Company registration number: 03561973
COMPANY INFORMATION
CONTENTS
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The directors present their Strategic Report for the year ended 31 December 2024.
Principal activity
The principal activity of the Company throughout the year was that of selling health food, supplements, and associated health products.
Principal activity
The principal activity of the Company throughout the year was that of selling health food, supplements, and associated health products.
The end of 2024 marks the completion of our third year operating as an Employee-Owned Trust (EOT). Back in December 2021 we made the transition from being a family owned and run business to being employee owned. We are incredibly proud to report another very successful year as an EOT, not only have we achieved further business growth but also again delivered improved measurable efficiencies in several key business processes.
During the year, our management structure and our overall mission remained unchanged, that is, to build upon CLF’s position as the wholesaler of choice to independent retailers by continuing to reinvest financial gains in our people, our industry, and our planet.
Our People
The team at CLF underpin our success. Longevity of service by our staff ensures continuity and a quality service for our customers and our suppliers alike. CLF value its employees by investing in them via an ethos of fair pay and a company profit share scheme. The CLF minimum wage is set above the national living wage for all employees irrespective of age. Our commitment to fair pay for all remains unchanged, as demonstrated by our continued accreditation with the Living Wage Foundation, we are proud to be a “Living Wage Employer”.
Our Industry
CLF fill the logistical gap between our customers and our suppliers by delivering products accurately and ‘Just in Time’ supported by weekend and evening deliveries. Continued investment into our state-of-the-art IT systems and facilities has again helped to reduce costs throughout the supply chain by driving efficiencies. This year we have also continued to invest in innovative marketing initiatives and weekly promotions designed to drive consumers into stores whilst building a stronger relationship between CLF, our retailers, and our suppliers. Our focus, devotion and support given to independent high street retailers has not changed throughout the year. They remain a central core to our strategic plans and our business purpose.
Our Planet
Environmentally friendly initiatives are at the heart of what we do. Our reusable tote box system was launched in 2009 and is still running today. We have continued to invest in new totes which are now lighter, so reduce our carbon footprint even further, and new delivery vehicles meeting the latest emissions criteria. We have also started to trial EV delivery vehicles with the aim to further reduce our carbon footprint. Our chilled and frozen insulated box system allows temperature-controlled deliveries without the additional energy required to run temperature-controlled vehicles often operated with partial loads. Our customers have responded by consolidating orders through CLF as their primary wholesaler which, in itself, reduces their carbon footprint via food miles. We all care about our planet.
Community
Our community continues to be a priority in many of the things that we do. We continue to ensure that the interests of our staff, their families and the wider community are always considered at the forefront of any business decisions. The continuation of employee support initiatives (for example our cycle to work scheme) helps to promote our business in the community and at the same time support local people or environments.
During the year, our management structure and our overall mission remained unchanged, that is, to build upon CLF’s position as the wholesaler of choice to independent retailers by continuing to reinvest financial gains in our people, our industry, and our planet.
Our People
The team at CLF underpin our success. Longevity of service by our staff ensures continuity and a quality service for our customers and our suppliers alike. CLF value its employees by investing in them via an ethos of fair pay and a company profit share scheme. The CLF minimum wage is set above the national living wage for all employees irrespective of age. Our commitment to fair pay for all remains unchanged, as demonstrated by our continued accreditation with the Living Wage Foundation, we are proud to be a “Living Wage Employer”.
Our Industry
CLF fill the logistical gap between our customers and our suppliers by delivering products accurately and ‘Just in Time’ supported by weekend and evening deliveries. Continued investment into our state-of-the-art IT systems and facilities has again helped to reduce costs throughout the supply chain by driving efficiencies. This year we have also continued to invest in innovative marketing initiatives and weekly promotions designed to drive consumers into stores whilst building a stronger relationship between CLF, our retailers, and our suppliers. Our focus, devotion and support given to independent high street retailers has not changed throughout the year. They remain a central core to our strategic plans and our business purpose.
Our Planet
Environmentally friendly initiatives are at the heart of what we do. Our reusable tote box system was launched in 2009 and is still running today. We have continued to invest in new totes which are now lighter, so reduce our carbon footprint even further, and new delivery vehicles meeting the latest emissions criteria. We have also started to trial EV delivery vehicles with the aim to further reduce our carbon footprint. Our chilled and frozen insulated box system allows temperature-controlled deliveries without the additional energy required to run temperature-controlled vehicles often operated with partial loads. Our customers have responded by consolidating orders through CLF as their primary wholesaler which, in itself, reduces their carbon footprint via food miles. We all care about our planet.
Community
Our community continues to be a priority in many of the things that we do. We continue to ensure that the interests of our staff, their families and the wider community are always considered at the forefront of any business decisions. The continuation of employee support initiatives (for example our cycle to work scheme) helps to promote our business in the community and at the same time support local people or environments.
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STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
Financial risk management
The Company's operations expose it to a variety of financial risks that include the effects of changes in credit risk, liquidity risk and interest rate risk. The Company has in place a risk management programme that seeks to limit the adverse effects on the financial performance of the Company by monitoring levels of debt finance and the related finance costs. The Company does not use derivative financial instruments to manage interest rate costs and as such, no hedge accounting is applied.
Price risk
The Company is exposed to price risk due to normal inflationary increases in the purchase price of the goods and services in the UK.
Credit risk
The Company has implemented policies that require appropriate credit checks on potential customers before sales are made.
Liquidity risk
The Company actively maintains a combination of short-term and long-term finance that is designed to ensure that the Company has sufficient available funds for operations and planned expansions.
The Company's operations expose it to a variety of financial risks that include the effects of changes in credit risk, liquidity risk and interest rate risk. The Company has in place a risk management programme that seeks to limit the adverse effects on the financial performance of the Company by monitoring levels of debt finance and the related finance costs. The Company does not use derivative financial instruments to manage interest rate costs and as such, no hedge accounting is applied.
Price risk
The Company is exposed to price risk due to normal inflationary increases in the purchase price of the goods and services in the UK.
Credit risk
The Company has implemented policies that require appropriate credit checks on potential customers before sales are made.
Liquidity risk
The Company actively maintains a combination of short-term and long-term finance that is designed to ensure that the Company has sufficient available funds for operations and planned expansions.
In addition to increasing Sales in the year (£70,113,694 compared to £58,345,276 in the previous year), the directors are further encouraged by the overall improvements seen in efficiency and productivity. An improvement in Gross Profit % has been achieved in the year 22.6% compared to 22.3% in the previous year.
The efficiency and productivity improvements plus focus and control of administrative expenses has led to a much-improved return on sales at 7.2% compared to 5.6% in the previous year.
The efficiency and productivity improvements plus focus and control of administrative expenses has led to a much-improved return on sales at 7.2% compared to 5.6% in the previous year.
This report was approved by the board and signed on its behalf.
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DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The directors present their report and the financial statements for the year ended 31 December 2024.
The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Company's financial statements and then apply them consistently;
∙make judgements and accounting estimates that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The profit for the year, after taxation, amounted to £3,700,154 (2023 - £2,453,475).
During the year, a distribution of £3,200,000 (2023 - £3,550,177) was paid to The CLF Distribution Employee Ownership Trust.
The directors who served during the year were:
The directors will continue to look to grow the business focused on new and innovative products.
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
Under section 487(2) of the Companies Act 2006, Menzies LLP will be deemed to have been reappointed as auditor 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.
This report was approved by the board and signed on its behalf.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CLF DISTRIBUTION LIMITED
We have audited the financial statements of CLF Distribution 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 Cash Flows, the Statement of Changes in Equity and the related notes, 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 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 United Kingdom, including the Financial Reporting Council'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.
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.
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.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CLF DISTRIBUTION LIMITED (CONTINUED)
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
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.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CLF DISTRIBUTION LIMITED (CONTINUED)
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. 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:
∙The Company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation, and general regulations such as health and safety. There are no industry specific laws and regulations which would be deemed to have a significant impact on the financial statements. We assessed the extent of compliance with the appropriate laws and regulations as part of our procedures on the related financial statement items.
∙We understood how the Company is complying with the legal and regulatory frameworks by, making inquiries to management, those responsible for legal and compliance procedures and the company secretary. We corroborated our inquiries through our review of board minutes.
∙The engagement partner assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognize non-compliance with laws and regulations. The assessment did not identify any issues in this area.
∙We assessed the susceptibility of the Company financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the engagement team included:
°Identifying and assessing the design effectiveness of controls management has in place to prevent and detect fraud;
°Understanding how those charged with governance considered and addressed the potential for override of controls or other inappropriate influence over the financial reporting process;
°Challenging assumptions and judgments made by management in its significant accounting estimates; and
°Identifying and testing journal entries, in particular any journal entries posted with unusual account combinations.
∙As a result of the above procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas:
°Posting of unusual journals and complex transactions.
°Misappropriation of funds through fraudulent purchase ledger and payroll activity.
°Manipulation of amounts subject to significant judgment or estimate.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditor's Report.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CLF DISTRIBUTION LIMITED (CONTINUED)
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
Chartered Accountants
Statutory Auditor
3000a Parkway
Hampshire
PO15 7FX
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STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
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STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 14 to 28 form part of these financial statements.
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