|
Registered number:
FOR THE YEAR ENDED 31 DECEMBER 2024
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
COMPANY INFORMATION
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
CONTENTS
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The directors present the strategic report for the year ended 31 December 2024.
The principal trading activity of the business during the financial year was the provision of goods and services related to the oil & gas industry.
The financial performance of the company and detail on the key metrics are outlined as follows: For the year under review, the company experienced a decline in turnover from the prior period, with a fall of 6% from the £21.2m seen in 2023 to come to £19.9m. This was due to several significant one-off projects mid-way through 2023 not being replicated in the latest year. The gross profit fell proportionally more than the drop in revenue year on year, from £7.41m to £5.77m, with the margin falling from the elevated levels seen in 2023 of 35% to come to 29%. Administrative expenses, however, decreased significantly from the prior year, from £9.57m to £5.89m – the comparative year was distorted by the recognition of management charges of £2.98m that were previously not charged for but that related to prior years. Nevertheless, even after adjusting for this, administrative expenses reduced slightly, in part reflecting tight control of costs by the business. The after-tax position of the company came to a £1.01m profit for the year, a reversal of the losses of £1.57m seen in 2023. During 2025, the company has again seen strong demand for its products and services and is on course to see a slight increase in turnover compared to 2024. Management remains optimistic about the overall future of the business and see opportunities for growth in the company’s end markets.
The three main segments of this division are: Well Abandonment, Fishing & Remedial, and Wellbore Departure, with Well Abandonment accounting for most of the activity of the division. 2024 was another robust year for Red Baron, culminating in a revenue of £16.3m, with the second half delivering particularly strong results. During 2025, the division has maintained momentum, elevating market share despite a decline in rig counts in the UK sector. Revenue is expected to remain similar to 2024’s, setting the stage for another robust year. Looking ahead into 2026, activity is anticipated to grow, supported by multiple new contracts wins and a healthy pipeline of projects. The division is well-positioned with a stable, low-attrition team and only a few roles to fill in the coming year. Importantly, the business remains dedicated to employee satisfaction and ongoing training initiatives to ensure the team continues to meet evolving customer needs.
The division did see a slight increase in revenue during the year, from the £3.4m seen in 2023 to reach £3.6m. For 2025, management has seen business activity fall compared to the previous year. However, of late, a few new drilling clients have been added to the customer list and there has been a recent increase in sales to clients in continental Europe. As we approach 2026, the business is expecting to see an upturn in sales for the division, mainly driven by a competitor leaving the machine shop market and the opportunities this brings. This, though, is expected to be offset by the anticipated weaker demand relating to the UK North Sea sector, with a continued challenging fiscal regime for oil & gas businesses dampening customer demand for the division’s products and services. Nonetheless, management are committed to keeping a tight control on costs, and, with a strong commitment to increasing the business’ visibility to the wider regional market, are positive that DRILCO can generate growth.
Page 1
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The company’s immediate and intermediate parent companies are based in the USA, and senior management there have outlined the framework of policies, procedures, organisational structure and internal controls to manage the business and related risks for the group. The principal risks and uncertainties faced by the company can broadly be categorised as: competitive, financial, compliance and legislative, and IT.
As a service provider to the oil and gas industry, the company faces intense competition from other players in the market. To mitigate against this risk, several different strategies have been implemented to maintain profitability while remaining competitive. This includes the company, as well as the wider group, investing in research and development to develop new technologies that differentiate us from competitors. We maintain a focus on operational efficiency to ensure prices remain competitive; and work closely with customers to understand their needs, so that we can provide tailored solutions that meet their unique requirements. Care is also taken to ensure that we protect the group’s unique intellectual property. We have also been closely monitoring the recent increase in cost inflation. In response to this, we have taken a number of actions to counteract the impact on our margins and profitability. These include reviewing and optimising our supply chain, focusing on improving our operational efficacy, and working closely with our customers to find mutually beneficial solutions that balance their needs alongside our company’s. Our experienced management team and agile organisational structure allow us to adapt quickly to changing market conditions. The company considers its capital resources to be adequate for the running of the operations of the business. We expect our operating cash flow to continue to meet cash requirements for the foreseeable future. Furthermore, any short-term cash requirements can be met with funding from related group undertakings. Trade debtor balances are constantly monitored for amounts outstanding, with respect to both time outstanding and credit limits. The breadth of our customer base also mitigates against individual credit risk and this potentially severely impacting on our cash flow. The company follows a number of processes to limit any potential adverse effect on financial performance. Internal control is had with regular reviews by senior management on the performance of the business’ divisions and monitoring of cashflows. The company’s leadership team is also responsible for ensuring appropriate internal control over the financial reporting. Complying with all legal and regularity requirements is a key priority for the business. Incidents of non-compliance could lead to penalties, litigation, and damage the company’s reputation. All activities are regularly monitored by the QHSE department to ensure that the highest standards are adhered to. The group’s QHSE standards, as well as local led procedures and processes, ensure that the company appropriately monitors and controls the quality of the goods and services supplied. Ethical and high standards of behaviour are reinforced with this being a key component of our group’s mission and values statements, and through mandatory code of conduct and ethics training for all employees. The IT infrastructure in place is critical to the running of the company and the wider group. An extended disruption to IT systems could have a significant impact on the operations of the organisation. Cyber security incidents could also lead to the exposure of sensitive company information and affect the day to day functioning of the business. To mitigate against these risks, the wider group has in place compulsory cyber security training, regular phishing tests and monitoring of IT activity, amongst other measures. The group also has a cybersecurity incident response plan in place, which provides guidance on the steps to take on responding to such incidents.
On behalf of the board.
Page 2
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
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 profit for the year, after taxation, amounted to £1,009,546 (2023 - loss £1,566,606).
The directors who served during the year were:
The Company will seek to minimise adverse impacts on the environment from its activities, whilst continuing to address health, safety and economic issues. The Company has complied with all applicable legislation and regulations.
The Company sells to most of its clients on customary credit terms and is, as a result, exposed to the usual credit risk and cash flow risk associated with this form of trading. It manages this risk through its credit control procedures. The existence of these trade credit facilities does not expose the group to price risk or liquidity risk. in order to maintain liquidity to ensure that sufficient funds are available for ongoing operations and future developments, the Company manages its working capital and relies on support from its parent entity as required.
The Company does not carry out Research & Development activities.
The Company holds employee team briefings and other organisational forums to communicate performance, policy and initiatives. This provides an opportunity for staff engagement and to create a culture that fosters open honest and direct communication.
The Company closely monitors customer satisfaction, perception and feedback regarding our overall performance. Supplier Performance is evaluated through regular reporting on performance.
Page 3
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The Company has no branches as defined in section 1046(3) of the Companies Act 2006, outside of the UK.
Where mandatory disclosures in the Directors' report are considered by the directors to be of strategic importance, these are disclosed in the strategic report.
The auditors, AAB Audit & Accountancy 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.
Page 4
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
DIRECTORS' RESPONSIBILITIES STATEMENT
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 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Company's financial statements and then apply them consistently;
∙make judgements 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 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.
Page 5
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WELLBORE INTEGRITY SOLUTIONS UK LIMITED
We have audited the financial statements of Wellbore Integrity Solutions UK Limited (the 'Company') for the year ended 31 December 2024, which comprise the Statement of comprehensive income, the Balance sheet, the Statement of cash flows, the Statement of changes in equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
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.
We have nothing to report in this regard.
Page 6
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WELLBORE INTEGRITY SOLUTIONS UK LIMITED (CONTINUED)
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Strategic report and the Directors' report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic report or the Directors' report.
Page 7
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WELLBORE INTEGRITY SOLUTIONS UK 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 Auditors' 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:
We obtained an understanding of the legal and regulatory frameworks within which the company operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were the Companies Act 2006 and Taxation legislation. We considered the opportunities and incentives that may exist within the organisation that could lead to a fraud being committed and identified the greatest potential for fraud in the following areas:
∙Manipulation of revenue recognition via the posting of manual journal entries;
∙Manipulation of significant accounting estimates and judgements; and
∙Management override of controls to manipulate the Company's key performance indicators to meet targets.
We discussed these risks with management and designed audit procedures to address these risks including:
∙Testing of journal entries and other adjustments for appropriateness;
∙Evaluating the business rationale of significant transactions outside the normal course of business;
∙Reviewing judgements made by management in their calculation of accounting estimates for potential management bias;
∙Performing enquiries of management about litigation and claims and inspection of relevant correspondence; and
∙Reviewing legal and professional fees to identify indications of actual or potential litigation, claims and any non-compliance with laws and regulations.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' report.
Page 8
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WELLBORE INTEGRITY SOLUTIONS UK 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 Auditors' report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Statutory Auditor
Kingshill View
Prime Four Business Park
Kingswells
AB15 8PU
Page 9
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 10
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
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 14 to 28 form part of these financial statements.
Page 11
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 12
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 13
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Wellbore Integrity Solutions UK Limited is a private company limited by shares incorporated in Scotland, England and Wales. The company operates from its business address at Badentoy Drive, Portlethen, Aberdeenshire, United Kingdom, AB12 4ZD.
The principal activity of the company during the year was the provision of goods and services related to the oil and gas industry.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).
For details regarding the impact of prior year restatements, please refer to note 21.
The following principal accounting policies have been applied:
The directors, therefore, have made an informed judgement, at the time of approving the financial statements, that there is a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. As a result, the directors have continued to adopt the going concern basis of accounting in preparing the annual financial statements.
Functional and presentation currency
Transactions and balances
Page 14
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Page 15
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Goodwill
Other intangible assets
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
Page 16
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
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.
Page 17
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the Company's Balance sheet when the Company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.
Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.
Other financial assets
Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.
Impairment of financial assets
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.
Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.
If there is a favourable change in relation to the events surrounding the impairment loss then the
Page 18
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.
Basic financial liabilities
Financial liabilities and equity instruments are classified 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 the deduction of all its liabilities.
Basic financial liabilities, which include trade and other creditors, bank loans and other loans are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade creditors are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
Other financial instruments
Derivatives, including forward exchange contracts, futures contracts and interest rate swaps, are not classified as basic financial instruments. These are initially recognised at fair value on the date the derivative contract is entered into, with costs being charged to the profit or loss. They are subsequently measured at fair value with changes in the profit or loss.
Debt instruments that do not meet the conditions as set out in FRS 102 paragraph 11.9 are subsequently measured at fair value through the profit or loss. This recognition and measurement would also apply to financial instruments where the performance is evaluated on a fair value basis as with a documented risk management or investment strategy.
Derecognition of financial instruments
Derecognition of financial assets
Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.
Page 19
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
2.Accounting policies (continued)
Derecognition of financial liabilities
Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.
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 following judgements and estimates have had the most significant impact on amounts recognised in the financial statements. Useful economic life of tangible fixed assets Useful economic lives are determined based on the expected period over which the assets will generate economic benefits. Dilapidation provision The company has recognised a provision for dilapidations associated with its leased property. This provision, as stated in Note 19, is based on a detailed dilapidations assessment conducted by a chartered surveyor, which determined the most reliable estimate of the costs required to restore the properties to their original condition in accordance with the terms of the lease agreements. Recoverability of related party debtors The company has significant balances due from related parties, included within debtors (Note 15). The recoverability of these balances is assessed based on management’s evaluation of the financial position, liquidity, and future cash flow forecasts of the counterparties.
Page 20
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Analysis of turnover by country of destination:
Page 21
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 22
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 23
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 24
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 25
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 26
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
Page 27
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
In the prior year, other operating income had been incorrectly netted off against administrative expenses. The comparative figures have been restated by an amount of £531,876 to present the income and related expenses in the appropriate classification within the Statement of Comprehensive Income. The prior year adjustment has no impact on the reported profit or retained earning position for the prior year.
The Company has no capital commitments to disclose as at 31 December 2024.
The company contributes to a defined contribution benefit scheme for all qualifying employees. During the year £295,468 was paid into the scheme (2023 - £278,757). the amounts payable at the year end amounted to £nil (2023 - £nil).
The company's ultimate parent is Wellbore Integrity Solutions LLC, incorporated in Houston, Texas, USA, with its principal place of business and registered office at 1310 Rankin Road, Building 18, Houston, Texas, 77073-4802.
The immediate parent of Wellbore Integrity Solutions UK Limited is Wellbore Integrity Solutions LLC (Delaware). The next most senior parent is Wellbore Integrity Solutions Intermediate Holdings LLC (Delaware).
Page 28
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||