Somerlap Forest Products Limited 01599346 false 2024-05-01 2025-04-30 2025-04-30 The principal activity of the company is the manufacture and distribution of pallets and the manufacture of fencing and garden products. Digita Accounts Production Advanced 6.30.9574.0 true true true Class 1 Class 2 Class 3 false true 01599346 2024-05-01 2025-04-30 01599346 2025-04-30 01599346 bus:OrdinaryShareClass1 2025-04-30 01599346 bus:Consolidated 2025-04-30 01599346 core:AcceleratedTaxDepreciationDeferredTax 2025-04-30 01599346 core:RetirementBenefitObligationsDeferredTax 2025-04-30 01599346 core:RetainedEarningsAccumulatedLosses 2025-04-30 01599346 core:ShareCapital 2025-04-30 01599346 core:SharePremium 2025-04-30 01599346 core:CurrentFinancialInstruments 2025-04-30 01599346 core:CurrentFinancialInstruments core:WithinOneYear 2025-04-30 01599346 core:Non-currentFinancialInstruments 2025-04-30 01599346 core:Non-currentFinancialInstruments core:AfterOneYear 2025-04-30 01599346 core:BetweenTwoFiveYears 2025-04-30 01599346 core:WithinOneYear 2025-04-30 01599346 core:LandBuildings 2025-04-30 01599346 core:MotorVehicles 2025-04-30 01599346 core:OtherPropertyPlantEquipment 2025-04-30 01599346 core:DeferredTaxation 2025-04-30 01599346 bus:FRS102 2024-05-01 2025-04-30 01599346 bus:Audited 2024-05-01 2025-04-30 01599346 bus:FullAccounts 2024-05-01 2025-04-30 01599346 bus:RegisteredOffice 2024-05-01 2025-04-30 01599346 bus:Director2 2024-05-01 2025-04-30 01599346 bus:Director4 2024-05-01 2025-04-30 01599346 bus:Director5 2024-05-01 2025-04-30 01599346 bus:Director6 2024-05-01 2025-04-30 01599346 bus:HighestPaidDirector 2024-05-01 2025-04-30 01599346 bus:OrdinaryShareClass1 2024-05-01 2025-04-30 01599346 bus:Consolidated 2024-05-01 2025-04-30 01599346 bus:PrivateLimitedCompanyLtd 2024-05-01 2025-04-30 01599346 bus:Agent1 2024-05-01 2025-04-30 01599346 core:RetainedEarningsAccumulatedLosses 2024-05-01 2025-04-30 01599346 core:ShareCapital 2024-05-01 2025-04-30 01599346 core:SharePremium 2024-05-01 2025-04-30 01599346 countries:UnitedKingdom 2024-05-01 2025-04-30 01599346 core:PlantEquipmentUnderOperatingLeases 2024-05-01 2025-04-30 01599346 core:ReportableOperatingSegment1 2024-05-01 2025-04-30 01599346 core:ReportableOperatingSegment2 2024-05-01 2025-04-30 01599346 core:ReportableOperatingSegment3 2024-05-01 2025-04-30 01599346 core:LandBuildings 2024-05-01 2025-04-30 01599346 core:MotorVehicles 2024-05-01 2025-04-30 01599346 core:OtherPropertyPlantEquipment 2024-05-01 2025-04-30 01599346 core:PlantMachinery 2024-05-01 2025-04-30 01599346 core:DeferredTaxation 2024-05-01 2025-04-30 01599346 core:OtherRelatedParties 2024-05-01 2025-04-30 01599346 core:UKTax 2024-05-01 2025-04-30 01599346 1 2024-05-01 2025-04-30 01599346 countries:AllCountries 2024-05-01 2025-04-30 01599346 2024-04-30 01599346 core:RetainedEarningsAccumulatedLosses 2024-04-30 01599346 core:ShareCapital 2024-04-30 01599346 core:SharePremium 2024-04-30 01599346 core:LandBuildings 2024-04-30 01599346 core:MotorVehicles 2024-04-30 01599346 core:OtherPropertyPlantEquipment 2024-04-30 01599346 core:DeferredTaxation 2024-04-30 01599346 2023-05-01 2024-04-30 01599346 2024-04-30 01599346 bus:OrdinaryShareClass1 2024-04-30 01599346 core:AcceleratedTaxDepreciationDeferredTax 2024-04-30 01599346 core:RetirementBenefitObligationsDeferredTax 2024-04-30 01599346 core:CurrentFinancialInstruments 2024-04-30 01599346 core:CurrentFinancialInstruments core:WithinOneYear 2024-04-30 01599346 core:Non-currentFinancialInstruments 2024-04-30 01599346 core:Non-currentFinancialInstruments core:AfterOneYear 2024-04-30 01599346 core:BetweenTwoFiveYears 2024-04-30 01599346 core:WithinOneYear 2024-04-30 01599346 core:LandBuildings 2024-04-30 01599346 core:MotorVehicles 2024-04-30 01599346 core:OtherPropertyPlantEquipment 2024-04-30 01599346 bus:HighestPaidDirector 2023-05-01 2024-04-30 01599346 core:RetainedEarningsAccumulatedLosses 2023-05-01 2024-04-30 01599346 core:ShareCapital 2023-05-01 2024-04-30 01599346 core:SharePremium 2023-05-01 2024-04-30 01599346 countries:UnitedKingdom 2023-05-01 2024-04-30 01599346 core:PlantEquipmentUnderOperatingLeases 2023-05-01 2024-04-30 01599346 core:ReportableOperatingSegment1 2023-05-01 2024-04-30 01599346 core:ReportableOperatingSegment2 2023-05-01 2024-04-30 01599346 core:UKTax 2023-05-01 2024-04-30 01599346 2023-04-30 01599346 core:RetainedEarningsAccumulatedLosses 2023-04-30 01599346 core:ShareCapital 2023-04-30 01599346 core:SharePremium 2023-04-30 iso4217:GBP xbrli:pure xbrli:shares

Somerlap Forest Products Limited
Annual Report and Financial Statements
Year Ended 30 April 2025

Registration number: 01599346

Somerlap Forest Products Limited

Contents

Company Information | 1
Strategic Report | 2 to 3
Directors' Report | 4
Statement of Directors' Responsibilities | 5
Independent Auditor's Report | 6 to 9
Profit and Loss Account | 10
Balance Sheet | 11
Statement of Changes in Equity | 12
Statement of Cash Flows | 13
Notes to the Financial Statements | 14 to 26

Somerlap Forest Products Limited

Company Information

Directors | Mr K A Bond Mr S Fraser Ms K Jones Mrs W Bond

Registered office | Wells Road Mark Somerset UK TA9 4NR

Bankers | Lloyds Bank PLC Bridgwater 25 Cornhill Bridgwater Somerset TA6 3AY

Auditors | PKF Francis Clark Statutory AuditorFirst Floor Blackbrook Gate 1 Blackbrook Business Park Taunton Somerset TA1 2PX

Somerlap Forest Products Limited

Strategic Report for the Year Ended 30 April 2025

The directors present their strategic report for the year ended 30 April 2025.

Principal activity

The principal activity of the company is the manufacture and distribution of pallets and the manufacture of fencing and garden products.

Review of the business

On 14 March 2023 the company transitioned to an Employee Ownership Trust as part of the ongoing strategy to give employees greater involvement to develop the business further. The directors recognised that organisations are most successful where management and staff share a common purpose, work together and communicate openly and the new structure will be a place where employees feel valued, motivated and know their views will be heard.
The directors are satisfied with both the result for the year and the financial position of the company as at 30 April 2025.
In 2025, revenue, which encompasses pallet manufacture and garden products, was consistent with the previous year. Gross margin decreased considerably in absolute terms and it decreased from 50% to 46% due to the pricing of timber. The administrative costs of the business – which includes wages and salaries increased by approximately £50,000 due to increases in wages costs, repairs and maintenance and transport costs but offset with a reduction in depreciation.
Profit after both tax and deferred tax charges of £646,352 (2024 - £1,002,313) is representative of both the market forces described above and the hard work and dedication of our employees for which the directors are grateful.
The company balance sheet as at 31 March 2025 has eroded slightly from net assets of £4,534,102 to £3,941,000, in line with the result for the year and after distributions.

The company's key financial and other performance indicators during the year were as follows:

| Unit | 2025 | 2024
Turnover | £ | 8,880,558 | 8,915,881
Gross profit | £ | 4,085,119 | 4,495,381
Gross margin | % | 46 | 50
Profit before tax | £ | 870,029 | 1,346,098
Net cash flow | £ | (400,018) | (1,265,523)

Future Developments:
Over the course of the calendar year 2025, the ownership structure will facilitate the continued involvement of employees in the running of the business. In trading terms the remainder of 2025 and into 2026 the profitability has continued along the same lines as the year to 30 April 2025 but with inflation starting to ease the company is looking to a bright future. The directors have, however, retained, on the balance sheet significant cash levels enabling the business to both deal with economic and market fluctuations and to invest in the business as and when the opportunity arises with a series of capital projects identified and underway.

Somerlap Forest Products Limited

Strategic Report for the Year Ended 30 April 2025

Principal risks and uncertainties

Economic uncertainty:
The business is exposed to UK economic uncertainty, whether driven by government fiscal policy or more general economic trends such as interest rate variations, wage and other cost inflation. Whilst acknowledging that inflation is easing the directors consider it appropriate to plan on the basis that the inflationary pressures remain. Steps have already been taken and will continue to be taken to manage inflation in particular in respect of energy costs whereby investment has been made into renewable energy and battery storage. As described above employee engagement is also a key factor in maintaining a strong workforce at the current time and the directors recognise that further recruitment may be necessary from time to time in a difficult employment market.
Supply availability and pricing:
The supply of timber products – principally from the UK and European forestry – is closely monitored by the directors in terms of availability, pricing and quality. Steps have been taken at various points to buy in bulk in order to ensure customer service and delivery is maintained. The timber market could be impacted by global conflicts and the supply chain issues that result.
Competition:
The directors consider competition as an ever present business risk and, being a smaller, player in the manufactured pallet market they recognise that whilst competitors can bring to bear economies of scale on pricing, Somerlap is able to focus more ably on quality, customer service and responsiveness.

Approved and authorised by the Board on 15 January 2026 and signed on its behalf by:

......................................... Mr K A Bond Director

Somerlap Forest Products Limited

Directors' Report for the Year Ended 30 April 2025

The directors present their report and the financial statements for the year ended 30 April 2025.

Directors of the company

The directors who held office during the year were as follows:

Mr K A Bond

Mr S Fraser

Ms K Jones

Mrs W Bond

Financial instruments

Objectives and policies

The company's activities expose it to a number of financial risks, including credit risk, cash flow risk and liquidity risk. The use and nature of financial instruments are determined by the directors in the context of trading terms made available to the company by customers and suppliers, with the objective of securing the liquidity and profitability of the company.

Price risk, credit risk, liquidity risk and cash flow risk

The directors consider there to be few significant financial risks to the business at the current time.
The business' principal financial instruments comprise of bank balances, trade debtors and trade creditors, of which the main purpose is to finance the business operations.
Trade debtors are managed in respect of credit and cash flow risk by regular monitoring of amounts outstanding for both time and credit limits. The amounts in the balance sheet allow for doubtful debt.
Trade creditors liquidity risk is managed by ensuring sufficient funds are available to meet amounts due.

Disclosure of information to the auditors

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditors are unaware.

Reappointment of auditors

The Auditor, PKF Francis Clark, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

Approved and authorised by the Board on 15 January 2026 and signed on its behalf by:

......................................... Mr K A Bond Director

Somerlap Forest Products Limited

Statement of Directors' Responsibilities

The directors acknowledge their responsibilities for preparing the Annual 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

• | select suitable accounting policies and apply them consistently;

• | make judgements and accounting estimates that are reasonable and prudent;

• | state whether applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

• | 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 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.

Somerlap Forest Products Limited

Independent Auditor's Report to the Members of Somerlap Forest Products Limited

Opinion

We have audited the financial statements of Somerlap Forest Products Limited (the 'company') for the year ended 30 April 2025, which comprise the Profit and Loss Account, Balance Sheet, Statement of Changes in Equity, Statement of Cash Flows, and Notes to the Financial Statements, 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 our opinion the financial statements:

• | give a true and fair view of the state of the company's affairs as at 30 April 2025 and of its profit for the year then ended;
• | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
• | have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

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 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 UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the director's 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 original financial statements were 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.

Other information

The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.

In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.

Somerlap Forest Products Limited

Independent Auditor's Report to the Members of Somerlap Forest Products Limited

Opinion on other matter prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

• | the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• | the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of our 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 and the Directors' Report.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

• | adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
• | the financial statements are not in agreement with the accounting records and returns; or
• | certain disclosures of directors' remuneration specified by law are not made; or
• | we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page 5, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor Responsibilities for the audit of the financial statements

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:

Somerlap Forest Products Limited

Independent Auditor's Report to the Members of Somerlap Forest Products Limited

As part of our audit planning we obtained an understanding of the legal and regulatory framework that is applicable to the entity and the industry/sector in which it operates to identify the key laws and regulations affecting the entity. As part of this assessment process we discussed with management the laws and regulations applicable to the company, reviewed certification identified on the company website and other communications and considered findings from previous audits.
The key laws and regulations we identified were Health & Safety at Work and General Data Protection Regulations (GDPR).
We also considered those laws and regulations that have a direct impact on the preparation of the financial statements, primarily Companies Act 2006, Corporation Taxes Acts 2009 & 2010, and the Capital Allowances Act 2001.
We discussed with management how the compliance with these laws and regulations is monitored and discussed policies and procedures in place.
We also identified the individuals who have responsibility for ensuring that the entity complies with laws and regulations and deal with reporting any issues if they arise.
As part of our planning procedures, we assessed the risk of any non-compliance with laws and regulations on the entity’s ability to continue trading and the risk of material misstatement to the financial statements.
Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Our procedures involved the following:
• Enquiries of management regarding their knowledge of any non-compliance with laws and regulations that could affect the financial statements;
• Reviewed legal and professional costs to identify any possible non compliance or legal costs in respect of non compliance;
• Examined regulatory inspection reports in relation to the key laws and regulations where such reports had been made during the period and after the period; and
• Review of the Information Commissioner's Office (ICO) website for any enforcement actions or decision notices impacting the company.
As part of our enquiries we discussed with management whether there have been any known instances, allegations or suspicions of fraud, of which management confirmed there had been none during or after the period.
We also evaluated the risk of fraud through management override including that arising from management’s incentives. The key risks we identified were incentives relating to management bonuses and financial loan covenants, and we determined that the principal risks were related to cut-off in respect of revenue recognition, management override of controls and stock valuation.
In response to the identified risk, as part of our audit work we:
• Used data analytics to test journal entries throughout the year, for appropriateness;
• Reviewed estimates and judgements made in the accounts for any indication of bias and challenged assumptions used by management in making the estimates; and
• Undertook specific cut-off procedures in respect of revenue recognition.

Somerlap Forest Products Limited

Independent Auditor's Report to the Members of Somerlap Forest Products Limited

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. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate omissions, collusion, forgery, misrepresentations, or the override of internal controls. We are also less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

......................................
Benjamin Slater BA(Hons) ACA (Senior Statutory Auditor)
PKF Francis Clark, Statutory Auditor
First Floor
Blackbrook Gate 1
Blackbrook Business Park
Taunton
Somerset
TA1 2PX

16 January 2026

Somerlap Forest Products Limited

Profit and Loss Account

Year Ended 30 April 2025

| Note | 2025 £ | 2024 £
Turnover | 3 | 8,880,558 | 8,915,881
Cost of sales |  | (4,795,439) | (4,420,500)
Gross profit |  | 4,085,119 | 4,495,381
Administrative expenses |  | (3,317,210) | (3,260,766)
Other operating income | 4 | 78,383 | 86,446
Operating profit | 5 | 846,292 | 1,321,061
Other interest receivable and similar income | 9 | 24,348 | 25,628
Interest payable and similar expenses | 10 | (611) | (591)
|  | 23,737 | 25,037
Profit before tax |  | 870,029 | 1,346,098
Tax on profit | 11 | (223,677) | (343,785)
Profit for the financial year |  | 646,352 | 1,002,313

The above results were derived from continuing operations.

The company has no recognised gains or losses for the year other than the results above.

Somerlap Forest Products Limited

Balance Sheet

30 April 2025

| Note | 2025 £ | 2024 £
Fixed assets |  |  |
Tangible assets | 12 | 1,668,292 | 1,888,134
Current assets |  |  |
Stocks | 13 | 1,329,304 | 1,421,433
Debtors | 14 | 1,546,557 | 1,432,640
Cash at bank and in hand |  | 1,717,976 | 2,117,994
|  | 4,593,837 | 4,972,067
Creditors: Amounts falling due within one year | 16 | (2,065,378) | (2,013,711)
Net current assets |  | 2,528,459 | 2,958,356
Total assets less current liabilities |  | 4,196,751 | 4,846,490
Creditors: Amounts falling due after more than one year | 16 | (18,071) | (17,460)
Provisions for liabilities | 19 | (237,680) | (294,928)
Net assets |  | 3,941,000 | 4,534,102
Capital and reserves |  |  |
Called up share capital |  | 315 | 315
Share premium reserve |  | 47,212 | 47,212
Profit and loss account |  | 3,893,473 | 4,486,575
Shareholders' funds |  | 3,941,000 | 4,534,102

Approved and authorised by the Board on 15 January 2026 and signed on its behalf by:

......................................... Mr K A Bond Director

Company Registration Number: 01599346

Somerlap Forest Products Limited

Statement of Changes in Equity

Year Ended 30 April 2025

| Share capital £ | Share premium £ | Profit and loss account £ | Total £
At 1 May 2024 | 315 | 47,212 | 4,486,575 | 4,534,102
Profit for the year | - | - | 646,352 | 646,352
Gift to employee ownership trust | - | - | (1,239,454) | (1,239,454)
At 30 April 2025 | 315 | 47,212 | 3,893,473 | 3,941,000

| Share capital £ | Share premium £ | Profit and loss account £ | Total £
At 1 May 2023 | 315 | 47,212 | 6,373,952 | 6,421,479
Profit for the year | - | - | 1,002,313 | 1,002,313
Gift to employee ownership trust | - | - | (2,889,690) | (2,889,690)
At 30 April 2024 | 315 | 47,212 | 4,486,575 | 4,534,102

Somerlap Forest Products Limited

Statement of Cash Flows

Year Ended 30 April 2025

| Note | 2025 £ | 2024 £
Cash flows from operating activities
Profit for the year |  | 646,352 | 1,002,313
Adjustments to cash flows from non-cash items |  |  |
Depreciation and amortisation | 5 | 302,634 | 364,223
(Profit)/loss on disposal of tangible assets |  | (1,477) | 13,198
Finance income | 9 | (24,348) | (25,628)
Finance costs | 10 | 611 | 591
Income tax expense | 11 | 223,677 | 343,785
|  | 1,147,449 | 1,698,482
Working capital adjustments |  |  |
Decrease in stocks | 13 | 92,129 | 105,337
(Increase)/decrease in trade debtors | 14 | (113,917) | 175,190
Increase in trade creditors | 16 | 158,082 | 28,700
Decrease in deferred income, including government grants |  | (609) | (608)
Cash generated from operations |  | 1,283,134 | 2,007,101
Income taxes paid | 11 | (386,731) | (109,758)
Net cash flow from operating activities |  | 896,403 | 1,897,343
Cash flows from investing activities |  |  |
Interest received | 9 | 24,348 | 25,628
Acquisitions of tangible assets |  | (82,792) | (298,804)
Proceeds from sale of tangible assets |  | 1,477 | -
Net cash flows from investing activities |  | (56,967) | (273,176)
Cash flows from financing activities |  |  |
Gift to employee ownership trust |  | (1,239,454) | (2,889,690)
Net decrease in cash and cash equivalents |  | (400,018) | (1,265,523)
Cash and cash equivalents at 1 May |  | 2,117,994 | 3,383,517
Cash and cash equivalents at 30 April |  | 1,717,976 | 2,117,994

Somerlap Forest Products Limited

Notes to the Financial Statements

Year Ended 30 April 2025

1 | General information

The company is a private company limited by share capital, incorporated in England & Wales.

The address of its registered office is:
Wells Road
Mark
Somerset
UK
TA9 4NR

These financial statements were authorised for issue by the Board on 15 January 2026.

2 | Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal 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.

Statement of compliance

These financial statements have been prepared in accordance with Financial Reporting Standard 102 - 'The Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.

Basis of preparation

These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.

Going concern

Recent trading results show steady sales in line with usual time of year fluctuations and the company continues to operate profitably. The directors are satisfied that, having considered no less than 12 months from the date of approval of the financial statements, that there are no significant risks to the going concern basis of the company and, therefore, that the going concern basis of preparation remains appropriate. Management has taken into account the following:
• Expected sales levels based on current customer orders and market conditions
• Planned cost levels and overhead controls
• Seasonal variations typical to the business
• The impact of raw material price changes and how we will adjust margins on our customers prices accordingly
• Potential customer loses and how we can increase new sales generation as required
• Assessment of the company’s ability to withstand potential reductions in turnover or margin.

Somerlap Forest Products Limited

Notes to the Financial Statements

Year Ended 30 April 2025

Key sources of estimation uncertainty

In the application of the company's accounting policies management is required to make judgements, estimates and assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from those estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of revision and future periods in the revision affects both current and future periods.
The key estimates that have a significant effect on the amounts recognised in the financial statements are described below:
Fixed assets are carried at cost, less accumulated depreciation and any subsequent accumulated impairment loss. This requires an estimation in the depreciation rates used as well as assessment of the ongoing economic contribution of the assets of the company as to whether an indicator of permanent impairment has occurred. The carrying value at the year end is £1,668,292 (2024: £1,888,134).
Stocks are held at the lower of cost and estimated selling price less cost to complete and sell. Stocks are assessed for impairment periodically and written down to realisable value where appropriate through the profit and loss. The carrying value at the year end is £1,329,304 (2024: £1,421,433).
Trade debtor balances are held at sales cost less any discount or rebates directly attributable to those sales. The recoverability of debtor balances is reviewed regularly to ensure that all debts are receivable or there is a high probability of receiving payment. Once a debt is considered to no longer be receivable a provision is introduced against that debt. The carrying value at the year end is £1,439,004 (2024: £1,303,643).
The key judgement that has a significant impact on the financial statements is in respect of going concern, as described above.

Revenue recognition

Turnover represents the fair value of consideration receivable, excluding Value Added Tax, in the respect of the sale of timber products. Revenue is recognised upon delivery of goods and services provided.

Foreign currency transactions and balances

Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rate on the date when the fair value is re-measured.
Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.

Somerlap Forest Products Limited

Notes to the Financial Statements

Year Ended 30 April 2025

Tax

Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

The current corporation tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates taxable income.

Deferred tax is recognised on all timing differences at the balance sheet date unless indicated below. Timing differences are differences between taxable profits and the results as stated in the profit and loss account and other comprehensive income. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
The carrying amount of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amount equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.

Tangible assets

Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class | Depreciation method and rate
Land & Buildings | 5% reducing balance
Plant & Machinery | 15%-25% reducing balance or 33.3% straight line
Motor Vehicles | 25% reducing balance

Stocks

Stock is valued at the lower of cost and net realisable value, after due regard for obsolete and slow moving stocks. Net realisable value is based on selling price less anticipated costs to completion and selling costs.

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.

Somerlap Forest Products Limited

Notes to the Financial Statements

Year Ended 30 April 2025

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

Financial instruments

Classification
The company holds the following financial instruments:
• Short term trade and other debtors and creditors;
• Cash and bank balances.
• Long term loans at below market rate
All financial instruments are classified as basic.
Recognition and measurement
The company has chosen to apply the recognition and measurement principles in FRS102.
Financial instruments are recognised when the company becomes party to the contractual provisions of the instrument and derecognised when in the case of assets, the contractual rights to cash flows from the assets expire or substantially all the risks and rewards of ownership are transferred to another party, or in the case of liabilities, when the company’s obligations are discharged, expire or are cancelled.
Such instruments are initially measured at transaction price, including transaction costs, and are subsequently carried at the undiscounted amount of the cash or other consideration expected to be paid or received, after taking account of impairment adjustments.
Long term loan liabilities constitute a finance transaction because they are at a below market rate of interest. Such loans are measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. The discount is recognised as a capital contribution within Equity. As the discount unwinds it is charged against profit.

Somerlap Forest Products Limited

Notes to the Financial Statements

Year Ended 30 April 2025

3 | Turnover

The analysis of the company's Turnover for the year from continuing operations is as follows:

| 2025 £ | 2024 £
Sale of goods | 8,787,894 | 8,830,947
Other revenue | 92,664 | 84,934
| 8,880,558 | 8,915,881

The analysis of the company's turnover for the year by class of business is as follows:

| 2025 £ | 2024 £
Timber products | 8,787,894 | 8,830,947
Heat generation | 92,664 | 84,934
| 8,880,558 | 8,915,881

The analysis of the company's Turnover for the year by market is as follows:

| 2025 £ | 2024 £
UK | 8,880,558 | 8,915,881

4 | Other operating income

The analysis of the company's other operating income for the year is as follows:

| 2025 £ | 2024 £
Sub lease rental income | 77,775 | 85,838
Miscellaneous other operating income | 608 | 608
| 78,383 | 86,446

5 | Operating profit

Arrived at after charging/(crediting)

| 2025 £ | 2024 £
Depreciation expense | 302,634 | 364,223
Foreign exchange losses | - | 403
Operating lease expense - plant and machinery | 2,607 | 844
(Profit)/loss on disposal of property, plant and equipment | (1,477) | 13,198

Somerlap Forest Products Limited

Notes to the Financial Statements

Year Ended 30 April 2025

6 | Staff costs

The aggregate payroll costs (including directors' remuneration) were as follows:

| 2025 £ | 2024 £
Wages and salaries | 1,853,968 | 1,784,770
Social security costs | 172,966 | 173,372
Pension costs, defined contribution scheme | 51,652 | 48,381
Other employee expense | 23,201 | 16,258
| 2,101,787 | 2,022,781

The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:

| 2025 No. | 2024 No.
Production | 36 | 36
Administration and support | 13 | 10
Distribution | 4 | 4
| 53 | 50

7 | Directors' remuneration

The directors' remuneration for the year was as follows:

| 2025 £ | 2024 £
Remuneration | 271,526 | 303,924
Contributions paid to money purchase schemes | 16,586 | 17,656
| 288,112 | 321,580

During the year the number of directors who were receiving benefits and share incentives was as follows:

| 2025 No. | 2024 No.
Accruing benefits under money purchase pension scheme | 4 | 4

In respect of the highest paid director:

| 2025 £ | 2024 £
Remuneration | 88,371 | 93,200
Company contributions to money purchase pension schemes | 6,476 | 6,476

Somerlap Forest Products Limited

Notes to the Financial Statements

Year Ended 30 April 2025

8 | Auditor's remuneration

| 2025 £ | 2024 £
Audit of the financial statements | 14,500 | 13,500

9 | Other interest receivable and similar income

| 2025 £ | 2024 £
Interest income on bank deposits | 24,308 | 25,628
Other finance income | 40 | -
| 24,348 | 25,628

10 | Interest payable and similar expenses

| 2025 £ | 2024 £
Interest expense on other finance liabilities | 611 | 591

11 | Taxation

Tax charged/(credited) in the profit and loss account

| 2025 £ | 2024 £
Current taxation |  |
UK corporation tax | 280,925 | 386,731
Deferred taxation |  |
Arising from origination and reversal of timing differences | (57,248) | (42,946)
Tax expense in the income statement | 223,677 | 343,785

Somerlap Forest Products Limited

Notes to the Financial Statements

Year Ended 30 April 2025

The tax on profit before tax for the year is higher than the standard rate of corporation tax in the UK (2024 - higher than the standard rate of corporation tax in the UK) of 25% (2024 - 25%).
The differences are reconciled below:

| 2025 £ | 2024 £
Profit before tax | 870,029 | 1,346,098
Corporation tax at standard rate | 217,507 | 336,525
Tax increase from effect of capital allowances and depreciation | 878 | 1,241
Effect of expense not deductible in determining taxable profit (tax loss) | 5,292 | 6,019
Total tax charge | 223,677 | 343,785

Deferred tax

Deferred tax assets and liabilities

2025 | Asset £ | Liability £
Fixed asset timing differences | - | 238,609
Short term timing differences | 929 | -
| 929 | 238,609

2024 | Asset £ | Liability £
Fixed asset timing differences | - | 295,824
Short term timing differences | 896 | -
| 896 | 295,824

Somerlap Forest Products Limited

Notes to the Financial Statements

Year Ended 30 April 2025

12 | Tangible assets

| Land and buildings £ | Motor vehicles £ | Plant and machinery £ | Total £
Cost or valuation
At 1 May 2024 | 1,401,507 | 868,016 | 3,158,874 | 5,428,397
Additions | 27,300 | - | 55,492 | 82,792
At 30 April 2025 | 1,428,807 | 868,016 | 3,214,366 | 5,511,189
Depreciation
At 1 May 2024 | 683,669 | 684,367 | 2,172,227 | 3,540,263
Charge for the year | 37,263 | 45,915 | 219,456 | 302,634
At 30 April 2025 | 720,932 | 730,282 | 2,391,683 | 3,842,897
Carrying amount
At 30 April 2025 | 707,875 | 137,734 | 822,683 | 1,668,292
At 30 April 2024 | 717,838 | 183,649 | 986,647 | 1,888,134

Included within the net book value of land and buildings above is £707,875 (2024 - £717,838) in respect of freehold land and buildings.

13 | Stocks

| 2025 £ | 2024 £
Raw materials and consumables | 1,329,304 | 1,421,433

14 | Debtors

| 2025 £ | 2024 £
Trade debtors | 1,439,004 | 1,303,643
Other debtors | - | 86
Prepayments and accrued income | 107,553 | 128,911
| 1,546,557 | 1,432,640

Somerlap Forest Products Limited

Notes to the Financial Statements

Year Ended 30 April 2025

15 | Cash and cash equivalents

| 2025 £ | 2024 £
Cash on hand | 200 | 200
Cash at bank | 1,717,776 | 2,117,794
| 1,717,976 | 2,117,994

16 | Creditors

| Note | 2025 £ | 2024 £
Due within one year |  |  |
Trade creditors |  | 1,254,369 | 1,136,571
Social security and other taxes |  | 356,003 | 332,572
Other creditors |  | 135,215 | 126,158
Accruals |  | 37,455 | 29,659
Corporation tax | 11 | 280,925 | 386,731
Deferred income |  | 1,411 | 2,020
|  | 2,065,378 | 2,013,711
Due after one year |  |  |
Loans and borrowings | 17 | 18,071 | 17,460

17 | Loans and borrowings

Non-current loans and borrowings

| 2025 £ | 2024 £
Other borrowings | 18,071 | 17,460

Bank loans and overdraft

The commercial account facility is subject to a legal charge over the freehold property at Mark, Somerset by Lloyds Bank.

Somerlap Forest Products Limited

Notes to the Financial Statements

Year Ended 30 April 2025

18 | Obligations under leases and hire purchase contracts

Operating leases

The total of future minimum lease payments is as follows:

| 2025 £ | 2024 £
Not later than one year | 58,667 | 64,000
Later than one year and not later than five years | - | 58,667
| 58,667 | 122,667

The amount of non-cancellable operating lease payments recognised as an expense during the year was £58,667 (2024 - £64,000).

19 | Provisions for liabilities

| Deferred tax £ | Total £
At 1 May 2024 | 294,928 | 294,928
Provisions used | (57,248) | (57,248)
At 30 April 2025 | 237,680 | 237,680

Somerlap Forest Products Limited

Notes to the Financial Statements

Year Ended 30 April 2025

20 | Share capital

Allotted, called up and fully paid shares

| 2025 | 2024
| No. | £ | No. | £
Ordinary shares of £0.01 each | 31,500 | 315 | 31,500 | 315

21 | Gift to Somerlap Employee Ownership Trust

On 14 March 2023 the shares in Somerlap Forest Products Limited were acquired by Somerlap Employee Ownership Trust ('the Trust') in order to establish an employee ownership structure.
During the year voluntary contributions (gifts) for the benefit of all employees were made to the Trust by Somerlap Forest Products Limited. Gifts totalling £1,239,454 (2024: £2,889,690) have been made in the year. The funds have been treated as a gift from equity.
These voluntary contribution payments to the Somerlap Employee Ownership Trust are treated as distributions by the company for accounting purposes and presented in the Statement of Changes in Equity. As a result the payments are accounted for when made. The treatment has been adopted on the basis that such payments are transfers of value to the company's shareholders.

22 | Analysis of changes in net debt

| At 1 May 2024 £ | Financing cash flows £ | Other non-cash changes £ | At 30 April 2025 £
Cash and cash equivalents |  |  |  |
Cash | 2,117,994 | (400,018) | - | 1,717,976
Borrowings |  |  |  |
Long term loans | (17,460) | - | (611) | (18,071)
Total | 2,100,534 | (400,018) | (611) | 1,699,905

Somerlap Forest Products Limited

Notes to the Financial Statements

Year Ended 30 April 2025

23 | Pension and other schemes

Defined contribution pension scheme

The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £51,652 (2024 - £48,381).
The pension liability at the year end was £8,503 (2024: £8,061).

24 | Related party transactions

Summary of transactions with other related parties

Director's pension fund During the year the Self-Invested Personal Pension Plan of Mr K and Mrs W Bond leased land and buildings to the company for £58,667 (2024 - £64,000). The company sublet the land and buildings to third parties and collected rent of £77,775 (2024 - £85,838) during the year. The company also incurred additional expenditure of £nil (2024 - £nil) during the year. At the balance sheet date, the amount due to the pension fund was £nil (2024 - £nil).

25 | Parent and ultimate parent undertaking

The ultimate controlling party is Somerlap Employee Ownership Trust.