Registered number:
For the Year Ended
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PEKTRON PLC
Company Information
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PEKTRON PLC
Contents
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PEKTRON PLC
Group Strategic Report
For the Year Ended 31 December 2019
We aim to present a balanced and comprehensive review of the development and performance of our business during the year and its position at the year end. Our review is consistent with the size and non-complex nature of our business and is written in the context of the risks and uncertainties we face.
Pektron Plc is a supplier of electronic parts for rugged environments, with particular expertise in vehicle electronics. We also supply various consultancy and other services in engineering, aviation and other industries. Turnover is in line with expectations. Gross profit margin is the same as the previous year but gross profit has slightly decreased.Overheads have decreased in line with the reduction in turnover, resulting in slightly lower operating profit than in the previous year The business continues to search out and win new business in all areas, and growth in all key performance indicators, including turnover and net profits, is anticipated in the coming years.
As for many businesses our size, the business environment in which we operate continues to be challenging. With these risks and uncertainties in mind though, we are aware that any plans for the future development of the business may be subject to unforeseen events outside our control.
The directors have not fully assessed the impact of Brexit, but remain confident that the business will be able to adapt to the changing circumstances as they arise. The impact of the Covid 19 pandemic on the business post year end has been challenging, but the directors have sought to address these challenges by reducing all non-essential costs and furloughing staff where possible to safeguard the economic future of the Group and ensuring it utilises available Government financial support, where appropriate. The Group has experienced some reduction in its turnover levels but cashflows remain healthy. The directors have not considered it necessary to prepare formal forecasts for the Group given the overall strength of the cash position of the Group, which retains considerable levels of cash and has no external debt. The Group does not follow a specific code on corporate governance. This is due to the fact that the Company is not defined as a large private company under the regulations and is a plc, on a historic basis. Therefore, the Waites principles are not seen as an appropriate code to follow, due to the following. • The directors are the shareholders of the Group. • The Group has a limited number of staff and suppliers. • The directors seek to identify and mitigate the risks facing the Group, whilst promoting the success of the Group by identifying appropriate opportunities.
We consider the key performance indicators of the business that communicate the financial performance and strength of the company are turnover and net profit on ordinary activities before taxation.
There are no other non-financial key performance indicators.
This report was approved by the board on 29 September 2020
and signed on its behalf.
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PEKTRON PLC
Directors' Report
For the Year Ended 31 December 2019
The directors present their report and the financial statements for the year ended 31 December 2019.
The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the
consolidated
financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year
. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period.
In preparing these financial statements, the directors are required to:
∙
select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙
make judgments 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 Group 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 the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The profit for the year, after taxation, amounted to £
370,037
(2018 -
£
395,936
)
.
A dividend of £450,000 was paid during the year (2018: £600,000).
The directors who served during the year were:
There are no future developments which require disclosure in the financial statements.
The Group have included details of key risks and uncertainties and disclosures in respect of corporate governance have been included in the Strategic Report using the provisions of section 414(c) of the Companies Act 2006.
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PEKTRON PLC
Directors' Report (continued)
For the Year Ended 31 December 2019
Each of the persons who are
directors at the time when this Directors' Report is approved has confirmed that:
There have been no significant events affecting the Group since the year end, with the exception of Covid , which has been considered within the strategic report.
Under section 487(2) of the Companies Act 2006, Smith Cooper Audit Limited will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.
This report was approved by the board on
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PEKTRON PLC
Independent Auditors' Report to the Members of Pektron plc
We have audited the financial statements of Pektron plc (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2019, which comprise the Group Statement of Comprehensive Income, the Group and Company Balance Sheets, the Group Statement of Cash Flows, the Group and Company Statement of Changes in Equity
and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards,
including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
∙
the directors
' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
∙
the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the Group's or the parent Company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.
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 Auditors' 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.
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PEKTRON PLC
Independent Auditors' Report to the Members of Pektron plc (continued)
We have nothing to report in this regard.
In our opinion, based on the work undertaken in the course of the audit:
∙
the information given in the Group 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 Group Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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:
As explained more fully in the Directors' Responsibilities Statement on page 2, 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 Group's and the parent 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 Group or the parent Company or to cease operations, or have no realistic alternative but to do so.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at:
www.frc.org.uk/auditorsresponsibilities
. This description forms part of our Auditors' Report.
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PEKTRON PLC
Independent Auditors' Report to the Members of Pektron plc (continued)
This report is made solely to the Company's members
in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants
Statutory Auditors
St Helen's House
King Street
DE1 3EE
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PEKTRON PLC
Consolidated Statement of Comprehensive Income
For the Year Ended 31 December 2019
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PEKTRON PLC
Registered number:
01477486
Consolidated Balance Sheet
As at
The financial statements were approved and authorised for issue by the board and were signed on its behalf on 29 September 2020
.
The notes on pages 14 to 23 form part of these financial statements.
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PEKTRON PLC
Registered number:
01477486
Company Balance Sheet
As at
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
The notes on pages 14 to 23 form part of these financial statements.
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PEKTRON PLC
Consolidated Statement of Changes in Equity
For the Year Ended
31 December 2019
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PEKTRON PLC
Company Statement of Changes in Equity
For the Year Ended
31 December 2019
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PEKTRON PLC
Consolidated Statement of Cash Flows
For the Year Ended 31 December 2019
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PEKTRON PLC
Consolidated Analysis of Net Debt
For the Year Ended 31 December 2019
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PEKTRON PLC
Notes to the Financial Statements
For the Year Ended 31 December 2019
Pektron Plc is a company limited by shares incorporated and domiciled in the England & Wales, United Kingdom. The address of the registered office is given on the company information page of the financial statements. Pektron Plc is a supplier of electronic parted for rugged environments, with particular expertise in vehicle electronics.
The Group's financial statements are rounded to the nearest £.
2.
Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in
the UK and the Republic of Ireland and the Companies Act 2006
.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.
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PEKTRON PLC
Notes to the Financial Statements
For the Year Ended 31 December 2019
2.
Accounting policies (continued)
The COVID 19 pandemic has developed rapidly in 2020 with a significant number of cases. Measures taken by the government to contain the virus have affected economic activity. We have taken a number of measures to monitor and mitigate the effects of COVID 19 such as safety and health measures for our people (such as social distancing and working from home) and securing the supply of PPE that are essential to our daily activities.
The impact of the Covid 19 pandemic on the business post year end has been challenging, but the directors have sought to address these challenges by reducing all non-essential costs and furloughing staff where possible to safeguard the economic future of the Group and ensuring it utilises available Government financial support, where appropriate. The Group has experienced some reduction in its turnover levels but cashflows remain healthy. The directors have not considered it necessary to prepare formal forecasts for the Group given the overall strength of the cash position of the Group, which retains considerable levels of cash and no external debt. The directors, therefore, consider that they have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future, for a variety of potential scenarios. The Group therefore continues to adopt the going concern basis in preparing its financial statements.
Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Consolidated Statement of Comprehensive Income
except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Consolidated Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in the Consolidated Statement of Comprehensive Income within 'other operating income'.
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PEKTRON PLC
Notes to the Financial Statements
For the Year Ended 31 December 2019
2.
Accounting policies (continued)
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Sale of goods
Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
Revenue is recognised on the dispatch of goods and the provision of the service.
Interest income is recognised in the Consolidated Statement of Comprehensive Income using the effective interest method.
Finance costs are charged to the Consolidated Statement of Comprehensive Income over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
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PEKTRON PLC
Notes to the Financial Statements
For the Year Ended 31 December 2019
2.
Accounting policies (continued)
Defined contribution pension plan
The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.
The contributions are recognised as an expense in the Consolidated Statement of Comprehensive Income when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Group in independently administered funds.
Investments in subsidiaries are measured at cost less accumulated impairment.
Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
In the Consolidated Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.
Short term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
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PEKTRON PLC
Notes to the Financial Statements
For the Year Ended 31 December 2019
2.
Accounting policies (continued)
Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.
No instances of estimation uncertainty or significant judgments arise in the preparation of the financial statements.
Analysis of turnover by country of destination:
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PEKTRON PLC
Notes to the Financial Statements
For the Year Ended 31 December 2019
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PEKTRON PLC
Notes to the Financial Statements
For the Year Ended 31 December 2019
There were no factors that may affect future tax charges.
Page 20
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PEKTRON PLC
Notes to the Financial Statements
For the Year Ended 31 December 2019
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PEKTRON PLC
Notes to the Financial Statements
For the Year Ended 31 December 2019
Profit and loss account
The Group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £783 (2018: £603). Contributions totalling £Nil (2018: £Nil) were payable to the fund at the balance sheet date
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PEKTRON PLC
Notes to the Financial Statements
For the Year Ended 31 December 2019
The company is controlled by N J Morgan, P D Morgan and R F Morgan.
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