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Europastry UK Ltd (formerly known as Dawn Foods Frozen Limited)
Registered number: 13826846
Annual report
For the year ended 31 December 2023
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
COMPANY INFORMATION
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PricewaterhouseCoopers LLC
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
CONTENTS
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Independent Auditors' Report
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Statement of Comprehensive Income
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Statement of Financial Position
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Statement of Changes in Equity
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Notes to the Financial Statements
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors present their Strategic Report of Europastry UK Ltd (formerly known as Dawn Foods Frozen Limited) ('the Company') for the year ended 31 December 2023.
The Company was incorporated on 4 January 2022. The prior period comparatives correspond for the first financial period ended 31 December 2022.
During the year, the Company changed its name from Dawn Foods Frozen Limited to Europastry UK Ltd.
Following the incorporation of the Company in January 2022, the trade and assets of the frozen bakery products of Dawn Foods Limited were transferred into the Company on 1 May 2022. On the 5 December 2022 the shares in the Company were purchased by Europastry S.A.
The results for the year and financial position of the Company are as shown on the financial statements.
The directors consider that the key performance indicators are those that communicate the financial performance and strength of the company as a whole, these being turnover, gross and net profit margin. Return on capital employed being calculated as profit on ordinary activities before interest and tax divided by gross assets less current liabilities.
The year 2022 was the first year of activity, starting in May 2022, with the impact of higher costs. In 2023, with an expectation of an increase of sales and gross margin going forward, the impact of higher costs has reduced.
Trading conditions have improved throughout 2023 and the directors' expectations are that the conditions will continue to improve into 2024. The directors are confident that the overall structure remains sound and the management team remains firmly in control with a clear vision for the future. Expenditure remains firmly controlled.
Principal risks and uncertainties
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Financial instruments and risk management
The Company's main financial instruments comprise cash at bank and intercompany loans. The main purpose of these financial instruments is to provide adequate finance for the company's operations.
The main risks arising from the Company's financial instruments are interest rate fluctuations and liquidity risk. It is the Company's policy to finance its operations through a mixture of cash and group borrowings and to review periodically the mix of these instruments with regard to the projected cash flow requirements of the Company and an acceptable level of risk exposure. The interest on the group borrowings is primarily at a fixed rate which minimises any risk to the Company.
Foreign currency risk arises from both the sale and purchases of goods to and from overseas customers and suppliers. Some of the transactions are conducted in Euros. This is currently more weighted towards the purchasing of stock from Central Europe and Spain, which can expose the Company to foreign currency risk.
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Principal risks and uncertainties (continued)
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Financial instruments and risk management (continued)
The Company's policy is to attempt to eliminate as much risk as possible by protecting itself against the risks of currency fluctuation and exposure by operating bank accounts in the aforementioned currencies and holding the necessary values of currency to limit exposure at any given time. Careful monitoring of the said accounts is ongoing. With the tangible funds available at the disposal of the company, quick currency acquisition is possible if necessary to aid in the smooth running of currency management.
Food safety & associated laws and regulations
The directors consider that one of the key priorities is ensuring meeting of food standards and quality of food products sold. To mitigate any risks, training is provided to staff and stringent quality procedures are followed with internal and external reviews being undertaken. The Company also seeks to comply with the required laws and regulations within the UK and the EU.
Credit
Credit risk arises from cash and cash equivalents, and deposits with banks and financial institutions, as well as credit exposures to customers, including outstanding receivables and committed transactions. The Company is not significantly exposed to any specific one customer. The Company also sets credit limits for customers and this is regularly monitored.
Financial key performance indicators
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In 2023, the net sales have increased by £22,891,759, mainly due to price increases and the full-year impact of sales activity, whereas in 2022, operational activities only commenced in May 2022.
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Return on capital employed (%)
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This report was approved by the board and signed on its behalf by:
J Bauló Miralles
Director
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors present their report and the audited financial statements of Europastry UK Ltd (formerly known as Dawn Foods Frozen Limited) ('the Company') for the year ended 31 December 2023.
The principal activity of the Company is the wholesale of frozen bakery products.
The profit for the year, after taxation, amounted to £462,693 (period ended 31 December 2022: loss of £515,245).
No dividends have been distributed during 2023, and the result of 2023 will not be distributed as dividends (period ended 31 December 2022: nil).
The directors who served during the year and to the date of this report were:
J Gallés Gabarró
J Bauló Miralles (appointed 01 October 2024)
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J Willem Kivits (appointed 28 July 2023, resigned 1 October 2024)
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Andeni Management B.V. (resigned 30 June 2023)
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Statement of directors' responsibilities in respect of the financial statements
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The directors are responsible for preparing the Annual report and the financial statements in accordance with applicable law and regulations 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 prepared the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”, and applicable law).
Under company law. 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 for the Company's financial statements and then apply them consistently;
∙make judgements and accounting estimates that are reasonable and prudent;
∙state whether applicable United Kingdom Accounting Standards, comprising FRS 102 have been followed, subject to any material departures disclosed and explained in the financial statements; and
∙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 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 hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
The Company made no political donations and did not incur any political expenditures during the year.
The Company's business activities, together with the factors likely to affect its future development, its financial position and its exposure to risks are described in the Strategic Report. The Company has net liabilities of £52,551 at 31 December 2023 (2022: net liabilities of £515,244). Whilst the Company is forecast to be profitable and operationally cash generative, it is dependent on group borrowings and the continued support of the immediate parent company, Europastry S.A. The Company therefore has received a letter of support from the immediate parent company, which confirms that it will continue to support the Company in order to meet its liabilities as they fall due for a period of at least twelve months after the date the financial statements are authorised for issue.
The directors have assessed the ability of Europastry S.A. to support the Company and after making enquiries of the Group, the directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the Annual report and accounts.
Matters covered in the Strategic Report
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As permitted by Paragraph 1A of Schedule 7 to the Large and Medium-sized Companies and Group (Accounts and Reports) Regulations 2008 certain matters which are required to be disclosed in the Directors' Report have been omitted as they are included in the Strategic Report. These matters relate to financial instruments and risk management.
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 director is aware, there is no relevant audit information of which the Company's auditors are unaware; and
∙the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.
Post balance sheet events
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There have been no significant events affecting the Company since the year end.
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
During the year, PricewaterhouseCoopers LLC was appointed as auditor.
The auditors, PricewaterhouseCoopers LLC, 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 by:
J Bauló Miralles
Director
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
Report on the audit of the financial statements
Opinion
In our opinion, Europastry UK Ltd (formerly known as Dawn Foods Frozen Limited)’s financial statements:
∙give a true and fair view of the state of the Company’s affairs as at 31 December 2023 and of its profit for the year then ended;
∙have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”, and applicable law); and
∙have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements, included within the Annual report which comprise: the Statement of Financial Position as at 31 December 2023; the Statement of Comprehensive Income and the Statement of Changes in Equity for the year then ended; and the notes to the financial statements, which include a description of the significant accounting policies.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities under ISAs (UK) are further described in the Auditors’ responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We remained independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, which includes the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements.
Conclusions relating to going concern
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.
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.
However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the Company's ability to continue as a going concern.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
Reporting on other information
The other information comprises all of the information in the Annual report other than the financial statements and our Auditors’ Report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly stated in this report, any form of assurance thereon.
In connection with our audit of the financial statements, 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 audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement of the financial statements or a material misstatement of the other information. 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 based on these responsibilities.
With respect to the Strategic Report and Directors' Report, we also considered whether the disclosures required by the UK Companies Act 2006 have been included.
Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain opinions and matters as described below.
Strategic Report and Directors' Report
In our opinion, based on the work undertaken in the course of the audit, the information given in the Strategic Report and Directors' Report for the year ended 31 December 2023 is consistent with the financial statements and has been prepared in accordance with applicable legal requirements.
In light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we did not identify any material misstatements in the Strategic Report and Directors' Report.
Responsibilities for the financial statements and the audit
Responsibilities of the directors for the financial statements
As explained more fully in the Statement of directors' responsibilities in respect of the financial statements, the directors are responsible for the preparation of the financial statements in accordance with the applicable framework and for being satisfied that they give a true and fair view. The directors are also responsible for such internal control as they 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.
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
Auditors’ 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 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 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.
Based on our understanding of the Company and industry, we identified that the principal risks of non-compliance with laws and regulations related to food safety laws and regulations and health and safety legislation, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the financial statements such as the Companies Act 2006 and tax legislation. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to the manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting of inappropriate journal entries or the introduction of management bias into accounting estimates with a view to manipulating the financial results of the Company. Audit procedures performed by the engagement team included:
∙Discussion with management, including consideration of known or suspected instances of non-compliance with laws and regulations and/or fraud;
∙Review of board meeting minutes and review of correspondence with the Company's legal advisors;
∙Obtaining an understanding of management's controls designed to prevent and detect irregularities such as those relating to non-compliance with laws and regulations and/or fraud;
∙Challenging assumptions and judgements made by management in their significant accounting estimates, in particular in relation to assessing the recoverability of goodwill and customer contracts; and
∙Identifying and, where appropriate, testing journal entries posted with unusual account combinations focussing on any journals impacting revenue.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors’ Report.
Use of this report
This report, including the opinions, has been prepared for and only for the Company’s members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
Other required reporting
Companies Act 2006 exception reporting
Under the Companies Act 2006 we are required to report to you if, in our opinion:
∙we have not obtained all the information and explanations we require for our audit; or
∙adequate accounting records have not been kept by the Company, or returns adequate for our audit have not been received from branches not visited by us; or
∙certain disclosures of directors’ remuneration specified by law are not made; or
∙the financial statements are not in agreement with the accounting records and returns.
We have no exceptions to report arising from this responsibility.
Dasa Brynjolffssen (Senior Stautory Auditor)
for and behalf of PricewaterhouseCoopers LLC
Chartered Accountants and Statutory Auditors
Douglas, Isle of Man
Date: 31 July 2025
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
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Year
ended
31 December
2023
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Period ended
31 December
2022
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Interest payable and similar expenses
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Profit/(loss) for the financial year
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Other comprehensive income
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Total comprehensive income for the year
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The Statement of Comprehensive Income has been prepared on the basis that all operations are continuing operations.
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The notes on pages 13 to 29 form part of these financial statements.
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
REGISTERED NUMBER: 13826846
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023
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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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The financial statements were approved and authorised for issue by the board and were signed on its behalf by by:
The notes on pages 13 to 29 form part of these financial statements.
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
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At incorporation on 4 January 2022
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Comprehensive loss for the year
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Other comprehensive income for the year
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Total comprehensive loss for the year
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Comprehensive income for the year
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Other comprehensive income for the year
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Total comprehensive income for the year
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The notes on pages 13 to 29 form part of these financial statements.
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Europastry UK Ltd (formerly known as Dawn Foods Frozen Limited) (the 'Company') is a private company limited by shares and incorporated in England and Wales. The Company's registered number is 13826846.
During the year, the Company changed its registered office address from Worcester Road, Evesham, Worcestershire, WR11 4QU to Unit 3, Lauriston Business Park, Pitchill, Evesham, Worcestershire, WR11 8SN.
The Company was incorporated on 4 January 2022. The prior period comparatives correspond for the first financial period ended 31 December 2022.
During the year, the Company changed its name from Dawn Foods Frozen Limited to Europastry UK Ltd.
The principal activity of the Company is the wholesale of frozen bakery products.
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 management to exercise judgement in applying the Company's accounting policies (see note 3).
The financial statements have been presented in Pounds Sterling as this is the currency of the primary economic environment in which the Company operates and is rounded to the nearest pound.
The following principal accounting policies have been applied:
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Financial Reporting Standard 102 - reduced disclosure exemptions
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The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
∙the requirements of Section 7 Statement of Cash Flows;
∙the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
∙the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
∙the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
∙the requirements of Section 33 Related Party Disclosures paragraph 33.7.
This information is included in the consolidated financial statements of Europastry S.A. as at 31 December 2023 and these financial statements may be obtained from Plaza Xavier Cugat, 2-ED C, 4a Planta 08174, Sant Cuga Del Valles, Barcelona, Spain.
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
The Company's business activities, together with the factors likely to affect its future development, its financial position and its exposure to risks are described in the Strategic Report. The Company has net liabilities of £52,551 at 31 December 2023 (2022: net liabilities of £515,244). Whilst the Company is forecast to be profitable and operationally cash generative, it is dependent on group borrowings and the continued support of the immediate parent company, Europastry S.A. The Company therefore has received a letter of support from the immediate parent company, which confirms that it will continue to support the Company in order to meet its liabilities as they fall due for a period of at least twelve months after the date the financial statements are authorised for issue.
The directors have assessed the ability of Europastry S.A. to support the Company and after making enquiries of the Group, the directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the Annual report and accounts.
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss.
All other foreign exchange gains and losses are presented in the Statement of Comprehensive Income within 'Administrative expenses'.
Turnover 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 turnover 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.
Turnover is measured at the fair value of the consideration received or receivable. This means that turnover is recognised net of any trade discounts, volume rebates, and similar allowances.
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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Operating leases: the Company as lessee
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Rentals paid under operating leases are charged to the Statement of Comprehensive Income on a straight-line basis over the lease term.
Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.
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Interest payable and similar expenses
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Interest payable and similar expenses are charged to the Statement of Comprehensive Income over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in the Statement of Comprehensive Income when they fall due. Amounts not paid are shown in other taxation and social security as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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 the Statement of Comprehensive Income 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 operates and generates 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.
- 16 -
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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 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 Statement of Comprehensive Income over its useful economic life of 5 years.
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.
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.
The estimated useful lives range as follows:
Amortisation is included in the 'administrative expenses' in the Statement of Comprehensive Income.
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis.
At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in the Statement of Comprehensive Income.
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
- 17 -
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
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Provisions for liabilities
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Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to the Statement of Comprehensive Income in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the reporting date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Statement of Financial Position.
The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the Company's Statement of Financial Position 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 trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.
Impairment of financial assets
Financial assets are assessed for indicators of impairment at each reporting date.
Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.
- 18 -
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
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Financial instruments (continued)
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If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.
Financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
Derecognition of financial assets
Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.
Derecognition of financial liabilities
Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.
- 19 -
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Judgements in applying accounting policies and key sources of estimation uncertainty
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In applying the Company’s accounting policies, the directors are required to make judgements, estimates and assumptions in determining the carrying amounts of assets and liabilities. The directors’ judgements, estimates and assumptions are based on the best and most reliable evidence available at the time when the decisions are made, and are based on historical experience and other factors that are considered to be applicable. Due to the inherent subjectivity involved in making such judgements, estimates and assumptions, the actual results and outcomes may differ.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the year in which the estimate is revised, if the revision affects only that year, or in the year of the revision and future years, if the revision affects both current and future years.
3.1 Critical judgements in applying the Company’s accounting policies
Critical judgements are those that the directors have made in the process of applying the Company's accounting policies that have the most significant effect on the amounts recognised in the financial statements.
The directors do not consider there to be any critical judgements.
3.2 Key sources of estimation uncertainty
A key source of estimation uncertainty is one where an estimate has been made in these financial statements where a reasonably possible change in a key assumption could result in a material change to that estimate in the subsequent year.
The directors do not consider there to be any key sources of estimation uncertainty.
- 20 -
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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An analysis of turnover by class of business is as follows:
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Year
ended
31
December
2023
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Period
ended
31 December 2022
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Wholesale of frozen bakery products
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Analysis of turnover by country of destination:
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Year
ended
31
December
2023
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Period
ended
31
December
2022
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Year
ended
31
December
2023
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Period
ended
31 December 2022
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Intercompany recharge associated with transfer pricing policy
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- 21 -
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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The operating profit/(loss) is stated after charging/(crediting):
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Year
ended
31
December
2023
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Period
ended
31 December 2022
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Amortisation of intangible assets
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Year
ended
31
December
2023
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Period
ended
31 December 2022
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Fees payable to the Company's auditor for the audit of the Company's annual financial statements
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In the current year the audit fee is payable to PricewaterhouseCoopers LLC and in the prior year the audit fee was payable to Ernst & Young LLP.
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Auditors' liability limitation
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The directors of the Company have agreed with the Company's auditors that the auditor's liability to damages for breach of duty in relation to the audit of the Company's financial statements for the period to 31 December 2023 will be limited to the greater of £100,000 or 3 times the auditor's fees for the statutory audit, and that, in any event, the auditor's liability for damages will be limited to that part of any loss suffered by the Company as is just and equitable having regard to the extent to which the auditor, the Company and any third parties are responsible for the loss in question. The shareholders of the Company approved this liability limitation agreement, as required by the Companies Act 2006,in a board meeting on 26 March 2024.
- 22 -
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Staff costs were as follows:
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Year
ended
31
December
2023
|
Period
ended
31 December 2022
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Cost of defined contribution scheme
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The average monthly number of employees during the year was as follows:
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Year
ended
31
December
2023
|
Period
ended
31 December 2022
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The directors do not receive remuneration directly from the Company. However, a portion of the costs associated with their management functions is recharged to the company through management fees. The amount included in the management fees for this financial year is £104,095 (2022: £nil).
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Interest payable and similar expenses
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Year
ended
31
December
2023
|
Period
ended
31 December 2022
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Loans from group undertakings
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- 23 -
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Year
ended
31
December
2023
|
Period
ended
31 December 2022
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Current tax on profits for the year/period
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Origination and reversal of timing differences
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Factors affecting tax charge for the year/period
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The tax assessed for the year is higher than (2022: lower than) the standard rate of corporation tax in the UK of 23.52% (period ended 31 December 2022:19%). The differences are explained below:
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Year
ended
31
December
2023
|
Period
ended
31
December
2022
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Profit/(loss) multiplied by standard rate of corporation tax in the UK of 23.52% (period ended 31 December 2022: 19%)
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Expenses not deductible for tax purposes
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Remeasurement of deferred tax for change in tax rates
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Deferred tax on business combination
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Total tax charge/(credit) for the year/period
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- 24 -
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
12.Tax on profit/loss (continued)
In the Spring Budget 2021, the UK Government announced that from 1 April 2023 the corporation tax rate would increase to 25% (rather than remaining at 19%, as previously enacted). There has been no change to corporation tax rates for the financial year ended 31 December 2024. For the financial year ended 31 December 2024 the weighted average tax rate is 25% (31 December 2023 weighted average tax rate was 23.5%). Deferred taxes at the balance sheet date have been measured using these enacted tax rates and reflected in these financial statements.
OECD Pillar Two model rules
The Company has assessed the implications of Pillar II requirements and confirms that there are no significant impacts on the financial statements for the year ended 31 December 2023. The directors have reviewed the relevant regulations and determined that the Company is in compliance with all applicable requirements.
As there are no material impacts, no further disclosures are necessary in this regard.
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The Goodwill and contracts relate to the acquisition of trade, assets and liabilities from Dawn Foods Limited in the prior year.
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- 25 -
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Finished goods and goods for resale
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During the year, a stock provision of £32,025 (2022: £nil) was recognised.
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Debtors: amounts falling due within one year
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Prepayments and accrued income
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Cash and cash equivalents
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- 26 -
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Creditors: amounts falling due within one year
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Amounts owed to group undertakings (note 18)
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Other taxation and social security
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In the prior year, trade creditors were disclosed as a single line item amounting to £7,768,176. In the current year, the note has been re-presented to separately disclose group trade creditors from trade creditors. This is only a presentational change to provide greater clarity and transparency. Prior year balances remain unchanged and have not been restated.
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Creditors: amounts falling due after more than one year
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Amounts owed to group undertakings
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Within amounts owed to group undertakings is £7,475,308 (2022: £nil) owed to the parent company. The loan became long-term in November 2023 as part of a new loan facility with the parent company. Amounts are unsecured, accrue interest at 6.197% and are repayable on 15 November 2028.
The remaining amounts owed to group undertakings are £3,191,904 (2022: £3,650,313) owed to another group company. The loan was renewed with the group company in November 2023. Amounts are unsecured, accrue interest at 4% till 15 November 2023 and 6.197% from 15 November 2023 (2023: 4%) and is repayable on 15 November 2028.
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- 27 -
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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Charged to Statement of Comprehensive Income
|
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The provision for deferred taxation is made up as follows:
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Short term timing differences
|
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Losses and other deductions
|
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Impact of acquired intangible assets
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Allotted, called up and fully paid
|
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1 (2022: 1) Ordinary share of £1
|
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The ordinary shares entitle the holder to one voting right and no right to fixed income.
|
Profit and loss account
This reserve represents the cumulative profits and losses of the Company.
The Company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £59,612 (2022: £35,455). Contributions totalling £86,031 (2022: £8,482) were payable to the fund at the Statement of Financial Position date and are included in other taxation and social security.
- 28 -
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EUROPASTRY UK LTD (FORMERLY KNOWN AS DAWN FOODS FROZEN LIMITED)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
|
|
Commitments under operating leases
|
|
|
At 31 December 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Later than 1 year and not later than 5 years
|
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Related party transactions
|
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The Company is exempt from disclosing related party transactions undertaken with other wholly owned members of the group that have been concluded under normal market conditions.
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Post balance sheet events
|
There have been no significant events affecting the Company since the year end.
The Company's immediate parent company is Europastry S.A., a company incorporated in Spain. Its registered office is Plaza Xavier Cugat, 2-ED C, 4a Planta 08174, Sant Cugat Del Valles, Barcelona, Spain. Europastry S.A is the smallest Group to prepare consolidated accounts. Copies of the consolidated financial statements can be obtained from its registered office.
The Company's ultimate parent company is Galles Office S.L., a company incorporated in Spain. Its registered office is C/ Santa Fe de Nou Mexic, 1 5.1 A., Barcelona, Spain. Galles Office S.L. is the largest Group to prepare consolidated accounts. Copies of the consolidated financial statements can be obtained from its registered office.
- 29 -
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