Registered number: 04987690
FOR THE YEAR ENDED 31 DECEMBER 2024
ARCH UK BIOCIDES LIMITED
COMPANY INFORMATION
ARCH UK BIOCIDES LIMITED
CONTENTS
ARCH UK BIOCIDES LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The Company's principal activity is that of a manufacturer and distributor of chemicals, globally to a wide range of industries.
The Company intends to achieve its objectives by further developing substrates and applications of its core products, and seeking alternative markets.
The Company intends to achieve its objectives by further developing substrates and applications of its core products, and seeking alternative markets.
The principal activity of the Company is the manufacture and distribution of biocides for a variety of uses, including building products, textile applications and health and hygiene products.
Total sales in 2024 were £39.7m compared to prior year £40.8m.
The business strives to optimise its global supply chain costs and administrative burden to enhance overall margin performance. Overheads are being monitored by management.
The business strives to optimise its global supply chain costs and administrative burden to enhance overall margin performance. Overheads are being monitored by management.
The Company remains well positioned at year end with new products in development. The Company remains invested in its operation in India.
Prospects for sales growth are deemed to be fair despite the current uncertain global economic outlook.
Prospects for sales growth are deemed to be fair despite the current uncertain global economic outlook.
The implementation of global trade sanctions and risk of escalation in 2025 is a major threat to the business.
The Company transacts in all the major currencies, and management frequently examine exposure and take the appropriate measures to avoid unnecessary risks from exchange rate fluctuations.
A serious accident or environmental incident could result in operational problems, additional cost and possible regulatory action.
The Company transacts in all the major currencies, and management frequently examine exposure and take the appropriate measures to avoid unnecessary risks from exchange rate fluctuations.
A serious accident or environmental incident could result in operational problems, additional cost and possible regulatory action.
The directors’ assessment of the Company’s going concern status is set out in note 2.3 to the financial statements.
The directors monitor the following principal key performance indicators:
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ARCH UK BIOCIDES LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The Company remains well positioned at year end with new products in development. The Company remains invested in its operation in India.
In accordance with the requirements of The Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018, the Company has assessed its total UK energy consumption and confirms that it is below the 40,000 kWh threshold. As a result, the Company qualifies as a low energy user and is exempt from making detailed SECR disclosures for the year ended 31 December 2024.
As a Board we have always taken decisions for the long-term and collectively and individually our aim is always to uphold the highest standard of conduct and act fairly. Similarly, we understand that our business can only grow and prosper over the long-term if we understand and respect the views and needs of our customers, colleagues and the communities in which we operate, as well as our suppliers, the environment and the shareholders to whom we are accountable.
We ensure that the requirements of s172 Companies Act 2006 are met and the interests of our stakeholder groups are considered through a combination of the following:
We ensure that the requirements of s172 Companies Act 2006 are met and the interests of our stakeholder groups are considered through a combination of the following:
−An employee engagement survey is completed periodically.
−The board wants to ensure that customers get the best of the products and services offered, and guarantee continual improvement and efficiency, committed project managers, and compliance with strict quality and regulatory standards.
−The Group's Supplier Code of Conduct governs how the board evaluate and set high standards for suppliers.
−Employees are required to take Code of Conduct training every year which includes an integrity pledge certificate. Additionally, employees have to pass tests in online training courses on anti-bribery, competition law, insider trading and conflicts of interest, All employees explicitly consent to uphold the values expressed in the Code of Conduct.
This report was approved by the board and signed on its behalf by:
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ARCH UK BIOCIDES 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 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 elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 101 ‘Reduced Disclosure Framework’. 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;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.
The directors who served during the year were:
The profit for the year, after taxation, amounted to £3,431 thousand (2023 - £4,747 thousand).
No dividends were declared in the year (2023: £nil). The directors do not recommend payment of a final dividend.
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ARCH UK BIOCIDES LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
During the year the Company had in force an indemnity provision in favour of one or more directors of the Company against liability in respect of proceedings brought by third parties, subject to the conditions set out in the Companies Act 2006.
It is company policy to keep employees informed of matters affecting their interests through normal management channels and due consideration is given to their interest when making management decisions. The Company arranges presentations by directors and managers together with briefing groups at which topical information is discussed with employees. The involvement of employees in the company's performance is encouraged through participation in profit related incentive payment schemes.
The policy of the Company for the employment of disabled persons is to give them equal opportunities with other employees to train for and attain any position in the Company having regard to the maintenance of a safe working environment and the constraints of their disabilities.
Close attention is given to the welfare of employees with particular regard to the requirements of the health and safety legislation.
The policy of the Company for the employment of disabled persons is to give them equal opportunities with other employees to train for and attain any position in the Company having regard to the maintenance of a safe working environment and the constraints of their disabilities.
Close attention is given to the welfare of employees with particular regard to the requirements of the health and safety legislation.
The auditor, Rödl & Partner Limited, 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 by:
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ARCH UK BIOCIDES LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ARCH UK BIOCIDES LIMITED
We have audited the financial statements of Arch UK Biocides Limited (the 'Company') for the year ended 31 December 2024, which comprise the Statement of comprehensive income, the Balance sheet, 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 101 ‘Reduced Disclosure Framework’ (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.
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ARCH UK BIOCIDES LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ARCH UK BIOCIDES 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.
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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ARCH UK BIOCIDES LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ARCH UK BIOCIDES 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:
∙Enquiry of management and those charged with governance around actual and potential litigation and claims;
∙Performing audit work over the risk of management override of controls, including testing of journal entries and other adjustments for appropiateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias;
∙Reviewing minutes of meetings of those charges with governance; and
∙Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.
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ARCH UK BIOCIDES LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ARCH UK BIOCIDES LIMITED (CONTINUED)
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ARCH UK BIOCIDES LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ARCH UK BIOCIDES 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
Birmingham, United Kingdom
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ARCH UK BIOCIDES LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
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ARCH UK BIOCIDES LIMITED
REGISTERED NUMBER: 04987690
BALANCE SHEET
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 13 to 39 form part of these financial statements.
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ARCH UK BIOCIDES LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
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ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Arch UK Biocides Limited (the ''Company'') is a private company limited by shares, incorporated and
domiciled in England. The registered office address is at Hexagon Tower Crumpsall Vale, Blackley,
Manchester, United Kingdom, M9 8GQ.
The Company's principal activity and nature of its operations are disclosed in the strategic report.
domiciled in England. The registered office address is at Hexagon Tower Crumpsall Vale, Blackley,
Manchester, United Kingdom, M9 8GQ.
The Company's principal activity and nature of its operations are disclosed in the strategic report.
2.Accounting policies
The preparation of financial statements in compliance with FRS 101 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
The Company has taken advantage of the following disclosure exemptions under FRS 101:
∙the requirements of paragraphs 45(b) and 46-52 of IFRS 2 Share-based payment
∙the requirements of paragraphs 62, B64(d), B64(e), B64(g), B64(h), B64(j) to B64(m), B64(n)(ii), B64(o)(ii), B64(p), B64(q)(ii), B66 and B67 of IFRS 3 Business Combinations
∙the requirements of paragraph 33(c) of IFRS 5 Non Current Assets Held For Sale and Discontinued Operations
∙the requirements of IFRS 7 Financial Instruments: Disclosures
∙the requirements of paragraphs 91-99 of IFRS 13 Fair Value Measurement
∙the requirements of IAS 7 Statement of Cash Flows
∙the requirements in IAS 24 Related Party Disclosures to disclose related party transactions entered into between two or more members of a group, provided that any subsidiary which is a party to the transaction is wholly owned by such a member
∙the requirements of paragraphs 130(f)(ii), 130(f)(iii), 134(d)-134(f) and 135(c)-135(e) of IAS 36 Impairment of Assets.
This information is included in the consolidated financial statements of Herens Midco S.à.r.l. as at 31 December 2024 and these financial statements may be obtained from 4, rue Albert, Borschette, Luxembourg, L-1246, Luxembourg .
The Company has taken advantage of the exemption under Section 401 of the Companies Act 2006 not to prepare consolidated financial statements. The financial statements present information about the Company as an individual entity and not about its group.
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ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
The financial statements have been prepared on a going concern basis which the directors consider to be appropriate for the following reasons.
The Company made a profit for the year of £3,431k (2023: £4,747k) and at the end of the year had net current assets of £56,104k (2023: £52,633k) and net assets of £61,407k (2023: £57,018k).
The directors have performed a going concern assessment which indicates that, taking account of reasonably possible downsides, the company will have sufficient funds, through funding from its intermediate parent company, Arxada Ltd, to meet its liabilities as they fall due during the going concern assessment period.
That assessment is dependent on Arxada Ltd not seeking repayment of the amounts currently due to the group, which at 31 December 2024 amounted to £7,371k. Arxada Ltd has indicated its intention to continue to make available such funds as are needed by the Company, and that it does not intend to seek repayment of amounts currently due during the going concern assessment period. As with any company placing reliance on other group entities for financial support, the directors acknowledge that there can be no certainty that this support will continue although, at the date of approval of these financial statements, they have no reason to believe that it will not do so.
Consequently, the directors are confident that the Company will have sufficient funds to continue to meet its liabilities as they fall due for at least 12 months from the date of approval of the financial statements and therefore have prepared the financial statements on a going concern basis.
The Company made a profit for the year of £3,431k (2023: £4,747k) and at the end of the year had net current assets of £56,104k (2023: £52,633k) and net assets of £61,407k (2023: £57,018k).
The directors have performed a going concern assessment which indicates that, taking account of reasonably possible downsides, the company will have sufficient funds, through funding from its intermediate parent company, Arxada Ltd, to meet its liabilities as they fall due during the going concern assessment period.
That assessment is dependent on Arxada Ltd not seeking repayment of the amounts currently due to the group, which at 31 December 2024 amounted to £7,371k. Arxada Ltd has indicated its intention to continue to make available such funds as are needed by the Company, and that it does not intend to seek repayment of amounts currently due during the going concern assessment period. As with any company placing reliance on other group entities for financial support, the directors acknowledge that there can be no certainty that this support will continue although, at the date of approval of these financial statements, they have no reason to believe that it will not do so.
Consequently, the directors are confident that the Company will have sufficient funds to continue to meet its liabilities as they fall due for at least 12 months from the date of approval of the financial statements and therefore have prepared the financial statements on a going concern basis.
Turnover is derived from the principal activity of the company and represents the value of goods supplied, excluding value added tax. Revenue is recognised when the significant risks and rewards of ownership have been transferred to the buyer.
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ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Functional and presentation currency
Transactions and balances
Defined benefit plans
A defined benefit plan is a post-employment benefit plan other than a defined contribution plan. The Company's net obligation in respect of defined benefit plans and other long term employee benefits is calculated by estimating the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value. The fair value of any plan assets is deducted. The Company determines the net interest expense (income) on the net defined benefit liability (asset) for the period by applying the discount rate as determined at the beginning of the annual period to the net defined benefit liability (asset) taking account of changes arising as a result of contributions and benefit payments.
The discount rate is the yield at the balance sheet date on AA credit rated bonds denominated in the currency of, and having maturity dates approximating to the terms of the company's obligations. A valuation is performed tri-annually by a qualified actuary using the projected unit credit method. The Company recognises net defined benefit plan assets to the extent that it is able to recover the surplus either through reduced contributions in the future or through refunds from the plan.
Changes in the net defined benefit liability arising from employee service rendered during the period, net interest on net defined benefit liability, and the cost of plan introductions, benefit changes, curtailments and settlements during the period are recognised in profit or loss. Remeasurement of the net defined benefit liability/asset is recognised in other comprehensive income in the period in which it occurs.
A defined benefit plan is a post-employment benefit plan other than a defined contribution plan. The Company's net obligation in respect of defined benefit plans and other long term employee benefits is calculated by estimating the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value. The fair value of any plan assets is deducted. The Company determines the net interest expense (income) on the net defined benefit liability (asset) for the period by applying the discount rate as determined at the beginning of the annual period to the net defined benefit liability (asset) taking account of changes arising as a result of contributions and benefit payments.
The discount rate is the yield at the balance sheet date on AA credit rated bonds denominated in the currency of, and having maturity dates approximating to the terms of the company's obligations. A valuation is performed tri-annually by a qualified actuary using the projected unit credit method. The Company recognises net defined benefit plan assets to the extent that it is able to recover the surplus either through reduced contributions in the future or through refunds from the plan.
Changes in the net defined benefit liability arising from employee service rendered during the period, net interest on net defined benefit liability, and the cost of plan introductions, benefit changes, curtailments and settlements during the period are recognised in profit or loss. Remeasurement of the net defined benefit liability/asset is recognised in other comprehensive income in the period in which it occurs.
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ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Expenditure on development activities is capitalised if the product or process is technically and commercially feasible and the company intends and has the technical ability and sufficient resources to complete development, future economic benefits are probable and if the Company can measure reliably the expenditure attributable to the intangible asset during its development. Development activities involve a plan or design for the production of new of substantially improved products or processes. The expenditure capitalised includes the cost of materials, direct labour and an appropriate proportion of overheads and capitalised borrowings costs.
Other development expenditure is recognised in the profit and loss account and other comprehensive income as an expense as incurred. Capitalised development expenditure is recognised in the profit and loss account and other comprehensive income as an expense as incurred. Capitalised development expenditure is stated at cost less accumulated amortisation and less accumulated impairment losses.
Interest income and interest payable is recognised in profit or loss as it accrues, using the effective interest method. Dividend income is recognised in the profit and loss account and other comprehensive income on the date the entity's right to receive payments is established. Foreign currency gains and losses are reported on a net basis.
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ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
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ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Non-derivative financial instruments comprise investments in trade and other debtors, trade and other creditors, cash and cash equivalents, interest-bearing borrowings and investments in subsidiaries.
Trade and other debtors
Trade and other debtors are recognised initially at fair value. Subsequent to initial recognition they are measured at amortised cost using the effective interest method, less any impairment losses.
Trade and other creditors
Trade and other creditors are recognised initially at fair value. Subsequent to initial recognition they are measured at amortised cost using the effective interest method.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits. Bank overdrafts that are repayable on demand and form an integral part of the Company's cash management are included as a component of cash and cash equivalents for the purpose only of the cash flow statement.
Interest-bearing borrowings
Interest-bearing borrowings are recognised initially at fair value less attributable transaction costs. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost using the effective interest method, less any impairment losses.
Investments in subsidiaries
These are separate financial statements of the Company. Investments in subsidiaries are carried at cost less impairment.
Trade and other debtors
Trade and other debtors are recognised initially at fair value. Subsequent to initial recognition they are measured at amortised cost using the effective interest method, less any impairment losses.
Trade and other creditors
Trade and other creditors are recognised initially at fair value. Subsequent to initial recognition they are measured at amortised cost using the effective interest method.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits. Bank overdrafts that are repayable on demand and form an integral part of the Company's cash management are included as a component of cash and cash equivalents for the purpose only of the cash flow statement.
Interest-bearing borrowings
Interest-bearing borrowings are recognised initially at fair value less attributable transaction costs. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost using the effective interest method, less any impairment losses.
Investments in subsidiaries
These are separate financial statements of the Company. Investments in subsidiaries are carried at cost less impairment.
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ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Financial assets (including trade and other debtors)
A financial asset not carried at fair value through profit or loss is assessed at each reporting date to determine whether there is objective evidence that it is impaired. A financial asset is impaired if objective evidence indicates that a loss event has occurred after the initial recognition of the asset, and that the loss event had a negative effect on the estimated future cash flows of that asset that can be estimated reliably.
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between is carrying amount and the present value of the estimated future cash flows discounted at the asset's original effective interest rate. For financial instruments measured at cost less impairment is calculated as the difference between its carrying amount and the best estimate of the amount that the Company would receive for the asset if it were to be sold at the reporting date. Interest on the impaired asset continues to be recognised through the unwinding of the discount. When a subsequent event causes the amount of impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss.
Non-financial assets
The carrying amounts of the Company's non-financial assets, other than stocks and deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset's recoverable amount is estimated.
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the "cash-generating unit").
Non-financial assets
An impairment loss is recognised if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognised in profit or loss.
In respect of other assets, impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.
A financial asset not carried at fair value through profit or loss is assessed at each reporting date to determine whether there is objective evidence that it is impaired. A financial asset is impaired if objective evidence indicates that a loss event has occurred after the initial recognition of the asset, and that the loss event had a negative effect on the estimated future cash flows of that asset that can be estimated reliably.
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between is carrying amount and the present value of the estimated future cash flows discounted at the asset's original effective interest rate. For financial instruments measured at cost less impairment is calculated as the difference between its carrying amount and the best estimate of the amount that the Company would receive for the asset if it were to be sold at the reporting date. Interest on the impaired asset continues to be recognised through the unwinding of the discount. When a subsequent event causes the amount of impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss.
Non-financial assets
The carrying amounts of the Company's non-financial assets, other than stocks and deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset's recoverable amount is estimated.
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the "cash-generating unit").
Non-financial assets
An impairment loss is recognised if the carrying amount of an asset or its CGU exceeds its estimated recoverable amount. Impairment losses are recognised in profit or loss.
In respect of other assets, impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.
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ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
At the inception of a contract, the Company assesses whether a contract is, or contains, a lease. A contract is, or contains a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.
The Company recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred, less any lease incentives received.
The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the end of the lease term. Unless the lease transfers ownership of the underlying asset to the Company by the end of the lease term or the cost of the right-of-use asset reflects that the Company will exercise a purchase option. In that case the right-of-use asset will be depreciated over the useful life of the underlying asset, which is determined on the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.
Depreciation is provided on the following basis:
Plant and machinery - 10 years
Fixtures and fittings - 3 years
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the Company's incremental borrowings rate.
Lease payments included in the measurement of the lease liability comprise the following:
The Company recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred, less any lease incentives received.
The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the end of the lease term. Unless the lease transfers ownership of the underlying asset to the Company by the end of the lease term or the cost of the right-of-use asset reflects that the Company will exercise a purchase option. In that case the right-of-use asset will be depreciated over the useful life of the underlying asset, which is determined on the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.
Depreciation is provided on the following basis:
Plant and machinery - 10 years
Fixtures and fittings - 3 years
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the Company's incremental borrowings rate.
Lease payments included in the measurement of the lease liability comprise the following:
∙fixed lease payments including in-substance fixed payments;
∙variable lease payments that depend on an index or rate, initially measured using the index or rate as at the commencement date;
∙the amount expected to be payable by the lessee under residual value guarantees; and
∙penalties for early terminating of a lease unless the company is reasonably certain not to terminate early.
The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, there is a change in the Company's estimate of the amount expected to be payable under a residual value guarantee, if the Company changes its assessment of whether it will exercise a purchase, extension or termination option or if there is a revised in-substance fixed lease payment.
When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, to the extent that the right-of-use asset is reduced to nil, with any further adjustment required from the remeasurement being recorded in profit or loss.
The Company has elected not to recognise right-of-use assets and lease liabilities for lease of low-value assets and short-term leases. The Company recognises the lease payments associated with these leases as an expense on a straight-line basis over the lease term.
When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, to the extent that the right-of-use asset is reduced to nil, with any further adjustment required from the remeasurement being recorded in profit or loss.
The Company has elected not to recognise right-of-use assets and lease liabilities for lease of low-value assets and short-term leases. The Company recognises the lease payments associated with these leases as an expense on a straight-line basis over the lease term.
Page 20
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary shares or options are shown in equity as a deduction, net of tax, from the proceeds.
(i) Defined benefit pension plans (note 22)
The pension cost and the defined benefit pension obligation of the Company's defined benefit pension plans are based on a number of selected assumptions; these include the discount rate, inflation rate, salary growth and longevity. Differences arising from actual experience or future changes in assumptions will be reflected in future periods. The effect of changing these assumptions is described in note 22.
Page 21
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 22
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 23
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 24
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
12.Taxation (continued)
The Company has gross unrecognised tax losses of £nil (2023: £nil) and capital losses of £1,302,000 (2023: £1,302,000) that are available indefinitely for offset against future taxable profits and capital gains of the Company, respectively. Deferred tax assets have not been recognised in respect of these losses as there is uncertainty over whether suitable profits will arise in future periods against which the deferred tax assets would reverse.
Page 25
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
13.Tangible fixed assets (continued)
Page 27
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 29
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Page 30
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
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Page 31
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Arch UK Biocides Pension Scheme
The Company operates a Defined benefit pension scheme.
This Plan is closed to new entrants, and no further defined benefits are being earned. Instead, members' future pension benefit is provided within a defined contribution section of the Plan. A full actuarial valuation was carried out as at 31 March 2023, the results of this valuation have been updated to 31 December 2024 by a qualified independent actuary.
The Plan is approved by HMRC for tax purposes, and is operated separately from the Group and managed by an independent Corporate Trustee. The Trustee is responsible for payment of benefits and management of the Plan's assets.
The Plan is subject to UK regulations, which require the Company and Trustee to agree a funding strategy and contribution schedule for the Plan. The last finalised valuation was undertaken at 31 March 2023. As a result the Company is expected to pay employer contributions of £400,000 pa from 1 July 2021 to 30 June 2026.
Information about the risks of the Plan to the Employer
The ultimate cost of the Plan to the Employer will depend upon actual future events rather than the assumptions made. Many of the assumptions made are unlikely to be borne out in practice and as such the cost of the Plan may be higher (or lower) than disclosed. In general, the risk to the Employer is that the assumptions underlying the disclosures, or the calculation of contribution requirements are not borne out in practice and the cost to the Employer is higher than expected. This could result in higher contributions required from the Employer and a higher deficit/lower surplus disclosed.
More specifically, the assumptions not being borne out in practice could include:
The Plan is approved by HMRC for tax purposes, and is operated separately from the Group and managed by an independent Corporate Trustee. The Trustee is responsible for payment of benefits and management of the Plan's assets.
The Plan is subject to UK regulations, which require the Company and Trustee to agree a funding strategy and contribution schedule for the Plan. The last finalised valuation was undertaken at 31 March 2023. As a result the Company is expected to pay employer contributions of £400,000 pa from 1 July 2021 to 30 June 2026.
Information about the risks of the Plan to the Employer
The ultimate cost of the Plan to the Employer will depend upon actual future events rather than the assumptions made. Many of the assumptions made are unlikely to be borne out in practice and as such the cost of the Plan may be higher (or lower) than disclosed. In general, the risk to the Employer is that the assumptions underlying the disclosures, or the calculation of contribution requirements are not borne out in practice and the cost to the Employer is higher than expected. This could result in higher contributions required from the Employer and a higher deficit/lower surplus disclosed.
More specifically, the assumptions not being borne out in practice could include:
∙The assets being lower than assumed and in particular falls in asset values (particularly equities) not being matched by similar falls in liabilities, resulting in an unaffordable increase in the required Employer contributions;
∙Unanticipated future changes in mortality patterns leading to an increase the Plan's liabilities. Future mortality rates cannot be predicted with certainty. This is especially so bearing in mind that the youngest Plan members could be expected to still be alive in 40 years or more and it is not possible to reliably predict what medical advances may or may not have occurred by this time;
∙The actual number of members exercising options within the Plan, for example taking early retirement or exchanging a portion of pension for a cash lump sum which could alter the long term cost of benefits; and
∙The relatively small number of Plan members is particularly likely to lead to volatility in the funding level and the Employer contributions, as the future demographic experience of such a group is more uncertain than would be the case for a larger group.
To help mitigate the risks that the Plan is exposed to, the Plan's Investment strategy includes "matching"
assets to broadly reflect the liabilities in respect of pensioner members.
Page 32
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
22.Pension commitments (continued)
Page 33
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
22.Pension commitments (continued)
Page 34
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
22.Pension commitments (continued)
Page 35
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 36
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 37
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 38
ARCH UK BIOCIDES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
The company is an immediate subsidiary undertaking of Arch Chemicals UK Holdings Limited which is registered in United Kingdom. Copies of this financial statements are available from Hexagon Tower Crumpsall Vale, Blackley, Manchester, M9 8GQ.
The smallest and largest group to consolidate the company's financial statements is Herens Midco S.à.r.l. Copies of Herens Midco S.à.r.l.'s consolidated financial statements can be obtained from 4, rue Albert Borschette, Luxembourg, L-1246, Luxembourg.
At the reporting date, the ultimate parent undertakings are Bain Capital Private Equity LP and Cinven Capital Management Limited, which are both incorporated in Luxembourg and have their principal office in Luxembourg.
The smallest and largest group to consolidate the company's financial statements is Herens Midco S.à.r.l. Copies of Herens Midco S.à.r.l.'s consolidated financial statements can be obtained from 4, rue Albert Borschette, Luxembourg, L-1246, Luxembourg.
At the reporting date, the ultimate parent undertakings are Bain Capital Private Equity LP and Cinven Capital Management Limited, which are both incorporated in Luxembourg and have their principal office in Luxembourg.
Page 39