Company registration number 02496978 (England and Wales)
VARITRONIX (U.K.) LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
VARITRONIX (U.K.) LIMITED
COMPANY INFORMATION
Directors
W Y S Ko
M W J Burke
K C Cheong
Company number
02496978
Registered office
82 St John Street
London
EC1M 4JN
Auditor
Beavis Morgan Audit Limited
82 St John Street
London
EC1M 4JN
Business address
Display House
3 Milbanke Court
Milbanke Way
Bracknell
Berkshire
RG12 1RP
VARITRONIX (U.K.) LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Statement of profit or loss and other comprehensive income
8
Statement of financial position
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 25
VARITRONIX (U.K.) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 1 -

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

Review of the business

The company's principal activity is that of marketing and selling electronic equipment.

 

The directors find the results and state of the company's affairs to be in line with their expectations although profits were lower than expected. Profits were primarily impacted by a reduction in revenue due to high interest rates depressing customer purchasing in the year. This has resulted in an increase in stock held on the balance sheet of £4,279,378 (2023: £1,891,085) held for major customers for just in time order purchases. The results of the company for the year, as set out on page 8 show a profit on ordinary activities before tax of £315,573 (2023: £2,274,486). The shareholders' funds of the company total £14,660,013 (2023: £14,436,557). The gross profit margin has decreased to 9.7% from 14.6% in 2023. Annual sales figures and gross profit margins are the company's key performance indicators.

Principal risks and uncertainties

Capital risk

The company manages its capital to ensure it will be able to continue as a going concern while maximising the return to stakeholders through optimisation of the debt and equity balance.

 

The capital structure of the company consists of cash and cash equivalents and equity attributable to equity holders. The company defines share capital and reserves as its equity. The company's policy is to maintain a strong capital base so as to sustain future development of the business. No share options are provided to employees or other external parties.

 

There were no changes in the company's approach to capital management during the year.

 

Credit risk

The company's principal financial assets are bank balances and cash; and trade and other receivables.

 

The company's credit risk is primarily attributable to its trade receivables. The amounts represented in the statement of financial position are net of allowances for doubtful receivables, estimated by the company's management based on prior experience and their assessment of the current economic environment.

 

The credit risk on liquid funds is limited because the counterparties are banks with high credit-ratings assigned by international credit-rating agencies.

 

The company has no significant concentration of credit risk, with exposure over a large number of counterparties and customers. The maximum exposure to credit risk in respect of financial assets held at 31 December 2024 and 31 December 2023 are the amounts shown in the balance sheet.

 

Liquidity risk

Responsibility for liquidity risk management rests with the board of directors, which has established an appropriate liquidity risk management framework for the management of the company's funding and liquidity management requirements. The company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

 

Foreign currency risk

The company undertakes certain transactions denominated in foreign currencies, predominately US dollars and Euros. Hence, exposures to exchange rate fluctuations arise. The management actively reviews the timing of translating their monetary assets and liabilities in foreign currencies into sterling. On this basis, exchange rate exposures are not considered to be a significant risk and therefore exposures are not currently managed.

 

Interest rate risk

The company was not exposed to any interest rate risk at 31 December 2024.

VARITRONIX (U.K.) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 2 -
Development and performance

The directors expect the sales of the company to continue to grow in 2025 but at a more modest rate. The are also expected to increase, with the expectation that interest rates will subside. The market that the company operates in (primarily automotive) continues to face multiple challenges such as inflation and interest rate rises (caused by the Russian war on Ukraine, driving up fuel costs), leading to financing / funding problems for many customers, so some new programs will be delayed until the market conditions are more favourable in Europe. The directors expect the market to continue at a flatter rate for the time being.

On behalf of the board

M W J Burke
Director
19 August 2025
VARITRONIX (U.K.) LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 3 -

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

Results and dividends

The results for the year are set out on page 8.

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

Directors

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

W Y S Ko
M W J Burke
K C Cheong
Financial instruments
Risk management

Details of financial risks and the company's policies for managing those risks are disclosed in the Strategic Report on pages 1 and 2.

Statement of directors' responsibilities

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 International Financial Reporting Standards (IFRSs) as adopted by the United Kingdom. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, International Accounting Standard 1 requires that directors:

 

 

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

VARITRONIX (U.K.) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 4 -
Statement of disclosure to auditor

Each director in office at the date of approval of this annual report confirms that:

 

 

This confirmation is given and should be interpreted in accordance with the provisions of section 418 of the Companies Act 2006.

 

On behalf of the board
M W J Burke
Director
19 August 2025
VARITRONIX (U.K.) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF VARITRONIX (U.K.) LIMITED
- 5 -
Opinion

We have audited the financial statements of Varitronix (U.K.) Limited (the 'company') for the year ended 31 December 2024 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the 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 UK adopted international accounting standards.

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 company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

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:

VARITRONIX (U.K.) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF VARITRONIX (U.K.) LIMITED (CONTINUED)
- 6 -
Matters on which we are required to report by exception

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

 

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

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

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

VARITRONIX (U.K.) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF VARITRONIX (U.K.) LIMITED (CONTINUED)
- 7 -
Extent to which the audit was considered capable of detecting irregularities, including fraud

Discussions with and enquiries of management and those charged with governance were held with a view to identifying those laws and regulations that could be expected to have a material impact on the financial statements. During the engagement team briefing, the outcomes of these discussions and enquiries were shared with the team, as well as consideration as to where and how fraud may occur in the entity.

 

The following laws and regulations were identified as being of significance to the entity:

 

 

 

Audit procedures undertaken in response to the potential risks relating to irregularities (which include fraud and non-compliance with laws and regulations) comprised of: inquiries of management and those charged with governance as to whether the entity complies with such laws and regulations; enquiries with the same concerning any actual or potential litigation or claims; inspection of relevant legal correspondence; review of board minutes; testing the appropriateness of journal entries; and the performance of analytical review to identify unexpected movements in account balances which may be indicative of fraud.

 

No instances of material non-compliance were identified. However, the likelihood of detecting irregularities, including fraud, is limited by the inherent difficulty in detecting irregularities, the effectiveness of the entity’s controls, and the nature, timing and extent of the audit procedures performed. Irregularities that result from fraud might be inherently more difficult to detect than irregularities that result from error. As explained above, there is an unavoidable risk that material misstatements may not be detected, even though the audit has been planned and performed in accordance with ISAs (UK).

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.

Matthew Burge (Senior Statutory Auditor)
For and on behalf of Beavis Morgan Audit Limited, Statutory Auditor
Chartered Accountants
82 St John Street
London
EC1M 4JN
19 August 2025
VARITRONIX (U.K.) LIMITED
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
- 8 -
2024
2023
Notes
£
£
Revenue
3
30,689,120
34,329,973
Cost of sales
(27,713,606)
(29,333,439)
Gross profit
2,975,514
4,996,534
Other operating income
4
352,447
700,166
Distribution costs
(1,494,797)
(1,002,468)
Administrative expenses
(1,513,522)
(2,412,999)
Operating profit
5
319,642
2,281,233
Finance costs
9
(4,069)
(6,747)
Profit before taxation
315,573
2,274,486
Income tax expense
10
(92,117)
(556,247)
Profit and total comprehensive income for the year
20
223,456
1,718,239

The income statement has been prepared on the basis that all operations are continuing operations.

VARITRONIX (U.K.) LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2024
31 December 2024
- 9 -
2024
2023
Notes
£
£
Non-current assets
Property, plant and equipment
11
86,839
170,487
Current assets
Inventories
12
4,279,378
1,891,085
Trade and other receivables
13
5,914,736
10,176,832
Current tax recoverable
462,162
-
0
Cash and cash equivalents
9,647,203
5,357,074
20,303,479
17,424,991
Current liabilities
Trade and other payables
15
5,671,373
2,856,570
Current tax liabilities
-
0
179,613
Lease liabilities
16
53,033
63,838
5,724,406
3,100,021
Net current assets
14,579,073
14,324,970
Non-current liabilities
Lease liabilities
16
5,899
58,900
Net assets
14,660,013
14,436,557
Equity
Called up share capital
19
1,000
1,000
Retained earnings
20
14,659,013
14,435,557
Total equity
14,660,013
14,436,557
The financial statements were approved by the board of directors and authorised for issue on 19 August 2025 and are signed on its behalf by:
W Y S Ko
Director
Company registration number 02496978 (England and Wales)
VARITRONIX (U.K.) LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
- 10 -
Share capital
Retained earnings
Total
£
£
£
Balance at 1 January 2023
1,000
12,717,318
12,718,318
Year ended 31 December 2023:
Profit and total comprehensive income
-
1,718,239
1,718,239
Balance at 31 December 2023
1,000
14,435,557
14,436,557
Year ended 31 December 2024:
Profit and total comprehensive income
-
223,456
223,456
Balance at 31 December 2024
1,000
14,659,013
14,660,013
VARITRONIX (U.K.) LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 11 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
24
4,836,609
(85,585)
Income taxes paid
(733,892)
(468,153)
Net cash inflow/(outflow) from operating activities
4,102,717
(553,738)
Investing activities
Purchase of property, plant and equipment
(3,643)
(39,596)
Proceeds from disposal of property, plant and equipment
-
0
13,000
Interest received
258,930
47,115
Net cash generated from investing activities
255,287
20,519
Financing activities
Payment of lease liabilities
(63,806)
(32,124)
Interest element of lease rentals paid
(4,069)
(6,747)
Net cash used in financing activities
(67,875)
(38,871)
Net increase/(decrease) in cash and cash equivalents
4,290,129
(572,090)
Cash and cash equivalents at beginning of year
5,357,074
5,929,164
Cash and cash equivalents at end of year
9,647,203
5,357,074
VARITRONIX (U.K.) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 12 -
1
Accounting policies
Company information

Varitronix (U.K.) Limited is a private company limited by shares incorporated in England and Wales. The registered office is 82 St John Street, London, EC1M 4JN.

1.1
Accounting convention

The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted for use in the United Kingdom and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS, except as otherwise stated.

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.

Under Companies Act 2006, s454, on a voluntary basis, the directors can amend these financial statements if they subsequently prove to be defective.

1.2
Going concern

The company's business activities, together with the factors likely to affect its future development and position, are set out in the Business Review section of the Strategic Report.true

 

The company has significant financial resources and together with the company's forecasts and projections, taking into account of reasonably possible changes to trading performance, the directors believe that the company is well placed to manage its business risks successfully despite the current economic outlook.

 

The directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Revenue

Revenue is measured based on the consideration specified in a contract with a customer and excludes amounts collected on behalf of third parties. The company recognises revenue when it transfers control of a product or service to a customer.

1.4
Property, plant and equipment

Property, plant and equipment 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:

Land and buildings Leasehold
Over the period of the lease.
Fixtures, fittings & equipment
5 years straight line
Motor vehicles
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 statement of comprehensive income.

VARITRONIX (U.K.) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 13 -
1.5
Impairment of tangible assets

At each reporting end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

1.6
Inventories

Inventories are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition.

Net realisable value is the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution.

1.7
Fair value measurement

IFRS 13 establishes a single source of guidance for all fair value measurements. IFRS 13 does not change when an entity is required to use fair value, but rather provides guidance on how to measure fair value under IFRS when fair value is required or permitted. The resulting calculations under IFRS 13 affected the principles that the company uses to assess the fair value, but the assessment of fair value under IFRS 13 has not materially changed the fair values recognised or disclosed. IFRS 13 mainly impacts the disclosures of the company. It requires specific disclosures about fair value measurements and disclosures of fair values, some of which replace existing disclosure requirements in other standards.

1.8
Cash and cash equivalents

Cash and cash equivalents include cash in hand and deposits held at call with banks. The company has no bank loans or overdrafts at the year end date.

1.9
Financial assets

Financial assets are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument. Financial assets are classified into specified categories, depending on the nature and purpose of the financial assets.

 

At initial recognition, financial assets classified as fair value through profit and loss are measured at fair value and any transaction costs are recognised in profit or loss. Financial assets not classified as fair value through profit and loss are initially measured at fair value plus transaction costs.

Impairment of financial assets

Financial assets, other than those measured at fair value through profit or 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 of the investment have been affected.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.

1.10
Financial liabilities

The company recognises financial debt when the company becomes a party to the contractual provisions of the instruments. Financial liabilities are classified as 'other financial liabilities'.

VARITRONIX (U.K.) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 14 -
Other financial liabilities

Other financial liabilities, including borrowings, trade payables and other short-term monetary liabilities, are initially measured at fair value net of transaction costs directly attributable to the issuance of the financial liability. They are subsequently measured at amortised cost using the effective interest method. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.

Derecognition of financial liabilities

Financial liabilities are derecognised when, and only when, the company’s obligations are discharged, cancelled, or they expire.

1.11
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs.

1.12
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 income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.

Deferred tax is calculated at the tax rates that are expected to apply when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.
1.13
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense.

 

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

 

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

1.14
Retirement benefits

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

VARITRONIX (U.K.) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 15 -
1.15
Leases

At inception, the company assesses whether a contract is, or contains, a lease within the scope of IFRS 16. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Where a tangible asset is acquired through a lease, the company recognises a right-of-use asset and a lease liability at the lease commencement date. Right-of-use assets are included within property, plant and equipment, apart from those that meet the definition of investment property.

The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date plus any initial direct costs and an estimate of the cost of obligations to dismantle, remove, refurbish or restore the underlying asset and the site on which it is located, less any lease incentives received.

 

The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of right-of-use assets are determined on the same basis as those of other property, plant and equipment. The right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are unpaid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the company's incremental borrowing rate. Lease payments included in the measurement of the lease liability comprise fixed payments, variable lease payments that depend on an index or a rate, amounts expected to be payable under a residual value guarantee, and the cost of any options that the company is reasonably certain to exercise, such as the exercise price under a purchase option, lease payments in an optional renewal period, or penalties for early termination of a lease.

The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in: future lease payments arising from a change in an index or rate; the company's estimate of the amount expected to be payable under a residual value guarantee; or the company's assessment of whether it will exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.

The company has elected not to recognise right-of-use assets and lease liabilities for short-term leases of machinery that have a lease term of 12 months or less, or for leases of low-value assets including IT equipment. The payments associated with these leases are recognised in profit or loss on a straight-line basis over the lease term.

1.16
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 are included in the statement of comprehensive income for the period.

VARITRONIX (U.K.) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 16 -
2
Critical accounting estimates and judgements

In the application of the company’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, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

3
Revenue
2024
2023
£
£
Revenue analysed by geographical market
United Kingdom
1,104,500
1,817,629
Rest of Europe
22,885,281
26,755,905
Rest of the World
6,699,339
5,756,439
30,689,120
34,329,973
4
Other operating income
2024
2023
£
£
Commissions income
91,831
278,730
Recharged costs
-
374,321
Interest income
258,930
47,115
Other income
1,686
-
0
352,447
700,166
5
Operating profit
2024
2023
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange (gains)/losses
(110,914)
359,444
Depreciation of property, plant and equipment
87,291
88,375
Profit on disposal of property, plant and equipment
-
(13,000)
Cost of inventories recognised as an expense
27,713,606
29,333,439
6
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
28,750
27,500
VARITRONIX (U.K.) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 17 -
7
Employees

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

2024
2023
Number
Number
Employees
13
11

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
836,370
1,067,937
Social security costs
84,621
150,718
Pension costs
68,840
80,771
989,831
1,299,426
8
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
298,414
276,165

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2023 - 1).

 

Remuneration disclosed above includes the following amounts paid to the highest paid director:

 

2024
2023
£
£
Remuneration for qualifying services
298,414
276,165
Company pension contributions to defined contribution schemes
22,806
21,681
9
Finance costs
2024
2023
£
£
Interest on lease liabilities
4,069
6,747
VARITRONIX (U.K.) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 18 -
10
Income tax expense
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
101,626
555,171
Adjustments in respect of prior periods
(9,509)
1,076
Total UK current tax
92,117
556,247

The charge for the year can be reconciled to the profit per the income statement as follows:

2024
2023
£
£
Profit before taxation
315,573
2,274,486
Expected tax charge based on a corporation tax rate of 25.00% (2023: 23.52%)
78,893
534,972
Effect of expenses not deductible in determining taxable profit
1,059
508
Change in unrecognised deferred tax assets
21,674
20,971
(Over)/under provided in prior years
(9,509)
1,076
Fixed asset differences
-
0
(39)
Remeasurement of deferred tax for changes in tax rates
-
0
(1,241)
Taxation charge for the year
92,117
556,247
VARITRONIX (U.K.) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 19 -
11
Property, plant and equipment
Land and buildings Leasehold
Fixtures, fittings & equipment
Motor vehicles
Total
£
£
£
£
Cost
At 1 January 2023
230,813
68,681
134,459
433,953
Additions
-
0
2,250
37,346
39,596
Disposals
-
0
-
0
(36,298)
(36,298)
At 31 December 2023
230,813
70,931
135,507
437,251
Additions
-
0
3,643
-
0
3,643
At 31 December 2024
230,813
74,574
135,507
440,894
Accumulated depreciation and impairment
At 1 January 2023
133,169
38,775
42,743
214,687
Charge for the year
35,996
11,359
41,020
88,375
Eliminated on disposal
-
0
-
0
(36,298)
(36,298)
At 31 December 2023
169,165
50,134
47,465
266,764
Charge for the year
32,973
9,149
45,169
87,291
At 31 December 2024
202,138
59,283
92,634
354,055
Carrying amount
At 31 December 2024
28,675
15,291
42,873
86,839
At 31 December 2023
61,648
20,797
88,042
170,487

Property, plant and equipment includes right-of-use assets, as follows:

Right-of-use assets
2024
2023
£
£
Net values at the year end
Property
28,675
61,648
Motor vehicles
42,873
88,042
71,548
149,690
Depreciation charge for the year
Property
32,973
35,996
Motor vehicles
45,169
41,020
78,142
77,016

The right to use assets relate to land and business premises leased from Starel Trading Limited, a fellow subsidiary undertaking, and cars are leased from Alphabet (GB) Limited.

VARITRONIX (U.K.) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 20 -
12
Inventories
2024
2023
£
£
Finished goods
4,279,378
1,891,085
13
Trade and other receivables
2024
2023
£
£
Trade receivables
4,357,772
8,951,492
VAT recoverable
-
0
194,013
Amounts owed by related parties
1,390,167
951,309
Other receivables
146,580
12,252
Prepayments
20,217
67,766
5,914,736
10,176,832

Trade receivables disclosed above are classified as loans and receivables and are therefore measured at amortised cost.

14
Trade receivables - credit risk
Fair value of trade receivables

The directors consider that the carrying amount of trade and other receivables is approximately equal to their fair value.

Ageing of past due but not impaired receivables
2024
2023
£
£
Past due less than three months
3,134,796
4,787,691
Past due less than six months
323,743
1,200,101
Past due less than twelve months
588,098
630,168
Past due more than twelve months
425,589
103,641
4,472,226
6,721,601

No significant receivable balances are impaired at the reporting end date.

VARITRONIX (U.K.) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 21 -
15
Trade and other payables
2024
2023
£
£
Trade payables
958,228
531,884
Amounts owed to a related party
4,508,380
2,088,532
Accruals
133,013
196,841
Social security and other taxation
67,254
39,313
Other payables
4,498
-
5,671,373
2,856,570

The directors consider that the carrying amounts of financial liabilities carried at amortised cost in the financial statements approximate to their fair values.

16
Lease liabilities
2024
2023
Maturity analysis
£
£
Within one year
53,968
67,876
In two to five years
5,908
59,843
Total undiscounted liabilities
59,876
127,719
Future finance charges and other adjustments
(944)
(4,981)
Lease liabilities in the financial statements
58,932
122,738

Lease liabilities are classified based on the amounts that are expected to be settled within the next 12 months and after more than 12 months from the reporting date, as follows:

2024
2023
£
£
Current liabilities
53,033
63,838
Non-current liabilities
5,899
58,900
58,932
122,738
2024
2023
Amounts recognised in profit or loss include the following:
£
£
Interest on lease liabilities
4,069
6,747
VARITRONIX (U.K.) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
16
Lease liabilities
(Continued)
- 22 -

The fair value of the company's lease obligations is £58,932 (2023: £122,738). This is assessed by using an incremental borrowing rate of 5%.

 

The company leases land and business premises from Starel Trading Limited, a fellow subsidiary undertaking. The contract has been signed for a 10 year period between 2015 and 2025, with quarterly lease payments of £10,000 payable to the landlord. A rent review is carried out by the landlord every 3 years over the terms of the lease, with the yearly rent payable being determined by the greater of: a) the yearly rent payable immediately prior to the review date; and b) yearly rent at the market rate. During the year the company made total lease payments of £40,000 (2023: £40,000).

 

The company leases motor vehicles from Alphabet (GB) Limited. The contracts have been signed for a 3 year period and fall between the period from 2022 to 2026, with monthly lease payments of £2,323 payable. During the year the company made total lease payments of £27,876 (2023: £25,126).

 

17
Liquidity risk

The following table details the remaining contractual maturity for the company's financial liabilities with agreed repayment periods. The contractual maturity is based on the earliest date on which the company may be required to pay.

Payable within twelve months
£
At 31 December 2023
Trade and other payables
2,558,814
At 31 December 2024
Trade and other payables
5,364,546
18
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
68,840
80,771

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

19
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Authorised
Ordinary shares of £10 each
100
100
1,000
1,000
Issued and fully paid
Ordinary shares of £10 each
100
100
1,000
1,000
VARITRONIX (U.K.) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 23 -
20
Retained earnings
2024
2023
£
£
At the beginning of the year
14,435,557
12,717,318
Profit for the year
223,456
1,718,239
At the end of the year
14,659,013
14,435,557
21
Financial risk management

Details of financial risks and the company's polices for managing those risks are provided in the Strategic Report on pages 1 and 2.

22
Related party transactions

During the year the company entered into the following transactions with related parties:

Sale of goods
Purchase of goods
2024
2023
2024
2023
£
£
£
£
Parent company
-
0
1,021,896
29,757,532
28,599,228
Other related parties
85,514
453,218
-
0
-
0
85,514
1,475,114
29,757,532
28,599,228
Commission received
Recharged costs
2024
2023
2024
2023
£
£
£
£
Parent company
94,476
278,730
-
374,321

The following amounts were outstanding at the reporting end date:

2024
2023
Amounts due to a related party
£
£
Parent company
4,508,380
2,088,532
VARITRONIX (U.K.) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
22
Related party transactions
(Continued)
- 24 -

The following amounts were outstanding at the reporting end date:

2024
2023
Amounts due from related parties
£
£
Parent company
1,383,149
835,792
Other related parties
7,018
115,517
1,390,167
951,309

All balances are unsecured, interest free and repayable within 60 days, All related party transactions are made on an arms length basis. No guarantees have been given or received.

23
Controlling party

At 31 December 2024 the directors consider the immediate parent and the ultimate controlling party of the company to be Varitronix Limited, which is incorporated in Hong Kong, and BOE Technology Group Co., Ltd, which is incorporated in the PRC, respectively. BOE Technology Group Co., Ltd produces financial statements available for public use.

The parent undertaking of the smallest group into which the financial statements of the company are consolidated is BOE Varitronix Limited and these are available from its registered office at Clarendon House, 2 Church Street, Hamilton HM11, Bermuda.

 

The parent undertaking of the largest group into which the financial statements of the company are consolidated is BOE Technology Group Co., Ltd and these are available from its registered office at 10 Jiuxianqiao Road, Chaoyang District, Beijing, P.R.China.

24
Cash generated from/(absorbed by) operations
2024
2023
£
£
Profit for the year after tax
223,456
1,718,239
Adjustments for:
Taxation charged
92,117
556,247
Finance costs
4,069
6,747
Interest income
(258,930)
(47,115)
Gain on disposal of property, plant and equipment
-
(13,000)
Depreciation of property, plant and equipment
87,291
88,375
Movements in working capital:
(Increase)/decrease in inventories
(2,388,293)
562,529
Decrease/(increase) in trade and other receivables
4,262,096
(2,950,743)
Increase/(decrease) in trade and other payables
2,814,803
(6,864)
Cash generated from/(absorbed by) operations
4,836,609
(85,585)
VARITRONIX (U.K.) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 25 -
25
Analysis of changes in net funds
1 January 2024
Cash flows
31 December 2024
£
£
£
Cash at bank and in hand
5,357,074
4,290,129
9,647,203
Obligations under finance leases
(122,738)
63,806
(58,932)
5,234,336
4,353,935
9,588,271
1 January 2023
Cash flows
31 December 2023
Prior year:
£
£
£
Cash at bank and in hand
5,929,164
(572,090)
5,357,074
Obligations under finance leases
(154,862)
32,124
(122,738)
5,774,302
(539,966)
5,234,336
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