| REGISTERED NUMBER: |
| STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
| FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MAY 2024 |
| FOR |
| NEOGEN FOOD SAFETY UK LTD |
| REGISTERED NUMBER: |
| STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
| FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MAY 2024 |
| FOR |
| NEOGEN FOOD SAFETY UK LTD |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| CONTENTS OF THE FINANCIAL STATEMENTS |
| FOR THE YEAR ENDED 31 MAY 2024 |
| Page |
| Company Information | 1 |
| Strategic Report | 2 |
| Report of the Directors | 5 |
| Statement of Directors' Responsibilities | 6 |
| Independent Auditor's Report | 7 |
| Statement of Comprehensive Income | 11 |
| Statement of Financial Position | 12 |
| Statement of Changes in Equity | 13 |
| Notes to the Financial Statements | 14 |
| NEOGEN FOOD SAFETY UK LTD |
| COMPANY INFORMATION |
| FOR THE YEAR ENDED 31 MAY 2024 |
| DIRECTORS: |
| SECRETARIES: |
| REGISTERED OFFICE: |
| REGISTERED NUMBER: |
| AUDITOR: |
| Statutory Auditor |
| Citypoint |
| 65 Haymarket Terrace |
| Edinburgh, UK |
| EH12 5HD |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| STRATEGIC REPORT |
| FOR THE YEAR ENDED 31 MAY 2024 |
| The directors present their strategic report for the year ended 31 May 2024. |
| PRINCIPAL ACTIVITY |
| The company manufactures and sells food safety products. |
| REVIEW OF BUSINESS |
| During the period the company continued to integrate 3M's UK food safety business into the Neogen Group. The results for the period reflected a mixed trading position, partly under the various legal agreements related to the 3M integration and partly a more fully integrated group position. A more normal trading pattern will emerge as production and sales channels are fully integrated for a full reporting period. |
| The directors are pleased with the first period of trading and are confident that the results for the coming year will be satisfactory. |
| FINANCIAL KEY PERFORMANCE INDICATORS |
| Turnover for the year to 31 May 2024 was £11.6m compared to £7.7m for the period from 1 September 2022 to 31 May 2023. There gross profit for the year was £1.85m (15.9%) compared to £1.73m (22.3%) in the prior period. |
| Other operating income, up from £1.67m in the period to 31 May 2023 to £1.8m in the current year. |
| Operating profit was 413,027 for the year, down from £839,734 in the period from 1 September 2022 to 31 May 2023 |
| Until 3M's food safety business is fully integrated and operations reach a settled position, there will be some variation in the level of profitability. |
| Other matters of note are: |
| Statement of financial position showed a net asset value of £7m (2023 £6.8m) |
| Fixed assets additions (including intangibles) of circa £0.3m (2023 £4.9m) |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| STRATEGIC REPORT |
| FOR THE YEAR ENDED 31 MAY 2024 |
| PRINCIPAL RISKS AND UNCERTAINTIES |
| The company operates in an innovative and competitive global market. The company manages the risks associated with that market with a commitment to: |
| Innovation and product improvement |
| Expanding its product and service range |
| Management of margins and costs; and |
| Maintaining a skilled and efficient workforce |
| The principal risks facing the business are: |
| Disruption to supply chain |
| Changing raw material prices |
| Loss of end customers due to external market factors |
| Being unable to retain and attract skilled and efficient employees |
| The company operates in an innovative and competitive global market and manages the risks associated with that market with a commitment to innovation and product improvement continually looking to improve and expand its product and service range through research and development. |
| The company works closely with its suppliers to build long term relationships and secure the best possible prices and reliable supplies, where possible ensuring alternative sources of supply are identified for key products. The company carries a small buffer stock to allow it to withstand any short term disruption or delay to supplies. |
| We aim to provide an exceptional working environment for our employees and offer training and other opportunities for them to progress and thrive within the company. |
| The company's activities expose it to a number of financial risks - primarily risks of changes in foreign currency exchange rates and credit risk. |
| The company purchases goods and services from key suppliers in US dollars and also Euros. It makes sales primarily in pounds sterling and has creditor and bank deposits denominated in both US dollars and Euros. Because the company has both assets and liabilities denominated in foreign currencies there is an element of natural hedging. However the company's result could be adversely affected if the US dollar and Euro strengthen against the pound. |
| The company mainly sells to other group entities so the risk of customer default is minimal. The company's bank deposits are held by banks with high credit ratings assigned by international credit rating agencies. |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| STRATEGIC REPORT |
| FOR THE YEAR ENDED 31 MAY 2024 |
| GOING CONCERN |
| As mentioned above, the company is taking steps to integrate 3M's UK food safety business into the Neogen Group. That is part of a global exercise to integrate the worldwide 3M food safety business. |
| The principal concern moving forward is ensure that process is successfully completed, minimising the impact on profitability whilst retaining former 3M personnel and customer base. More significant progress towards these goals have been made since the year end and the directors are confident of a successful integration. |
| The company is well funded with a strong net current asset position, it is profitable and generating substantial cash inflow and, based on the directors' forecasts prepared until July 2026, that position is expected to continue. The company's working capital position is supported by loans from other group companies. Although the loans are repayable on demand, the companies have confirmed in writing that they will continue to support the company's working capital for the foreseeable future and will not recall the loans within the next 12 months, unless the company has sufficient working capital to allow it to continue to trade independently. |
| Accordingly, the directors believe that there is no material uncertainty and they have adopted the going concern basis in preparing the financial statements. |
| ON BEHALF OF THE BOARD: |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| REPORT OF THE DIRECTORS |
| FOR THE YEAR ENDED 31 MAY 2024 |
| The directors present their report with the financial statements of the company for the year ended 31 May 2024. |
| DIVIDENDS |
| No dividends will be distributed for the year ended 31 May 2024. |
| RESEARCH AND DEVELOPMENT |
| The company conducts research and development on its own accord. Expenditure of £229,116 (2023 £155,110) was incurred on research and development during the period and that cost is reflected in the statement of comprehensive income. |
| DIRECTORS |
| Other changes in directors holding office are as follows: |
| The directors who were in office at the date the financial statements were approved are detailed on page 1. |
| STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITOR |
| So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditor is unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditor is aware of that information. |
| AUDITOR |
| The auditor, BDO LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
| ON BEHALF OF THE BOARD: |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| STATEMENT OF DIRECTORS' RESPONSIBILITIES |
| FOR THE YEAR ENDED 31 MAY 2024 |
| The directors are responsible for preparing the Strategic Report, the Report of the Directors 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), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and 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 and then apply them consistently; |
| - make judgements and accounting estimates that are reasonable and prudent; |
| - state whether applicable accounting standards have been followed, subject to any material departures |
| disclosed and explained in the financial statements; |
| - 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 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. |
| INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF |
| NEOGEN FOOD SAFETY UK LTD |
| Disclaimer of opinion |
| We were engaged to audit the financial statements of Neogen Food Safety UK Ltd ("the Company") for the year ended 31 May 2024 which comprise the Statement of comprehensive income, the Statement of financial position, the Statement of changes in equity, and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). |
| We do not express an opinion on the accompanying financial statements of the company. Because of the significance of the matter described in the basis for disclaimer of opinion section of our report, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements. |
| Basis for disclaimer of opinion |
| We were not appointed as the auditor of the company until after the date that various assets and liabilities were acquired from 3M UK Plc in 2022. Thus, we did not observe the counting of physical stock at the date of the acquisition and did not physically verify the tangible fixed assets at the date of the acquisition. In addition to this, management could not provide a listing of the acquired stock and tangible fixed assets with their values. We were unable to satisfy ourselves by alternative means concerning the stock (£1,030,117) and the tangible fixed assets (£1,094,175) acquired by using other audit procedures. As a result of these limitations, we were unable to conclude on the accuracy of the goodwill arising on acquisition of £3,368,595. |
| Consequently, we were unable to determine whether any adjustment to goodwill, stocks and tangible fixed assets as at 31 May 2023 was necessary or whether there was any consequential adjustment to cost of sales, goodwill amortisation, depreciation of tangible fixed assets or related balances for the year ended 31 May 2024. |
| The combination of the financial statement areas noted above was considered to represent a substantial portion of the financial statements for the period ended 31 May 2023 and therefore was considered to be pervasive. Accordingly, we did not express an opinion on the financial statements of the company for the period ended 31 May 2023. As the acquired tangible fixed assets and goodwill are still carried on the Statement on Financial Position as at 2024, we have not been able to obtain the sufficient appropriate audit evidence required due to the reasons discussed above. Consequently, we were unable to determine whether any adjustment to goodwill and tangible fixed assets as at 31 May 2024 was necessary or whether there was any consequential adjustment to goodwill amortisation, depreciation of tangible fixed assets or related balances for the year ended 31 May 2024. |
| The combination of the financial statement areas noted above was considered to represent a substantial portion of the financial statements for the year ended 31 May 2024 and therefore was considered to be pervasive. |
| Other Companies Act 2006 reporting |
| Because of the significance of the matter described in the basis for disclaimer of opinion section of our report, we have been unable to form an opinion, whether based on the work undertaken in the course of the audit: |
| - the information given in the Strategic report and the report of the Directors for the financial year for |
| which the financial statements are prepared is consistent with the financial statements; and |
| - the Strategic report and the report of the Directors have been prepared in accordance with |
| applicable legal requirements. |
| Notwithstanding our disclaimer of an opinion on the financial statements, in the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit performed subject to the pervasive limitation described above, we have not identified material misstatements in the Strategic report or the report of the Directors. |
| INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF |
| NEOGEN FOOD SAFETY UK LTD |
| Arising from the limitation of our work referred to above: |
| - we have not obtained all the information and explanations that we considered necessary for |
| the purpose of our audit: and |
| - we were unable to determine whether adequate accounting records have been kept. |
| 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: |
| - returns adequate for our audit have not been received from branches not visited by us; or |
| - the financial statements are not in agreement with the accounting records and returns; or |
| - certain disclosures of Directors' remuneration specified by law are not made. |
| Responsibilities of Directors |
| As explained more fully in the Statement of Directors' responsibilities, 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 responsibility is to conduct an audit of the company's financial statements in accordance with International Standards on Auditing (UK) and to issue an auditor's report. |
| However, because of the matter described in the basis for disclaimer of opinion section of our report, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements. |
| 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. |
| Extent to which the audit was capable of detecting irregularities, including fraud |
| 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: |
| Non-compliance with laws and regulations |
| Based on: |
| - Our understanding of the Company and the industry in which it operates; |
| - Discussion with management and those charged with governance; and |
| - Obtaining an understanding of the Company's policies and procedures regarding compliance |
| with laws and regulations; |
| we considered the significant laws and regulations to be the applicable accounting framework, UK tax legislation and Companies Act 2006. |
| The Company is also subject to laws and regulations where the consequence of non-compliance could have a material effect on the amount or disclosures in the financial statements, for example through the imposition of fines or litigations. We identified such laws and regulations to be the health and safety legislations. |
| INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF |
| NEOGEN FOOD SAFETY UK LTD |
| Our procedures in respect of the above included: |
| - Review of minutes of meetings of those charged with governance for any instances of |
| non-compliance with laws and regulations; |
| - Review of correspondences with tax authorities for any instances of non-compliance with |
| laws and regulations; |
| - Review of financial statement disclosures and agreeing to supporting documentation; and |
| - Review of legal expenditure accounts to understand the nature of expenditure incurred. |
| Fraud |
| We assessed the susceptibility of the financial statements to material misstatement, including fraud. Our risk assessment procedures included: |
| - Enquiry with management and those charged with governance regarding any known or |
| suspected instances of fraud; |
| - Obtaining an understanding of the Company's policies and procedures relating to: |
| o Detecting and responding to the risks of fraud; and |
| o Internal controls established to mitigate risks related to fraud. |
| - Review of minutes of meetings of those charged with governance for any known or |
| suspected instances of fraud; |
| - Discussion amongst the engagement team as to how and where fraud might occur in the |
| financial statements; and |
| - Performing analytical procedures to identify any unusual or unexpected relationships that |
| may indicate risks of material misstatement due to fraud. |
| Based on our risk assessment, we considered the areas most susceptible to fraud to be management override of controls and revenue recognition. |
| Our procedures in respect of the above included: |
| - Testing a sample of journal entries throughout the year, which met defined risk criteria, by |
| agreeing to supporting documentation; |
| - Assessing significant estimates made by management for bias; and |
| - Carrying out detailed testing, on a sample basis, of revenue transactions which occurred |
| around the year end to assess if revenue was recognised in the correct period. |
| We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members who were all deemed to have appropriate competence and capabilities and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit. |
| Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that 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, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it. In addition, the extent to which the audit was capable of detecting irregularities, including fraud was limited by the matter described in the basis for disclaimer of opinion section of our report. |
| INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF |
| NEOGEN FOOD SAFETY UK LTD |
| 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. |
| for and on behalf of |
| Statutory Auditor |
| Edinburgh, UK |
| BDO LLP is a limited liability partnership registered in England and Wales (with |
| registered number OC305127). |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| STATEMENT OF COMPREHENSIVE INCOME |
| FOR THE YEAR ENDED 31 MAY 2024 |
| Year Ended | Period |
| 31.5.24 | 5.4.22 to 31.5.23 |
| Notes | £ | £ | £ | £ |
| TURNOVER | 3 |
| Cost of sales |
| GROSS PROFIT |
| Distribution costs |
| Administrative expenses |
| 3,244,950 | 2,556,845 |
| (1,393,318 | ) | (829,562 | ) |
| Other operating income | 4 |
| OPERATING PROFIT | 6 |
| Interest receivable and similar income |
| 413,857 | 839,738 |
| Interest payable and similar expenses | 7 |
| PROFIT BEFORE TAXATION |
| Tax on profit | 8 |
| PROFIT FOR THE FINANCIAL YEAR |
| OTHER COMPREHENSIVE INCOME | - | - |
| TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| STATEMENT OF FINANCIAL POSITION |
| 31 MAY 2024 |
| 2024 | 2023 |
| Notes | £ | £ | £ | £ |
| FIXED ASSETS |
| Intangible assets | 9 |
| Tangible assets | 10 |
| CURRENT ASSETS |
| Stocks | 11 |
| Debtors | 12 |
| Cash at bank |
| CREDITORS |
| Amounts falling due within one year | 13 |
| NET CURRENT ASSETS |
| TOTAL ASSETS LESS CURRENT LIABILITIES |
| PROVISIONS FOR LIABILITIES | 16 |
| NET ASSETS |
| CAPITAL AND RESERVES |
| Called up share capital | 17 |
| Share premium | 18 |
| Retained earnings | 18 |
| SHAREHOLDERS' FUNDS |
| The financial statements were approved by the Board of Directors and authorised for issue on |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| STATEMENT OF CHANGES IN EQUITY |
| FOR THE YEAR ENDED 31 MAY 2024 |
| Called up |
| share | Retained | Share | Total |
| capital | earnings | premium | equity |
| £ | £ | £ | £ |
| Changes in equity |
| Issue of share capital | - |
| Total comprehensive income | - | - |
| Balance at 31 May 2023 |
| Changes in equity |
| Total comprehensive income | - | - |
| Balance at 31 May 2024 |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| NOTES TO THE FINANCIAL STATEMENTS |
| FOR THE YEAR ENDED 31 MAY 2024 |
| 1. | ACCOUNTING POLICIES |
| General information and basis of preparing the financial statements |
| Neogen Food Safety UK Limited is a private limited company, limited by shares, incorporated in England & Wales under the Companies Act 2006. The address of the registered office and company number is given in the company information on page 1 of these financial statements. The nature of the company's operations and its principal activity are set out in the strategic report. |
| The financial statements have been prepared in accordance with the applicable accounting standards including Financial Reporting Standard 102 The Financial Reporting Standard Applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006. The financial statements have been prepared on a going concern basis under the historical cost convention. |
| The financial statements have been prepared in sterling which is the functional currency of the company, rounded to the nearest pound. |
| The significant accounting policies applied in the preparation of these financial statements are set out below. |
| Going concern |
| The company is taking steps to integrate 3M's UK food safety business into the Neogen Group. That is part of a global exercise to integrate the worldwide 3M food safety business. |
| The principal concern moving forward is ensure that process is successfully completed, minimising the impact on profitability whilst retaining former 3M personnel and customer base. More significant progress towards these goals have been made since the year end and the directors are confident of a successful integration. |
| The company is well funded with a strong net current asset position, it is profitable and generating substantial cash inflow and, based on the directors' forecasts prepared until July 2026, that position is expected to continue. |
| The company's working capital position is supported by loans from other group companies. Although the loans are repayable on demand, the companies have confirmed in writing that they will continue to support the company's working capital for the foreseeable future and will not recall the loans within the next 12 months, unless the company has sufficient working capital to allow it to continue to trade independently. |
| Accordingly, the directors believe that there is no material uncertainty and they have adopted the going concern basis in preparing the financial statements. |
| Financial Reporting Standard 102 - reduced disclosure exemptions |
| The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland": |
| • | the requirements of Section 7 Statement of Cash Flows; |
| • | the requirement of paragraph 3.17(d); |
| • | the requirements of paragraphs 26.18(b), 26.19 to 26.21 and 26.23; |
| • | the requirement of paragraph 33.7. |
| This information is included in the consolidated financial statements of Neogen Corporation as at 31 May 2023 and these financial statements may be obtained from Neogen Corporation, 620 Lesher Place, Lansing MI, 48912, USA. |
| Turnover |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| NOTES TO THE FINANCIAL STATEMENTS - continued |
| FOR THE YEAR ENDED 31 MAY 2024 |
| Turnover is measured at the fair value of the consideration received or receivable net of VAT and trade discounts. |
| The policies adopted for the recognition of turnover are as follows: |
| Sale of goods |
| Turnover from the sale of goods (principally test kits and related products and equipment) is recognised when significant risks and rewards of ownership of the goods have transferred to the buyer, the amount of turnover can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the company and the costs incurred or to be incurred in respect of the transaction can be measured reliably. |
| Rendering of services |
| The company provides analysis and testing services and recognises revenue from such services when the test/analysis is complete and reported to the customer. |
| Goodwill |
| Goodwill, being an amount paid in connection with the acquisition of part of 3M's foods safety business in 2022. It represents the difference between the cost of acquiring the business and the fair value of the identifiable assets and liabilities acquired. It is being amortised on a straight line basis over its estimated useful life of twenty years. |
| Tangible fixed assets |
| Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life: |
| Short leasehold property | - 27.27% on cost |
| Improvements to property | - 27.27% on cost |
| Plant and Machinery | - 14.29 % on cost |
| Fixtures and fittings | - 20% on cost |
| Computer equipment | - 33% on cost |
| The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of significant change since the last reporting date. |
| Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the statement of comprehensive income. |
| Assets in the course of construction are not depreciated. Depreciation on such assets begins when they are brought into use. |
| Stocks |
| Stocks and work in progress are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing stock to its present location and condition. Cost is calculated using the first-in, first-out basis. Provision is made for damaged, obsolete and slow-moving stock where appropriate. |
| Taxation |
| Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
| Current or deferred taxation assets and liabilities are not discounted. |
| Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date. |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| NOTES TO THE FINANCIAL STATEMENTS - continued |
| FOR THE YEAR ENDED 31 MAY 2024 |
| 1. | ACCOUNTING POLICIES - continued |
| Deferred tax |
| Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date. |
| Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
| Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
| Research and development |
| Expenditure on research and development is written off in the year in which it is incurred. |
| Foreign currencies |
| Foreign currency transactions are initially recognised by applying to the foreign currency amount the spot exchange rate between the functional currency and the foreign currency at the date of the transaction. |
| Monetary assets and liabilities denominated in a foreign currency at the statement of financial position date are translated using the closing rate. |
| Hire purchase and leasing commitments |
| Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
| Pension costs and other post-retirement benefits |
| The company operates a defined contribution scheme. The assets of the scheme are held separately from those of the company in independently administered funds. Contributions payable to the scheme are charged to the statement of comprehensive income in the period to which they relate. |
| Financial instruments |
| Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the statement of comprehensive income in administrative expenses. |
| Cash in the balance sheet comprises cash in hand and cash at bank. |
| Impairment |
| Assets are reviewed for any indication that the asset may be impaired at each balance sheet date. If such indication exists, the recoverable amount of the asset, or the asset's cash generating unit, is estimated and compared to the carrying amount. Where the carrying amount exceeds its recoverable amount, an impairment loss is recognised in the statement of comprehensive income. |
| Employee benefits |
| When employees have rendered service to the company, short term benefits (including holiday pay) to which the employees are entitled are recognised at the undiscounted amount expected to be paid in exchange for that service. |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| NOTES TO THE FINANCIAL STATEMENTS - continued |
| FOR THE YEAR ENDED 31 MAY 2024 |
| 2. | CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY |
| The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported as assets, liabilities, revenues and expenses for the year. The key sources of estimation uncertainty are as follows: |
| Depreciation and amortisation of tangible and intangible fixed assets: |
| Tangible fixed assets are depreciated over their useful lives taking into account residual values, where appropriate. The expected lives of assets and their residual values are assessed regularly and may vary depending on a number of factors including technological innovation, product life cycles, future market conditions and maintenance programmes. |
| Intangible assets are amortised over their expected useful lives. These estimates are based on a variety of factors such as expected product life cycles and levels of cash generation. |
| Impairment of assets: |
| Tangible fixed assets, intangible fixed assets, stock and debtors are all reviewed for evidence of impairment. |
| In connection with fixed assets (tangible and intangible) factors taken into consideration include the economic viability, the expected future financial performance of the asset and, where appropriate, the viability and expected future performance of related cash generating units. |
| For stock, past and expected future sales, current stock levels, expiry dates and expected selling price less cost to complete and sell are all considered to determine the appropriate level of impairment provision. |
| Trade debtors are reviewed for evidence of impairment. Factors considered include ageing, past recovery rates, customer creditworthiness, and the stage and expected outcome of any recovery proceedings. |
| Stock costing: |
| In arriving at the cost of stock, estimation is required to determine the value of labour and overheads to be applied. |
| Assets acquired from 3M |
| On acquisition, the fixed assets acquired from 3M as part of the global process to combine 3M's food safety business into the Neogen Group, were recorded at their estimated fair value. The fair value was as determined by an external plant valuation specialist. |
| 3. | TURNOVER |
| The turnover and profit before taxation are attributable to the one principal activity of the company. |
| An analysis of turnover by class of business is given below: |
| Period |
| 5.4.22 |
| Year Ended | to |
| 31.5.24 | 31.5.23 |
| £ | £ |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| NOTES TO THE FINANCIAL STATEMENTS - continued |
| FOR THE YEAR ENDED 31 MAY 2024 |
| 3. | TURNOVER - continued |
| An analysis of turnover by geographical market is given below: |
| Period |
| 5.4.22 |
| Year Ended | to |
| 31.5.24 | 31.5.23 |
| £ | £ |
| United Kingdom |
| Europe |
| United States of America |
| 4. | OTHER OPERATING INCOME |
| Period |
| 5.4.22 |
| Year Ended | to |
| 31.5.24 | 31.5.23 |
| £ | £ |
| Intra-group payroll charges |
| Intra-group administration re-charges |
| 1,806,345 | 1,669,296 |
| 5. | EMPLOYEES AND DIRECTORS |
| Period |
| 5.4.22 |
| Year Ended | to |
| 31.5.24 | 31.5.23 |
| £ | £ |
| Wages and salaries |
| Social security costs |
| Other pension costs |
| The average number of employees during the year was as follows: |
| Period |
| 5.4.22 |
| Year Ended | to |
| 31.5.24 | 31.5.23 |
| Production and R&D | 70 | 73 |
| Marketing | 9 | 5 |
| Administration | 2 | 6 |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| NOTES TO THE FINANCIAL STATEMENTS - continued |
| FOR THE YEAR ENDED 31 MAY 2024 |
| 5. | EMPLOYEES AND DIRECTORS - continued |
| Period |
| 5.4.22 |
| Year Ended | to |
| 31.5.24 | 31.5.23 |
| £ | £ |
| Directors' remuneration |
| The directors are remunerated by other group companies. |
| 6. | OPERATING PROFIT |
| Period |
| Year | 5.4.22 |
| ended | to |
| 31.5.24 | 31.5.23 |
| £ | £ |
| Depreciation - tangible fixed assets | 504,274 | 267,703 |
| Loss on disposal of tangible fixed assets | 73,624 |
| Goodwill amortisation | 168,430 | 126,322 |
| Auditor's remuneration | 65.988 | 19,250 |
| Operating lease rentals | 258,694 | 198,445 |
| Net (gains)/losses of foreign exchange | 75,834 | 43,436 |
| Research and development | 229,116 | 155,110 |
| 7. | INTEREST PAYABLE AND SIMILAR EXPENSES |
| Period |
| 5.4.22 |
| Year Ended | to |
| 31.5.24 | 31.5.23 |
| £ | £ |
| HMRC interest |
| Intra-group interest |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| NOTES TO THE FINANCIAL STATEMENTS - continued |
| FOR THE YEAR ENDED 31 MAY 2024 |
| 8. | TAXATION |
| Analysis of the tax charge |
| The tax charge on the profit for the year was as follows: |
| Period |
| 5.4.22 |
| Year Ended | to |
| 31.5.24 | 31.5.23 |
| £ | £ |
| Current tax: |
| UK corporation tax |
| Withholding tax | - | 1 |
| Total current tax |
| Deferred tax | ( |
) |
| Tax on profit |
| UK corporation tax has been charged at 25% (2023 - 20.35%). |
| Reconciliation of total tax charge included in profit and loss |
| The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
| Period |
| 5.4.22 |
| Year Ended | to |
| 31.5.24 | 31.5.23 |
| £ | £ |
| Profit before tax |
| Profit multiplied by the standard rate of corporation tax in the UK of |
| Effects of: |
| Expenses not deductible for tax purposes |
| Depreciation in excess of capital allowances |
| Adjustments to tax charge in respect of previous periods | ( |
) |
| Change in tax rates | - | 8,917 |
| Super-deduction | - | (9,446 | ) |
| Other differences |
| Total tax charge | 162,128 | 211,019 |
| Rate of UK corporation tax |
| The main UK Corporation tax rate changed from 19% to 25% on 1 April 2023. That resulted in an average tax rate for the company's financial period to 31 May 2023 of 20.35% |
| Factors that may affect future tax charges |
| The increase in the UK Corporation tax will impact the company's future tax charge accordingly. The value of the deferred tax liability at the statement of financial position date has been calculated using the applicable rate when the liability is expected to be realised. |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| NOTES TO THE FINANCIAL STATEMENTS - continued |
| FOR THE YEAR ENDED 31 MAY 2024 |
| 9. | INTANGIBLE FIXED ASSETS |
| Goodwill |
| £ |
| COST |
| At 1 June 2023 |
| and 31 May 2024 |
| AMORTISATION |
| At 1 June 2023 |
| Amortisation for year |
| At 31 May 2024 |
| NET BOOK VALUE |
| At 31 May 2024 |
| At 31 May 2023 |
| 10. | TANGIBLE FIXED ASSETS |
| Improvements |
| Short | to | Plant and |
| leasehold | property | machinery |
| £ | £ | £ |
| COST |
| At 1 June 2023 |
| Additions |
| Disposals | ( |
) | ( |
) |
| Reclassification/transfer | ( |
) |
| At 31 May 2024 |
| DEPRECIATION |
| At 1 June 2023 |
| Charge for year |
| Eliminated on disposal | ( |
) | ( |
) |
| Reclassification/transfer | ( |
) |
| At 31 May 2024 |
| NET BOOK VALUE |
| At 31 May 2024 |
| At 31 May 2023 |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| NOTES TO THE FINANCIAL STATEMENTS - continued |
| FOR THE YEAR ENDED 31 MAY 2024 |
| 10. | TANGIBLE FIXED ASSETS - continued |
| Fixtures | Assets |
| and | under | Computer |
| fittings | construction | equipment | Totals |
| £ | £ | £ | £ |
| COST |
| At 1 June 2023 |
| Additions |
| Disposals | ( |
) |
| Reclassification/transfer | ( |
) |
| At 31 May 2024 |
| DEPRECIATION |
| At 1 June 2023 |
| Charge for year |
| Eliminated on disposal | ( |
) |
| Reclassification/transfer |
| At 31 May 2024 |
| NET BOOK VALUE |
| At 31 May 2024 |
| At 31 May 2023 |
| 11. | STOCKS |
| 2024 | 2023 |
| £ | £ |
| Raw materials |
| Work in progress |
| Finished goods |
| 12. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
| 2024 | 2023 |
| £ | £ |
| Trade debtors |
| Amounts owed by group undertakings |
| Other debtors |
| Value added tax |
| Accrued income |
| Prepayments |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| NOTES TO THE FINANCIAL STATEMENTS - continued |
| FOR THE YEAR ENDED 31 MAY 2024 |
| 13. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
| 2024 | 2023 |
| £ | £ |
| Trade creditors |
| Amounts owed to group undertakings |
| Tax |
| Social security and other taxes |
| Value added tax | - | 55,736 |
| Other creditors |
| Accrued expenses |
| 14. | LEASING AGREEMENTS |
| Minimum lease payments under non-cancellable operating leases fall due as follows: |
| 2024 | 2023 |
| £ | £ |
| Within one year |
| Between one and five years |
| 15. | FINANCIAL INSTRUMENTS |
| There are no financial instruments measured at fair value through the statement of comprehensive income. |
| 16. | PROVISIONS FOR LIABILITIES |
| 2024 | 2023 |
| £ | £ |
| Deferred tax - capital allowances in advance of depreciation |
147,026 |
160,781 |
| Deferred |
| tax |
| £ |
| Balance at 1 June 2023 |
| Credit to Statement of Comprehensive Income during year | ( |
) |
| Balance at 31 May 2024 |
| £66,887 of the above provision is expected to reverse by 31 May 2025. |
| The amount of unprovided deferred tax at 31 May 2024 was nil (2023 nil) |
| 17. | CALLED UP SHARE CAPITAL |
| Allotted, issued and fully paid: |
| Number: | Class: | Nominal | 2024 | 2023 |
| value: | £ | £ |
| Ordinary | 1 | 1,000,002 | 1,000,002 |
| NEOGEN FOOD SAFETY UK LTD (REGISTERED NUMBER: 14027492) |
| NOTES TO THE FINANCIAL STATEMENTS - continued |
| FOR THE YEAR ENDED 31 MAY 2024 |
| 18. | RESERVES |
| Retained | Share |
| earnings | premium | Totals |
| £ | £ | £ |
| At 1 June 2023 | 5,817,908 |
| Profit for the year |
| At 31 May 2024 | 6,069,626 |
| Retained earnings |
| Represents cumulative profits and losses net of dividends and other adjustments. |
| Share premium |
| Records the amount above the nominal value received on the issue of shares. |
| 19. | ULTIMATE PARENT COMPANY |
| The company's immediate parent company is Neogen Food Safety UK Holdings Limited, registered in the UK. Its ultimate parent company is Neogen Corporation, a publicly owned company based in the United States of America whose shares are traded on the NASDAQ Stock Market. Copies of the group financial statements for Neogen Corporation are available from Neogen Corporation, 620 Lesher Place, Lansing, MI, 48912, USA. |
| 20. | RELATED PARTY DISCLOSURES |
| The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |