Company registration number 02999887 (England and Wales)
J.H. LAVENDER & COMPANY LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
J.H. LAVENDER & COMPANY LIMITED
COMPANY INFORMATION
Directors
Mr A Taylor
Mr I M Timings
Dr A J Rose
Mr J M Warner
Secretary
Mr A Taylor
Company number
02999887
Registered office
Hall Green Works
Crankhall Lane
West Bromwich
West Midlands
B71 3JZ
Auditor
CK Audit
No 4 Castle Court 2
Castlegate Way
Dudley
West Midlands
DY1 4RH
Business address
Hall Green Works
Crankhall Lane
West Bromwich
West Midlands
B71 3JZ
J.H. LAVENDER & COMPANY LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Directors' responsibilities statement
5
Independent auditor's report
6 - 8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 24
J.H. LAVENDER & COMPANY LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2025
- 1 -
The directors present the strategic report for the year ended 31 March 2025.
Review of the business
Following a profit of £432,528 in 2024, the Directors are extremely pleased to report a profit of £451,965 for the year ending 31st March 2025. To achieve 2 consecutive years of profitability, after the recent and on-going trials and tribulations in the manufacturing sector and in the economy as a whole, supports the Directors view that the foundations of business are now stronger than ever!
Die-casting remains a very competitive industry with continued cost pressures being encountered throughout the financial year. Most notably, from 1st April 2024, a further National Living Wage increase of 9.8% was imposed by the Government, which had a major influence on employee pay expectations at all levels within the business. On the basis that our customers supported us with unit price increases in the previous year commencing 1st April 2023, to cover increases in energy, and labour and consumables due to high inflation, the Directors took the stance that the business would attempt to absorb any increases in operating costs this year through further improvements in production efficiencies. This has been partially achieved and was made possible by maintaining a stable and well-trained work force, along with more consistent production output and lower scrap rates. This scenario was assisted with reduced fluctuations in customer demand, smoothing production and planning issues.
We were able to secure unit price increases as from 1st April 2023, and a major proportion of this related to a separate energy surcharge agreement. As part of the negotiations with our customers, the agreement was that as we greatly appreciated their support when the prices were increasing, when the time came to renew contracts, any reductions would be duly passed on. The business was able to do this during the year and offer our customers reductions in selling prices, which further underpins and supports our close working relationships with them.
In the year turnover was £15,457,395 reducing from a company historic high of £17,120,348 in 2024. However, this reduction of £1,662,953 (9.7%) is not due to a reduction in output. As previously stated, energy reductions were passed back on to the customer during 2024 and this accounted for a direct like-for-like reduction in turnover of circa £300K. In addition, the sales value of child parts for assembly operations peaked at £1.8M in 2023. Due to changes during 2024 in process routes and some assembled parts becoming obsolete, this value reduced by £650K to £1.15M. The balance of the reduction in turnover between the years was due to a decrease in tooling sales of approx. £700K.
With a second year of consecutive profits, the balance sheet has strengthened overall with total equity increasing from £1,815,710 in 2024 to £2,386,634 in 2025, which represents a 31.4% increase. Then looking specifically at the net current liabilities, this position has improved again from (£757,935) in 2024 to (£249,823) in 2025. Finally on the balance sheet, the CBILS loan and 2 off RLS loans, all required during and after the COVID-19 crisis, have continued to be serviced during the year and there has been no requirements for any additional loan finance. Following a 33.6% reduction in long-term finance in the previous year, it has reduced again from (£711,774) to (£351,239) in 2025, a further significant reduction of 50.6%.
J.H. LAVENDER & COMPANY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
- 2 -
Principal risks and uncertainties
Price Risk
During the financial year, raw material (aluminium ingot) prices have again remained stable at a slightly lower average of £2,101 per metric ton, compared to £2,188 last year. Any movement in prices, up or down, are mitigated by agreements that allow the business to pass on any movements in price to the customer.
Interest Rate Risk
The group's invoice discounting facility is linked to the Bank of England base rate, which has continued to reduce gradually from its 16 year high of 5.25% and currently stands at 4.25% This has therefore reduced the element of interest rate risk faced by the business. This position should continue with further reductions forecast.
Economy Risk
Due to various geopolitical factors, include conflicts in the Middle East and Tariffs being imposed by the USA, the outlook for the UK economy is very fragile. With such issues beyond the control of the business, there is very little that can be done to mitigate such risks.
Energy Risk
Even though there have been reductions in the wholesale energy prices, there is still volatility in the energy markets, so this is a continuing risk for the business as the aluminium die-casting process is a high consumer of energy. Currently, there is stability for the business for the next 12 months, due to the long-term energy contracts that were signed, but in 2026 these are due for renewal so the energy risk will return.
Key performance indicators
Analysis using key performance indicators:
Profit ratio
Pre-tax profit margin 2.92% (2024: 2.53%)
Activity ratio
Stock turnover 8.3% (2024: 6.9%)
Capital ratio
Interest cover 2.37 (2024: 2.14)
Mr I M Timings
Director
17 July 2025
J.H. LAVENDER & COMPANY LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2025
- 3 -
The directors present their annual report and financial statements for the year ended 31 March 2025.
Principal activities
The principal activity of the company continued to be that of aluminium pressure and gravity diecasters and machinists.
Results and dividends
The results for the year are set out on page 9.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr A Taylor
Mr I M Timings
Dr A J Rose
Mr J M Warner
Future developments
As a result of the new Governments first budget, not only was there another increase in the National Living Wage of 6.7% from April 2025, but there were also increases to the rate of employer national insurance contributions and a reduction in the threshold, ultimately resulting in an additional increase in employer NI contributions.
As this represented a significant increase in operating costs and as it was on the back of a 9.8% increase from April 2024 which the business chose to absorb, this year the Directors were left with little choice other than to request price increases from our customer base.
Following detailed negotiations, the Directors can confirm that all the increases requested were accepted by our customers. As a result, forecasts for the new financial year commencing April 2025 confirm that the business will remain profitable for the third consecutive year.
Turnover is forecast to reduce to £14M, again reductions are due to passing on further energy surcharge reductions to customers and this turnover figure reflects a full year of reductions in the sales value of child part components for assembly parts that is forecast to be £300K compared to £1.8M only 2 years ago.
With on-going profits forecast, the cash position is also forecast to remain positive. However, the invoice discounting facility provided by HSBC plc, will continue to be required, but at a much lower level compared to previous years. This will help to reduce the discounting cost of the facility, which will also continue to fall in line with any further interest rate reductions. Existing long-term debt will continue to be serviced and further reduced, with most of it being cleared in 12 months’ time. This will also improve levels of profitability further with the removal of these finance costs.
The long-term energy contracts that were secured in January 2024 when the market was low are due for renewal in April 26. At this moment in time with all the Geopolitical factors present, it is difficult to forecast if the new contracts will be secured at higher or lower rates than the existing ones. But based on previous agreements with customers the Directors are confident that that the customer base will once again be supportive in accepting any energy surcharge that is required.
The above is all in line with previous predictions made by the Directors that the business was entering a period of consolidation with sustained and increasing levels of profitability. It was suggested that this scenario would continue for 3-5 years, and the business is now in the third year of this time frame and as things stand, years 4 and 5 are expected to produce similar financial outcomes.
J.H. LAVENDER & COMPANY LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
- 4 -
Auditor
The auditor, CK Audit, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
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.
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
Mr I M Timings
Director
17 July 2025
J.H. LAVENDER & COMPANY LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2025
- 5 -
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:
select suitable accounting policies and then apply them consistently;
make judgements 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 company 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 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.
J.H. LAVENDER & COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF J.H. LAVENDER & COMPANY LIMITED
- 6 -
Opinion
We have audited the financial statements of J.H. Lavender & Company Limited (the 'company') for the year ended 31 March 2025 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:
give a true and fair view of the state of the company's affairs as at 31 March 2025 and of its profit 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.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the 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 strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
J.H. LAVENDER & COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF J.H. LAVENDER & COMPANY LIMITED (CONTINUED)
- 7 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the 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 directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Extent to which the audit was considered capable of detecting irregularities, including fraud
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:
We obtained an understanding of the legal and regulatory frameworks that are applicable to the Company by discussion and enquiry with the directors and management team and our general knowledge and experience of the aluminium die casting sector.
We focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation, data protection, employment, and health and safety legislation;
We assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and reviewing correspondence with relevant regulators.
J.H. LAVENDER & COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF J.H. LAVENDER & COMPANY LIMITED (CONTINUED)
- 8 -
Audit response to risks identified
We assessed the susceptibility of the Company’s financial statements to material misstatement, including how fraud might occur. Audit procedures performed included but were not limited to:
Challenging assumptions and judgements made by management in its significant accounting estimates;
Identifying and testing journal entries;
Reviewing unusual or unexpected transactions; and
Agreeing the financial statement disclosures to underlying supporting documentation.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
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.
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.
Frances Clapham
Senior Statutory Auditor
For and on behalf of CK Audit
17 July 2025
Chartered Accountants
Statutory Auditor
No 4 Castle Court 2
Castlegate Way
Dudley
West Midlands
DY1 4RH
J.H. LAVENDER & COMPANY LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2025
- 9 -
2025
2024
Notes
£
£
Turnover
2
15,457,395
17,120,348
Cost of sales
(12,801,032)
(14,469,585)
Gross profit
2,656,363
2,650,763
Administrative expenses
(1,876,116)
(1,839,232)
Other operating income
1,723
Operating profit
3
781,970
811,531
Interest receivable and similar income
6
334
1,320
Interest payable and similar expenses
7
(330,339)
(380,323)
Profit before taxation
451,965
432,528
Tax on profit
8
118,959
(33,665)
Profit for the financial year
570,924
398,863
The profit and loss account has been prepared on the basis that all operations are continuing operations.
The notes on pages 12 to 24 form part of these financial statements.
J.H. LAVENDER & COMPANY LIMITED
BALANCE SHEET
AS AT 31 MARCH 2025
31 March 2025
- 10 -
2025
2024
Notes
£
£
£
£
Fixed assets
Tangible assets
9
3,823,694
4,130,303
Current assets
Stocks
10
1,279,765
1,182,722
Debtors
11
4,328,318
5,281,462
Cash at bank and in hand
171,713
49,279
5,779,796
6,513,463
Creditors: amounts falling due within one year
12
(6,029,619)
(7,271,398)
Net current liabilities
(249,823)
(757,935)
Total assets less current liabilities
3,573,871
3,372,368
Creditors: amounts falling due after more than one year
13
(351,239)
(711,774)
Provisions for liabilities
Deferred tax liability
16
835,998
844,884
(835,998)
(844,884)
Net assets
2,386,634
1,815,710
Capital and reserves
Called up share capital
19
1,000
1,000
Profit and loss reserves
2,385,634
1,814,710
Total equity
2,386,634
1,815,710
The notes on pages 12 to 24 form part of these financial statements.
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 17 July 2025 and are signed on its behalf by:
Mr I M Timings
Director
Company registration number 02999887 (England and Wales)
J.H. LAVENDER & COMPANY LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2025
- 11 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 April 2023
1,000
1,415,847
1,416,847
Year ended 31 March 2024:
Profit and total comprehensive income
-
398,863
398,863
Balance at 31 March 2024
1,000
1,814,710
1,815,710
Year ended 31 March 2025:
Profit and total comprehensive income
-
570,924
570,924
Balance at 31 March 2025
1,000
2,385,634
2,386,634
The notes on pages 12 to 24 form part of these financial statements.
J.H. LAVENDER & COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
- 12 -
1
Accounting policies
Company information
J.H. Lavender & Company Limited is a private company limited by shares incorporated in England and Wales. The registered office is Hall Green Works, Crankhall Lane, West Bromwich, West Midlands, B71 3JZ.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
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 financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of J.H. Lavender (Holdings) Ltd. These consolidated financial statements are available from its registered office, Hall Green Works, Crankhall Lane, West Bromwich, West Midlands, B71 3JZ.
1.2
Going concern
With the company remaining in a profit-making position for a sustained period, this has enabled a further improvement in the net current liabilities position from (£757,935) in 2024 to (£249,823) in 2025. With profits forecast for subsequent years this trend is set to continue.true
In addition, following a further significant reduction of 50.6% in long-term finance from (£711,774) to (£351,239) in 2025, at the end of the current financial year (31st March 2026) long-term finance liabilities are anticipated to further decrease.
HSBC plc continue to provide working capital support via an invoice discounting facility, with limits increasing when required in order to facilitate any growth in turnover. To fund increases in capacity where required, in addition to grants from the local council, HSBC plc continue to provide the option for asset finance.
At the time of approving the directors believe that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
J.H. LAVENDER & COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
1
Accounting policies
(Continued)
- 13 -
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Plant and equipment
8% - 20% reducing balance
Fixtures and fittings
10 years straight line
Computers
5/10 years straight line
Motor vehicles
5 years straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.5
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
1.6
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.7
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
J.H. LAVENDER & COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
1
Accounting policies
(Continued)
- 14 -
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.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
J.H. LAVENDER & COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
1
Accounting policies
(Continued)
- 15 -
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
J.H. LAVENDER & COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
1
Accounting policies
(Continued)
- 16 -
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
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.
1.14
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
Government grants relating to turnover are recognised as income over the periods when the related costs are incurred. Grants relating to an asset are recognised in income systematically over the asset's expected useful life. If part of such a grant is deferred it is recognised as deferred income rather than being deducted from the asset's carrying amount.
2
Turnover and other revenue
2025
2024
£
£
Turnover analysed by class of business
Principal activity
15,457,395
17,120,348
2025
2024
£
£
Turnover analysed by geographical market
United Kingdom
14,435,201
15,745,801
Europe
1,003,285
1,342,400
Rest of world
18,909
32,147
15,457,395
17,120,348
J.H. LAVENDER & COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
2
Turnover and other revenue
(Continued)
- 17 -
2025
2024
£
£
Other revenue
Interest income
334
1,320
Grants received
1,723
-
3
Operating profit
2025
2024
Operating profit for the year is stated after charging/(crediting):
£
£
Government grants
(1,723)
-
Fees payable to the company's auditor for the audit of the company's financial statements
10,400
12,675
Depreciation of owned tangible fixed assets
320,682
314,318
Depreciation of tangible fixed assets held under finance leases
7,569
8,227
Operating lease charges
35,823
30,394
4
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2025
2024
Number
Number
Production staff
84
86
Management and administration
24
25
Directors
4
4
Total
112
115
Their aggregate remuneration comprised:
2025
2024
£
£
Wages and salaries
4,159,689
4,067,923
Social security costs
443,718
428,682
Pension costs
175,276
169,734
4,778,683
4,666,339
J.H. LAVENDER & COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
- 18 -
5
Directors' remuneration
2025
2024
£
£
Remuneration for qualifying services
474,974
480,993
Company pension contributions to defined contribution schemes
36,400
32,116
511,374
513,109
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2024 - 2).
Remuneration disclosed above include the following amounts paid to the highest paid director:
2025
2024
£
£
Remuneration for qualifying services
219,663
217,074
Company pension contributions to defined contribution schemes
26,004
25,716
6
Interest receivable and similar income
2025
2024
£
£
Interest income
Interest on bank deposits
334
1,320
7
Interest payable and similar expenses
2025
2024
£
£
Interest on bank overdrafts and loans
65,859
101,538
Interest on invoice finance arrangements
249,511
256,962
Interest on finance leases and hire purchase contracts
2,249
4,739
Other interest
12,720
17,084
330,339
380,323
8
Taxation
2025
2024
£
£
Current tax
Adjustments in respect of prior periods
(105,073)
Deferred tax
Origination and reversal of timing differences
(13,886)
33,665
Total tax (credit)/charge
(118,959)
33,665
J.H. LAVENDER & COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
8
Taxation
(Continued)
- 19 -
The actual (credit)/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:
2025
2024
£
£
Profit before taxation
451,965
432,528
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2024: 25.00%)
112,991
108,132
Tax effect of expenses that are not deductible in determining taxable profit
336
1,938
Tax effect of income not taxable in determining taxable profit
(431)
Tax effect of utilisation of tax losses not previously recognised
(126,753)
(75,061)
Adjustments in respect of prior years
(105,073)
Depreciation on assets not qualifying for tax allowances
4,238
4,035
Other permanent differences
(4,267)
Under/(over) provided in prior years
(5,379)
Taxation (credit)/charge for the year
(118,959)
33,665
9
Tangible fixed assets
Assets under construction
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 April 2024
294,357
9,236,061
64,704
363,292
21,500
9,979,914
Additions
274,162
710
41,127
315,999
Disposals
(49,887)
(246,579)
(296,466)
Transfer to Parent Company
(294,357)
(294,357)
At 31 March 2025
9,510,223
15,527
157,840
21,500
9,705,090
Depreciation and impairment
At 1 April 2024
5,450,514
62,367
320,386
16,344
5,849,611
Depreciation charged in the year
310,026
624
14,164
3,437
328,251
Eliminated in respect of disposals
(49,887)
(246,579)
(296,466)
At 31 March 2025
5,760,540
13,104
87,971
19,781
5,881,396
Carrying amount
At 31 March 2025
3,749,683
2,423
69,869
1,719
3,823,694
At 31 March 2024
294,357
3,785,547
2,337
42,906
5,156
4,130,303
J.H. LAVENDER & COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
9
Tangible fixed assets
(Continued)
- 20 -
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2025
2024
£
£
Plant and equipment
87,041
94,610
10
Stocks
2025
2024
£
£
Raw materials and consumables
170,365
181,351
Work in progress
1,109,400
1,001,371
1,279,765
1,182,722
11
Debtors
2025
2024
Amounts falling due within one year:
£
£
Trade debtors
3,520,651
4,861,224
Amounts owed by group undertakings
478,341
172,984
Other debtors
6,888
2,385
Prepayments and accrued income
182,438
109,869
4,188,318
5,146,462
Deferred tax asset (note 16)
140,000
135,000
4,328,318
5,281,462
Included in the above trade debtors are balance totalling £3,027,359 (2024: £3,888,671) that are subject to invoice finance arrangements. The trade debtor balances have been transferred to the counterparty, though the transactions does not qualify for derecognition on the basis that the late payment risk is retained by the company. The associated liability recognised in creditors amounts to £2,786,847 (2024: £3,756,432).
J.H. LAVENDER & COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
- 21 -
12
Creditors: amounts falling due within one year
2025
2024
Notes
£
£
Bank loans
14
337,319
337,319
Obligations under finance leases
15
23,217
23,217
Trade creditors
2,146,449
2,346,298
Taxation and social security
308,300
306,196
Government grants
17
118,277
Other creditors
2,842,366
3,764,276
Accruals and deferred income
253,691
494,092
6,029,619
7,271,398
13
Creditors: amounts falling due after more than one year
2025
2024
Notes
£
£
Bank loans and overdrafts
14
339,630
676,948
Obligations under finance leases
15
11,609
34,826
351,239
711,774
14
Loans and overdrafts
2025
2024
£
£
Bank loans
676,949
1,014,267
Payable within one year
337,319
337,319
Payable after one year
339,630
676,948
J.H. LAVENDER & COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
14
Loans and overdrafts
(Continued)
- 22 -
The finance leases are secured by a chattels mortgage, date 01/10/2010, and there is a legal assignment of contract monies, dated 26/03/2014, both with HSBC Asset Finance (UK) Ltd and HSBC Equipment Finance (UK) Ltd.
The invoice discounting account is secured by a fixed charge on non-vesting debts and floating charge, dated 22/09/2009, with HSBC Invoice Finance (UK) Ltd.
The bank borrowings are further secured by a debenture with HSBC Bank Plc, dated 24/09/2009, a composite company unlimited multilateral unlimited guarantee with HSBC Plc dated 24/09/2009, a legal assignment of contract monies, with HSBC Bank Plc, dated 10/07/2012 and a chattels mortgage, against certain machinery, with HSBC Equipment Finance (UK) Ltd, dated 16/01/2020.
The CBILS loan is also covered by a guarantee in favour of HSBC UK Bank plc given by the directors guaranteeing all liabilities, limited to £100,000 in total.
The CBILS loan had an initial repayment free period of 12 months from the date the loan is drawn. It is then repayable by equal instalments over 60 months with an interest rate of 3.99% per annum over the BoE base rate.
The Company holds two RLS loans, the first of which was drawn down in January 2022 and had an initial repayment free period of 6 months from the date the loan is drawn. It is then repayable by equal instalments over 66 months with a fixed interest rate of 5.06%. The second RLS loan was drawn down in November 2022 and had a 6 month period free of capital repayments. The loan is repayable over 66 equal installments and has an interest rate set at 3.99% above the BoE base rate.
15
Finance lease obligations
2025
2024
Future minimum lease payments due under finance leases:
£
£
Within one year
25,466
25,466
In two to five years
12,733
36,138
38,199
61,604
Less: future finance charges
(3,373)
(3,561)
34,826
58,043
Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 5 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
J.H. LAVENDER & COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
- 23 -
16
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
Assets
Assets
2025
2024
2025
2024
Balances:
£
£
£
£
Accelerated capital allowances
835,998
844,884
-
-
Tax losses
-
-
140,000
135,000
835,998
844,884
140,000
135,000
2025
Movements in the year:
£
Liability at 1 April 2024
709,884
Credit to profit or loss
(13,886)
Liability at 31 March 2025
695,998
17
Government grants
2025
2024
£
£
Arising from government grants
118,277
-
18
Retirement benefit schemes
2025
2024
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
175,276
169,734
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.
19
Share capital
2025
2024
2025
2024
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
1,000
1,000
1,000
1,000
J.H. LAVENDER & COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
- 24 -
20
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2025
2024
£
£
Within one year
104,831
123,634
Between two and five years
309,056
42,117
413,887
165,751
21
Related party transactions
The company has taken advantage of exemptions available under FRS 102 33.1A whereby transactions between two or more members of a group, where one is a wholly owned subsidiary of the other, have not been disclosed.
22
Ultimate controlling party
The parent company of J.H. Lavender & Company Ltd is J.H. Lavender (Holdings) Ltd.
The directors of J.H. Lavender (Holdings) Ltd are regarded as its controlling parties by virtue of their ability to act in concert in respect of the operations of the company.
J.H. Lavender & Company Ltd is consolidated into J.H. Lavender (Holdings) Ltd group accounts. Copies of group accounts can be obtained from the Company Secretary, Hall Green Works, Crankhall Lane, West Bromwich, West Midlands, B71 3JZ.
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