Company Registration No. 11465212 (England and Wales)
CARALLON GROUP HOLDINGS LIMITED
CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
31 JULY 2024
Kings House
9-10 Haymarket
London
SW1Y 4BP
CARALLON GROUP HOLDINGS LIMITED
CONTENTS
Page
Company information
1
Strategic report
2 - 3
Directors' report
5
Directors' responsibilities statement
4
Independent auditor's report
6 - 9
Group statement of comprehensive income
10
Group balance sheet
11
Company balance sheet
13
Group statement of changes in equity
12
Company statement of changes in equity
14
Group statement of cash flows
15
Notes to the financial statements
16 - 28
CARALLON GROUP HOLDINGS LIMITED
COMPANY INFORMATION
- 1 -
Directors
Mr C Hunt
Mr R J Mead
Secretary
Mr C Hunt
Company number
11465212
Registered office
272 Gunnersbury Avenue
London
W4 5QB
Auditor
TC Group London Limited
Kings House
9-10 Haymarket
London
United Kingdom
SW1Y 4BP
CARALLON GROUP HOLDINGS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JULY 2024
- 2 -

The directors present the strategic report for the year ended 31 July 2024.

Principle activity

The principal activity of the Group is the design, development, and manufacture of industry-leading control products for the architectural, entertainment, film and broadcast industries.

 

Business Review

The Group remained profitable during the financial year and continues to manage several development projects with extended life cycles for all its major customers. This allows Carallon to plan with a long-term growth strategy in mind.

 

Direct manufacturing income declined by around 12% compared to the previous year due to a combination of some component supply chain issues and some easing of demand for its video processing products, while income from development contracting increased by 13%.

 

Carallon manages its operations, administration, and manufacturing activities from its purpose-built facility in Gunnersbury, to accommodate some planned growth in manufacturing and services.

 

The Carallon group of companies is ultimately owned by an Employee Ownership Trust, which directly works for the benefit of its employees and enables its staff to share in all rights and benefits.

Principal risks and uncertainties

Carallon’s main customers are primarily export-focused, and cost of living and inflationary pressures may pose a risk to both its contracting revenue and manufacturing income if there are consequent effects on demand. The recent implementation of US tariffs also needs to be factored as a potential risk, but the exact scale of any impact can’t be predicted with any certainty at the time of filing.

 

The Group has implemented enhanced IT security measures to protect against potential data loss and cyber-crime. VAT and other liabilities have been paid to terms.

 

Carallon uses a contract manufacturer for some of its electronics requirements, and there is a risk to production should global or environmental events impact on its ability to supply key assemblies. The significant disruption in the global supply chain for electronics has reduced and the lead times of core components has returned to nearer normal levels. However, longer lead-time ordering is still in place for some parts, and some redesign of affected materials has been adopted to mitigate the threat of those components which are end-of-life or difficult to source.

 

Financial and credit risk

Carallon has budgetary and forecasting procedures in place to monitor its working capital and cash requirements. An enhanced internal ERP system is in place to support audit and approval processes for purchases, expenses, and credit management. Customer trade credit limits are regularly assessed by senior management.

 

Currency risk

The Group holds debtor and creditor balances in foreign currencies, and where possible attempts to buy and sell in US dollars to set off balances against each other. Bank reserves of foreign currency are regularly monitored and transferred to pounds at prevailing rates of exchange.

CARALLON GROUP HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 3 -
Key performance indicators

The Group monitors its performance primarily via comparative earnings before dividends and tax after

adjustments for non-recurring expenditure.

 

 

 

 

 

 

2024

 

2023

 

 

 

 

 

 

 

 

Operating profit before interest, tax and dividends

1,510,802

 

3,272,534

 

 

Depreciation and amortisation

205,783

 

145,116

 

 

Adjusted operating profit

1,716,585

 

3,417,650

 

 

On behalf of the board

.............................................
Mr C Hunt
Director
Date: .............................................
CARALLON GROUP HOLDINGS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 JULY 2024
- 4 -

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

CARALLON GROUP HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JULY 2024
- 5 -

The directors present their annual report and financial statements for the year ended 31 July 2024.

Principal activities

The principal activity of the company and group continued to be that of the development and design of control systems.

Results and dividends

The results for the year are set out on page 10.

During the year, the company made distributions of £282,937 to the Employee Ownership Trust. The directors do not recommend payment of a further distribution.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Mr C Hunt
Mr R J Mead
Strategic report

The truegroup has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the group's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of the exposure of the group to financial, credit and currency risk.

Auditor

TC Group are deemed to be re-appointed under section 487(2) of the Companies Act 2006.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

On behalf of the board
..............................
Mr C Hunt
Director
Date: .................................
2025-08-19
CARALLON GROUP HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF CARALLON GROUP HOLDINGS LIMITED
- 6 -
Opinion

We have audited the financial statements of Carallon Group Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 July 2024 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and 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.

CARALLON GROUP HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CARALLON GROUP HOLDINGS LIMITED
- 7 -

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the 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 parent company or to cease operations, or have no realistic alternative but to do so.

CARALLON GROUP HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CARALLON GROUP HOLDINGS LIMITED
- 8 -
Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

 

Irregularities, including fraud, are instances of non-compliance with laws and regulations. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

 

Extent to which the audit was considered capable of detecting irregularities, including fraud

The objectives of our audit, in respect to fraud, are: to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and its management.

Our approach was as follows:

 

CARALLON GROUP HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CARALLON GROUP HOLDINGS LIMITED
- 9 -

Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Where the risk was considered to be higher, we performed audit procedures to address each identified fraud risk. These procedures included: testing manual journals; reviewing the financial statement disclosures and testing to supporting documentation; performing analytical procedures; and enquiring of management, and were designed to provide reasonable assurance that the financial statements were free from fraud or error.

 

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Robert Keen FCCA (Senior Statutory Auditor)
For and on behalf of TC Group London Limited
Statutory Auditor
Date: .........................
2025-08-19
Office: London
CARALLON GROUP HOLDINGS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JULY 2024
- 10 -
2024
2023
Notes
£
£
Turnover
3
29,960,913
36,477,450
Cost of sales
(22,268,801)
(27,409,092)
Gross profit
7,692,112
9,068,358
Distribution costs
(138,902)
(209,559)
Administrative expenses
(6,441,054)
(5,972,371)
Other operating income
398,646
386,106
Operating profit
5
1,510,802
3,272,534
Interest payable and similar expenses
8
(28,680)
(24,544)
Profit before taxation
1,482,121
3,247,990
Tax on profit
7
33,898
(99,313)
Profit for the financial year
1,516,019
3,148,677
Profit for the financial year is all attributable to the owner of the parent company.
Total comprehensive income for the year is all attributable to the owner of the parent company.
CARALLON GROUP HOLDINGS LIMITED
GROUP BALANCE SHEET
AS AT
31 JULY 2024
31 July 2024
- 11 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
10
992,447
1,026,075
Current assets
Stocks
12
5,140,869
4,930,947
Debtors
13
10,082,930
6,835,184
Cash at bank and in hand
1,113,207
2,053,227
16,337,006
13,819,358
Creditors: amounts falling due within one year
15
(6,389,624)
(5,032,688)
Net current assets
9,947,382
8,786,670
Total assets less current liabilities
10,939,829
9,812,745
Creditors: amounts falling due after more than one year
16
(51,479)
(157,477)
Net assets
10,888,350
9,655,268
Capital and reserves
Called up share capital
19
171
171
Share premium account
3,192,474
3,192,474
Profit and loss reserves
7,695,705
6,462,623
Total equity
10,888,350
9,655,268
The financial statements were approved by the board of directors and authorised for issue on ......................... and are signed on its behalf by:
2025-08-19
..............................................
Mr C  Hunt
Director
Company registration number 11465212 (England and Wales)
CARALLON GROUP HOLDINGS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JULY 2024
- 12 -
Share capital
Share premium account
Profit and loss reserves
Total
£
£
£
£
Balance at 1 August 2022
171
3,192,474
4,445,696
7,638,341
Year ended 31 July 2023:
Profit and total comprehensive income
-
-
3,148,677
3,148,677
Distributions to Employee Ownership Trust
-
-
(1,131,750)
(1,131,750)
Balance at 31 July 2023
171
3,192,474
6,462,623
9,655,268
Year ended 31 July 2024:
Profit and total comprehensive income
-
-
1,516,019
1,516,019
Distributions to Employee Ownership Trust
-
-
(282,937)
(282,937)
Balance at 31 July 2024
171
3,192,474
7,695,705
10,888,350
CARALLON GROUP HOLDINGS LIMITED
COMPANY BALANCE SHEET
AS AT 31 JULY 2024
31 July 2024
- 13 -
2024
2023
Notes
£
£
£
£
Fixed assets
Investments
9
3,000,000
3,000,000
Current assets
Debtors
13
192,645
192,645
Net current assets
192,645
192,645
Total assets less current liabilities
3,192,645
3,192,645
Capital and reserves
Called up share capital
19
171
171
Share premium account
3,192,474
3,192,474
Total equity
3,192,645
3,192,645

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £282,937 (2023 - £1,131,750 profit).

The financial statements were approved by the board of directors and authorised for issue on ......................... and are signed on its behalf by:
2025-08-19
..............................
Mr C  Hunt
Director
Company Registration No. 11465212
The notes on pages 16 to 28 form part of these financial statements
CARALLON GROUP HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JULY 2024
- 14 -
Share capital
Share premium account
Profit and loss reserves
Total
£
£
£
£
Balance at 1 August 2022
171
3,192,474
-
0
3,192,645
Year ended 31 July 2023:
Profit and total comprehensive income for the year
-
-
1,131,750
1,131,750
Distributions to Employee Ownership Trust
-
-
(1,131,750)
(1,131,750)
Balance at 31 July 2023
171
3,192,474
-
0
3,192,645
Year ended 31 July 2024:
Profit and total comprehensive income for the year
-
-
282,937
282,937
Distributions to Employee Ownership Trust
-
-
(282,937)
(282,937)
Balance at 31 July 2024
171
3,192,474
-
0
3,192,645
The notes on pages 16 to 28 form part of these financial statements
CARALLON GROUP HOLDINGS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 JULY 2024
- 15 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
23
(394,358)
2,676,549
Interest paid
(28,680)
(24,544)
Income taxes (paid)/refunded
-
66,842
Net cash (outflow)/inflow from operating activities
(423,038)
2,718,847
Investing activities
Purchase of tangible fixed assets
(143,471)
(263,894)
Net cash used in investing activities
(143,471)
(263,894)
Financing activities
Payment of finance leases obligations
(90,569)
(144,220)
Distributions to Employee Ownership Trust
(282,942)
(1,131,750)
Net cash used in financing activities
(373,511)
(1,275,970)
Net (decrease)/increase in cash and cash equivalents
(940,020)
1,178,983
Cash and cash equivalents at beginning of year
2,053,227
874,244
Cash and cash equivalents at end of year
1,113,207
2,053,227
The notes on pages 16 to 28 form part of these financial statements
CARALLON GROUP HOLDINGS LIMITED
GROUP STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 16 -
1
Judgements and key sources of estimation uncertainty

In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Stock provision

Stock values can decrease due to deterioration, damage or obsolescence. Provisions for slow-moving and obsolete stock are based on management's judgement using their expertise and knowledge.

2
Accounting policies
Company information

Carallon Group Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is .

 

The group consists of Carallon Group Holdings Limited and all of its subsidiaries.

2.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

2.2
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill.

CARALLON GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2024
2
Accounting policies
(Continued)
- 17 -
2.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Carallon Group Holdings Limited together with all entities controlled by the parent company which includes it's subsidiaries, Carallon Holdings Limited and Carallon Limited.

 

All financial statements are made up to 31 July 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

2.4
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

2.5
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Revenue from contracts for the provision of services is recognised by reference to the stage of completion.

Royalties due to the company on sale of goods are recognised when the amount of revenue can be measured reliably and it is probable that the economic benefits associated with the transaction will flow to the entity.

2.6
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Leasehold improvements
Over the term of the lease
Fixtures, fittings and equipment
3 years straight line
Computer equipment
3 years straight line

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

CARALLON GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
2
Accounting policies
(Continued)
- 18 -
2.7
Fixed asset investments

In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

2.8
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and associated costs which have been incurred in bringing the stocks to their present location and condition.

 

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

2.9
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks.

2.10
Financial instruments

The group 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 group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

CARALLON GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
2
Accounting policies
(Continued)
- 19 -
Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors and loans from fellow group companies are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Derecognition of financial liabilities

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

CARALLON GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
2
Accounting policies
(Continued)
- 20 -
2.11
Equity instruments

Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.

2.12
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

2.13
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

2.14
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

2.15
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

CARALLON GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
2
Accounting policies
(Continued)
- 21 -

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

2.16
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

2.17

Research and development

Research and development expenditure is written off as incurred.

3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Product design and development
29,960,913
36,477,450
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
29,960,913
36,477,450
4
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
6,175
1,950
Audit of the financial statements of the company's subsidiaries
22,875
17,700
29,050
19,650
For other services
All other non-audit services
-
6,925
CARALLON GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 22 -
5
Operating profit
2024
2023
£
£
Operating profit for the year is stated after charging:
Exchange losses
49,307
82,881
Depreciation of owned tangible fixed assets
177,104
61,543
Depreciation of tangible fixed assets held under finance leases
100,615
83,573
Operating lease charges
1,060,793
1,103,160
6
Employees

The average monthly number of persons (including directors) employed by the group and company during the year was:

Group
Company
2024
2023
2024
2023
Number
Number
Number
Number
Directors
6
5
-
-
Direct staff
64
51
-
-
Admin, operational and manufacturing staff
62
50
-
-
Total
132
106
0
0

Their aggregate remuneration comprised:

Group
Company
2024
2023
2024
2023
£
£
£
£
Wages and salaries
6,563,804
5,437,701
-
0
-
0
Social security costs
686,298
618,158
-
-
Pension costs
299,424
241,892
-
0
-
0
7,549,526
6,297,751
-
0
-
0
7
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
(33,898)
(44,687)
CARALLON GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
7
Taxation
2024
2023
£
£
(Continued)
- 23 -
Deferred tax
Origination and reversal of timing differences
-
0
144,000
Total tax (credit)/charge
(33,898)
99,313

The actual (credit)/charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2024
2023
£
£
Profit before taxation
1,482,121
3,247,990
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 21.01%)
370,530
682,403
Tax effect of expenses that are not deductible in determining taxable profit
542
469
Tax effect of utilisation of tax losses not previously recognised
(3,578)
(146,311)
Permanent capital allowances in excess of depreciation
(35,868)
(120,061)
Depreciation on assets not qualifying for tax allowances
44,276
-
Research and development enhanced expenditure
(314,124)
(408,937)
RDEC tax credit
(95,676)
(52,250)
Deferred tax asset for tax losses
-
0
144,000
Taxation (credit)/charge
(33,898)
99,313
8
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
-
362
Other finance costs:
Interest on hire purchase agreements
28,680
24,182
Total finance costs
28,680
24,544
CARALLON GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 24 -
9
Fixed asset investments
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Investments in subsidiaries
11
-
0
-
0
3,000,000
3,000,000
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 August 2023 and 31 July 2024
3,000,000
Carrying amount
At 31 July 2024
3,000,000
At 31 July 2023
3,000,000
10
Tangible fixed assets
Group
Leasehold improvements
Fixtures, fittings and equipment
Computer equipment
Total
£
£
£
£
Cost
At 1 August 2023
972,804
74,190
578,965
1,625,959
Additions
116,270
-
0
27,201
143,471
At 31 July 2024
1,089,074
74,190
606,166
1,769,430
Depreciation and impairment
At 1 August 2023
90,470
71,745
437,669
599,884
Depreciation charged in the year
100,615
1,188
75,296
177,099
At 31 July 2024
191,085
72,933
512,965
776,983
Carrying amount
At 31 July 2024
897,989
1,257
93,201
992,447
At 31 July 2023
882,335
2,447
141,293
1,026,075
The company had no tangible fixed assets at 31 July 2024 or 31 July 2023.
CARALLON GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 25 -
11
Subsidiaries

Details of the company's subsidiaries at 31 July 2024 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Indirect
Carallon Holdings Limited
United Kingdom
Ordinary shares
100
-
Carallon Ltd
United Kingdom
Ordinary shares
0
100
12
Stocks
Group
Company
2024
2023
2024
2023
£
£
£
£
Raw materials and consumables
5,140,869
4,930,947
-
-
13
Debtors
Group
Company
2024
2023
2024
2023
Amounts falling due within one year:
£
£
£
£
Trade debtors
4,124,042
479,966
-
0
-
0
Corporation tax recoverable
79,530
45,632
-
0
-
0
Amounts owed by group undertakings
-
-
192,645
192,645
Amounts due from connected companies
4,719,463
5,179,225
-
0
-
0
Prepayments and accrued income
1,159,895
1,130,361
-
0
-
0
10,082,930
6,835,184
192,645
192,645
14
Financial instruments
Group
Company
2024
2023
2024
2023
£
£
£
£
Carrying amount of financial assets
Debt instruments measured at amortised cost
8,843,505
5,659,191
192,645
192,645
Carrying amount of financial liabilities
Measured at amortised cost
5,778,320
4,824,381
-
-
CARALLON GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 26 -
15
Creditors: amounts falling due within one year
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Obligations under hire purchase agreements
17
170,790
155,361
-
0
-
0
Trade creditors
3,112,848
3,065,543
-
0
-
0
Other taxation and social security
662,783
365,784
-
-
Other creditors
42,664
56,397
-
0
-
0
Accruals and deferred income
2,400,539
1,389,603
-
0
-
0
6,389,624
5,032,688
-
0
-
0
16
Creditors: amounts falling due after more than one year
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Obligations under hire purchase agreements
17
51,479
157,477
-
0
-
0
17
Hire purchase agreements
Group
Company
2024
2023
2024
2023
£
£
£
£
Future minimum lease payments due under hire purchase agreements:
Within one year
170,790
155,361
-
0
-
0
In two to five years
51,479
157,477
-
0
-
0
222,269
312,838
-
-

Hire purchase payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 5 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

CARALLON GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 27 -
18
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
299,424
241,892

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

19
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of 5p each
3,395
3,395
170
170
Deferred shares of £1 each
1
1
1
1
3,396
3,396
171
171
20
Operating lease commitments

At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

Group
Company
2024
2023
2024
2023
£
£
£
£
Within one year
1,172,992
662,996
-
-
Between two and five years
3,569,977
4,589,970
-
-
4,742,969
5,252,966
-
-
21
Events after the reporting date

After the year-end, the company made distributions of £282,937 to the Employee Ownership Trust.

CARALLON GROUP HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2024
- 28 -
22
Related party transactions

During the year, the group sold goods and services to, and received royalties from, connected companies in the sum of £27,601,198 (2023- £35,407,464 ).

Also during the year, the group received contributions from connected companies towards rent amounting to £432,391 (2023 - £386,106).

At the year end, the group was owed £8,378,446 (2023 -£5,179,225 ) by the connected companies.

23
Cash (absorbed by)/generated from group operations
2024
2023
£
£
Profit for the year after tax
1,516,019
3,148,677
Adjustments for:
Taxation (credited)/charged
(33,898)
99,313
Finance costs
28,680
24,544
Depreciation and impairment of tangible fixed assets
177,099
145,116
Movements in working capital:
Increase in stocks
(209,922)
(647,756)
Increase in debtors
(3,213,843)
(1,170,751)
Increase in creditors
1,341,507
1,077,406
Cash (absorbed by)/generated from operations
(394,358)
2,676,549
24
Analysis of changes in net funds - group
1 August 2023
Cash flows
31 July 2024
£
£
£
Cash at bank and in hand
2,053,227
(940,020)
1,113,207
Obligations under finance leases
(312,838)
90,569
(222,269)
1,740,389
(849,451)
890,938
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