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Registered number: 03318338
PRESTON INNOVATIONS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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PRESTON INNOVATIONS LIMITED
COMPANY INFORMATION
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Third Floor, Priory Place
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PRESTON INNOVATIONS LIMITED
CONTENTS
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Independent Auditor's Report
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Statement of Comprehensive Income
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Statement of Financial Position
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Statement of Changes in Equity
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Notes to the Financial Statements
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PRESTON INNOVATIONS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The Directors present their Strategic Report and the audited financial statements of the Company for the year ended 31 December 2024.
The objective of Preston Innovations Limited remains to achieve annual growth by increasing market share and strengthening brands by providing innovative, high quality products backed by excellent customer service.
This year saw a return to more standard trading as the restructuring of the prior year was completed. Turnover of £22.4m represents an increase of 9% on the prior year (£20.6m excluding the 'one-off' intercompany sales of 2023).
The gross profit margin is 39.5% (2023 – 32.6% excluding the 'one-off' intercompany sales of 2023) due to a full year of the cost savings resulting from the operational restructuring undertaken in the prior year. The prior year margin was lower due to the discounting activity to reduce higher levels of post Covid-19 stock.
Administrative costs have reduced as the restructuring activities were completed during FY23.
The increase in balance sheet net assets to £19.2m (2023 - £16.8m) reflects a strong year's trading building on the operational reorganisation of the prior year. The reduction of the cash balance reflects participation in cash pooling with the wider Group.
Design, innovation and the introduction of new products continues to be critical to the business success. The Company continues to invest considerable amounts in research and development in advance of products coming to market. The popularity of the new products, plus the acceptance of them by anglers is the number one objective of the Company. To continually generate this increase in demand the business invests heavily in producing and editing high quality video content .The continued strong financial performance in the year is evidence of the success of our design and innovation.
The directors are pleased with the performance of the Company in the year.
Principal risks and uncertainties
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Sporting goods are non-essential items and as such the business is susceptible to general macro-economic forces. There is some protection from this as part of a wider European Group that allows diversification across broader geographical markets.
As an outdoor pursuit, angling is also seasonal and severe weather can also impact sales. The Company’s approach to mitigate these risks is to broaden its geographical market presence in order to reduce exposure to these factors on a regional basis.
The Company operates in a highly competitive UK market. Our focus remains on product innovation and as such we continue to invest in product development as we view it as key to the continued success of the Company. The aim is to offer innovative, high quality, value for money products to our customers.
The majority of the Company’s revenue is in British Pounds. Whilst the primary currency for purchasing stock from other group companies is Euros, the main currency used for supplier purchases is US dollars. Fluctuations in exchange rates can have a significant impact on the business and as a result there is a Group level strategy for managing foreign exchange risk via hedging of currencies using forward contracts.
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PRESTON INNOVATIONS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The availability of skilled labour is a potential challenge to the Company. We provide training and development opportunities to upskill current employees as well as employing a robust recruitment strategy to attract and retain skilled labour.
Management seek to ensure that the risk of loss of data and business interruption due to failures in IT security is mitigated to the greatest extent possible through the use of monitored Anti-Virus software, secure back up systems and regular review and enhancement of IT systems and policies.
The Directors feel the business is well placed to take on any future challenges as a result of the strategic initiatives carried out during the year.
Key performance indicators
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The key performance indicators for the company are turnover, gross profit and EBITDA.
As noted above, Turnover has increased by 9% on the prior year once intercompany sales are removed and is in line with the year prior to that. Gross profit percentage has increased significantly to 39.5% (2023 – 32.6% excluding the 'one-off' intercompany sales of 2023) as trading normalised compared to the prior year's need to discount.
EBITDA for the year ended 31 December 2024 was £4.0m (2023 - £0.2m). EBITDA as a percentage of turnover was 17.9% (2023 - 1.4% excluding the 'one-off' intercompany sales of 2023) as the business did not see the one off costs incurred in the prior year and build upon the efficiencies gained by that reorganisation.
To ensure maximum value is delivered on behalf of stakeholders to the business, EBITDA targets are set and reviewed regularly.
Stock levels are reviewed on an ongoing basis, thereby highlighting any potential problems in relation to shortages of stock or ageing stocks. Stock turn also remains a key indicator of buying efficiencies. Management is happy that the level of stock held is appropriate, and also reviewed at the wider Group level.
This report was approved by the board and signed on its behalf.
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PRESTON INNOVATIONS LIMITED
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 company's principal activity during the year continued to be the manufacture and wholesale of fishing equipment and accessories.
The profit for the year, after taxation, amounted to £2,377,342 (2023 - loss £419,559).
Dividends of £Nil were paid during the year (2023: £Nil).
The directors who served during the year and up to the date of signing these financial statements were:
The four key risks the Company monitors are interest rate risk, liquidity risk, credit risk and foreign exchange risk.
Interest rate risk
The Company finances its operations through a mixture of retained profits and borrowings from group companies thus minimising exposure to interest rate risk from external borrowings.
Liquidity risk
The repayments terms of the intercompany balances have been structured to be serviced from cash generated by operating activities.
Credit risk
The credit rating of significant customers is monitored regularly.
Foreign exchange risk
Foreign exchange risk has now shifted out of the Company level to the wider group due to the organisational changes that were made in the prior year. The Company purchases stock in euros from another group entity, with the group assuming the associated currency risk. However, the original purchasing of stock by the group is conducted in US dollars. The risk of significant exchange rate fluctuations is mitigated at a Group level by entering into forward contracts to secure rates.
Planned operational and further facility investments together with continued staff development will enable future growth within both the UK and Europe.
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PRESTON INNOVATIONS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
Research and development activities
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Research and Development is considered key to securing long term growth and the company continues to invest in this area enabling the development of innovative and excellent quality products.
During the year, the Company incurred amounts of £269,689 (2023 - £313,551) relating to research and development of which £245,599 (2023 - £190,970) was capitalised, and the remaining balance charged to profit and loss.
Qualifying third party indemnity provisions
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An indirect parent company, Rather Outdoors Corporation, maintains liability insurance for the Company's Directors and Officers. The insurance cover does not provide cover in the event a Director or Officer is proved to have acted fraudulently or dishonestly. The indemnity is categorised as a 'qualifying third-party indemnity' for the purposes of the Companies Act 2006 and will continue in force for the benefit of Directors and Officers on an ongoing basis.
Matters covered in the Strategic Report
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The directors have not disclosed risks and uncertainties within the directors' report as they have been included within the Strategic Report on pages 1 to 2.
At the date of approval of the financial statements the directors have considered the continued challenges posed by the uncertainties of the ongoing war in Ukraine and Red Sea disruption and the resultant impact on business conditions across Europe and the UK.
The business continues to be impacted by delays in the supply chain seen as a result of the disruption to shipping through the Red Sea and is working hard to maintain stock levels and availability.
Sporting goods are non-essential items and as such the business is susceptible to general macro-economic forces. As an outdoor pursuit, angling is also seasonal and severe weather can also impact sales and the UK market is a highly competitive one. The Company's approach to mitigate these risks is to continue to invest in an innovative and high quality product offering.
The directors make an estimate of the future performance of the Company in order to prepare the financial statements on a going concern basis. When assessing future performance, the directors consider financial projections which reflect current and expected market conditions. Based on the consideration of financing facilities, and after modelling of severe but plausible scenarios on forecasted cash flows and considering the progress of the Company, the directors have a reasonable expectation that the Company will be able to execute their plans such that they will have adequate resources to continue in operational existence for the foreseeable future and for a period of at least 12 months from the date of approval of these financial statements.
The Company is also part of a cash pooling arrangement with the wider Rather Outdoors Group and the directors have sought assurances that cash remitted to Group can be returned should the need arise in the future.
In Q1 2025 the United States imposed new tariffs on goods entering the US market. There is limited impact to the EMEA side of the business as they trade outside of the US. There is a level of impact to the Rather Outdoors US business. However, management has largely mitigated tariff risk through imposing price increases and reducing marketing spend, advertising cost and reducing travel costs in the US.
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PRESTON INNOVATIONS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
Directors' responsibilities statement
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The directors are responsible for preparing the Strategic Report, the Directors' 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 prepared the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the 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 judgments 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.
Disclosure of information to the auditor
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Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
∙so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and
∙the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.
The auditors, RSM UK Audit LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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PRESTON INNOVATIONS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PRESTON INNOVATIONS LIMITED
We have audited the financial statements of Preston Innovations 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 notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" (United Kingdom Generally Accepted Accounting Practice).
In our opinion, the financial statements:
∙give a true and fair view of the state of the company's affairs as at 31 December 2024 and of its profit for the year then ended;
∙have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
∙have been prepared in accordance with the requirements of the Companies Act 2006.
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 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
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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.
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PRESTON INNOVATIONS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PRESTON INNOVATIONS LIMITED (CONTINUED)
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.
Opinion on other matters prescribed by the Companies Act 2006
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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.
Matters on which we are required to report by exception
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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:
∙adequate accounting records have not been kept, or 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; or
∙we have not received all the information and explanations we require for our audit.
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PRESTON INNOVATIONS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PRESTON INNOVATIONS LIMITED (CONTINUED)
Responsibilities of directors
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As explained more fully in the Directors' Responsibilities Statement set out on page 5, 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
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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.
The extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities are instances of non-compliance with laws and regulations. The objectives of our audit are to obtain sufficient appropriate audit evidence regarding compliance with laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements, to perform audit procedures to help identify instances of non-compliance with other laws and regulations that may have a material effect on the financial statements, and to respond appropriately to identified or suspected non-compliance with laws and regulations identified during the audit.
In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the financial statements due to fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud through designing and implementing appropriate responses and to respond appropriately to fraud or suspected fraud identified during the audit.
However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team:
∙obtained an understanding of the nature of the industry and sector, including the legal and regulatory framework that the company operates in and how the company is complying with the legal and regulatory framework;
∙inquired of management, and those charged with governance, about their own identification and assessment of the risks of irregularities, including any known actual, suspected or alleged instances of fraud;
∙discussed matters about non-compliance with laws and regulations and how fraud might occur including assessment of how and where the financial statements may be susceptible to fraud.
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PRESTON INNOVATIONS LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF PRESTON INNOVATIONS LIMITED (CONTINUED)
As a result of these procedures, we consider the most significant laws and regulations that have a direct impact on the financial statements are FRS 102 and compliance with the Companies Act 2006 and Tax compliance regulations. We performed audit procedures to detect non-compliances which may have a material impact on the financial statements which included reviewing financial statement disclosures, completion of disclosure checklists to identify areas of non-compliance and evaluating advice received from external tax advisors.
The most significant laws and regulations that have an indirect impact on the financial statements are those in relation to health and safety. We performed audit procedures to inquire of management and those charged with governance whether the company is in compliance with these laws and regulations and completed searches for any reportable health and safety incidents in the public domain.
The audit engagement team identified the risk of management override of control and existence and valuation of revenue transactions as the areas where the financial statements were most susceptible to material misstatement due to fraud. Audit procedures performed included but were not limited to testing manual journal entries and other adjustments and evaluating the business rationale in relation to significant, unusual transactions and transactions entered into outside the normal course of business, and the corroboration of a sample of revenue transactions to supporting documentation in addition to reviewing a sample a sample of revenue transactions that were outside of the expected revenue cycle.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: http://www.frc.org.uk /auditorsresponsibilities. This description forms part of our auditor’s 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.
Josh Taylor (Senior Statutory Auditor)
for and on behalf of
RSM UK Audit LLP , Statutory Auditor
Chartered Accountants
Third Floor, Priory Place
New London Road
Chelmsford
Essex
CM2 0PP
18 September 2025
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PRESTON INNOVATIONS LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
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Interest payable and similar expenditure
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Profit/(loss) for the financial year
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Total comprehensive income for the year
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The notes on pages 16 to 31 form part of these financial statements.
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PRESTON INNOVATIONS LIMITED
REGISTERED NUMBER: 03318338
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Provisions for liabilities
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The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 16 to 31 form part of these financial statements.
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PRESTON INNOVATIONS LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
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The notes on pages 16 to 31 form part of these financial statements.
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PRESTON INNOVATIONS LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
Cash flows from operating activities
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Profit/(loss) for the financial year
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Amortisation of intangible assets
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Depreciation of tangible assets
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Impairments of fixed assets
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Profit on disposal of tangible assets
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(Increase)/decrease in stocks
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(Decrease)/increase in creditors
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(Decrease)/increase in provisions
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Net cash generated from operating activities
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Cash flows from investing activities
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Purchase of intangible fixed assets
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Purchase of tangible fixed assets
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Sale of tangible fixed assets
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Net cash from investing activities
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PRESTON INNOVATIONS LIMITED
STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
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Cash flows from financing activities
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Repayment of finance leases
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Finance lease interest paid
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Net cash used in financing activities
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Net (decrease) in cash and cash equivalents
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Cash and cash equivalents at beginning of year
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Cash and cash equivalents at the end of year
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Cash and cash equivalents at the end of year comprise:
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The notes on pages 16 to 31 form part of these financial statements.
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PRESTON INNOVATIONS LIMITED
ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2024
The notes on pages 16 to 31 form part of these financial statements.
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Preston Innovations Limited ("the Company") is a private company limited by shares and is registered, domiciled and incorporated in England.
The address of the Company's registered office and principal place of business is Front Building, Stafford Park 12, Telford, Shropshire, TF3 3BJ.
The Company's principal activities and nature of operations are included in the directors' report.
2.Accounting policies
These financial statements have been prepared in accordance with FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" ("FRS 102") and the requirements of the Companies Act 2006, including the provisions of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, and under the historical cost convention.
Monetary amounts are rounded to the nearest whole £1 except where otherwise indicated.
At the date of approval of the financial statements the directors have considered the continued challenges posed by the uncertainties of the ongoing war in Ukraine and Red Sea disruption and the resultant impact on business conditions across Europe and the UK.
The business continues to be impacted by delays in the supply chain seen as a result of the disruption to shipping through the Red Sea and is working hard to maintain stock levels and availability.
Sporting goods are non-essential items and as such the business is susceptible to general macro-economic forces. As an outdoor pursuit, angling is also seasonal and severe weather can also impact sales and the UK market is a highly competitive one. The Company's approach to mitigate these risks is to continue to invest in an innovative and high quality product offering.
The directors make an estimate of the future performance of the Company in order to prepare the financial statements on a going concern basis. When assessing future performance, the directors consider financial projections which reflect current and expected market conditions. Based on the consideration of financing facilities, and after modelling of severe but plausible scenarios on forecasted cash flows and considering the progress of the Company, the directors have a reasonable expectation that the Company will be able to execute their plans such that they will have adequate resources to continue in operational existence for the foreseeable future and for a period of at least 12 months from the date of approval of these financial statements.
The Company is also part of a cash pooling arrangement with the wider Rather Outdoors Group and the directors have sought assurances that cash remitted to Group can be returned should the need arise in the future.
In Q1 2025 the United States imposed new tariffs on goods entering the US market. There is limited impact to the EMEA side of the business as they trade outside of the US. There is a level of impact to the Rather Outdoors US business. However, management has largely mitigated tariff risk through imposing price increases and reducing marketing spend, advertising cost and reducing travel costs in the US.
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Research and Development
The Company capitalises development expenditure as an intangible asset when it is able to demonstrate all of the following:
a)The technical feasibility of completing the development so the intangible asset will be available for use or sale.
b)Its intention to complete the development and to use or sell the intangible asset.
c)Its ability to use or sell the intangible asset.
d)How the intangible asset will generate probable future economic benefits.
e)The availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset.
f)Its ability to measure reliably the expenditure attributable to the intangible asset during its development.
Capitalised development expenditure is initially recognised at cost and subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Capitalised development expenditure is amortised on a straight line basis over its useful life, which is 3 years. The directors consider this useful life to be appropriate based on the anticipated revenue streams and technological life of the products.
All research expenditure and development expenditure that does not meet the above conditions is expensed as incurred.
Tangible fixed assets are stated at cost and net of depreciation.
Depreciation is provided by the company to write off the cost less estimated residual value of tangible fixed assets over their expected useful life on a straight line basis, as follows:
Residual value is calculated on prices prevailing at the reporting date, after estimated costs of disposal, for the asset as if it were at the age and in the condition expected at the end of its useful life.
Land and buildings are accounted for separately even when acquired together.
Stocks are valued at the lower of cost and net realisable value. Stocks are recognised when the risks and rewards of ownership have transferred to the company.
At each reporting date, the Company assesses whether stocks are impaired or if an impairment loss recognised in prior periods has reversed. Any excess of the carrying amount of stock over its estimated selling price is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
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Functional and presentational currencies
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The financial statements are presented in sterling which is also the functional currency of the Company.
Transactions in currencies other than the functional currency (foreign currencies) are initially recorded at the exchange rate prevailing on the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the reporting date. Non-monetary assets and liabilities denominated in foreign currencies are translated at the rate ruling at the date of the transaction.
All translation differences are taken to profit or loss.
The tax expense represents the sum of the current tax expense and deferred tax expense. Current tax assets are recognised when tax paid exceeds the tax payable.
Current tax is based on taxable profit for the year. Taxable profit differs from total comprehensive income because it excludes items of income or expense that are taxable or deductible in other periods. Current tax assets and liabilities are measured using tax rates that have been enacted or substantively enacted by the reporting date.
Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled based on tax rates that have been enacted or substantively enacted by the reporting date. Deferred tax is not discounted.
Deferred tax liabilities are recognised in respect of all timing differences that exist at the reporting date. Timing differences are differences between taxable profits and total comprehensive income that arise from the inclusion of income and expenses in tax assessments in different periods from their recognition in the financial statements. Deferred tax assets are recognised only to the extent that it is probable that they will be recovered by the reversal of deferred tax liabilities or other future taxable profits.
Current and deferred tax is charged or credited in profit or loss.
Current tax assets and current tax liabilities and deferred tax assets and deferred tax liabilities are offset, if and only if, there is a legally enforceable right to set off the amounts and the entity intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.
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Operating leases: the Company as lessee
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Rentals paid under operating leases are charged to the Statement of Comprehensive Income on a straight line basis over the lease term.
Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
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Finance leases and hire purchase contracts
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Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired by finance lease are depreciated over the shorter of the lease term and their useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the company. Obligations under such agreements are included in the creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to profit or loss so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.
Defined contribution plans
For defined contributions schemes the amount charged to profit and loss is the contributions payable in the year. Differences between contributions payable in the year and contributions actually paid are shown as either accruals or prepayments.
The costs of short-term employee benefits are recognised as a liability and an expense.
The best estimate of the expenditure required to settle an obligation for termination benefits is recognised immediately as an expense when the Company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Turnover represents the invoiced value, net of Value Added Tax, of goods sold and services provided to customers. Turnover is derived entirely from the company’s principal activity. Turnover is recognised when substantially all of the obligations under a sales contract have been fulfilled. Turnover is recognised exclusive of sales taxes and discounts allowed.
Other income includes the above line credits for research and development taxation credits. This treatment is in accordance with HMRC Research and Development Expenditure Credit (RDEC) scheme requirements.
Interest Income
Interest income is accrued on a time-apportioned basis, by reference to the principal outstanding at the effective interest rate.
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
The Company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102, in full, to all of its financial instruments.
Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual provisions of the instrument, and are offset only when the Company currently has a legally enforceable right to set off the recognised amounts and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
Financial assets
Trade debtors, other debtors and amounts owed by group undertakings
Trade debtors, other debtors and amounts owed by group undertakings which are receivable within one year are initially measured at the transaction price. Trade debtors, other debtors and amounts owed by group undertakings are subsequently measured at amortised cost, being the transaction price less any amounts settled and any impairment losses.
A provision for impairment of financial assets is established when there is objective evidence that the amounts due will not be collected according to the original terms of the contract. Impairment losses are recognised in profit or loss for the excess of the carrying value of the financial asset over the present value of the future cash flows discounted using the original effective interest rate. Subsequent reversals of an impairment loss that objectively relate to an event occurring after the impairment loss was recognised, are recognised immediately in profit or loss.
Financial liabilities and equity
Financial instruments are classified as liabilities and equity instruments according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities.
Equity instruments
Financial instruments classified as equity instruments are recorded at the fair value of the cash or other resources received or receivable, net of direct costs of issuing the equity instruments.
Trade creditors, other creditors, amounts owed to group and accruals
Trade creditors, other creditors, amounts owed to group and accruals payable within one year are initially measured at the transaction price and subsequently measured at amortised cost, being the transaction price less any amounts settled.
Derecognition of financial assets and liabilities
A financial asset is derecognised only when the contractual rights to cash flows expire or are settled, or substantially all the risks and rewards of ownership are transferred to another party, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party. A financial liability (or part thereof) is derecognised when the obligation specified in the contract is discharged, cancelled or expires.
The profit and loss account reserve represents cumulative profit and loss net of distributions to owners.
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
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Cash and cash equivalents
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For the purposes of the cash flow statement cash and cash equivalents at the end of the period relate to bank balances included in cash at bank and in hand.
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Impairment of fixed assets and goodwill
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Assets that are subject to depreciation or amortisation are assessed at each reporting date to determine whether there is any indication that the assets are impaired. Where there is any indication that an asset may be impaired, the carrying value of the asset (or cash-generating unit to which the asset has been allocated) is tested for impairment. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's (or CGU's) fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (CGUs). Non-financial assets that have been previously impaired are reviewed at each reporting date to assess whether there is any indication that the impairment losses recognised in prior periods may no longer exist or may have decreased.
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Critical accounting estimates and areas of judgement
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Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
Critical accounting estimates, assumptions and areas of judgement
The Company makes estimates and assumptions concerning the future. The resulting accounting estimates and assumptions will, by definition, seldom equal the related actual results.
The Company makes estimates and judgements on the required level of stock provision at each reporting date, such that stock is held at the lower of cost and net realisable value. The Company evaluates the stock held against known changes in the market, stock lines and sales patterns to determine the levels of provision required. No other critical estimates or judgements are made.
In the opinion of the directors, an analysis of turnover by geographical market would be seriously prejudicial to the interests of the company. Consequently, no such disclosure has been made in these financial statements. All of the company’s turnover and profits on ordinary activities before taxation derive from the company’s principal activity.
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Interest payable and similar expenses
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Finance leases and hire purchase contracts
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Profit before taxation is stated after charging/(crediting):
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Research & development charged as an expense
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Depreciation charge - on owned assets
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Depreciation charge - on leased assets
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Amortisation of intangible assets
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Operating lease rentals - plant and machinery
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Operating lease rentals - property
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Stock impairment loss recognised in cost of sales
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Impairment of plant and machinery
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Profit on disposal of tangible assets
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During the year, the Company obtained the following services from the Company's auditors:
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Statutory audit of accounts
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Staff costs were as follows:
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Cost of defined contribution scheme
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The average monthly number of employees, including the directors, during the year was as follows:
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The company operates a defined contribution pension scheme whose assets are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the company and amounted to £42,818 (2023: £53,966). The contributions payable to the fund at the year end was £7,706 (2023: £8,915).
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Remuneration of key management personnel
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The total remuneration of the directors and managers who are considered to be the key management personnel of the Company was £Nil (2023: £Nil) as they are remunerated by other group companies.
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Current tax on profits for the year
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Adjustments in respect of previous periods
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Origination and reversal of timing differences
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Adjustments in respect of previous years
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Tax on profit/(loss) for the financial year
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
11.Taxation (continued)
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Factors affecting tax charge for the year
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The tax assessed for the year is higher than (2023 - higher than) the standard rate of corporation tax in the UK of25% (2023 - 23.52%). The differences are explained below:
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Profit/(loss) on ordinary activities before tax
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Profit/(loss) on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 23.52%)
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Expenses not deductible for tax purposes
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Adjustments to tax charge in respect of previous years
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Other differences leading to an increase in the tax charge
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Total tax charge for the year
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Factors that may affect future tax charges
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There were no factors that may affect future tax charges.
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Raw materials and consumables
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The carrying value of stocks are stated net of impairment losses totalling £62,151 (2023 - £13,756). Impairment losses totalling £48,575 (2023 - £290,627) was recognised in profit and loss.
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Amounts owed by group undertakings
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Prepayments and accrued income
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Trade debtors are stated net of a provision of £75,309 (2023: £79,823).
Amounts owed by group undertakings are unsecured, interest free, have no fixed date of repayment and are repayable on demand.
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Cash and cash equivalents
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Obligations under finance lease and hire purchase contracts
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Accruals and deferred income
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Amounts owed to group undertakings are unsecured, interest free, have no fixed date of repayment and are repayable on demand.
Obligations under finance lease and hire purchase contracts are secured on the assets to which they relate.
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Creditors: Amounts falling due after more than one year
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Net obligations under finance leases and hire purchase contracts
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Obligations under finance lease and hire purchase contracts are secured on the assets to which they relate.
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Charged to profit or loss
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The provision for deferred taxation is made up as follows:
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Difference between accumulated depreciation and capital allowances
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The deferred tax liability of £116,015 (2023: £100,254) is expected to reverse over the next 3 to 10 years. This relates to accelerated capital allowances that are expected to mature over the same period.
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Charged to profit or loss
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Allotted, called up and fully paid
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100 (2023 - 100) Ordinary shares of £1.00 each
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Ordinary share rights
The Company’s ordinary shares each carry the right to one vote at general meetings of the Company.
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PRESTON INNOVATIONS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Profit and loss account
The profit and loss account represents the cumulative profits and losses, net of dividends paid and other adjustments.
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Commitments under operating leases
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At 31 December 2024 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Amounts due within one year
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Amounts due between two and five years
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Ultimate controlling party
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The immediate parent company of Preston Innovations Limited is Zebco Holdings LLC, a company incorporated and registered in the United States of America. The ultimate parent company is Rather Outdoors Corporation with the controlling party being BDT Capital Partners.
The registered office of Rather Outdoors Corporation is 209 Stoneridge Dr, Columbia, SC 29210, United States of America.
The largest and smallest group in which the results of the company are consolidated at 31 December 2024 were Rather Outdoors Corporation, these are not publicly available.
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