| HCD RESEARCH LIMITED |
| Notes to the Accounts |
| for the year ended 31 March 2025 |
|
| 1 |
Accounting policies |
|
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Statement of compliance |
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HCD Research Limited ('the Company') is a private limited liability company incorporated in England and Wales. The Company's registration number is 00708818 and the address of the registered office is 179 Junction Road, Burgess Hill, West Sussex, RH15 0JW. The principle activity of the Company in the year under review was the design and manufacture of precision crystal oscillators and frequency standards |
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Basis of preparation |
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The accounts have been prepared under the historical cost convention and in accordance with FRS 102, The Financial Reporting Standard applicable in the UK and Republic of Ireland (as applied to small entities by section 1A of the standard). |
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The financial statements have been prepared under the historical cost convention. The presentation currency is £ sterling |
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The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented unless otherwise stated. |
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Turnover |
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Turnover is measured at the fair value of the consideration received or receivable, net of discounts and value added taxes. Turnover includes revenue earned from the sale of goods and from the rendering of services. Turnover from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have transferred to the buyer. Turnover from the rendering of services is recognised by reference to the stage of completion of the contract. The stage of completion of a contract is measured by comparing the costs incurred for work performed to date to the total estimated contract costs. |
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Intangible fixed assets |
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Intangible fixed assets comprise:- |
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- Product designs purchased from third parties measured at cost less accumulative amortisation based on a five year write off . |
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- Development costs of specific products which are expected to provide revenue for several years. These costs are being amortised over the sales of the relevant products. |
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- Specialised operating software which is being written off over three years. |
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Tangible fixed assets |
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Tangible fixed assets are measured at cost less accumulative depreciation and any accumulative impairment losses. Depreciation is provided on all tangible fixed assets, other than freehold land, at rates calculated to write off the cost, less estimated residual value, of each asset evenly over its expected useful life, as follows: |
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Freehold buildings |
over 50 years |
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Plant and machinery |
over 5 years |
|
Fixtures, fittings, tools and equipment |
over 5 years |
|
Computing equipment |
over 3 years |
|
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Investments |
|
Investments in subsidiaries, associates and joint ventures are measured at cost less any accumulated impairment losses. Listed investments are measured at fair value. Unlisted investments are measured at fair value unless the value cannot be measured reliably, in which case they are measured at cost less any accumulated impairment losses. Changes in fair value are included in the profit and loss account. |
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Stocks |
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Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost, which comprise direct production costs, are based on the method most appropriate to the type of inventory class, but usually on a weighted average cost basis. Overheads are charged to profit and loss as incurred. Estimated selling price less costs to complete and sell is based on the estimated selling price of the goods less any estimated completion or selling costs likely to be incurred on the sale. |
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When stocks are sold, the carrying amount of those stocks is recognised as an expense in the period in which the related revenue is recognised. The amount of any write-down of stocks to estimated selling price less costs to complete and sell and all losses of stocks are recognised as an expense in the period in which the write-down or loss occur. The amount of any reversal of any write-down of stock is recognised as a reduction in the amount of stocks recognised as an expense in the period in which the reversal occurs. |
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Debtors |
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Short term debtors are measured at transaction price (which is usually the invoice price), less any impairment losses for bad and doubtful debts. Loans and other financial assets are initially recognised at transaction price including any transaction costs and subsequently measured at amortised cost determined using the effective interest method, less any impairment losses for bad and doubtful debts. |
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Creditors |
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Short term creditors are measured at transaction price (which is usually the invoice price). Loans and other financial liabilities are initially recognised at transaction price net of any transaction costs and subsequently measured at amortised cost determined using the effective interest method. |
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Taxation |
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A current tax liability is recognised for the tax payable on the taxable profit of the current and past periods. A current tax asset is recognised in respect of a tax loss that can be carried back to recover tax paid in a previous period. |
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Deferred tax is recognised in respect of all timing differences between the recognition of income and expenses in the financial statements and their inclusion in tax assessments. Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference, except for revalued land and investment property where the tax rate that applies to the sale of the asset is used. Current and deferred tax assets and liabilities are not discounted. |
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Cash and cash equivalents |
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Cash and cash equivalents comprise cash at bank and on hand, demand deposits with banks and other short-term highly liquid investments with original maturities of three months or less and bank overdrafts. In the statement of financial position, bank overdrafts are shown within borrowings or current liabilities. |
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Interest bearing borrowings |
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All interest-bearing loans and borrowings which are basic financial instruments are initially recognised at the present value of cash payable to the bank (including interest). After initial recognition they are measured at amortised cost using the effective interest rate method, less impairment. Any difference between the amount initially recognised and redemption value is recognised in profit and loss together with any interest and fees payable. |
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Provisions |
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Provisions (ie liabilities of uncertain timing or amount) are recognised when there is an obligation at the reporting date as a result of a past event, it is probable that economic benefit will be transferred to settle the obligation and the amount of the obligation can be estimated reliably. |
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Foreign currency translation |
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Transactions in foreign currencies are initially recognised at the rate of exchange ruling at the date of the transaction. At the end of each reporting period foreign currency monetary items are translated at the closing rate of exchange. Non-monetary items that are measured at historical cost are translated at the rate ruling at the date of the transaction. All differences are charged to profit or loss. |
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Grants receivable |
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Revenue grants from government or other sources are credited to the Income Statement in the period in which the grant aided expenditure has been incurred. |
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Employee benefits - pensions |
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The obligations for contributions to defined contribution scheme are recognised as an expense as incurred. The assets of the scheme are held separately from those of the Company in an independentantly administered fund. |
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| 2 |
Other operating income |
2025 |
|
2024 |
| £ |
£ |
|
|
Rent received |
6,437 |
|
6,437 |
|
Covid Business Interruption Loan Scheme |
1,425 |
|
1,425 |
|
|
|
|
|
|
|
7,862 |
|
7,862 |
|
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|
|
|
|
|
|
|
| 3 |
Finance costs (net) |
2025 |
|
2024 |
| £ |
£ |
|
|
Interest receivable and similar income |
1,128 |
|
222 |
|
Interest payable and similar charges |
(42,546) |
|
(40,160) |
|
|
|
|
|
|
|
(41,418) |
|
(39,938) |
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|
|
|
|
|
|
|
|
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Interest receivable and similar income |
|
Bank and other interest receivable |
1,128 |
|
222 |
|
Income from investments |
- |
|
- |
|
|
|
|
|
|
|
1,128 |
|
222 |
|
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|
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|
|
|
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|
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Interest payable and similar charges |
|
Bank and other interest payable |
(1,221) |
|
(1,084) |
|
Loan interest payable |
(39,691) |
|
(37,216) |
|
Loan costs written off |
(1,634) |
|
(1,860) |
|
|
|
|
|
|
|
(42,546) |
|
(40,160) |
|
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|
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| 4 |
Employees |
2025 |
|
2024 |
| Number |
Number |
|
|
Average number of persons employed by the company |
16 |
|
16 |
|
|
|
|
|
|
|
|
|
|
| 5 |
Tax on profit/(loss) on ordinary activities |
2025 |
|
2024 |
| £ |
£ |
|
Current tax charge/(credit) |
|
Charge/(credit) for the current year |
(250) |
|
8,148 |
|
Adjustment in respect of prior years |
(5,629) |
|
|
|
|
|
|
|
(5,879) |
|
8,148 |
|
Deferred tax charge/(credit) |
|
Oringination and reversal of timing differences |
(1,335) |
|
(6,281) |
|
Adjustment in respect of prior years |
8,074 |
|
1,126 |
|
|
|
|
|
|
|
6,739 |
|
(5,155) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
860 |
|
2,993 |
|
|
|
|
|
|
|
|
|
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The company has taken advantage of various R&D tax incentive schemes to reduce its taxation liabilities |
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| 6 |
Intangible fixed assets |
|
|
Designs and know how |
|
Product development costs |
|
Operating software |
|
Total |
| £ |
£ |
£ |
£ |
|
Cost |
|
At 1 April 2024 |
40,000 |
|
50,536 |
|
20,532 |
|
111,068 |
|
Disposals |
- |
|
(1,850) |
|
- |
|
(1,850) |
|
At 31 March 2025 |
40,000 |
|
48,686 |
|
20,532 |
|
109,218 |
|
|
|
|
|
|
|
|
|
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Amortisation |
|
At 1 April 2024 |
40,000 |
|
3,895 |
|
17,672 |
|
61,567 |
|
Provided during the year |
- |
|
- |
|
2,427 |
|
2,427 |
|
At 31 March 2025 |
40,000 |
|
3,895 |
|
20,099 |
|
63,994 |
|
|
|
|
|
|
|
|
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Net book value |
|
At 31 March 2025 |
- |
|
44,791 |
|
433 |
|
45,224 |
|
At 31 March 2024 |
- |
|
46,641 |
|
2,860 |
|
49,501 |
|
|
|
|
|
|
|
|
|
|
| 7 |
Tangible fixed assets |
|
|
Land and buildings |
|
Plant and machinery etc |
|
Furniture and equipment |
|
Total |
| £ |
£ |
£ |
£ |
|
Cost |
|
At 1 April 2024 |
488,466 |
|
475,225 |
|
77,988 |
|
1,041,679 |
|
Additions |
- |
|
57,658 |
|
17,358 |
|
75,016 |
|
At 31 March 2025 |
488,466 |
|
532,883 |
|
95,346 |
|
1,116,695 |
|
|
|
|
|
|
|
|
|
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Depreciation |
|
At 1 April 2024 |
5,808 |
|
415,905 |
|
74,755 |
|
496,468 |
|
Charge for the year |
6,969 |
|
26,665 |
|
3,396 |
|
37,030 |
|
At 31 March 2025 |
12,777 |
|
442,570 |
|
78,151 |
|
533,498 |
|
|
|
|
|
|
|
|
|
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Net book value |
|
At 31 March 2025 |
475,689 |
|
90,313 |
|
17,195 |
|
583,197 |
|
At 31 March 2024 |
482,658 |
|
59,320 |
|
3,233 |
|
545,211 |
|
|
|
|
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|
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|
Cost of valuation at 31st March 2024 comprises: |
| £ |
£ |
|
Valuation in 2016 |
70,891 |
|
|
|
70,891 |
|
Cost |
488,466 |
|
461,992 |
|
95,346 |
|
1,045,804 |
|
|
488,466 |
|
532,883 |
|
95,346 |
|
1,116,695 |
|
|
|
|
|
|
|
|
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The directors have, on the basis of professional advice, assessed that the value of the land included in the land and buildings cost of £488,466 amounts to £140,000. |
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|
| 8 |
Investments |
| Investments in |
| subsidiary |
| undertakings |
| £ |
|
Cost |
|
At 1 April 2024 |
7,500 |
|
Additions/disposals in year |
- |
|
Revaluation |
- |
|
At 31 March 2025 |
7,500 |
|
|
|
|
|
|
|
|
|
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Historical cost |
|
At 1 April 2024 |
7,500 |
|
At 31 March 2025 |
7,500 |
|
|
|
|
|
|
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At 31 March 2024 the Company owned the whole of the issued share capital of HCD Engineering Limited (registration number 01098969 - England and Wales) which has been dormant for both 2024 and 2023 |
|
|
| 9 |
Inventories |
2025 |
|
2024 |
| £ |
£ |
|
Raw materials and components |
86,562 |
|
97,280 |
|
Work in progress |
79,476 |
|
69,023 |
|
|
|
|
|
|
|
166,038 |
|
166,303 |
|
|
|
|
|
|
|
|
|
|
| 10 |
Debtors |
2025 |
|
2024 |
| £ |
£ |
|
Trade debtors |
143,801 |
|
169,845 |
|
Amounts owed by group undertakings and undertakings in which the company has a participating interest |
|
9,046 |
|
9,046 |
|
UK Corporation Tax recoverable |
|
|
|
|
122,476 |
|
65,595 |
|
Deferred tax asset |
|
|
|
|
10,654 |
|
5,121 |
|
Innovate UK grant claims |
|
|
|
|
64,618 |
|
52,933 |
|
Other debtors |
10,850 |
|
9,967 |
|
|
|
|
|
|
361,445 |
|
312,507 |
|
|
|
|
|
|
|
|
|
|
| 11 |
Creditors: amounts falling due within one year |
2025 |
|
2024 |
| £ |
£ |
|
Bank loans and overdrafts |
27,133 |
|
49,285 |
|
Trade creditors |
205,767 |
|
212,013 |
|
Amounts owed to group undertakings and undertakings in which the company has a participating interest |
|
7,500 |
|
7,500 |
|
Taxation and social security costs |
19,964 |
|
15,819 |
|
Other creditors |
182,449 |
|
182,926 |
|
Accruals and deferred income |
21,655 |
|
9,374 |
|
|
|
|
|
|
464,468 |
|
476,917 |
|
|
|
|
|
|
|
|
|
|
| 12 |
Creditors: amounts falling due after one year |
2025 |
|
2024 |
| £ |
£ |
|
Loans:- |
|
- secured |
449,569 |
|
451,014 |
|
- unsecured |
- |
|
23,782 |
|
|
|
|
|
|
449,569 |
|
474,796 |
|
|
|
|
|
|
|
|
|
|
| 13 |
Loans |
2025 |
|
2024 |
| £ |
£ |
|
Loans falling due after one year:- |
|
|
Due for payment within 2 to 5 years |
|
- Coronavirus Business Interruption Loan (unsecured) |
- |
|
23,782 |
|
- HSBC mortgage loans (secured) |
15,205 |
|
26,263 |
|
|
|
|
|
|
15,205 |
|
50,045 |
|
Due for payment after more than five years (all secured):- |
|
- Director's loan payable otherwise than by instalments |
|
116,250 |
|
116,250 |
|
- HSBC mortgage loans payable by instalments |
318,114 |
|
308,501 |
|
|
|
|
|
|
434,364 |
|
424,751 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
449,569 |
|
474,796 |
|
|
|
|
|
|
|
|
|
|
The company had the following loans outstanding at the end of the year:- |
|
|
Covid Business Interruption Loan:- |
|
|
In October 2020 the Company took out a Coronavirus Business Interruption Loan from the Funding Circle. The loan was for £150,000 and is repayable over five years with the last payment being made in October 2025. No capital or interest payments were due to be made in the first twelve months of the loan period. The first year's interest payments and the loan fees were funded by the UK Government. The loan is unsecured. |
|
|
Loans to fund the purchase of the company's premises in Burgess Hill:- |
|
|
Two loans from HSBC Bank UK plc totalling £348,750 at an interest rate of 3% above the Bank of England base rate and repayable over 25 years. The loans are secured by a fixed charge on the property and a floating charge over the whole of the company's assets in the event of a default of the loan covenants. |
|
|
A loan of £116,250 by one of the directors of the company which is secured by way of a second charge on the property. This loan is at an interest rate of 1% above Barclays Bank base rate and carries no fixed repayment terms. |
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|
Analysis of borrowings:- |
Principle |
Loan costs |
Net |
|
|
|
|
£ |
£ |
£ |
|
Secured:- |
|
- HSBC mortgage loans |
341,518 |
|
(4,848) |
|
336,670 |
|
- Director's loan |
116,250 |
|
|
|
116,250 |
|
|
|
|
457,768 |
|
(4,848) |
|
452,920 |
|
Unsecured:- |
|
- Coronavirus Business Interruption Loan |
23,782 |
|
- |
|
23,782 |
|
|
|
|
|
481,550 |
|
(4,848) |
|
476,702 |
|
|
|
|
|
|
|
|
|
|
| 14 |
Deferred taxation - (debit)/credit |
2025 |
|
2024 |
| £ |
£ |
|
|
At 1 April 2024 |
(5,121) |
|
34 |
|
Charge/(credit) for year (Note 6) |
(1,335) |
|
(6,281) |
|
Prior year adjustment |
(4,198) |
|
1,126 |
|
|
|
|
|
|
|
(10,654) |
|
(5,121) |
|
|
|
|
|
|
|
|
|
|
| 15 |
Share capital |
2025 |
|
2024 |
| £ |
£ |
|
Allotted, issued and fully paid: |
|
19,748 A Ordinary shares of £1 each |
19,748 |
|
19,748 |
|
8,147 B Ordinary shares of £1 each |
8,147 |
|
8,147 |
|
1,468 C Ordinary shares of £1 each |
16 |
|
16 |
|
363 E Ordinary shares of £1 each |
363 |
|
363 |
|
363 O Ordinary shares of £1 each |
363 |
|
363 |
|
363 T Ordinary shares of £1 each |
363 |
|
363 |
|
363 R Ordinary shares of £1 each |
363 |
|
363 |
|
|
|
|
|
|
|
29,363 |
|
29,363 |
|
|
|
|
|
|
|
|
|
|
All classes of share rank pari pasu in all respects with the other classes of shares. |
|
| 16 |
Capital commitments |
2025 |
|
2024 |
| £ |
£ |
|
|
Amounts contracted for but not provided in the accounts |
|
- purchase of 179 Junction Road, Burgess Hill, RH15 0JW |
- |
|
465,000 |
|
|
|
|
|
|
|
|
|
|
| 17 |
Related party transactions |
|
|
The directors have provided funds to the company to finance operations and the purchase of capital equipment. These funds are interest free and are repayable on demand. |
|
|
|
|
|
|
2025 |
|
2024 |
| £ |
£ |
|
|
At 31st March the total of such advances was |
|
181,233 |
|
181,893 |
|
|
|
|
|
|
|
|
|
|
During the year payments have been made for invoiced services to companies in which directors have significant shareholdings as follows:- |
|
|
|
|
|
|
Value of payments made |
|
|
|
|
|
|
2025 |
|
2024 |
|
Company |
Director |
£ |
£ |
|
|
KCL Management Services Ltd |
Mr T. E. Reynolds |
6,866 |
|
7,553 |
|
Ineox Lab Ltd |
Mr O. Khorremy |
17,281 |
|
11,207 |
|
|
|
|
|
|
|
|
|
|
Mr R. Oxborrow has made a secured loan of £116,500 to the Company to assist in the purchase of the Company's premises in Burgess Hill. Further details of this loan are shown in Note 13. |
|
|
| 18 |
Controlling party |
|
|
The Company is a subsidiary undertaking of HCD Holdings Ltd (registration number 09913404 - England and Wales). The directors regard HCD Holdings Ltd as the Company's ultimate holding company. |
|
|
| 19 |
Other information |
|
|
HCD RESEARCH LIMITED is a private company limited by shares and incorporated in England. Its registered office is: |
|
HCD Research Ltd |
|
179 Junction Road |
|
BURGESS HILL |
|
West Sussex |
|
RH15 0JW |