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Viking Maritime Group Limited
Company statement of changes in equity
For the year ended 31 December 2023
Page 14
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Viking Maritime Group Limited
Consolidated statement of cash flows
For the year ended 31 December 2023
Page 15
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
Viking Maritime Group Limited ('the company') is a private company limited by shares and is incorporated in England with the registration number 02340526. The address of the company's registered office is Viking House, Beechwood Business Park, Menzies Road, Dover, Kent, CT16 2FG.
The principal activity of the company and its subsidiaries (together 'the group') is the provision of training, recruitment, placement and crew management services to the maritime industry. The group operates from a number of locations in the United Kingdom, New Zealand and the United States of America. Further information on the activities of the group is included as part of the strategic report on pages 1 to 2.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The financial statements are rounded to the nearest pound.
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 judgement in applying the Group's accounting policies (see note 3).
The company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own statement of comprehensive income in these financial statements.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the balance sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the consolidated statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date control ceases.
Page 16
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
2.Accounting policies (continued)
The group has reported an operating profit for the year but continues to have a net liability position at the year end. The group is continuing to recover from challenging trading conditions presented throughout the COVID-19 pandemic and related restrictions imposed both domestically and abroad. The sector in which the group provides services had been affected globally and although the industry is continuing to recover the financial burden of this time still effects the group..
The directors continue to closely monitor the group’s cash flow to ensure that its obligations can be met as they fall due. The group’s forecasts and projections, which taking account of possible changes in trading performance, show that continued support from its facility providers is required. The directors continue to regularly discuss the support required with it providers who have indicated that they are willing to continue to support the company. The directors remain confident that the underlying profit centres all provide a needed service to the maritime industry and will continue to produce a profitable position. Notwithstanding these factors, after making enquiries and considering the uncertainties, the directors have formed a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. For these reasons, they continue to adopt the going concern basis of accounting in preparing the annual financial statements.
Functional and presentation currency
Transactions and balances
Page 17
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
2.Accounting policies (continued)
Page 18
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
2.Accounting policies (continued)
When a sale and leaseback transaction results in an operating lease, and it is clear that the transition is established at fair value any profit or loss is recognised immediately. If the sale price is below fair value, any profit or loss is recognised immediately unless the loss is compensated for by the future lease payments at below market price. In that case any such loss is amortised in proportion to the lease payments over the period for which the asset is expected to be used. If the sale price is above fair value, the excess over fair value is amortised over the period for which the asset is expected to be used. If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only. Grants of a revenue nature are recognised in the consolidated statement of comprehensive income in the same period as the related expenditure.
Page 19
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
2.Accounting policies (continued)
Page 20
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
2.Accounting policies (continued)
Goodwill
Goodwill represents the excess of the cost of a business combination over the total acquisition date fair value of the identifiable assets, liabilities and contingent liabilities acquired. Cost comprises the fair value of assets given, liabilities assumed and equity instruments issued. The group has chosen not to separately identify the fair value of intangible assets acquired upon a business combination. When a business combination agreement provides for an adjustment to the cost of the combination which is contingent on future events, the company includes the estimated amount of that adjustment in the cost of the combination at the acquisition date if the adjustment is probable and can be measured reliably. However, if the potential adjustment is not recognised at the acquisition date but subsequently becomes probable and can be measured reliably, the additional consideration shall be treated as an adjustment to the cost of the combination. Changes in the estimated value of contingent consideration arising on business combinations completed as a consequence result in a change in the carrying value of the related goodwill. Goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight line basis to the statement of comprehensive income over its useful economic life. Other intangible assets
At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
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.
Development costs are amortised on a straight line basis over 10 years.
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
2.Accounting policies (continued)
Investment property rented to other group entities and accounted for under the cost model is stated at historical cost less accumulated depreciation and any accumulated impairment losses.
At each reporting date the Group assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
The Group adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the Group. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred.
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.
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
2.Accounting policies (continued)
In the consolidated accounts, interests in associated undertakings are accounted for using the equity method of accounting. Under this method an equity investment is initially recognised at the transaction price (including transaction costs) and is subsequently adjusted to reflect the investors share of the profit or loss, other comprehensive income and equity of the associate. The consolidated statement of comprehensive income includes the Group's share of the operating results, interest, pre-tax results and attributable taxation of such undertakings applying accounting policies consistent with those of the Group. In the consolidated balance sheet, the interests in associated undertakings are shown as the Group's share of the identifiable net assets, including any unamortised premium paid on acquisition. Any premium on acquisition is dealt with in accordance with the goodwill policy.
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
2.Accounting policies (continued)
The Group only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan. Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the consolidated statement of comprehensive income. For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Group would receive for the asset if it were to be sold at the balance sheet date. Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is an 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.
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
The following judgements have had the most significant impact on amounts recognised in the financial statements: Development expenditure The group has adopted a policy of capitalising development expenditure, as permitted by FRS102. This approach is dependent upon the directors’ judgement that the project’s technical and economic feasibility is assured. In doing so the directors make assumptions regarding the future cash flows that the project is expected to generate, the discount rates to be applied and the expected period over which the project to expected to generate benefits. Going concern In the judgement of the directors it is appropriate to prepare the financial statements in accordance with the going concern basis of accounting. See note 2.3 for further details.
The whole of the turnover is attributable to the group's principal activity of providing training, recruitment, placement and crew management services to the maritime industry.
Analysis of turnover by country of destination:
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
Page 26
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
Page 27
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
10.Taxation (continued)
As part of the Finance Bill 2020, which was substantively enacted on 17 March 2020, the corporation tax main rate is to remain at 19% until 31 March 2023.
Following the end of the accounting period, the UK government have announced that the main rate will increase on 1 April 2023 to 25%, for companies with taxable profits above £250,000. Companies with taxable profits below £50,000 will continue to pay at 19%, and marginal relief will apply between these thresholds. This change forms part of the Finance Bill 2021, which was substantively enacted on 24 May 2021. Deferred taxes have been measured using rates substantively enacted at the reporting date and reflected in these financial statements.
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
Page 29
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
Page 30
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
13.Tangible fixed assets (continued)
Page 31
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
Page 32
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
Page 33
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
Page 34
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
Page 35
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
Page 36
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
The group's obligations under finance lease and hire purchase contracts are secured by way of a chattels mortgage in favour of HSBC Asset Finance (UK) Ltd and HSBC Equipment Finance (UK) Ltd containing a fixed charge over the associated assets purchased by the company.
A loan received from Kent County Council, included within other loans, is secured by way of a legal charge, containing a fixed charge over the land and freehold property held by the group. The group's overdraft facility and bank loans are secured by way of a debenture in favour of HSBC Bank PLC, containing fixed and floating charges over all of the assets of the company. The aggregate amount of debts secured by the group is £4,091,810 (2022 - £4,280,888) included within creditors due within one year and creditors due after more than one year. The group has deferred income which relates to a financial contribution received for the construction of tangible fixed assets. This income is credited to profit or loss at the same rate as the depreciation on the assets to which the lease incentive relates. At the balance sheet date the total amount deferred was £287,066 (2022 - £331,910).
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
Page 38
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
The group has exposure to three main areas of risk – currency risk, liquidity risk and customer credit exposure. The group has established a risk and financial management framework whose primary objectives are to protect the group from events that hinder the achievement of its performance objectives. The objectives aim to limit undue counterparty exposure, ensure sufficient working capital exists and to monitor the management of risk.
The group’s principal financial instruments comprise bank balances, bank overdrafts, trade creditors, trade debtors, loans to the group and lease arrangements. The main purpose of these instruments is to finance the group’s operations. Currency risk The majority of the group's transactions, assets and liabilities are in the UK and sterling based. Therefore, the group has low exposure to currency rate fluctuations. Liquidity risk Liquidity risk is the risk that the group will encounter difficulty in meeting its financial obligations as they fall due. The group’s objective in managing liquidity risk is to ensure that this does not arise. Having assessed future cash flow requirements the group expects to be able to meet its financial obligations through the cash flows that are generated from its operating activities. In the event that these cash flows would not be sufficient to enable the group to meet all of its obligations the group has available credit facilities provided by its bankers, as disclosed in notes 17 and 18. The interest rate risk arising from these facilities is considered by the directors to be minimal, and the group has not entered into any derivative instruments designed to mitigate exposure to such risk. With these facilities in place the group is in a position to meets its commitments and obligations as they fall due. Customer credit exposure The group regularly offers credit terms to its customers which allow for payment of the debt after delivery of the goods or services. The group is at risk to the extent that a customer may be unable to pay the debt within those terms. This risk is mitigated by the strong on-going customer relationships and by only granting credit to customers who are able to demonstrate an appropriate payment history and satisfy credit worthiness procedures.
Page 39
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
Page 40
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
Foreign exchange reserve
Profit and loss account
The group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the group in an independently administered fund. The pension cost charge represents contributions payable by the group to the fund and amounted to £58,724 (2022 - £41,140). Contributions totalling £9,983 (2022 - £7,574) were payable to the fund at the balance sheet date and are included in creditors.
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Viking Maritime Group Limited
Notes to the financial statements
For the year ended 31 December 2023
The company's ultimate controlling party is the Jaenicke family, who hold 100% of the issued share capital of the company. No individual member of the family is considered to have ultimate control over the company.
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