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Registered number: 10379255
HERD GROUP LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
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HERD GROUP LIMITED
COMPANY INFORMATION
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AAB Audit & Accountancy Limited
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HERD GROUP LIMITED
CONTENTS
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Independent auditors' report
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Consolidated statement of comprehensive income
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Consolidated statement of financial position
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Company statement of financial position
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Consolidated statement of changes in equity
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Company statement of changes in equity
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Consolidated statement of cash flows
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Notes to the financial statements
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HERD GROUP LIMITED
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 OCTOBER 2024
As shown in the statement of comprehensive income, sales were consistent during the period ended 31 October 2024 against 2023.
The profit before tax for the year ended 31 October 2024 was £2,711,969 (2023: £3,099,336).
The Herd Group Employee Ownership Trustee Limited was set up in December 2022. This enabled the purchase of the Company from the previous shareholders, providing continuity in all areas of the business, a lasting legacy for the employees and ensuring the Herd brand will be ever present for the long term.
Net assets of the Group at 31 October 2024 were £2,998,401 (2023: £2,427,930).
The Group manages its operations using key performance indicators such as fleet utilisation; which remain well above industry averages (2024: 96.6%, 2023: 98.7%) and profit per unit on vehicle sales, which achieved planned levels for the year (2024: £1,677, 2023: £2,368). These are monitored with regular monthly reviews by the Board to ensure that the Group meets its targeted financial objectives.
The Group also uses internal key performance indicators such as weekly Sales, Orders and Vehicle running cost reports to ensure monthly targets are met which is reviewed against the forecasted plan. A rolling six month cash-flow is also reviewed monthly to ensure a positive growing cash balance is maintained to meet business liabilities as well as future business investment plans.
The Group is performing strongly, and the directors expect this to continue into FY25, supported by an excellent reputation within the Automotive sector. The growth in the business in 2024 has been driven through fleet growth and organic strengthening in the Herd Business and Franchise sectors, along with the volume of used vehicle sales. The continued short supply of van stock has maintained high residual values allowing profits on vehicle sales to be maximised. The directors believe that this will be maintained and enable the company to continue on its growth trajectory.
Principal risks and uncertainties
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The Group seeks to align its business objectives with risk management processes such that the business can ensure that there is an ongoing process for managing and reporting on risks. There are no major risks identified other than those of a normal commercial environment. Actions are put in place to manage risks down to a level of acceptance. Regular and frequent Board meetings allow for such discussions to be raised and addressed.
Although there remains a shortage of new van stock, through our contacts and key relationships, Herd Group secured volume of stock in 2024 to meet all its growth and swap programs. We have already reached agreements with all key manufacturers, with orders in place for continued supply into 2025.
Page 1
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HERD GROUP LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2024
Future plans & developments
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The Group has plans to continue to grow its core rental business, contributed by the increase in the hire fleet, all of which is achievable with the stock already secured.
The Franchise network continues to be a key focus and the plan is to expand our reach further across the UK in FY25.
There is also a focus on Herd Connect, our brilliant fleet management solution, with plans in place to accelerate the growth of this in FY25.
The synergies that are provided by all areas of the business enable our customers to benefit from the diverse products that we offer.
To underpin the future plans and developments, investment has been made in key positions in 2024, providing the springboard to support our growth initiatives. Continued investment in software is also key to our plans to make the organisation more nimble in its reporting whilst delivering process efficiencies.
The platform is firmly in place to accelerate the business, challenge the sector, create solutions and provide exceptional customer care which will result in improved profit generation and cash growth.
This report was approved by the board and signed on its behalf.
Page 2
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HERD GROUP LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 OCTOBER 2024
The directors present their report and the financial statements for the year ended 31 October 2024.
Directors' responsibilities statement
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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.
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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 the Group and of the profit or loss of the Group for that period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies 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 directors who served during the year were:
Disclosure of information to auditors
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Each of the persons who are directors at the time when this Directors' report is approved has confirmed that:
∙so far as the directors are aware, there is no relevant audit information of which the Company and the Group's auditors are unaware, and
∙the directors have taken all the steps that ought to have been taken as directors in order to be aware of any relevant audit information and to establish that the Company and the Group's auditors are aware of that information.
Page 3
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HERD GROUP LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2024
Post balance sheet events
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There have been no significant events affecting the Group since the year end.
The auditors, AAB Audit & Accountancy 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 4
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HERD GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HERD GROUP LIMITED
We have audited the financial statements of Herd Group Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 October 2024, which comprise the Consolidated statement of comprehensive income, the Consolidated Statement of Financial Position, the Company Statement of Financial Position, 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).
In our opinion the financial statements:
∙give a true and fair view of the state of the Group's and of the parent Company's affairs as at 31 October 2024 and of the Group's 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 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.
Conclusions relating to going concern
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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 5
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HERD GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HERD GROUP 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.
Opinion on other matters prescribed by the Companies Act 2006
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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.
Matters on which we are required to report by exception
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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.
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 by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
∙the parent Company financial statements are not in agreement with the accounting records and returns; or
∙certain disclosures of directors' remuneration specified by law are not made; or
∙we have not received all the information and explanations we require for our audit.
Responsibilities of directors
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As explained more fully in the Directors' responsibilities statement set out on page 3, 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 Group's and the parent 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 Group or the parent Company or to cease operations, or have no realistic alternative but to do so.
Page 6
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HERD GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HERD GROUP LIMITED (CONTINUED)
Auditors' responsibilities for the audit of the financial statements
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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:
We considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas: timing of recognition of income, management override of controls, posting of unusual journals and complex transactions. We discussed these risks with client management, designed audit procedures to test the timing of income, tested a sample of journals to confirm they were appropriate and reviewed areas of judgement for indicators of management bias to address these risks.
The organisation is subject to many other laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines or litigation. We identified health and safety as the area most likely to have such an effect. Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the directors and other management and inspection of regulatory and legal correspondence, if any.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also:
∙Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
∙Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion of the effectiveness of the Company's internal control.
∙Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
∙Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our Auditors' report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our Auditors' report. However, future events or conditions may cause the Company to cease to continue as a going concern.
∙Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Page 7
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HERD GROUP LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HERD GROUP LIMITED (CONTINUED)
∙Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
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.
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.
Susan Seaman BA, FCA, CIOT (Senior statutory auditor)
for and on behalf of
AAB Audit & Accountancy Limited
Chartered accountants & statutory auditor
Gresham House
5-7 St Pauls Street
Leeds
LS1 2JG
21 July 2025
Page 8
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HERD GROUP LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 OCTOBER 2024
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Interest receivable and similar income
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Interest payable and similar expenses
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Profit for the financial year
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Profit for the year attributable to:
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Owners of the parent Company
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There were no recognised gains and losses for 2024 or 2023 other than those included in the consolidated statement of comprehensive income.
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There was no other comprehensive income for 2024 (2023:£NIL).
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The notes on pages 16 to 29 form part of these financial statements.
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Page 9
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HERD GROUP LIMITED
REGISTERED NUMBER: 10379255
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 OCTOBER 2024
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Provisions for liabilities
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Page 10
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HERD GROUP LIMITED
REGISTERED NUMBER: 10379255
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 OCTOBER 2024
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Capital redemption reserve
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Equity attributable to owners of the parent Company
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The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 16 to 29 form part of these financial statements.
Page 11
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HERD GROUP LIMITED
REGISTERED NUMBER: 10379255
COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 OCTOBER 2024
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Profit and loss account brought forward
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Other changes in the profit and loss account
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Profit and loss account carried forward
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The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 16 to 29 form part of these financial statements.
Page 12
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HERD GROUP LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 OCTOBER 2024
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Capital redemption reserve
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Comprehensive income for the year
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Contributions by and distributions to owners
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Dividends: Equity capital
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Shares issued during the year
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Comprehensive income for the year
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Contributions by and distributions to owners
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Dividends: Equity capital
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Shares issued during the year
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The notes on pages 16 to 29 form part of these financial statements.
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Page 13
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HERD GROUP LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 OCTOBER 2024
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Comprehensive income for the year
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Contributions by and distributions to owners
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Dividends: Equity capital
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Shares issued during the year
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Total transactions with owners
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Comprehensive income for the year
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Contributions by and distributions to owners
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Dividends: Equity capital
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Shares issued during the year
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The notes on pages 16 to 29 form part of these financial statements.
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Page 14
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HERD GROUP LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 OCTOBER 2024
Cash flows from operating activities
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Profit for the financial year
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Amortisation of intangible assets
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Depreciation of tangible assets
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Decrease/(increase) in stocks
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Decrease/(increase) in debtors
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Increase/(decrease) in creditors
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Net cash generated from operating activities
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Cash flows from investing activities
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Purchase of tangible fixed assets
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Sale of tangible fixed assets
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Net cash from investing activities
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Cash flows from financing activities
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Repayment of/new finance leases
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Group dividends for EOT contributions
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Net cash used in financing activities
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Net increase/(decrease) in cash and cash equivalents
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Cash and cash equivalents at beginning of year
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Cash and cash equivalents at the end of year
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Cash and cash equivalents at the end of year comprise:
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Page 15
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HERD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
The principal activity of the Company is that of a holding company. The Company is a private limited company, which is incorporated in England and Wales (no. 10379255). The adress of the registered office is 500 Dashwood Lang Road, Bourne Business Park, Addlestone, Surrey, KT15 2HJ.
2.Accounting policies
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Basis of preparation of financial statements
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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 Statement of financial position, 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.
In accordance with the transitional exemption available in FRS 102, the Group has chosen not to retrospectively apply the standard to business combinations that occurred before the date of transition to FRS 102, being 16 September 2016.
For the year ending 31 October 2024, Camper Tribe Limited, a fully owned subsidiary, has taken the exemption from audit under section 479A of the Companies Act 2006 relating to subsidiary companies.
Page 16
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HERD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
2.Accounting policies (continued)
The directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. When making this assessment, the directors have considered the results and future forecasts of the Herd Group.
A going concern analysis has been performed to assess the impact of current and recent market forces on the group.
The group has net assets of £2,998,401 as at 31 October 2024 (2023: £2,427,930) and made a profit for the year ended 31 October 2024 of £2,024,969 (2023: £2,325,336).
With regards to liquidity, the directors believe that the group has sufficient resources to continue as a going concern due to cash optimisation procedures which includes Invoice Financing.
The directors therefore consider that it is appropriate to adopt the going concern basis in preparing the financial statements.
Turnover is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods supplied and services rendered, stated net of discounts and of Value Added Tax.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have transferred to the buyer, usually on despatch of the goods, the amount of revenue can be measured reliably, if it is probable that the associated economic benefits will flow to the entity, and the costs incurred or to be incurred in respect of the transactions can be measured reliably.
When the outcome of a transaction involving the rendering of services can be reliably estimated, revenue from the rendering of services is measured by reference to the stage of completion of the service transaction at the end of the reporting period.
Defined contribution pension plan
The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of financial position. The assets of the plan are held separately from the Group in independently administered funds.
Page 17
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HERD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
2.Accounting policies (continued)
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Current and deferred taxation
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The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company and the Group operate and generate income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
Goodwill
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.
Other intangible assets
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
Amortisation is provided on the following bases:
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
Page 18
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HERD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
2.Accounting policies (continued)
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Tangible fixed assets (continued)
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Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
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.
Investments in subsidiaries are measured at cost less accumulated impairment.
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell.
Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the
stock to its present location and condition.
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Provisions for liabilities
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Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
Increases in provisions are generally charged as an expense to profit or loss.
A financial asset or a financial liability is recognised only when the entity becomes a party to the
contractual provisions of the instrument.
Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.
Debt instruments are subsequently measured at amortised cost.
Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately.
For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets are either assessed individually or grouped on the basis of similar credit risk characteristics.
Page 19
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HERD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
2.Accounting policies (continued)
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Financial instruments (continued)
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Any reversals of impairment are recognised in profit or loss immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised.
Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.
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Judgments in applying accounting policies and key sources of estimation uncertainty
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The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the date of the statement of financial position and the amounts reported for revenues and expenses during the year. However, the nature of estimation means that actual outcomes could differ from those estimates. Details of these judgements are set out in the accounting policies.
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An analysis of turnover by class of business is as follows:
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All turnover arose within the United Kingdom.
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The operating profit is stated after charging:
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Depreciation of tangible assets
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Impairment of trade debtors
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Amortisation of intangible assets
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Page 20
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HERD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
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During the year, the Group obtained the following services from the Company's auditors:
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Fees payable to the Company's auditors for the audit of the consolidated and parent Company's financial statements
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Fees payable to the Company's auditors in respect of:
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Taxation compliance services
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All non-audit services not included above
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Staff costs, including directors' remuneration, were as follows:
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Cost of defined contribution scheme
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The average monthly number of employees, including the directors, during the year was as follows:
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The Company has no employees other than the directors, who did not receive any remuneration (2023 - £NIL)
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Page 21
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HERD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
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Group contributions to defined contribution pension schemes
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The highest paid director received remuneration of £116,624 (2023 - £184,167).
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The value of the Group's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £40,000 (2023 - £40,110).
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Other interest receivable
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Interest payable and similar expenses
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Finance leases and hire purchase contracts
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Origination and reversal of timing differences
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Page 22
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HERD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
11.Taxation (continued)
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Factors affecting tax charge for the year
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The tax assessed for the year is higher than (2023 - higher than) the standard rate of corporation tax in the UK of 25% (2023 - 22.52%). The differences are explained below:
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Profit on ordinary activities before tax
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Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 22.52%)
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Expenses not deductible for tax purposes
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Effect of capital allowances and depreciation
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Changes in provisions leading to an increase (decrease) in the tax charge
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Total tax charge for the year
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Factors that may affect future tax charges
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There were no factors that may affect future tax charges.
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Dividends paid during the year
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Group dividends for EOT contributions
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Page 23
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HERD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
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Charge for the year on owned assets
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Page 24
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HERD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
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Charge for the year on owned assets
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The net book value of assets held under Hire Purchase contracts is £64,585,523 (2023: £54,203,757). The depreciation charged on those assets is £10,258,922 (2023: £7,308,533).
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Page 25
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HERD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
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Investments in subsidiary companies
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The following were subsidiary undertakings of the Company:
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Finished goods and goods for resale
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Page 26
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HERD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
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Prepayments and accrued income
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Obligations under finance lease and hire purchase contracts
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Accruals and deferred income
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The obligations under finance leases and hire purchase contracts of £14,560,545 (2023: £11,608,338) relates to amounts due in respect of hire purchase agreements. These creditors are secured on the assets to which they relate.
The balance of bank loans is an invoice finance facility, which is secured by fixed and floating charges
over the assets of the Company.
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Creditors: Amounts falling due after more than one year
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Net obligations under finance leases and hire purchase contracts
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The obligations under finance leases and hire purchase contracts of £49,935,001 (2023: £44,805,191) relates to amounts due in respect of hire purchase agreements. These creditors are secured on the assets to which they relate.
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Page 27
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HERD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
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Hire purchase and finance leases
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Minimum lease payments under hire purchase fall due as follows:
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Less future finance charges
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Charged to profit or loss
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There is no deferred taxation for the Company.
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The provision for deferred taxation is made up as follows:
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Accelerated capital allowances
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Allotted, called up and fully paid
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6,710 (2023 - 6,710) Ordinary shares of £0.01 each
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1,422(2023 -1,185) C ordinary shares of £0.01 each
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Page 28
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HERD GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2024
22.Share capital (continued)
The Company has allotted and issued 237 (2023: 1,185) C Ordinary shares with aggregate nominal value and consideration of £2.37 (2023: £11.85).
Share premium account
This reserve records the amount above the nominal value received for shares sold, less transaction costs.
Capital redemption reserve
This reserve records the nominal value of shares repurchased by the company.
Profit and loss account
This reserve records retained earnings and accumulated losses.
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Related party transactions
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On 22 December 2022, the Herd Group Employee Ownership Trustee ("EOT") purchased 95% of the ordinary share capital of Herd Group Limited, following which the Company is now an 'employee owned' company.
At 31 October 2024, deferred consideration of £12,217,950 is outstanding by the Company with a remaining payment period of 3 years. The liabilities in relation to this transaction are held between the EOT and Herd Group Limited and Herd Hire Ltd does not act as a guarantor on the loans to the EOT. During the period, the Company made dividend payments totalling to £1,454,500.
The present obligation to make the future loan payments is that of the EOT so the liability for the future payments has not been recognised.
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Page 29
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