Company registration number 03122581 (England and Wales)
NCO EUROPE LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
NCO EUROPE LIMITED
COMPANY INFORMATION
Directors
Mrs S B Bilsborough
Mr N J Ford
Company number
03122581
Registered office
New City House
57-63 Ringway
Preston
PR1 1AF
Auditor
MHA
Richard House
9 Winckley Square
Preston
PR1 3HP
NCO EUROPE LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 5
Directors' responsibilities statement
6
Independent auditor's report
7 - 9
Statement of comprehensive income
10
Balance sheet
11
Statement of changes in equity
12
Notes to the financial statements
13 - 25
NCO EUROPE LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 1 -

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

Business review

NCO Europe Limited (“the Company”) is a wholly owned subsidiary of NCO Holdings Limited. The company is the only trading company in the group.

 

The principal activity of the Company continued to be that of a multi-lingual Business Process Outsourcer (“BPO”) delivering customer contact solutions across a range of sectors. The company is authorised and regulated by the Financial Conduct Authority.

 

2023 saw the last revenues generated from the subcontracting contracts from the COVID-19 Pandemic. NCO are proud of its social contributions made in delivery of these contracts.

 

Despite the fall in revenues, with the COVID-19 pandemic work excluded, NCO have maintained its’ client base and the underlying revenues of the business grew in 2024.

 

The company continues to have a profitable business which delivered an overall operating profit before tax of £511,000 (2023 - £1,386,000).

 

The company would like to extend its thanks to all its’ employees, customers, clients’ suppliers, and the wider NCO community, who have continued to be invaluable in delivering a successful 2024 for NCO Europe Limited.

 

The company’s financial performance during the year ended 31 December 2024 was as follows:

 

 

 

2024

2023

 

 

 

£’000

£’000

 

 

Revenue

 

16,068

17,285

 

 

 

Operating Profit

510

-1386

 

 

 

511

-1386

 

1,386

 

Risks and uncertainties

The management of the business and the execution of the Company’s strategies are subject to a number of risks and uncertainties and the Company regularly reviews and implements procedures to mitigate these risks. The key business risks and uncertainties affecting the Company are set out below:

 

Competition

Whilst the Company operates in competitive markets, it has a strong history of meeting and exceeding client expectations, which has proven to deliver long standing client relationships, market share growth and the addition of new revenue streams.

NCO EUROPE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 2 -

Economic

Changes in economic conditions can create both risk and opportunity for the Company as clients change their outsourcing strategies.

 

On a monthly basis, the Company closely monitors profitability by ensuring that productivity targets and service levels are met, assessing staffing requirements and regularly reviewing direct and indirect costs, whilst investing in new business to diversify the customer base and technology to drive operational efficiency.

 

Regulation

The Company is authorised and regulated by the Financial Conduct Authority (FCA).

 

The Company continues to invest in supporting the internal Compliance and Risk Team and ensure adherence to regulatory requirements. The Board review compliance matters at each of their Board meetings, specifically the number and nature of complaints received as this is a key indicator of regulatory compliance as well as being an FCA requirement.

Key performance indicators

The Company has achieved its’ objectives for profitability and regulatory compliance in 2024.

 

KPIs are reviewed by the Executive Team via monthly Board meetings. The KPIs reviewed are revenue, earnings before interest, taxes, depreciation, amortisation (“EBITDA”) and regulatory consideration including customer complaints. Each of these KPIs are monitored at both Company and Client level. Further details are shown below.

 

 

 

2024

2023

 

 

 

 

 

Growth/ (Reduction) in sales

(7)%

5%

Year on year sales growth expressed as a percentage. Movement is consistent with the explanations provided in the Business review.

 

 

 

 

EBITDA

3%

5%

Operating profit with depreciation, amortisation and corporation tax charges added back, expressed as a percentage of revenue. Movement is consistent with the explanations provided in the Business review.

 

Future outlook

NCO Europe will continue to build on strong and successful relationships with its’ existing clients whilst exploring and securing new key partnerships.

 

We have also entered into an exciting transformation stage where NCO Europe are progressing with comprehensive and advanced technologies across the entire business to optimise operational efficiencies and service offerings to new and existing clients.

 

The economic pressures imposed by governmental policy are creating a challenging environment for companies to operate in. Unprecedented increases in Employers’ contribution to National Insurance and National Living Wage create barriers to anticipated growth.

 

Despite these challenges, NCO Europe are committed and confident that we have the strategy in place to ensure we continue to be profitable and deliver growth in revenues organically through our existing partnerships and new opportunities.

NCO EUROPE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 3 -

On behalf of the board

Mrs S B Bilsborough
Director
9 July 2025
NCO EUROPE LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 4 -

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

Principal activities

The principal activity of the company continued to be that of multi-lingual Business Process Outsourcing, conducting activities within a range of sectors.

Results and dividends

The results for the year are set out on page 10.

Directors

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

Mrs S B Bilsborough
Mr N J Ford
Disabled persons

The company gives full consideration to applications for employment from disabled persons where the candidate’s particular aptitudes and abilities are consistent with adequately meeting the requirements of the job. Opportunities are available to disabled employees for training, career development and promotion. Where existing employees become disabled, it is the company’s policy to provide continuing employment wherever practicable in the same or an alternative position and to provide appropriate training to achieve this aim.

Employee involvement

The company operates a framework for employee information and consultation which complies with the requirements of the Information and Consultation of Employees Regulations 2004. During the year, the policy of providing employees with information about the company and the financial and economic factors affecting company performance, has been continued through the distribution of company memorandums. Regular meetings are held between management and employees to allow a free flow of information and ideas. Employees participate directly in the success of the business through the company’s incentives and bonus schemes.

Auditor

The auditor, MHA, previously traded through the legal entity MacIntyre Hudson LLP. In response to regulatory changes, MacIntyre Hudson LLP ceased to hold an audit registration with the engagement transitioning to MHA Audit Services LLP.

 

MHA will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

Strategic report

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of financial risk management objectives and policies, principal risks and uncertainties and future developments.

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.

NCO EUROPE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 5 -
Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
Mrs S B Bilsborough
Mr N J Ford
Director
Director
9 July 2025
NCO EUROPE LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 6 -

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.

NCO EUROPE LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF NCO EUROPE LIMITED
- 7 -
Opinion

We have audited the financial statements of NCO Europe 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 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 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 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.

NCO EUROPE LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF NCO EUROPE LIMITED (CONTINUED)
- 8 -

Opinions on other matters prescribed by the Companies Act 2006

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

 

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.

Matters on which we are required to report by exception

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 responsibilities for the audit of the financial statements

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

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

NCO EUROPE LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF NCO EUROPE LIMITED (CONTINUED)
- 9 -

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

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

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Karen Hain BA FCA
Senior Statutory Auditor
For and on behalf of MHA, Statutory Auditor
Preston, United Kingdom
9 July 2025
MHA is the trading name of MHA Audit Services LLP, a limited liability partnership in England and Wales (registered number OC455542)
NCO EUROPE LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
- 10 -
2024
2023
Notes
£000
£000
Turnover
3
16,068
17,285
Cost of sales
(11,115)
(11,413)
Gross profit
4,953
5,872
Administrative expenses
(3,935)
(3,927)
Earnings before interest, tax, depreciation and amortisation
1,018
1,945
Depreciation and amortisation
(508)
(559)
Operating profit
4
510
1,386
Interest receivable and similar income
7
12
9
Interest payable and similar expenses
8
4
(17)
Profit before taxation
526
1,378
Tax on profit
9
(128)
(331)
Profit for the financial year
398
1,047

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

NCO EUROPE LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2024
31 December 2024
- 11 -
2024
2023
Notes
£000
£000
£000
£000
Fixed assets
Intangible assets
11
174
362
Tangible assets
12
444
686
618
1,048
Current assets
Debtors falling due after more than one year
13
95
32
Debtors falling due within one year
13
4,867
4,442
Cash at bank and in hand
674
805
5,636
5,279
Creditors: amounts falling due within one year
14
(1,453)
(1,540)
Net current assets
4,183
3,739
Total assets less current liabilities
4,801
4,787
Provisions for liabilities
Provisions
15
82
4
(82)
(4)
Net assets
4,719
4,783
Capital and reserves
Called up share capital
18
-
0
-
0
Share premium account
1,050
1,050
Profit and loss reserves
3,669
3,733
Total equity
4,719
4,783

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved by the board of directors and authorised for issue on 9 July 2025 and are signed on its behalf by:
Mrs S B Bilsborough
Mr N J Ford
Director
Director
Company registration number 03122581 (England and Wales)
NCO EUROPE LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
- 12 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£000
£000
£000
£000
Balance at 1 January 2023
-
0
1,050
3,098
4,148
Year ended 31 December 2023:
Profit and total comprehensive income
-
-
1,047
1,047
Dividends
10
-
-
(412)
(412)
Balance at 31 December 2023
-
0
1,050
3,733
4,783
Year ended 31 December 2024:
Profit and total comprehensive income
-
-
398
398
Dividends
10
-
-
(462)
(462)
Balance at 31 December 2024
-
0
1,050
3,669
4,719
NCO EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 13 -
1
Accounting policies
Company information

NCO Europe Limited is a private company limited by shares incorporated in England and Wales. The registered office is New City House, 57-63 Ringway, Preston, PR1 1AF.

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 £000.

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

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

 

- Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

- Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’: Interest income/expense and net gains/losses for each category of financial instrument;

- Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

1.2
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for a period of twelve months following approval of the accounts. The company was profitable in 2024 and continues to forecast profitability throughout 2025 onwards. The company actively manage its cashflows and has obtained facilities with the bank to allow for any immediate cash requirements for the business. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.true

1.3
Turnover

Revenue, which is stated net of VAT, represents amounts derived from the provision of services which fall within the company's ordinary activities.

 

Revenue from financial care relates to commission earned from the recovery of debt owed by external parties and is recognised upon receipt of funds by the company or its client.

 

Revenue from customer contact outsourcing contracts relates to revenue earned from the provision of business process outsourcing services to clients. The fees for customer contact outsourcing contracts are recognised as services are performed and earned under service arrangements with clients, where fees are fixed or determinable and collectability is reasonably assured.

1.4
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses, if any.

NCO EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 14 -

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

Software
3-5 years

Software development costs that are directly attributable to the design and testing of identifiable and unique software products controlled by the company are recognised as intangible assets when the following criteria are met:

 

- it is technically feasible to complete the software so that it will be available for use;

- management intends to complete the software and use or sell it;

- there is an ability to use or sell the software;

- it can be demonstrated how the software will generate probable future economic benefits;

- adequate technical, financial and other resources to complete the development and to use or sell the software are available; and

- the expenditure attributable to the software during its development can be reliably measured.

 

Other development expenditures that do not meet these criteria are recognised as an expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period.

 

Costs associated with maintaining computer software are also recognised as an expense as incurred.

 

Where factors, such as technological advancement or changes in market price, indicate that residual value or useful life have changed, the residual value, useful life or amortisation rate are amended prospectively to reflect the new circumstances. The assets are reviewed for impairment if the above factors indicate that the carrying amount may be impaired.

1.5
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:

Leasehold improvements
Over the remaining life of the lease
Fixtures and fittings
7 Years
Computers
5 Years
Motor vehicles
5 Years

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.

The assets' residual values and useful lives are reviewed, and adjusted, if appropriate, at the end of each reporting period. The effect of any change is accounted for prospectively.

NCO EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 15 -
1.6
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible 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.

1.7
Cash and cash equivalents

Cash at bank and in hand are basic financial assets and include cash in hand and deposits held at call with banks. Excluded within cash and cash equivalents are amounts held on behalf of clients.

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.

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

The company does not have any non-basic financial instruments.

NCO EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 16 -
Impairment of financial assets

Financial assets 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 and bank loans, 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

The company does not have any non-basic financial instruments.

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.

NCO EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 17 -
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
Provisions

Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

1.12
Employee benefits

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

1.13
Retirement benefits

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

1.14
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.

NCO EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 18 -
1.15
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.

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.

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Useful economic lives of fixed assets

The annual depreciation and amortisation charges for tangible and intangible fixed assets are sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary to reflect current estimates, based on technological advancement, future investments, economic utilisation and the physical condition of the assets.

Recoverability of the deferred tax asset

Deferred tax assets are recognised only to the extent that the directors consider there to be suitable taxable profits in the foreseeable future from which the underlying timing differences can be deducted. Future taxable profit projections are prepared and re-assessed annually. They are amended when necessary to reflect profit trends and changes to the company's client base.

 

3
Turnover and other revenue
2024
2023
£000
£000
Turnover analysed by geographical market
United Kingdom and Europe
16,068
17,285
2024
2023
£000
£000
Other revenue
Interest income
12
9
NCO EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
3
Turnover and other revenue
(Continued)
- 19 -

No analysis of turnover by class has been presented as the directors feel this would be prejudicial to the interests of the company.

4
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£000
£000
Exchange losses
35
8
Fees payable to the company's auditor for the audit of the company's financial statements
16
15
Depreciation of owned tangible fixed assets
294
343
Loss/(profit) on disposal of tangible fixed assets
7
(2)
Amortisation of intangible assets
207
218
Operating lease charges
121
221
5
Employees

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

2024
2023
Number
Number
Administrative staff and management
75
75
Operations staff
413
415
Total
488
490

Their aggregate remuneration comprised:

2024
2023
£000
£000
Wages and salaries
10,980
10,103
Social security costs
917
769
Pension costs
207
170
12,104
11,042
NCO EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 20 -
6
Directors' remuneration
2024
2023
£000
£000
Remuneration for qualifying services
44
48
Company pension contributions to defined contribution schemes
10
8
54
56

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2023 - 1).

7
Interest receivable and similar income
2024
2023
£000
£000
Interest income
Interest on bank deposits
12
5
Other interest income
-
0
4
Total income
12
9
8
Interest payable and similar expenses
2024
2023
£000
£000
Interest on finance leases and hire purchase contracts
(4)
17
9
Taxation
2024
2023
£000
£000
Current tax
UK corporation tax on profits for the current period
191
296
Tax relating to prior year adjustments recognised in profit or loss
(5)
-
0
Total current tax
186
296
Deferred tax
Origination and reversal of timing differences
(58)
33
Changes in tax rates
-
0
2
Total deferred tax
(58)
35
Total tax charge
128
331
NCO EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
9
Taxation
(Continued)
- 21 -

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
£000
£000
Profit before taxation
526
1,378
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 23.52%)
132
324
Tax effect of expenses that are not deductible in determining taxable profit
(4)
5
Change in CT rates
-
0
2
Taxation charge for the year
128
331
10
Dividends
2024
2023
£000
£000
Final paid
462
412
11
Intangible fixed assets
Software
£000
Cost
At 1 January 2024
1,015
Additions
19
At 31 December 2024
1,034
Amortisation and impairment
At 1 January 2024
653
Amortisation charged for the year
207
At 31 December 2024
860
Carrying amount
At 31 December 2024
174
At 31 December 2023
362
NCO EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 22 -
12
Tangible fixed assets
Leasehold improvements
Fixtures and fittings
Computers
Motor vehicles
Total
£000
£000
£000
£000
£000
Cost
At 1 January 2024
584
290
1,379
181
2,434
Additions
-
0
1
64
-
0
65
Disposals
-
0
(9)
(59)
-
0
(68)
At 31 December 2024
584
282
1,384
181
2,431
Depreciation and impairment
At 1 January 2024
507
271
949
21
1,748
Depreciation charged in the year
28
6
224
36
294
Eliminated in respect of disposals
-
0
(9)
(46)
-
0
(55)
At 31 December 2024
535
268
1,127
57
1,987
Carrying amount
At 31 December 2024
49
14
257
124
444
At 31 December 2023
77
19
430
160
686
13
Debtors
2024
2023
Amounts falling due within one year:
£000
£000
Trade debtors
2,426
2,428
Amounts owed by group undertakings
632
427
Other debtors
131
156
Prepayments and accrued income
1,678
1,431
4,867
4,442
2024
2023
Amounts falling due after more than one year:
£000
£000
Deferred tax asset (note 16)
95
32
Total debtors
4,962
4,474

Other debtors includes an invoice discounting facility of £54,000 (2023: £4,000) and is secured by a fixed and floating charge over all assets of the company.

NCO EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 23 -
14
Creditors: amounts falling due within one year
2024
2023
£000
£000
Trade creditors
349
403
Corporation tax
74
296
Other taxation and social security
368
182
Other creditors
41
34
Accruals and deferred income
621
625
1,453
1,540

The finance lease and hire purchase creditor is secured by the underlying assets to which it relates.

15
Provisions for liabilities
2024
2023
£000
£000
Dilapidation provision
23
4
Legal provision
59
-
82
4
Movements on provisions:
Dilapidation provision
Legal provision
Total
£000
£000
£000
At 1 January 2024
5
-
5
Additional provisions in the year
18
59
77
At 31 December 2024
23
59
82

The provision for dilapidations represents the anticipated contractual dilapidation charges payable upon vacation of the property leases.

NCO EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 24 -
16
Deferred taxation

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

Assets
Assets
2024
2023
Balances:
£000
£000
Decelerated capital allowances
89
24
Other short-term timing differences
6
8
95
32
2024
Movements in the year:
£000
Asset at 1 January 2024
(32)
Credit to profit or loss
(63)
Asset at 31 December 2024
(95)

As at the signing date of these financial statements, the company has not finalised its capital expenditure programme for the coming year and so an assessment as to the likely movement of timing differences cannot be made.

17
Retirement benefit schemes
2024
2023
Defined contribution schemes
£000
£000
Charge to profit or loss in respect of defined contribution schemes
207
170

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. The unpaid contributions outstanding at the year end, included in creditors are £41,000 (2023: £34,000). The employees are members of NCO Europe Limited group personal pension plan.

18
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
153
153
153
153
NCO EUROPE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 25 -
19
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
£000
£000
Within one year
120
120
Between two and five years
60
180
180
300
20
Related party transactions

The company has taken advantage of the exemption conferred by Section 33 FRS102, namely from disclosing any transactions entered into between two or more members of the group, provided that any subsidiary which is a party to the transaction is wholly owned by such a member.

21
Ultimate controlling party

The immediate parent company is NCO Holdings Limited, a company incorporated in England and Wales. NCO Europe Limited is a wholly owned subsidiary of NCO Holdings Limited, and the results of NCO Holdings Limited are included in the consolidated financial statements of NCO Holdings Limited which have been filed with the registrar in accordance with Companies Act 2006.

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