Company registration number 01332714 (England and Wales)
OXFORD LASERS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
OXFORD LASERS LIMITED
COMPANY INFORMATION
Directors
M Collins
Dr A Kearsley
Dr M Knowles
Surtek Limited
Professor C E Webb
S Richardson
(Appointed 26 May 2022)
Secretary
R Morton
Company number
01332714
Registered office
Unit 8
Moorbrook Park
Didcot
Oxfordshire
OX11 7HP
Auditor
Critchleys Audit LLP
Beaver House
23-38 Hythe Bridge Street
Oxford
OX1 2EP
Bankers
Barclays Bank plc
54 Cornmarket Street
Oxford
OX1 3HS
Solicitors
Blake Morgan
Seacourt Tower
West Way
Botley
Oxford
OX2 0FB
OXFORD LASERS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Profit and loss account
8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Statement of cash flows
12
Notes to the financial statements
13 - 26
OXFORD LASERS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 1 -
The directors present the strategic report for the year ended 31 December 2022.
Review of the business
The company's principal activity during the year continued to be the design, build and use of laser-integrated tools for micromachining and imaging applications, along with offering contract services for high-precision laser cutting, drilling, milling, scribing, and patterning. We also provide Imaging contract services for Spray Characterisation, Droplet / Particle analysis.
During FY22 Oxford Lasers recorded strong growth on the previous year, in both laser system and subcontract services sales.
We continued to face supply chain pressures during 2022, such as increases in component prices, the availability of components, disrupted supplies and long lead times. A number of actions have been taken by the company to mitigate supply.
The company continued to invest in R&D and in our state-of-the-art micromachining systems to ensure Oxford Lasers are at the leading edge of technology, addressing challenging applications.
With a good forward orderbook, and after reviewing the company’s plans and financing arrangements, the Directors consider that the company has adequate resources and is well placed to achieve sustained growth and profitability for the foreseeable future.
Principal risks and uncertainties
The company uses various financial instruments including cash, equity, and various items, such as trade debtors and trade creditors that arise directly from its operations. The main purpose of these financial instruments is to raise finance for the company’s operations.
The existence of these financial instruments exposes the company to a number of financial risks, which are described in more detail below.
Key performance indicators
We consider the key financial performance indications are those that communicate the financial performance and strength of the company, these being revenue, operating profit and profit before tax. The KPI's for the year ended 31 December 2022 with comparatives for 2021 are summarised as follows:
OXFORD LASERS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 2 -
Other information and explanations
Currency Risk
The company is exposed to foreign exchange risk on amounts due from customers, amounts due to suppliers and amounts held in foreign currency bank accounts. The company monitors exposures to foreign exchange risks and hold foreign balances to hedge against this risk.
Liquidity Risk
The management's objectives are to retain sufficient liquid funds to enable it to meet its day-to-day trading requirements, to minimise the company's exposure to fluctuation customer cash flow and manage future cash flows expected to arise from the company's trading activities.
Interest Rate Risk
The company has exposure to interest rate risk in terms of interest received and payable.
Credit Risk
The principal credit risk arises from its trade debtors. In order to manage the credit risk, the company has appropriate policies concerning the credit offered to customers, requirements for advance payments and the regular monitoring of amounts outstanding. The amounts presented in the balance sheet are net of allowances for doubtful debts.
Dr M Knowles
Director
14 September 2023
OXFORD LASERS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 3 -
The directors present their annual report and financial statements for the year ended 31 December 2022.
Principal activities
The principal activity of the company continued to be that of the design and manufacture of lasers and associated equipment
Results and dividends
The results for the year are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
No preference dividends were paid.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Dr J F Baker
(Deceased 31 March 2023)
M Collins
Dr A Ferguson
(Resigned 31 March 2023)
Dr A Kearsley
Dr M Knowles
R Morris
(Resigned 25 February 2022)
Surtek Limited
Professor C E Webb
S Richardson
(Appointed 26 May 2022)
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
On behalf of the board
Dr M Knowles
Director
14 September 2023
OXFORD LASERS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 4 -
The directors are responsible 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 then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
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.
OXFORD LASERS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF OXFORD LASERS LIMITED
- 5 -
Opinion
We have audited the financial statements of Oxford Lasers Limited (the 'company') for the year ended 31 December 2022 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including 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 31 December 2022 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.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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 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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our 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.
OXFORD LASERS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF OXFORD LASERS LIMITED
- 6 -
Matters on which we are required to report by exception
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.
We have nothing to report in respect of the following matters in relation to which 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 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 directors' responsibilities statement, 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's 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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our knowledge and experience;
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence where applicable; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.
OXFORD LASERS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF OXFORD LASERS LIMITED
- 7 -
To address the risk of fraud through management bias and override of controls, we:
performed analytical procedures to identify any unusual or unexpected relationships;
tested journal entries to identify unusual transactions;
assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and
investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
agreeing financial statement disclosures to underlying supporting documentation;
reading the minutes of meetings of those charged with governance;
enquiring of management as to actual and potential litigation and claims;
reviewing relevant correspondence.
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's 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.
Katherine Wilkes
Senior Statutory Auditor
For and on behalf of Critchleys Audit LLP
15 September 2023
Chartered Accountants
Statutory Auditor
Beaver House
23-38 Hythe Bridge Street
Oxford
OX1 2EP
OXFORD LASERS LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 8 -
2022
2021
Notes
£
£
Turnover
3
6,159,231
5,352,824
Cost of sales
(3,641,346)
(3,048,855)
Gross profit
2,517,885
2,303,969
Administrative expenses
(2,579,163)
(2,694,084)
Other operating income
372,725
606,497
Operating profit
4
311,447
216,382
Interest receivable and similar income
7
25
Profit before taxation
311,447
216,407
Tax on profit
8
57,558
2,351
Profit for the financial year
369,005
218,758
The profit and loss account has been prepared on the basis that all operations are continuing operations.
OXFORD LASERS LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022
- 9 -
2022
2021
£
£
Profit for the year
369,005
218,758
Other comprehensive income
-
-
Total comprehensive income for the year
369,005
218,758
OXFORD LASERS LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2022
31 December 2022
- 10 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
9
1,529,415
1,913,489
Current assets
Stocks
11
788,810
806,738
Debtors
12
1,204,659
934,757
Cash at bank and in hand
2,313,820
1,685,168
4,307,289
3,426,663
Creditors: amounts falling due within one year
13
(1,016,939)
(923,306)
Net current assets
3,290,350
2,503,357
Total assets less current liabilities
4,819,765
4,416,846
Provisions for liabilities
Provisions
15
231,814
191,293
Deferred tax liability
14
80,581
87,188
(312,395)
(278,481)
Net assets
4,507,370
4,138,365
Capital and reserves
Called up share capital
18
264,603
264,603
Share premium account
22,400
22,400
Capital redemption reserve
416
416
Profit and loss reserves
4,219,951
3,850,946
Total equity
4,507,370
4,138,365
The financial statements were approved by the board of directors and authorised for issue on 14 September 2023 and are signed on its behalf by:
Dr M Knowles
Director
Company Registration No. 01332714
OXFORD LASERS LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
- 11 -
Share capital
Share premium account
Capital redemption reserve
Profit and loss reserves
Total
£
£
£
£
£
Balance at 1 January 2021
264,603
22,400
416
3,632,188
3,919,607
Year ended 31 December 2021:
Profit and total comprehensive income for the year
-
-
-
218,758
218,758
Balance at 31 December 2021
264,603
22,400
416
3,850,946
4,138,365
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
-
369,005
369,005
Balance at 31 December 2022
264,603
22,400
416
4,219,951
4,507,370
OXFORD LASERS LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 12 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
22
817,908
269,974
Income taxes refunded
50,951
17,465
Net cash inflow from operating activities
868,859
287,439
Investing activities
Purchase of tangible fixed assets
(240,207)
(1,418,616)
Interest received
25
Net cash used in investing activities
(240,207)
(1,418,591)
Net increase/(decrease) in cash and cash equivalents
628,652
(1,131,152)
Cash and cash equivalents at beginning of year
1,685,168
2,816,320
Cash and cash equivalents at end of year
2,313,820
1,685,168
OXFORD LASERS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 13 -
1
Accounting policies
Company information
Oxford Lasers Limited is a private company limited by shares incorporated in England and Wales. The registered office is Unit 8, Moorbrook Park, Didcot, Oxfordshire, OX11 7HP.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover consists the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the company’s activities. Turnover is shown net of value added tax, returns, rebates and discounts.
The company recognises revenue when:
The amount of revenue can be reliably measured;
it is probable that future economic benefits will flow to the entity;
and specific criteria have been met for each of the company's activities.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Leasehold improvements
20% straight line (term of lease)
Plant and equipment
20% and 33% straight line
Freehold land and assets in the course of construction are not depreciated.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
Development costs
Research and development expenditure is written off as incurred.
OXFORD LASERS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 14 -
1.5
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.
The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. Profit on long term contracts is taken as the work is carried out if the final outcome can be assessed with reasonable certainty. The profit included is calculated on a prudent basis to reflect the proportion of the work carried out at the year end, by recording turnover and related costs (as defined in Stocks above) as contract activity progresses. Turnover is calculated as that proportion of total contract value which costs incurred to date bear to total expected costs for that contract. Revenues derived from variations on contracts are recognised only when they have been accepted by the customer. Full provision is made for losses on all contracts in the year in which they are first foreseen.
1.7
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ 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.
OXFORD LASERS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 15 -
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of 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 deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
OXFORD LASERS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 16 -
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
OXFORD LASERS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 17 -
1.11
Provisions
Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
1.12
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
1.15
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
Other grants
Grants of a revenue nature are credited to income so as to match them with the expenditure to which they relate.
1.16
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
OXFORD LASERS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 18 -
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these 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 where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Tangible fixed assets
Tangible fixed assets are depreciated over their useful lives taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. Residual value assessments consider issues such as the remaining life of the asset and projected disposal values.
Stock provisions
Stock is recognised at the lower of cost and net realisable value. The provision for slow moving stock are based on an analysis of stock items which have had slow or minimal turnover during the prior 24 months and an estimate of their likelihood of being used in the future. In reference to this, a slow moving provision is calculated based upon 50% for those items not sold in the last 12-24 months and 100% for those not sold in over 24 months.
Warranty provision
The company makes provision for potential future warranty claims on system sales. Management estimates this initially based on an analysis of expenditure from the previous 12 month period. Management will then exercise judgement from historical claims to estimate whether to increase or release the provision depending on expectations of the coming 12 month period
3
Turnover and other revenue
2022
2021
£
£
Turnover analysed by class of business
Design, manufacture and servicing of lasers
6,159,231
5,352,824
2022
2021
£
£
Turnover analysed by geographical market
UK
571,507
921,031
US
3,598,828
2,893,188
Rest of world
1,988,896
1,538,605
6,159,231
5,352,824
OXFORD LASERS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
3
Turnover and other revenue
(Continued)
- 19 -
2022
2021
£
£
Other revenue
Interest income
-
25
Grants received
144,875
413,889
4
Operating profit
2022
2021
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(175,638)
9,761
Government grants
(144,875)
(413,889)
Fees payable to the company's auditor for the audit of the company's financial statements
10,500
9,500
Depreciation of owned tangible fixed assets
624,281
609,200
Operating lease charges
173,239
115,713
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2022
2021
Number
Number
60
60
Their aggregate remuneration comprised:
2022
2021
£
£
Wages and salaries
3,019,510
2,865,194
Social security costs
334,871
308,010
Pension costs
185,612
185,507
3,539,993
3,358,711
6
Directors' remuneration
2022
2021
£
£
Remuneration for qualifying services
464,058
459,686
Company pension contributions to defined contribution schemes
34,701
38,359
498,759
498,045
OXFORD LASERS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
6
Directors' remuneration
(Continued)
- 20 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2022
2021
£
£
Remuneration for qualifying services
122,272
119,757
Company pension contributions to defined contribution schemes
9,882
9,144
Included in the above is £34,701 of contributions paid to money purchase schemes (2021: £38,359).
7
Interest receivable and similar income
2022
2021
£
£
Interest income
Interest on bank deposits
25
2022
2021
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
25
8
Taxation
2022
2021
£
£
Current tax
Adjustments in respect of prior periods
(50,951)
(17,464)
Deferred tax
Origination and reversal of timing differences
(6,607)
15,113
Total tax credit
(57,558)
(2,351)
OXFORD LASERS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
8
Taxation
(Continued)
- 21 -
The actual credit for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2022
2021
£
£
Profit before taxation
311,447
216,407
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
59,175
41,117
Tax effect of expenses that are not deductible in determining taxable profit
325
103,506
Tax effect of utilisation of tax losses not previously recognised
(113,154)
(5)
Research and development tax credit
(62,902)
(21,561)
Under/(over) provided in prior years
11,951
4,097
Deferred tax movement
(6,607)
15,114
Depreciation in excess of capital allowances
53,654
(144,619)
Taxation credit for the year
(57,558)
(2,351)
9
Tangible fixed assets
Leasehold improvements
Assets under construction
Plant and equipment
Total
£
£
£
£
Cost
At 1 January 2022
108,686
591,403
3,357,946
4,058,035
Additions
7,428
78,799
153,980
240,207
Transfers
(363,221)
363,221
At 31 December 2022
116,114
306,981
3,875,147
4,298,242
Depreciation and impairment
At 1 January 2022
81,669
2,062,877
2,144,546
Depreciation charged in the year
27,512
596,769
624,281
At 31 December 2022
109,181
2,659,646
2,768,827
Carrying amount
At 31 December 2022
6,933
306,981
1,215,501
1,529,415
At 31 December 2021
27,017
591,403
1,295,069
1,913,489
10
Subsidiaries
Details of the company's subsidiaries at 31 December 2022 are as follows:
OXFORD LASERS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
10
Subsidiaries
(Continued)
- 22 -
Name of undertaking
Address
Nature of business
Class of
% Held
shares held
Direct
Oxford Lasers Inc
UK
Ordinary shares
Ordinary shares
100.00
Registered office addresses (all UK unless otherwise indicated):
1
2 Shaker Road, Unit B104, Shirley, USA, MA 01464, USA
The principal activity of Oxford Lasers Inc is the design and manufacture of lasers and associated equipment.
11
Stocks
2022
2021
£
£
Raw materials, WIP and consumables
788,810
806,738
12
Debtors
2022
2021
Amounts falling due within one year:
£
£
Trade debtors
660,010
517,926
Amounts owed by group undertakings
308,226
175,658
Other debtors
97,729
133,487
Prepayments and accrued income
138,694
107,686
1,204,659
934,757
13
Creditors: amounts falling due within one year
2022
2021
Notes
£
£
Trade creditors
134,486
199,648
Amounts owed to group undertakings
14,999
14,999
Taxation and social security
96,481
79,142
Deferred income
16
81,431
91,320
Other creditors
458,627
317,394
Accruals and deferred income
230,915
220,803
1,016,939
923,306
OXFORD LASERS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 23 -
14
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2022
2021
Balances:
£
£
Accelerated capital allowances
231,966
220,701
Tax losses
(151,385)
(133,513)
80,581
87,188
2022
Movements in the year:
£
Liability at 1 January 2022
87,188
Credit to profit or loss
(6,607)
Liability at 31 December 2022
80,581
The deferred tax liability set out above is expected to reverse within [12 months] and relates to accelerated capital allowances that are expected to mature within the same period.
15
Provisions for liabilities
2022
2021
£
£
Warranty and Dilapidation Provision
231,814
191,293
Movements on provisions:
Warranty and Dilapidation Provision
£
At 1 January 2022 and 31 December 2022
231,814
16
Deferred income
2022
2021
£
£
Other deferred income
81,431
91,320
OXFORD LASERS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 24 -
17
Retirement benefit schemes
2022
2021
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
185,612
185,507
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
Included in the balance sheet are unpaid pension contributions of £28,560 (2021: £26,848).
18
Share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of 10p each
1,920,800
1,920,800
192,080
192,080
2022
2021
2022
2021
Preference share capital
Number
Number
£
£
Issued and fully paid
Preference shares of 10p each
725,320
725,320
72,523
72,523
Preference shares classified as equity
72,523
72,523
Total equity share capital
264,603
264,603
19
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
Restated
2022
2021
£
£
Within one year
197,306
183,619
Between two and five years
435,479
632,975
In over five years
898
653
633,683
817,247
20
Related party transactions
Transactions with related parties
During the year the company entered into the following transactions with related parties:
Restated
OXFORD LASERS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
20
Related party transactions
(Continued)
- 25 -
Sales
Sales
Purchases
Purchases
2022
2021
2022
2021
£
£
£
£
Surtek Limited
-
-
28,632
51,882
Oxford Lasers Inc.
3,699,351
2,964,265
82,048
151,804
Management charge receivable
2022
2021
£
£
Oxford Lasers Inc.
258,196
203,686
The following amounts were outstanding at the reporting end date:
2022
2021
Amounts due from related parties
£
£
Oxford Lasers Inc.
977,733
995,164
Provision for doubtful debts owed by subsidiary
(669,506)
(819,506)
Other information
Summary of transactions with all subsidiaries
Oxford Lasers Inc.
Transactions during the year consisted of intercompany sales/purchases as well as management charges receivable.
Summary of transactions with other related parties
Surtek Limited - director of Oxford Lasers Limited and of Oxford Lasers Group Limited (which is the ultimate holding company).
Transactions during the year consisted of the provision of consultancy services. The amount transacted is as disclosed above.
21
Ultimate controlling party
The company's immediate parent is Oxford Lasers Micromachining Limited, incorporated in England and Wales.
The ultimate parent is Oxford Lasers Group Limited, incorporated in England and Wales.
OXFORD LASERS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 26 -
22
Cash generated from operations
2022
2021
£
£
Profit for the year after tax
369,005
218,758
Adjustments for:
Taxation credited
(57,558)
(2,351)
Investment income
(25)
Depreciation and impairment of tangible fixed assets
624,281
609,200
Increase in provisions
40,521
98,096
Movements in working capital:
Decrease in stocks
17,928
161,470
Increase in debtors
(269,902)
(548,023)
Increase/(decrease) in creditors
103,522
(259,135)
Decrease in deferred income
(9,889)
(8,016)
Cash generated from operations
817,908
269,974
23
Analysis of changes in net funds
1 January 2022
Cash flows
31 December 2022
£
£
£
Cash at bank and in hand
1,685,168
628,652
2,313,820
2022-12-312022-01-01falseCCH SoftwareCCH Accounts Production 2023.200Dr J F BakerM CollinsDr A FergusonDr A KearsleyDr M KnowlesR MorrisSurtek LimitedProfessor C E WebbS RichardsonR Morton369005013327142022-01-012022-12-3101332714bus:Director22022-01-012022-12-3101332714bus:Director42022-01-012022-12-3101332714bus:Director52022-01-012022-12-3101332714bus:Director72022-01-012022-12-3101332714bus:Director82022-01-012022-12-3101332714bus:Director92022-01-012022-12-3101332714bus:CompanySecretary12022-01-012022-12-3101332714bus:Director12022-01-012022-12-3101332714bus:Director32022-01-012022-12-3101332714bus:Director62022-01-012022-12-3101332714bus:RegisteredOffice2022-01-012022-12-3101332714bus:Agent12022-01-012022-12-31013327142022-12-31013327142021-01-012021-12-3101332714core:RetainedEarningsAccumulatedLosses2021-01-012021-12-3101332714core:RetainedEarningsAccumulatedLosses2022-01-012022-12-31013327142021-12-3101332714core:LeaseholdImprovements2022-12-3101332714core:ConstructionInProgressAssetsUnderConstruction2022-12-3101332714core:PlantMachinery2022-12-3101332714core:LeaseholdImprovements2021-12-3101332714core:ConstructionInProgressAssetsUnderConstruction2021-12-3101332714core:PlantMachinery2021-12-3101332714core:CurrentFinancialInstrumentscore:WithinOneYear2022-12-3101332714core:CurrentFinancialInstrumentscore:WithinOneYear2021-12-3101332714core:CurrentFinancialInstruments2022-12-3101332714core:CurrentFinancialInstruments2021-12-3101332714core:ShareCapital2022-12-3101332714core:ShareCapital2021-12-3101332714core:SharePremium2022-12-3101332714core:SharePremium2021-12-3101332714core:CapitalRedemptionReserve2022-12-3101332714core:CapitalRedemptionReserve2021-12-3101332714core:RetainedEarningsAccumulatedLosses2022-12-3101332714core:RetainedEarningsAccumulatedLosses2021-12-3101332714core:ShareCapital2020-12-3101332714core:SharePremium2020-12-3101332714core:CapitalRedemptionReserve2020-12-3101332714core:RetainedEarningsAccumulatedLosses2020-12-31013327142021-12-31013327142020-12-3101332714core:LeaseholdImprovements2022-01-012022-12-3101332714core:PlantMachinery2022-01-012022-12-3101332714core:UKTax2022-01-012022-12-3101332714core:UKTax2021-01-012021-12-310133271412022-01-012022-12-310133271412021-01-012021-12-310133271422022-01-012022-12-310133271422021-01-012021-12-310133271432022-01-012022-12-310133271432021-01-012021-12-3101332714core:LeaseholdImprovements2021-12-3101332714core:ConstructionInProgressAssetsUnderConstruction2021-12-3101332714core:PlantMachinery2021-12-3101332714core:ConstructionInProgressAssetsUnderConstruction2022-01-012022-12-3101332714core:WithinOneYear2022-12-3101332714core:WithinOneYear2021-12-3101332714core:BetweenTwoFiveYears2022-12-3101332714core:BetweenTwoFiveYears2021-12-3101332714core:MoreThanFiveYears2022-12-3101332714core:MoreThanFiveYears2021-12-3101332714bus:PrivateLimitedCompanyLtd2022-01-012022-12-3101332714bus:FRS1022022-01-012022-12-3101332714bus:Audited2022-01-012022-12-3101332714bus:FullAccounts2022-01-012022-12-31xbrli:purexbrli:sharesiso4217:GBP