|
Company Registration Number
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
COMPANY INFORMATION
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
CONTENTS
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 MAY 2024
The directors present their strategic report for the year ended 31 May 2024.
The principal activities of the group continued to be that of a civil engineering, construction and joinery throughout the period.
The financial year ended 31 May 2024 has been particularly challenging, resulting in significant losses. The key factors contributing to these financial results are outlined below.
The financial year ended 31 May 2024 was challenging for the Group due to unforeseen complexities in a small number of contracts and wider macroeconomic pressures affecting the UK construction sector. Revenue for the year was £22.9m (2023: £24m) with a gross profit of £2.1m (2023: £3.6m), reflecting a decline in gross margin to 9% (2023: 15%). Two major contracts experienced unexpected delivery challenges which impacted profitability; however, lessons learned from these projects have already been applied to strengthen bidding, contract management, and risk control processes. The company experienced significant challenges with one significant contract, the Carlisle Southern Link Road (CSLR). Following a successful mediation with the Principle Contractor, and the Client, all parties mutually agreed to terminate the contract. While the cost to the company was significant along with the loss of secured work, it prevented further losses on a project that faces significant cost and time issues. Despite these challenges, the Group remains resilient. After the balance sheet date, a substantial £12 million investment was secured to strengthen working capital and support future growth. This strategic investment is complemented by the integration of additional businesses in Rail Civil Engineering, Renewable Energy and Utilities, bringing profitable contracts and broadening the Group’s capabilities.
Page 1
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
The directors consider the principal risks and uncertainties faced by the group to be those in relation to contracting, the economic environment, cash flow, and credit risk.
Contracting Given that contracting involves forecasting future costs to agree a price for works that is often fixed to an extent, there is inherently a risk involved, in that the profitability of those contracts cannot be known at the point at which the contract is entered into. Lessons have been learned on the CLSR contract and are now being applied to contract negotiations and bidding processes to prevent the recurrence of similar issues. This risk is also managed by ensuring that the estimating and commercial departments are well-resourced and expertly trained through the ongoing monitoring of contract performance, agreeing escalator clauses in contracts where possible, and ensuring that margins on contracts are robust. Economic environment Continued macroeconomic volatility could impact demand for construction projects and the cost of labour and materials. The directors monitor the economic environment and particularly input prices and the market for contracts closely, so that they can respond appropriately to changes in the environment. Increasing requirements for sustainable construction methods and materials could impact costs but also present new business opportunities. Regulation Compliance with evolving health, safety, and environmental regulations remains a key focus and the SHEQ continues to underpin all areas of the business. Cash flow Contracting requires significant investments in working capital and is to an extent seasonal with lower activity levels at certain times of year. This presents a cash flow risk. The directors manage the cash flow risk through ongoing cash flow forecasting, monitoring the adequacy of facilities against anticipated requirements, seeking to reduce working capital requirements where possible via utilising stock and closely managing debtors, and controlling costs. Credit The group is exposed to credit losses from its customers. The directors manage this risk by applying strict credit checks, ensuring that stage payments are included in contrac. Post balance sheet events On 21 February 2025, Cubby Construction Limited acquired the trade and assets of Colin Briscoe Construction Limited: Established in 1993 in Carnforth, this high-quality Civil Engineering and Building Contractor has a strong reputation for working with blue-chip companies. On 1 July 2025, the entire share capital of Cubby Construction Limited was sold to a new company Svella Bidco 1 Limited. On the same date the group secured £12million investment. The investment will be utilised to strengthen the company’s working capital position, support key strategic initiatives and drive growth. This growth strategy also promises future investment for acquisitions, asset purchases, and most importantly, investment in people.
Page 2
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
Outlook With the support of new investment and experience, the Group is well-positioned to grow sustainably and profitably. The enlarged Group now operates across the Northwest, Northeast, Midlands, and Southern Scotland with six core divisions: Construction, Civil Engineering, Rail, Utilities, Plant, and Joinery. Management remains focused on: • Securing the right projects that deliver sustainable margins • Building strong relationships with clients and supply chain partners • Investing in our people and systems to enhance quality and efficiency • Diversifying revenue streams to reduce risk The Board is confident that the lessons learned, new investment, and strengthened operations provide a solid platform for future growth, benefiting employees, clients, and stakeholders alike. The Board wishes to thank our dedicated employees, loyal clients, and stakeholders for their support throughout this period of transition.
This report was approved by the board and signed on its behalf.
Page 3
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MAY 2024
The directors present their report and the financial statements for the year ended 31 May 2024.
The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.
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 the Group and to 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The loss for the year, after taxation, amounted to £1,326,737 (2023 - profit £357,652).
The directors who served during the year were:
The following information, which would otherwise be disclosed in the directors' report is instead disclosed in the strategic report, as permitted by section 414c(11) of the Companies Act 2006:
- post balance sheet events, and; - future developments.
Page 4
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
The auditors, Armstrong Watson Audit Limited, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
Page 5
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CUBBY CONSTRUCTION LIMITED
We have audited the financial statements of Cubby Construction Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 May 2024, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Balance Sheet, the Company Balance Sheet, the Consolidated Statement of Cash Flows, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and the related notes, 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).
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 Auditors' 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 United Kingdom, including the Financial Reporting Council'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.
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's or the parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Page 6
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CUBBY CONSTRUCTION LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' 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.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Group Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Directors' Report.
Page 7
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CUBBY CONSTRUCTION LIMITED (CONTINUED)
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 Auditors' 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 Group financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows: • the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations; • we identified the laws and regulations applicable to the company through discussions with directors and other management; • we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management; and • identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit. We assessed the susceptibility of the Group's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by: • making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and • considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. To address the risk of fraud through management bias and override of controls, we: • performed analytical procedures as a risk assessment tool to identify any unusual or unexpected relationships; • tested journal entries to identify unusual transactions; and • reviewed the application of accounting policies. In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to: • agreeing financial statement disclosures to underlying supporting documentation; and • enquiring of management as to actual and potential litigation and claims.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' Report.
Page 8
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CUBBY CONSTRUCTION LIMITED (CONTINUED)
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 Auditors' 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.
for and on behalf of
Chartered Accountants & Statutory Auditors
Carlisle
Page 9
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MAY 2024
Page 10
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
REGISTERED NUMBER: 02641120
CONSOLIDATED BALANCE SHEET
AS AT 31 MAY 2024
Page 11
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
REGISTERED NUMBER: 02641120
CONSOLIDATED BALANCE SHEET (CONTINUED)
AS AT 31 MAY 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 21 to 42 form part of these financial statements.
Page 12
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
REGISTERED NUMBER: 02641120
COMPANY BALANCE SHEET
AS AT 31 MAY 2024
Page 13
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
REGISTERED NUMBER: 02641120
COMPANY BALANCE SHEET (CONTINUED)
AS AT 31 MAY 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 21 to 42 form part of these financial statements.
Page 14
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2024
Page 15
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2023
Page 16
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2024
Page 17
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2023
Page 18
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MAY 2024
Page 19
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 MAY 2024
Page 20
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
Cubby Construction Limited is a private company, limited by shares, registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.
The principal activity of the company and group is that of a construction contractor.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.
Page 21
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
2.Accounting policies (continued)
The group has made a loss of £1,326,737 for the financial year and at the year-end had net current
liabilities of £2,102,799 due to challenging trading conditions, details of which have been included in the group’s strategic report. Despite these challenges, the directors have assessed the company’s ability to continue as a going concern and have considered the following factors: • Post balance sheet investment: The group has secured a significant investment of £12million from investors, strengthening its liquidity position. • New contract wins: the company has secured new contracts and been awarded frameworks post year-end, which are expected to contribute positively to revenue and profitability. • Acquisitions: recent acquisitions alongside the transfer of subsidiaries as part of the new group structure following the sale of the business is anticipated to bring opportunities in new geographies as well as capabilities in specialist sectors that typically attract higher margins. • Debt and cash flow: the company has sufficient resources to meet its obligations as they fall due. The current banking partner has indicated its willingness to continue to lend to the group and the new investment provides funding to support working capital and for future growth. The directors acknowledge that there are inherent risks, including macroeconomic uncertainty and ongoing market volatility. However, based on the mitigating actions taken, financial support secured, and projection, they are confident that the company has adequate resources to continue in operational existence for the foreseeable future. Accordingly, the financial statements have been prepared on a going concern basis. Revenue from long-term contracts is recognised according to the stage of completion of that contract, with reference to the proportion of work done (output method). Profit is recognised on only where the outcome of the contract can be measured reliably. Amounts receivable on contracts, included in debtors, is stated at the valuation of work performed, including profit where applicable, to the extent that it is probable that these amounts will be recovered, less any stage payments received. Where contracts are anticipated to be loss making, the expected loss is recognised in full as soon as that loss is foreseen. Revenue from the provision of services, where these do not constitute long-term contractual arrangements, are recognised in accordance with the stage of completion of those services. Revenue from the provision of goods is recognised on dispatch.
Page 22
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
2.Accounting policies (continued)
Page 23
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
2.Accounting policies (continued)
Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses.
Goodwill is amortised on a straight line basis to the Consolidated Statement of Comprehensive Income over its useful economic life. The useful economic life of goodwill was determined to be one year in a previous period, and as such this value has now been fully amortised.
Page 24
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
2.Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, as detailed below.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Fair values are determined from market based evidence normally undertaken by professionally qualified valuers.
Page 25
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
2.Accounting policies (continued)
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
The Group has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
Basic financial assets
Basic financial assets, which include trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.
Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.
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 Group after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other creditors, bank loans, other loans and loans
Page 26
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
2.Accounting policies (continued)
due to fellow group companies are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade creditors are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
Page 27
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
Provision for bad or doubtful debts Management provide for bad or doubtful debts when there is evidence that the asset will not be recoverable. Debts are reviewed individually, with no standard policy being applied, owing to the relatively low level of bad debts historically. Estimates Land and building revaluation (including investment property) Property valuations have been undertaken by external valuers, with reference to the sale prices of similar properties in the locality of the properties being valued. The price a property would attract is inherently unknowable unless that property is sold, and therefore there is a degree of estimation involved, particularly as a result of changes in the market since the reference property sales, and differences between the comparator properties and those being valued. Contracts Revenue is recognised in line with the estimated stage of completion of the contract. The stage of completion is calculated with reference to progress on the specified works within the contract (also known as the Output Method). Where available, internal and external valuations and certifications by Quantity Surveyors are used to determine the stage of completion. Where these are not available or are not coterminous with the reporting date, management estimate the stage of completion using knowledge of the contract considering, amongst other factors, the days on which work was performed, time elapsed between valuations, key milestones within contracts, and the anticipated final margin on the contract. The stage of completion of contracts is inherently uncertain and requires estimation. Where contracts are anticipated to be loss-making after the reporting date, the loss is recognised in full as a provision. Determining whether a contract will be loss-making involves estimating future costs, which is inherently uncertain. Stock provision Stock is held at the lower of cost and net realisable value. Where the net realisable value is considered to be lower than the cost, a provision is made against the cost of the stock. The amount of this provision is assessed with reference to factors such as the volume of usage of the stock line and estimated scrap or direct sales value. Calculating this provision involves predicting future events, and as a result there is inherent uncertainty in this estimate.
The whole of the turnover is attributable to the principal activity of the group, which is that of a construction contractor. All turnover arose in the United Kingdom.
Page 28
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
Page 29
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
Page 30
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
Page 31
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
12.Taxation (continued)
There were no factors that may affect future tax charges.
Page 32
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
14.Tangible fixed assets (continued)
Page 33
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
14.Tangible fixed assets (continued)
Page 34
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
Page 35
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
The investment property was disposed of early in the financial year at its market value. 2024 valuations were made by Walton Goodland Chartered Surveyors in 2022, on an open market value for existing use basis.
Page 36
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
Page 37
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
Page 38
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
Page 39
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
Page 40
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
Revaluation reserve
Profit and loss account
During the preparation of the financial statements for the year ended 31 May 2024, the company identified an error in the calculation of deferred tax in the prior year’s financial statements. The deferred tax liability was misstated due to incorrect recognition of temporary differences relating to property, plant, and equipment, as well as losses carried forward.
To correct this misstatement, a prior year adjustment has been made, and the impact of this adjustment is as follows: The deferred tax liability as at 31 May 2023 was understated by £770,010, and has now been restated accordingly. Retained earnings as at 1 June 2023 have been reduced by £770,010 to reflect the correction of this error and the comparative figures in the statement of financial position and statement of comprehensive income have been restated to reflect the correct deferred tax position. This adjustment has no impact on the company’s cash flow position but has resulted in a decline to net assets and retained earnings in the prior year. The directors have reviewed the company’s accounting policies and internal controls to prevent similar misstatements in the future.
The group contributes to defined contribution pension schemes. The assets of the schemes are held separately from those of the company in funds administered by Trustees. The Schemes provide money purchase benefits for certain employees based on the accumulated contribution paid on behalf of each member. The group had outstanding contributions under pension schemes at 31st May 2024 of £
Page 41
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CUBBY CONSTRUCTION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
On 1 July 2025, the entire share capital of Cubby Construction Limited was sold to a new company Svella Bidco 1 Limited, an intermediary holding company. The new ultimate parent, by viture of its 75% holding in Svella Bidco 1 Limited, is Svella Plc. On 1 July 2025 the group secured £12million investment available for draw down as the group requires to support working capital and growth.
For the year ended 31 May 2024, the company was controlled by the Directors, who together owned 100% of the issued share capital.
Page 42
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||