1.
General Information
Hexcel Reinforcements UK Limited
is a private company, limited by shares, incorporated in England & Wales, registered number
03685736
. The registered office is Ickleton Road, Duxford, Cambridge, CB22 4QB.
2.
Accounting Policies
2.1.
Basis of Preparation of Financial Statements
The financial statements have been prepared under the historical cost convention and in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland'' and the Companies Act 2006.
2.2.
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 and Section 3 Financial Statement Presentation paragraph 3.17 (d);
-
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44, 11.45, 11.47, 11.48 (a) (iii), 11.48 (a) (iv), 11.48 (b) and 11.48 (c);
-
the requirements of Section 12 Other Financial Instruments Issues paragraphs 12.27, 12.29 (a), 12.29 (b), 12.29A and 12.30;
Where relevant the above information is included in the consolidated financial statements of Hexcel Corporation as at 31 December 2024 and these financial statements may be obtained from the Securities and Exchange Commission, Washington D.C. 20549, USA or from the following Internet address: http://www.sec.gov/edgar.shtml.
2.3.
Going Concern Disclosure
The directors have not identified any material uncertainties related to events or conditions that may cast significant doubt about the company's ability to continue as a going concern with continued support from its group.
2.4.
Significant judgements and estimations
The company makes estimates and assumptions concerning the future. Management are also required to exercise judgement in the process of applying the company accounting policies. 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.
The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below:
Depreciation and residual values
The director has reviewed the asset lives and associated residual values of all fixed asset classes, and in particular, the useful economic lives and residual values of fixture & fittings and plant & machinery, and have concluded that asset lives and residual values are appropriate.
The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and project disposal values.
Finished Goods
Stock includes attributable labour and overheads and are based on management's estimate of the absorption of fixed and variable costs in the manufacturing process excluding selling and marketing costs.
Recoverability of trade debtors
Management makes allowance for doubtful debts based on an assessment of the recoverability of debtors. Allowances are applied to debtors where events or changes in circumstances indicate that the carrying amounts may not be recoverable. Management specifically analyse historical bad debts, customer creditworthiness, current economic trends and changes in customer payment terms when making a judgement to evaluate the adequacy of the provision for doubtful debts. Where the expectation is different from the original estimate, such difference will impact the carrying value of debtors and the charge in the profit and loss account.
Hexcel Reinforcements UK Limited
Notes to the Financial Statements (continued)
For The Year Ended 31 December 2024
2.5.
Turnover
Revenue is measured at the fair value of the consideration received or receivable and represents the amount receivable for goods supplied or services rendered, before commission and net of returns, discounts and rebates allowed by the company and value added taxes.
The company recognises commission charges within cost of sales.
The company recognises revenue when (a) the significant risks and rewards of ownership have been transferred to the buyer; (b) the company retains no continuing involvement or control over the goods; (c) the amount of revenue can be measured reliably; (d) it is probably that future economic benefits will flow to the entity and (e) when specific criteria relating to each of the company's sales channels have been met.
2.6.
Tangible Fixed Assets and Depreciation
Tangible assets are stated at historical cost less accumulated depreciation and accumulated impairment losses. Historical cost includes the original purchase price, costs directly attributable to bringing the asset to its working condition for its intended use, dismantling and restoration costs and borrowing costs capitalised.
Depreciation is charged so as to allocate the costs of assets less their residual value over their estimated useful life or if held under a finance lease, over the lease term, whichever is shorter.
| Freehold |
|
| Assets under construction |
|
| Plant & Machinery |
|
| Fixtures & Fittings |
|
The assets' residual values and useful lives are reviewed, and adjusted, if appropriate, at the end of each reporting period. The effect of any change is accounted for prospectively.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised on the profit and loss.
2.7.
Leasing and Hire Purchase Contracts
Assets obtained under finance leases are capitalised as tangible fixed assets. Assets acquired under finance leases are depreciated over the shorter of the lease term and their useful lives. Assets acquired under hire purchase contracts 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 the profit and loss account so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.
Rentals applicable to operating leases where substantially all of the benefits and risks of ownership remain with the lessor are charged to the profit and loss account as incurred.
2.8.
Stocks and Work in Progress
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Stocks are recognised as an expense in the period in which the related revenue is recognised.
Cost is determined on the first in, first-out (FIFO) method.
At the end of each reporting period stocks are assessed for impairment. If an item of stock is impaired, the identified stock is reduced to its selling price less costs to complete and sell and an impairment charge is recognised in the profit and loss account. Where a reversal of the impairment is recognised the impairment charge is reversed, up to the original impairment loss, and is recognised as a credit on the profit and loss.
2.9.
Cash and Cash Equivalents
Cash and cash equivalents are basic financial assets and include cash in hand and deposits held at call with banks, other short-term highly liquid investments that mature in no more than three months from the date of acquisition and are readily convertible to a known amount of cash with insignificant risk of change in value, and bank overdrafts.
Hexcel Reinforcements UK Limited
Notes to the Financial Statements (continued)
For The Year Ended 31 December 2024
2.10.
Financial Instruments
The company has chosen to adopt the Sections 11 and 12 of FRS 102 in respect of financial instruments.
(i) Financial assets
Basic financial assets, including trade and other receivables, cash and bank balances and investments in commercial paper, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Such assets are subsequently carried at amortised cost using the effective interest method.
At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is decrease in the impairment loss arising from an event occurring after the impairment was recognised the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.
(ii) Financial liabilities
Basic financial liabilities, including trade and other payables and bank loans are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.
2.11.
Foreign Currencies
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.
2.12.
Taxation
2.12.
Taxation - continued
Taxation expense for the period comprises current and deferred tax recognised in the reporting period. Tax is recognised in the profit and loss account, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case tax is also recognised in other comprehensive income or directly in equity respectively.
Current or deferred taxation assets and liabilities are not discounted.
(i) Current tax
Current tax is the amount of income tax payable in respect of the taxable profit for the year or prior years. Tax is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the period end.
Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.
(ii) Deferred tax
Deferred tax arises from timing differences that are differences between taxable profits and total comprehensive income as stated in the financial statements. These 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 recognised on all timing differences at the reporting date except for certain exceptions. Unrelieved tax losses and other deferred tax assets are only recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.
...CONTINUED
Hexcel Reinforcements UK Limited
Notes to the Financial Statements (continued)
For The Year Ended 31 December 2024
Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the period end and that are expected to apply to the reversal of the timing difference.
2.13.
Pensions
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.
2.14.
Research and development
Expenditure on research is written off in the year in which it is incurred. Development expenditure is written off in the same way unless the directors are satisfied as to the technical, commercial and financial viability of individual projects.
2.15.
Assets under construction
Assets under construction are not depreciated until available for use so that the useful life of the asset can be estimated and the appropriate depreciation applied.
3.
Turnover
Analysis of turnover by geographical market is as follows:
| 2024 | 2023 | ||
|---|---|---|---|
| £ | £ | ||
| United Kingdom |
|
|
|
| Europe |
|
|
|
| North America |
|
|
|
| Asia |
|
|
|
| Rest of the world |
|
|
|
| 18,975,200 | 19,384,233 | ||
4.
Operating Loss
The operating loss is stated after charging:
| 2024 | 2023 | ||
|---|---|---|---|
| £ | £ | ||
| Bad debts | (114,056) | (19,100) | |
| Operating lease rentals |
|
|
|
| Exchange differences |
|
|
|
| Depreciation of tangible fixed assets |
|
|
|
|
2024
|
2023
|
||
|
£
|
£
|
||
|
Research and development including RDEC
|
106,836
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|
118,546
|
5.
Auditor's Remuneration
Remuneration received by the company's auditors and their associates during the year was as follows:
| 2024 | 2023 | ||
|---|---|---|---|
| £ | £ | ||
| Audit Services | |||
| Audit of the company's financial statements |
|
|
|
Hexcel Reinforcements UK Limited
Notes to the Financial Statements (continued)
For The Year Ended 31 December 2024
6.
Staff Costs
Staff costs, including directors' remuneration, were as follows:
| 2024 | 2023 | ||
|---|---|---|---|
| £ | £ | ||
| Wages and salaries |
|
|
|
| Social security costs |
|
|
|
| Other pension costs |
|
|
|
|
|
|
||
7.
Average Number of Employees
Average number of employees, including directors, during the year was as follows:
| 2024 | 2023 | ||
|---|---|---|---|
| Board of Directors |
|
|
|
| Manufacturing, warehouse and engineering |
|
|
|
| Sales and administrative |
|
|
|
|
|
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8.
Directors' remuneration
|
2024
|
2023
|
|
|
£
|
£
|
|
|
Directors' remuneration
|
-
|
-
|
9.
Interest Payable and Similar Charges
| 2024 | 2023 | ||
|---|---|---|---|
| £ | £ | ||
| Other finance charges |
|
|
|
10.
Tax on Profit
|
The tax credit on the loss for the year was as follows:
|
|||||
| Tax Rate | 2024 | 2023 | |||
|---|---|---|---|---|---|
| 2024 | 2023 | £ | £ | ||
| Current tax | |||||
| UK Corporation Tax | 25.0% | 25.0% |
( |
( |
|
| Deferred Tax | |||||
| Deferred taxation |
|
( |
|||
| Total tax charge for the period |
( |
( |
|||
|
The actual credit for the year can be reconciled to the expected credit for the year based on the loss and the standard rate of corporation tax as follows:
|
|||||
| 2024 | 2023 | ||||
| £ | £ | ||||
| Profit before tax | (3,433,949) | (3,173,933) | |||
| Tax on profit at 25% (UK standard rate) |
( |
( |
|||
...CONTINUED
Hexcel Reinforcements UK Limited
Notes to the Financial Statements (continued)
For The Year Ended 31 December 2024
| Goodwill/depreciation not allowed for tax |
|
|
|||
| Capital allowances |
( |
( |
|||
| Short term timing differences |
( |
( |
|||
| Transfer pricing adjustments |
( |
( |
|||
| Total tax charge for the period | (1,448,316) | (1,279,336) | |||
11.
Tangible Assets
| Land & Property | |||||
|---|---|---|---|---|---|
| Freehold | Assets under construction | Plant & Machinery | Fixtures & Fittings | Total | |
| £ | £ | £ | £ | £ | |
| Cost | |||||
| As at 1 January 2024 |
|
|
|
|
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| Additions |
|
|
|
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| Transfers |
|
( |
|
|
( |
| As at 31 December 2024 |
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|
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| Depreciation | |||||
| As at 1 January 2024 |
|
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| Provided during the period |
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| As at 31 December 2024 |
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| Net Book Value | |||||
| As at 31 December 2024 |
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| As at 1 January 2024 |
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12.
Stocks
| 2024 | 2023 | ||
|---|---|---|---|
| £ | £ | ||
| Raw materials |
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| Finished goods |
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| Work in progress |
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The directors' consider there to be no material differences between value shown in the balance sheet and replacement cost.
13.
Debtors
| 2024 | 2023 | ||
|---|---|---|---|
| £ | £ | ||
| Due within one year | |||
| Prepayments and accrued income |
|
|
|
| Corporation tax recoverable assets |
|
|
|
| Deferred tax current asset | 146,914 | 1,012,984 | |
| Amounts owed by group undertakings |
|
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Hexcel Reinforcements UK Limited
Notes to the Financial Statements (continued)
For The Year Ended 31 December 2024
14.
Creditors: Amounts Falling Due Within One Year
| 2024 | 2023 | ||
|---|---|---|---|
| £ | £ | ||
| Trade creditors |
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| Other taxes and social security |
|
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| VAT |
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| Other creditors |
|
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| Accruals and deferred income |
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| Amounts owed to group undertakings |
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17.
Other Commitments
The total of future minimum lease payments under non-cancellable operating leases are as following:
| 2024 | 2023 | ||
|---|---|---|---|
| £ | £ | ||
| Not later than one year |
|
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|
| Later than one year and not later than five years |
|
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18.
Pension Commitments
The company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund.
During the year the charge to the profit and loss account in respect of defined contribution schemes was £122,825 (2023: £115,424).
At the balance sheet date contributions of £NIL were due to the fund and are included in creditors.
19.
Related Party Disclosures
The company has taken advantage of exemption, under 33.1A of the Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland", not to disclose transactions with wholly owned subsidiaries within the group.
20.
Controlling Parties
The Company's immediate parent undertaking is Hexcel Composites Limited, a company registered in England and Wales. The group financial statements of Hexcel Composites Limited represent the smallest group including the financial statements of Hexcel Reinforcements UK Limited and are available from Companies House, Crown Way, Maindy, Cardiff, CF4 3UZ.
The Company's ultimate parent undertaking and ultimate controlling party and the largest group to consolidate these financial statements, is Hexcel Corporation, a company incorporated in the state of Delaware, United States of America. Copies of the group financial statements of Hexcel Corporation are available from the Securities and Exchange Commission, Washington D.C. 20549, USA or from the following Internet address: http://www.sec.gov/edgar.shtml