinery with a carrying amount of £43,057 (2023 - £57,409) has been pledged as security for hire purchase liabilities.

Motor vehicles with a carrying amount of £960,937 (2023 - £273,267) has been pledged as security for hire purchase liabilities.

14

Investments

Company

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

14

Investments (continued)

2024
£

2023
£

Investments in subsidiaries

1

-

Investments in associates

2,210,776

2,210,776

2,210,777

2,210,776

Subsidiaries

£

Cost or valuation

Additions

1

Provision

Carrying amount

At 30 April 2024

1

Associates

£

Cost

At 1 May 2023

2,210,776

Provision

Carrying amount

At 30 April 2024

2,210,776

At 30 April 2023

2,210,776

The company has valued its investments in associates at fair value by measuring the associate's assets and liabilities.

Under the equity method of accounting, an equity investment is initially recognised at the transaction price and is subsequently adjusted to reflect the investor’s share of the profit or loss and other comprehensive income of the associate. In this case there is no material difference to the fair value calculation included in these accounts.

Details of undertakings

Details of the investments (including principal place of business of unincorporated entities) in which the company holds 20% or more of the nominal value of any class of share capital are as follows:

Undertaking

Registered office

Holding

Proportion of voting rights and shares held

2024

2023

Subsidiary undertakings

E-Type Fabs Ltd

Unit 9B, Alliance Industrial Estate
Dodsworth Street
Darlington
Co.Durham
DL1 2PA

England

Ordinary shares

100%

0%

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

14

Investments (continued)

Undertaking

Registered office

Holding

Proportion of voting rights and shares held

Associates

DRVN Advanced Engineering Limited

13-13a Westwood Way
Westwood Business Park
Coverntry
CV4 8HS

Ordinary shares

25%

25%

England

Subsidiary undertakings

E-Type Fabs Ltd

The principal activity of E-Type Fabs Ltd is bespoke restoration and maintenance of motor vehicles. The loss for the financial period of E-Type Fabs Ltd was £1,816,408 and the aggregate amount of Capital and reserves at the end of the period was £(2,139,963).

Associates

DRVN Advanced Engineering Limited

The principal activity of DRVN Advanced Engineering Limited is engineering design activities. Its financial period end is 31 July. The loss for the financial period of DRVN Advanced Engineering Limited was £1,582,085 and the aggregate amount of Capital and reserves at the end of the period was £2,985,356.

15

Stocks

 

Group

Company

2024
£

2023
£

2024
£

2023
£

Work in progress

1,426,452

431,849

928,452

431,849

Other inventories

3,004,753

3,135,119

2,852,559

3,135,119

4,431,205

3,566,968

3,781,011

3,566,968

16

Debtors

   

Group

Company

Current

Note

2024
£

2023
£

2024
£

2023
£

Trade debtors

 

1,519,708

4,898,531

1,407,691

4,898,531

Amounts owed by related parties

24

4,671,121

2,333,641

4,655,693

2,333,641

Other debtors

 

2,118,199

1,510,164

2,118,199

1,510,164

Prepayments

 

119,841

114,799

102,993

114,799

   

8,428,869

8,857,135

8,284,576

8,857,135

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

17

Cash and cash equivalents

 

Group

Company

2024
£

2023
£

2024
£

2023
£

Cash at bank

13,898

39,172

11,926

39,172

Short-term deposits

352

8,593

352

8,593

14,250

47,765

12,278

47,765

Bank overdrafts

(1,912,969)

(1,785,093)

(1,912,969)

(1,785,093)

Cash and cash equivalents in statement of cash flows

(1,898,719)

(1,737,328)

(1,900,691)

(1,737,328)

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

18

Creditors

   

Group

Company

Note

2024
£

2023
£

2024
£

2023
£

Due within one year

 

Loans and borrowings

22

3,191,409

2,115,957

3,191,409

2,115,957

Trade creditors

 

1,784,667

1,552,904

426,353

1,552,904

Amounts due to related parties

24

4,141,963

2,501,838

3,092,997

2,501,838

Social security and other taxes

 

538,321

268,988

97,894

268,988

Outstanding defined contribution pension costs

 

18,329

3,917

(171)

3,917

Other payables

 

(184)

4,004

(184)

4,004

Accruals

 

1,061,644

3,527,043

1,033,143

3,527,043

Income tax liability

11

903,916

1,256,628

903,916

1,256,628

 

11,640,065

11,231,279

8,745,357

11,231,279

Due after one year

 

Loans and borrowings

22

5,327,116

3,070,676

5,206,717

3,070,676

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

19

Provisions for liabilities

Group

Deferred tax
£

Total
£

At 1 May 2023

2,136,390

2,136,390

Increase (decrease) in existing provisions

(101,440)

(101,440)

At 30 April 2024

2,034,950

2,034,950

Company

Deferred tax
£

Total
£

At 1 May 2023

2,136,390

2,136,390

Increase (decrease) in existing provisions

(101,440)

(101,440)

At 30 April 2024

2,034,950

2,034,950

20

Pension and other schemes

Defined contribution pension scheme

The group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the group to the scheme and amounted to £26,863 (2023 - £22,112).

Contributions totalling £18,329 (2023 - £3,917) were payable to the scheme at the end of the year and are included in creditors.

21

Share capital

Allotted, called up and fully paid shares

2024

2023

No.

£

No.

£

Ordinary shares of £1 each

200

200

200

200

       

Rights, preferences and restrictions

Ordinary shares have the following rights, preferences and restrictions:
There is a single class of ordinary shares. There are no restrictions on the distribution of dividends and the repayment of capital.

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

22

Loans and borrowings

Non-current loans and borrowings

 

Group

Company

2024
£

2023
£

2024
£

2023
£

Bank borrowings

2,185,220

2,211,250

2,064,821

2,211,250

Finance lease liabilities

467,456

859,426

467,456

859,426

Other borrowings

2,674,440

-

2,674,440

-

5,327,116

3,070,676

5,206,717

3,070,676

Current loans and borrowings

 

Group

Company

2024
£

2023
£

2024
£

2023
£

Bank borrowings

178,946

223,003

178,946

223,003

Bank overdrafts

1,912,969

1,785,093

1,912,969

1,785,093

Finance lease liabilities

1,099,494

107,861

1,099,494

107,861

3,191,409

2,115,957

3,191,409

2,115,957

Company

Bank borrowings

The company's bank holds fixed securities over some of the company's properties plus a floating charge over all the assets of the company.

The company has also given guarantee on contracts totalling £1.7m.

Included in the loans and borrowings are the following amounts due after more than five years:

2024
£

2023
£

After more than five years by instalments

1,134,293

1,313,239

-

-

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

23

Contingent assets

Company

In October 2022 the property at Royal Burgh House, Rutherglen was burnt down. The Company's Insurers have accepted policy liability and have confirmed that the building is insured to be repaired to its pre-fire conditions. It is not yet practical to state the financial effect.

24

Related party transactions

Group

Key management compensation

2024
£

2023
£

Salaries and other short term employee benefits

66,375

25,500

Company

Key management compensation

2024
£

2023
£

Salaries and other short term employee benefits

46,375

25,500

Transactions with directors

2024

At 1 May 2023
£

Advances to director
£

Other payments made to company by director
£

At 30 April 2024
£

Mr J McDermott

Director's loan account

179,865

90,000

11,469

281,334

Mr W McDermott

Director's loan account

111,371

90,000

8,558

209,929

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

24

Related party transactions (continued)

2023

At 1 May 2022
£

Advances to director
£

At 30 April 2023
£

Mr J McDermott

Director's loan account

-

179,865

179,865

Mr W McDermott

Director's loan account

-

111,371

111,371

Interest is charged on these loans at a rate of 4.5% per annum. There are no fixed repayment terms.

Summary of transactions with other related parties

During the year to 30 April 2024 the following balances were due to/(from) the company to organisations with mutual directors or shareholders.

There are no fixed repayment terms, no guarantees or terms and conditions and they are not secured.

 

The company is exempt from disclosing related party transactions with its subsidiary company as it is wholly owned.

Company

Sales

Purchases

Due to/(from)

£

£

£

Chameleon Digitization Ltd

94,471

-

1,452,971

Chameleon Vision Ltd

-

-

(10,207)

McDermott Group Ltd

-

-

(55,511)

Momentum 4 Ltd

22,904

56,797

99,393

MDG Chameleon Ltd

-

120,273

(397,172)

MDG Capital Ltd

-

-

(68,324)

MDG Capital 1 Ltd

-

-

126,808

MDG Capital 2 Ltd

-

-

(19,487)

MDG Capital 3 Ltd

-

-

118,189

DRVN Automotive Ltd

-

-

3,913,804

DMD London Ltd

63,570

-

(1,403,832)

Devine Energy Ltd

41,730

576,890

6,591

The Recruitment Bunker Ltd

24,483

-

255,288

247,158

753,960

4,018,511

 

Easy Heat Systems Limited

Notes to the Financial Statements for the Year Ended 30 April 2024

25

Parent and ultimate parent undertaking

The company is owned by its directors who own 100% of its share capital.

.