REGISTERED NUMBER: 01830061 (England and Wales) |
GROUP STRATEGIC REPORT, |
REPORT OF THE DIRECTORS AND |
CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
FOR |
ADVANCED INSTRUMENTS HOLDINGS LTD |
REGISTERED NUMBER: 01830061 (England and Wales) |
GROUP STRATEGIC REPORT, |
REPORT OF THE DIRECTORS AND |
CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
FOR |
ADVANCED INSTRUMENTS HOLDINGS LTD |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
CONTENTS OF THE CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
Page |
Group Strategic Report | 1 |
Report of the Directors | 3 |
Report of the Independent Auditors | 4 |
Consolidated Statement of Comprehensive Income | 7 |
Consolidated Balance Sheet | 8 |
Company Balance Sheet | 9 |
Consolidated Statement of Changes in Equity | 10 |
Company Statement of Changes in Equity | 11 |
Consolidated Cash Flow Statement | 12 |
Notes to the Consolidated Financial Statements | 13 |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
GROUP STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
The directors present their strategic report of the company and the group for the year ended 31 December 2022. |
REVIEW OF BUSINESS |
The group has continued to manufacture and distribute its instruments to customers in the clinical and bio pharma end markets. |
The group's performance for the year ended 31 December 2022 showed total revenues of £22.1m, an increase of 60% on the previous year. The increase in sales was driven by the addition of the Solentim Group in July 2021. Demand for capital equipment in the bio pharma end market slowed down in 2022 following very robust buying in 2021. |
The group generated earnings before interest, taxation, depreciation and amortisation ("EBITDA") of £3.2m (2021: £2.4m). |
In the view of the directors, the group's key accomplishments, against the high-level strategic objectives for its parent group, have been: |
- To continue to serve our customers in the important UK clinical and biopharma markets with timely delivery of high-quality products. |
- To prepare the group for increased customer engagement in the UK and Europe and investment in research and development. |
PRINCIPAL RISKS AND UNCERTAINTIES |
Geopolitical events and security of supply |
With the increasing prevalence of supply chain disruptions across the industry, the group has sought to mitigate supply chain risk by increasing both inventory levels and committed purchase orders. |
Product and market risk |
The group is in a very competitive market. It must continue to innovate its products to maintain a leadership position with customers in the cell line development and Osmolality markets. |
Regulatory risks |
Due to the nature of the industry in which we operate, the group is exposed to traditional regulatory risks (associated with the ongoing compliance of its business operations and products). Internal quality and regulatory issues are a core commitment of the Board, so suitable skills and experience are brought to bear to ensure that associated risks are managed. |
Economic risks |
Financial risks, which are primarily associated with the collectability of accounts receivable, and recoverability of inventory acquired to support key customers. These risks are appropriately managed through detailed oversight of our expert finance team. |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
GROUP STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
ANALYSIS OF KEY FINANCIAL PERFORMANCE INDICATORS |
Performance measure | 2022 | 2021 | Movement % | Commentary |
Revenue | £m | 22.1 | 13.8 | 60 | The increase in revenue was driven by the addition of the Solentim Group in July 2021. |
Gross profit | £m | 11.9 | 5.9 | 102 | Gross profit increased as the additional sales of the Solentim portfolio were at a principal margin, whereas the osmometer portfolio products were at a distributor margin. |
Gross margin | % | 54 | 42 | 29 | Gross margin increased as the additional sales of the Solentim portfolio were at a principal margin, whereas the osmometer portfolio products were at a distributor margin. |
Operating loss | £m | 10.4 | 1.9 | 447 | Operating loss includes acquired intangibles amortisation of £13.4m (2021: £4.4m). |
EBITDA | £m | 3.2 | 2.4 | 38 | The increase in profit margin drove the rise in EBITDA. |
AREAS DEEMED TO BE OF KEY STRATEGIC IMPORTANCE |
Long-range plans |
We have a long-range plan for the business that includes continued investment in research and development staff to continuously innovate our products (to meet the needs of our customer base) and to expand our distribution capabilities across Europe. |
Employees |
To achieve our long range plans we need to attract and retain a talented workforce. We want to provide a challenging and stimulating workplace to both retain, develop and attract new team members. |
Business relationships |
We are committed to maintain strong relationships with our customers and suppliers. For our customers we seek to understand their unique needs, and to continuously innovate and bring those customers products and services to improve their workflows. Similarly, to serve those customers we need strong relationships with our suppliers to ensure that they are in a position to continue to meet our needs. |
Community and environment |
We are committed to supporting our community and reducing our CO2 emissions through various means. |
FINANCIAL INSTRUMENTS |
The group has an unsecured loan from a fellow subsidiary of £100m with interest charged at 6%. The loan is repayable in 2030. In addition, the group has an unsecured, interest-free loan from the same subsidiary of £7m. This is repayable on demand but the directors do not expect this to be demanded in the medium-term. The directors consider the exposure to credit, liquidity and cash flow risk to be limited. |
ON BEHALF OF THE BOARD: |
15 February 2024 |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
The directors present their report with the financial statements of the company and the group for the year ended 31 December 2022. |
DIVIDENDS |
No dividends will be distributed for the year ended 31 December 2022. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 January 2022 to the date of this report. |
DISCLOSURE IN THE STRATEGIC REPORT |
The group has chosen, in accordance with the Companies Act 2006 s414C(11), to set out in the group's strategic report information required by Schedule 7 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 to be contained in the directors' report. |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Group Strategic Report, the Report of the Directors 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 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 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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the group's auditors are aware of that information. |
ON BEHALF OF THE BOARD: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
ADVANCED INSTRUMENTS HOLDINGS LTD |
Opinion |
We have audited the financial statements of Advanced Instruments Holdings Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2022 which comprise the Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement 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 group's and of the parent company affairs as at 31 December 2022 and of the group's loss 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 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 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 group's and the parent 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. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors 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 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 the audit: |
- | the information given in the Group Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Group Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
ADVANCED INSTRUMENTS HOLDINGS LTD |
Matters on which we are required to report by exception |
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 Report of the Directors. |
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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the parent company 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 three, 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 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. |
Auditors' 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 a Report of the Auditors 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: |
Based on our understanding of the company and industry, we considered the risk of non-compliance with laws and regulations, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the financial statements such as the Companies Act 2006. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to revenue recognition, including cut-off. Audit procedures performed included: |
- | Enquiring of management whether there were instances of non-compliance with laws and regulation or fraud; |
- | Review of legal expenses for evidence of fees relating to non-compliance; |
- | Review of stock and dilapidation provision estimates to ensure not influenced by management bias; |
- | Review of journal entries, non-sales bank receipts and non-purchase bank payments for unusual accounting entries; and |
- | Cut off procedures to test that revenue from goods and services were correctly recognised as revenue in the correct period. |
There are inherent limitations in the audit procedures described above. We are 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. Also, 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 concealment by, for example, forgery or intentional misrepresentations, or through collusion. |
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 Report of the Auditors. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
ADVANCED INSTRUMENTS HOLDINGS LTD |
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 a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed. |
for and on behalf of |
Statutory Auditor |
Atlas Chambers |
33 West Street |
Brighton |
East Sussex |
BN1 2RE |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
CONSOLIDATED |
STATEMENT OF COMPREHENSIVE |
INCOME |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2022 | 2021 |
Notes | £ | £ |
TURNOVER | 3 | 22,128,923 | 13,807,304 |
Cost of sales | (10,232,989 | ) | (8,002,187 | ) |
GROSS PROFIT | 11,895,934 | 5,805,117 |
Distribution costs | (408,724 | ) | (135,570 | ) |
Administrative expenses | (21,935,354 | ) | (7,650,960 | ) |
(10,448,144 | ) | (1,981,413 | ) |
Other operating income | - | 58,151 |
OPERATING LOSS | 5 | (10,448,144 | ) | (1,923,262 | ) |
Profit/(loss) on disposal of fixed asset investment |
6 |
(1,216,049 |
) |
- |
(11,664,193 | ) | (1,923,262 | ) |
Interest receivable and similar income | 4,469 | 1,926 |
Interest payable and similar expenses | 7 | (5,382,320 | ) | (484,850 | ) |
LOSS BEFORE TAXATION | (17,042,044 | ) | (2,406,186 | ) |
Tax on loss | 8 | 3,199,469 | 48,602 |
LOSS FOR THE FINANCIAL YEAR | ( |
) | ( |
) |
OTHER COMPREHENSIVE INCOME |
Unrealised foreign exchange gains | 73,566 | 42,810 |
Income tax relating to other comprehensive income |
- |
- |
OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX |
73,566 |
42,810 |
TOTAL COMPREHENSIVE LOSS FOR THE YEAR |
(13,769,009 |
) |
(2,314,774 |
) |
Loss attributable to: |
Owners of the parent | (13,842,575 | ) | (2,357,584 | ) |
Total comprehensive loss attributable to: |
Owners of the parent | (13,769,009 | ) | (2,314,774 | ) |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
CONSOLIDATED BALANCE SHEET |
31 DECEMBER 2022 |
2022 | 2021 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 10 | 182,830,075 | 191,622,903 |
Tangible assets | 11 | 592,840 | 358,375 |
Investments | 12 | - | - |
183,422,915 | 191,981,278 |
CURRENT ASSETS |
Stocks | 13 | 5,719,647 | 3,069,597 |
Debtors | 14 | 3,545,837 | 3,129,453 |
Cash at bank and in hand | 3,725,048 | 6,688,611 |
12,990,532 | 12,887,661 |
CREDITORS |
Amounts falling due within one year | 15 | 15,478,347 | 182,488,632 |
NET CURRENT LIABILITIES | (2,487,815 | ) | (169,600,971 | ) |
TOTAL ASSETS LESS CURRENT LIABILITIES |
180,935,100 |
22,380,307 |
CREDITORS |
Amounts falling due after more than one year |
16 |
(100,000,000 |
) |
- |
PROVISIONS FOR LIABILITIES | 18 | (20,716,325 | ) | (23,392,523 | ) |
NET ASSETS/(LIABILITIES) | 60,218,775 | (1,012,216 | ) |
CAPITAL AND RESERVES |
Called up share capital | 19 | 75,000,070 | 70 |
Capital redemption reserve | 20 | 35 | 35 |
Foreign translation reserve | 20 | 78,337 | - |
Retained earnings | 20 | (14,859,667 | ) | (1,012,321 | ) |
SHAREHOLDERS' FUNDS | 60,218,775 | (1,012,216 | ) |
The financial statements were approved by the Board of Directors and authorised for issue on 15 February 2024 and were signed on its behalf by: |
S M Hanlon - Director |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
COMPANY BALANCE SHEET |
31 DECEMBER 2022 |
2022 | 2021 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 10 |
Tangible assets | 11 |
Investments | 12 |
CURRENT ASSETS |
Stocks | 13 |
Debtors | 14 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 15 |
NET CURRENT ASSETS/(LIABILITIES) | ( |
) |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year |
16 |
( |
) |
PROVISIONS FOR LIABILITIES | 18 | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 19 |
Capital redemption reserve | 20 |
Retained earnings | 20 | ( |
) |
SHAREHOLDERS' FUNDS |
Company's (loss)/profit for the financial year | (5,266,312 | ) | 1,123,153 |
The financial statements were approved by the Board of Directors and authorised for issue on |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
Called up | Capital | Foreign |
share | Retained | redemption | translation | Total |
capital | earnings | reserve | reserve | equity |
£ | £ | £ | £ | £ |
Balance at 1 January 2021 | 70 | 1,302,453 | 35 | - | 1,302,558 |
Changes in equity |
Deficit for the year | - | (2,357,584 | ) | - | - | (2,357,584 | ) |
Other comprehensive income | - | 42,810 | - | - | 42,810 |
Total comprehensive loss | - | (2,314,774 | ) | - | - | (2,314,774 | ) |
Balance at 31 December 2021 | 70 | (1,012,321 | ) | 35 | - | (1,012,216 | ) |
Changes in equity |
Deficit for the year | - | (13,842,575 | ) | - | - | (13,842,575 | ) |
Other comprehensive income | - | 73,566 | - | - | 73,566 |
Total comprehensive loss | - | (13,769,009 | ) | - | - | (13,769,009 | ) |
Issue of share capital | 75,000,000 | - | - | - | 75,000,000 |
Transfer between reserves | - | (78,337 | ) | - | 78,337 | - |
Balance at 31 December 2022 | 75,000,070 | (14,859,667 | ) | 35 | 78,337 | 60,218,775 |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
COMPANY STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
Called up | Capital |
share | Retained | redemption | Total |
capital | earnings | reserve | equity |
£ | £ | £ | £ |
Balance at 1 January 2021 |
Changes in equity |
Total comprehensive income | - |
Balance at 31 December 2021 | 70 | 2,425,606 | 2,425,711 |
Changes in equity |
Issue of share capital | - | - |
Total comprehensive income | - | ( |
) | ( |
) |
Balance at 31 December 2022 | ( |
) |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
CONSOLIDATED CASH FLOW STATEMENT |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2022 | 2021 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 25 | 2,368,781 | 3,184,554 |
Interest paid | (67 | ) | - |
Tax paid | (213,310 | ) | (668,134 | ) |
Net cash from operating activities | 2,155,404 | 2,516,420 |
Cash flows from investing activities |
Purchase of intangible fixed assets | (22,571 | ) | (2,155 | ) |
Purchase of tangible fixed assets | (540,383 | ) | (45,579 | ) |
Sale of tangible fixed assets | 116,469 | 133,700 |
Purchase of subsidiary net of cash | (4,750,517 | ) | (173,771,959 | ) |
Interest received | 4,469 | 1,926 |
Net cash from investing activities | (5,192,533 | ) | (173,684,067 | ) |
Cash flows from financing activities |
Intercompany loan | - | 176,035,576 |
Net cash from financing activities | - | 176,035,576 |
(Decrease)/increase in cash and cash equivalents | (3,037,129 | ) | 4,867,929 |
Cash and cash equivalents at beginning of year |
26 |
6,688,611 |
1,777,872 |
Effect of foreign exchange rate changes | 73,566 | 42,810 |
Cash and cash equivalents at end of year | 26 | 3,725,048 | 6,688,611 |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
1. | STATUTORY INFORMATION |
Advanced Instruments Holdings Ltd is a private company, limited by shares, registered in England and Wales. The company's registered number, registered office address and principal business address are as below: |
Registered number: 01830061 |
Registered office: |
5th Floor |
One New Change |
London |
EC4M 9AF |
Principal business address: |
Solent House |
Johnson Road |
Fernside Business Park |
Wimborne |
Dorset |
BH21 7SE |
The principal activity of the group was the supply of scientific instruments. |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
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" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention, as modified by the recognition of certain financial assets and liabilities measured at fair value. |
Going concern |
In 2022, the group's debt was re-structured to secure its liability position for the coming few years. £100 million of debt due within one year was subject to a new loan agreement with payment due in 2030, while £75 million was capitalised into share capital. The group has repayable on demand loans amounting to £10 million due to the parent group. A letter of support has been provided by the group undertakings, confirming repayment of the loans will not be demanded in the near future. |
The directors' assessment of going concern takes into account the terms of the loan and group cash flow forecasts to conclude that there are no uncertainties over the group's ability to continue as a going concern. |
Reduced disclosures |
The parent company has taken advantage of the exemption from disclosing the following information, as permitted by the reduced disclosure regime within FRS 102, since the financial statements of the parent company are consolidated in the group financial statements: |
- Section 7 ‘Statement of Cash Flows’ - Presentation of a Statement of Cash Flow and related notes and disclosures |
- Section 33 ‘Related Party Disclosures’ - Compensation for key management personnel |
Basis of consolidation |
The group consolidated financial statements include the financial statements of the company and all of its subsidiary undertakings. |
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. Where the group owns less than 50% of the voting powers of an entity but controls the entity by virtue of an agreement with other investors which give it control of the financial and operating policies of the entity, it accounts for that entity as a subsidiary. |
Any subsidiary undertakings sold or acquired during the year are included up to, or from, the dates of change of control or change of significant influence respectively. |
All intra-group transactions, balances, income and expenses are eliminated on consolidation. |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2. | ACCOUNTING POLICIES - continued |
Critical accounting judgements and key sources of estimation uncertainty |
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. |
The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below. |
i. Dilapidation provision |
Provision is made for dilapidations. This requires management’s best estimate of the expenditure that will be incurred based on contractual requirements. The provision has been calculated using market data on average costs for similar office space. |
ii. Investments and goodwill valuation |
Annually, the group considers whether investments in subsidiaries may be impaired. Where an indication of impairment is identified the estimation of recoverable value requires estimation of the recoverable value of the cash generating unit (CGU). |
This requires estimation of the future cash flows from the CGUs and also selection of appropriate discount rates in order to calculate the net present value of those cash flows. The recoverable amount of the CGUs are a source of significant estimation uncertainty and determining this involved the use of significant assumptions. |
iii. Stock valuation |
Where necessary, provision is made for slow moving and obsolete inventories. Calculation of these provisions requires judgements to be made, which include forecast of customer demand and promotional, competitive and economic environment trends. |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2. | ACCOUNTING POLICIES - continued |
Turnover |
Turnover is measured at the fair value of the consideration received or receivable net of VAT and trade discounts. The policies adopted for the recognition of turnover are as follows: |
Sale of goods |
Turnover from the sale of machines and consumables is recognised when significant risks and rewards of ownership of the goods have transferred to the buyer, the amount of turnover can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the company and the costs incurred or to be incurred in respect of the transaction can be measured reliably. This is usually on dispatch of the goods. |
Rendering of services |
When the outcome of a transaction can be estimated reliably, turnover from service agreements is recognised on a straight line basis over the service agreement. |
Where the outcome cannot be measured reliably, turnover is recognised only to the extent of the expenses recognised that are recoverable. |
Business combinations and goodwill |
Business combinations are accounted for by applying the acquisition method. |
The cost of a business combination is the fair value of the consideration given, liabilities incurred or assumed and of equity instruments issued plus the costs directly attributable to the business combination. |
On acquisition of a business, fair values are attributed to the identifiable assets, liabilities and contingent liabilities unless the fair value cannot be measured reliably, in which case the value is incorporated in goodwill. Intangible assets are only recognised separately from goodwill where they are separable and arise from contractual or other legal rights. |
Goodwill recognised represents the excess of the fair value and directly attributable costs of the purchase consideration over the fair values to the group’s interest in the identifiable net assets, liabilities and contingent liabilities acquired. |
On acquisition, goodwill is allocated to cash-generating units (‘CGU’s’) that are expected to benefit from the combination. |
Goodwill is amortised over its expected useful life which is estimated to be 5 to 15 years. |
Goodwill is assessed for impairment when there are indicators of impairment and any impairment is charged to the income statement. |
Intangible assets |
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. |
The estimated useful lives range as follows (pending patents are not amortised): |
Patents and licences | - over 20 years |
Technology | - over 15 years |
Tangible fixed assets |
Improvements to property | - |
Plant and machinery | - |
Fixtures and fittings | - |
Computer equipment | - |
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2. | ACCOUNTING POLICIES - continued |
Stocks |
Stocks and work in progress (other than finished goods and work in progress held at the balance sheet date that were acquired following a business combination) are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Stock is valued on a first in, first out basis. Work in progress and finished goods are valued for direct material only, and do not include labour or attributable overheads. |
Finished goods and work in progress held at the balance sheet date that were acquired following a business combination are stated at fair value at the acquisition date. |
At each balance sheet date, stocks are assessed for impairment, If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment is recognised immediately in profit and loss. |
Financial instruments |
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102, in full, to all of its financial instruments. |
Financial assets and financial liabilities are recognised when the group becomes a party to the contractual provisions of the instrument. |
Basic financial assets and liabilities |
Trade, group and other debtors (including accrued income) which are receivable within one year and which do not constitute a financing transaction are initially measured at the transaction price and subsequently measured at amortised cost, being the transaction price less any amounts settled and any impairment losses. |
A provision for impairment of debtors is established when there is objective evidence that the amounts due will not be collected according to the original terms of the contract. Impairment losses are recognised in profit or loss for the excess of the carrying value of the trade debtor over the present value of the future cash flows discounted using the original effective interest rate. Subsequent reversals of an impairment loss that objectively relate to an event occurring after the impairment loss was recognised, are recognised immediately in profit or loss. |
Trade, group and other creditors (including accruals) payable within one year that do not constitute a financing transaction are initially measured at the transaction price and subsequently measured at amortised cost, being transaction price less any amounts settled. |
Debt instruments are carried at amortised cost using the effective interest rate method. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2. | ACCOUNTING POLICIES - continued |
Research and development |
In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence are all recognised an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequent amortised on a straight line basis over their useful economic lives. |
Foreign currencies |
The group financial statements are presented in pound sterling and rounded to thousands. |
The company’s functional and presentation currency is the pound sterling. |
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result. |
The trading results of group undertakings are translated into sterling at the average exchange rates for the year. The assets and liabilities of overseas undertakings, including goodwill and fair value adjustments arising on acquisition, are translated at the exchange rates ruling at the year end. Exchange adjustments arising from the retranslation of opening net investments and from the translation of the profits or losses at average rates are recognised in ‘Other comprehensive income’. |
Leasing commitments |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The group operates a defined contribution pension scheme. Contributions payable to the group's pension scheme are charged to profit or loss in the period to which they relate. |
Provisions |
Provisions are recognised when the company has an obligation at the balance sheet date as a result of a past event, it is probable that an outflow of economic benefits will be required in settlement and the amount can be reliably estimated. |
3. | TURNOVER |
The turnover and loss before taxation are attributable to the one principal activity of the group. |
An analysis of turnover by geographical market is given below: |
2022 | 2021 |
£ | £ |
United Kingdom | 6,456,988 | 9,449,072 |
Europe | 2,104,033 | 316,529 |
United States of America | 9,340,085 | 2,936,380 |
Asia | 4,105,100 | 1,105,323 |
Australasia | 122,717 | - |
22,128,923 | 13,807,304 |
Turnover is categorised as following: |
2022 | 2021 |
£ | £ |
Sale of goods | 18,537,327 | 11,853,120 |
Rendering of services | 3,591,596 | 1,964,184 |
22,128,923 | 13,807,304 |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
4. | EMPLOYEES AND DIRECTORS |
2022 | 2021 |
£ | £ |
Wages and salaries | 5,823,958 | 2,386,179 |
Social security costs | 700,954 | 256,037 |
Other pension costs | 324,911 | 80,735 |
6,849,823 | 2,722,951 |
The average number of employees during the year was as follows: |
2022 | 2021 |
Production | 40 | 32 |
Distribution | 20 | 17 |
Service | 10 | 11 |
Admin and management | 21 | 17 |
2022 | 2021 |
£ | £ |
Directors' remuneration | 148,005 | 202,552 |
Directors' pension contributions to money purchase schemes | 7,152 | 11,871 |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes | 1 | 1 |
5. | OPERATING LOSS |
The operating loss is stated after charging/(crediting): |
2022 | 2021 |
£ | £ |
Hire of plant and machinery | - | 1,201 |
Other operating leases | 171,075 | 77,674 |
Depreciation - owned assets | 271,986 | 72,543 |
Profit on disposal of fixed assets | (73,718 | ) | (107,748 | ) |
Goodwill amortisation | 6,975,508 | 2,196,573 |
Patents and licences amortisation | 4,469 | 1,986 |
Technology amortisation | 6,466,667 | 2,155,556 |
Auditors' remuneration | 17,500 | 31,200 |
Foreign exchange differences | (430,087 | ) | (10,279 | ) |
Research and development expenditure | 546,103 | 117,949 |
6. | EXCEPTIONAL ITEMS |
On 30 November 2022, the ownership of the shares in a subsidiary of the group were transferred to the parent company, Advanced Instruments LLC. There was no consideration, resulting in a loss on disposal of £1,216,049 (2021: £nil). |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
7. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2022 | 2021 |
£ | £ |
Bank loan interest | 68 | - |
Interest payable to group undertakings | 5,382,252 | 484,850 |
5,382,320 | 484,850 |
8. | TAXATION |
Analysis of the tax credit |
The tax credit on the loss for the year was as follows: |
2022 | 2021 |
£ | £ |
Current tax: |
UK corporation tax | - | 543,354 |
Overseas corporation tax | 29,510 | 83,992 |
Under/(over) provision prior year tax | (557,520 | ) | - |
Total current tax | (528,010 | ) | 627,346 |
Deferred tax | (2,671,459 | ) | (675,948 | ) |
Tax on loss | (3,199,469 | ) | (48,602 | ) |
UK corporation tax was charged at 19 %) in 2021. |
Reconciliation of total tax credit included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
2022 | 2021 |
£ | £ |
Loss before tax | (17,042,044 | ) | (2,406,186 | ) |
Loss multiplied by the standard rate of corporation tax in the UK of 19 % (2021 - 19 %) |
(3,237,988 |
) |
(457,175 |
) |
Effects of: |
Expenses not deductible for tax purposes | 1,161,962 | 1,101,747 |
Income not taxable for tax purposes | (191 | ) | - |
Depreciation in excess of capital allowances | 584,011 | 63,347 |
Utilisation of tax losses | 113,600 | 2,975 |
Adjustments to tax charge in respect of previous periods | (557,520 | ) | - |
Timing differences | 90,607 | (761,815 | ) |
Tax at different rates | 26,799 | 2,319 |
Losses carried forward | (1,380,749 | ) | - |
Total tax credit | (3,199,469 | ) | (48,602 | ) |
Tax effects relating to effects of other comprehensive income |
2022 |
Gross | Tax | Net |
£ | £ | £ |
Unrealised foreign exchange gains | 73,566 | - | 73,566 |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
8. | TAXATION - continued |
2021 |
Gross | Tax | Net |
£ | £ | £ |
Unrealised foreign exchange gains | 42,810 | - | 42,810 |
An increase in the UK corporation rate from 19% to 25% is effective from 1 April 2023. |
Deferred tax at the balance sheet date have been measured at this tax rate since it was enacted on 24 May 2021. |
9. | INDIVIDUAL STATEMENT OF COMPREHENSIVE INCOME |
As permitted by Section 408 of the Companies Act 2006, the Income Statement of the parent company is not presented as part of these financial statements. |
10. | INTANGIBLE FIXED ASSETS |
Group |
Patents |
and |
Goodwill | licences | Technology | Totals |
£ | £ | £ | £ |
COST |
At 1 January 2022 | 98,845,765 | 131,253 | 97,000,000 | 195,977,018 |
Additions | 4,631,245 | 22,571 | - | 4,653,816 |
At 31 December 2022 | 103,477,010 | 153,824 | 97,000,000 | 200,630,834 |
AMORTISATION |
At 1 January 2022 | 2,196,573 | 1,986 | 2,155,556 | 4,354,115 |
Amortisation for year | 6,975,508 | 4,469 | 6,466,667 | 13,446,644 |
At 31 December 2022 | 9,172,081 | 6,455 | 8,622,223 | 17,800,759 |
NET BOOK VALUE |
At 31 December 2022 | 94,304,929 | 147,369 | 88,377,777 | 182,830,075 |
At 31 December 2021 | 96,649,192 | 129,267 | 94,844,444 | 191,622,903 |
Technology with a carrying value of £88.4 million was acquired as part of a business combination. It has been recognised separately from goodwill since it arises from contractual rights to the group's developed instruments and consumables, and it is a separable asset. |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
11. | TANGIBLE FIXED ASSETS |
Group |
Improvements | Fixtures |
to | Plant and | and | Computer |
property | machinery | fittings | equipment | Totals |
£ | £ | £ | £ | £ |
COST |
At 1 January 2022 | 12,410 | 343,683 | 63,349 | 58,456 | 477,898 |
Additions | 14,517 | 440,129 | 70,405 | 15,332 | 540,383 |
Disposals | - | (50,912 | ) | (17,661 | ) | (11,009 | ) | (79,582 | ) |
Transfer to ownership | 8,819 | 3,589 | 7,885 | 918 | 21,211 |
At 31 December 2022 | 35,746 | 736,489 | 123,978 | 63,697 | 959,910 |
DEPRECIATION |
At 1 January 2022 | 7,160 | 76,229 | 27,334 | 8,800 | 119,523 |
Charge for year | 6,196 | 187,949 | 37,973 | 39,868 | 271,986 |
Eliminated on disposal | - | (6,805 | ) | (9,776 | ) | (7,858 | ) | (24,439 | ) |
At 31 December 2022 | 13,356 | 257,373 | 55,531 | 40,810 | 367,070 |
NET BOOK VALUE |
At 31 December 2022 | 22,390 | 479,116 | 68,447 | 22,887 | 592,840 |
At 31 December 2021 | 5,250 | 267,454 | 36,015 | 49,656 | 358,375 |
Company |
Improvements | Fixtures |
to | Plant and | and |
property | machinery | fittings | Totals |
£ | £ | £ | £ |
COST |
At 1 January 2022 |
Additions |
At 31 December 2022 |
DEPRECIATION |
At 1 January 2022 |
Charge for year |
At 31 December 2022 |
NET BOOK VALUE |
At 31 December 2022 |
At 31 December 2021 |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
12. | FIXED ASSET INVESTMENTS |
Company |
Shares in |
group |
undertakings |
£ |
COST |
At 1 January 2022 |
Additions |
At 31 December 2022 |
NET BOOK VALUE |
At 31 December 2022 |
At 31 December 2021 |
The group or the company's investments at the Balance Sheet date in the share capital of companies include the following: |
Subsidiaries |
Registered office: Solent House, Johnson Road, Fernside Business Park, Wimborne, Dorset BH21 7SE |
Nature of business: |
% |
Class of shares: | holding |
Registered office: 30 Rue Godot de Mauroy, 75009 Paris, France |
Nature of business: |
% |
Class of shares: | holding |
Advanced Instruments SAS is included in the consolidated financial statements. |
Registered office: Sundkrogsgade 21, 2100 Copenhagen, Denmark |
Nature of business: |
% |
Class of shares: | holding |
Advanced Instruments Denmark ApS is included in the consolidated financial statements. |
Registered office: 600 W. Germantown Pike, Suite 110, Plymouth Meeting, Montgomery, PA, 19462, United States of America |
Nature of business: |
% |
Class of shares: | holding |
Solentim, Inc. was a 100% subsidiary of Advanced Instruments Ltd. On 30 November 2022, the ownership of the shares were transferred to Advanced Instruments Holdings Ltd and immediately transferred to the parent of the group, Advanced Instruments LLC. There was no consideration for the disposal. |
Solentim, Inc. is included in the consolidated financial statements. It ceased trading in March 2022, other than servicing existing service contracts, |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
12. | FIXED ASSET INVESTMENTS - continued |
Registered office: Room 721, Building 1, No 22-23, Lane 466, Yindu Road, Minhang District, Shanghai, People's Republic of China |
Nature of business: |
% |
Class of shares: | holding |
Advanced Instruments (Shanghai) Technology Co., Ltd is a 100% subsidiary of Advanced Instruments Ltd. |
Advanced Instruments (Shanghai) Technology Co., Ltd is included in the consolidated financial statements. |
Registered office: 25-28 North Wall Quay, Dublin 1, Dublin, Ireland |
Nature of business: |
% |
Class of shares: | holding |
Advanced Instruments Limited is a 100% subsidiary of Advanced Instruments Ltd. |
Advanced Instruments Limited is included in the consolidated financial statements. |
Registered office: Marnixlaan 23, 1000 Brussel, Belgium |
Nature of business: |
% |
Class of shares: | holding |
Advanced Instruments (Belgium) BV was incorporated on 19 August 2022. |
Advanced Instruments (Belgium) BV is included in the consolidated financial statements. |
Registered office: Eschersheimer Landstraße 14, 60322 Frankfurt am Main, Germany |
Nature of business: |
% |
Class of shares: | holding |
Advanced Instruments GmbH was incorporated on 1 June 2022. It is a 100% subsidiary of Advanced Instruments Limited. |
Advanced Instruments GmbH is included in the consolidated financial statements. |
Registered office: c/o Intertrust (Suisse) SA, Zählerweg 6, 6300 Zug, Switzerland |
Nature of business: |
% |
Class of shares: | holding |
Advanced Instruments Life Sciences GmbH was incorporated on 3 November 2022. The shareholding is held by Advanced Instruments Ltd. |
Advanced Instruments Life Sciences GmbH is included in the consolidated financial statements. |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
12. | FIXED ASSET INVESTMENTS - continued |
Registered office: Solent House, Johnson Road, Fernside Business Park, Wimborne, Dorset BH21 7SE |
Nature of business: |
% |
Class of shares: | holding |
On 1 August 2022, the group acquired 100% of the share capital of SAL Scientific Limited. Goodwill arising on the acquisition of £4,628,608 has been capitalised and will be amortised over 5 years. The investment in SAL Scientific Limited has been included in the company's balance sheet at its fair value at the date of acquisition. |
The acquisition has been accounted for under the acquisition method of accounting. Analysis of the acquisition of SAL Scientific Limited is as follows: |
Book value | Adjustment | Fair value |
£ | £ | £ |
Tangible assets | 21,211 | - | 21,211 |
Stock | 41,964 | - | 41,964 |
Debtors | 120,416 | - | 120,416 |
Cash | 332,138 | - | 332,138 |
Creditors | (59,328 | ) | - | (59,328 | ) |
Provisions | (2,354 | ) | - | (2,354 | ) |
Total identifiable assets | 454,047 | - | 454,047 |
Satisfied by: |
Cash | £5,082,655 |
Reconciliation to goodwill addition: | £ |
Consideration | 5,082,655 |
Directly attributable costs | - |
Net assets acquired | (454,047 | ) |
Goodwill addition (note 9) | 4,628,608 |
SAL Scientific Limited is included in the consolidated financial statements. Its reporting accounting period is from 1 August 2022 to 31 December 2023. |
The revenue from SAL Scientific Limited included in the consolidated income statement for 2022 is £19,890. It contributed a loss before tax of £20,720 over the same period. |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
13. | STOCKS |
Group | Company |
2022 | 2021 | 2022 | 2021 |
£ | £ | £ | £ |
Consumables | 53,620 | 875,441 |
Raw materials | 3,227,269 | 1,101,728 |
Work-in-progress | 617,705 | 223,958 |
Finished goods | 1,821,053 | 868,470 |
5,719,647 | 3,069,597 |
Group |
Stock is stated after provisions for impairment of £306,329 (2021: £102,777). |
Stock at the balance sheet date includes £nil (2021: £120,000) carried at fair value following fair value adjustment on business combination. |
Company |
Stock is stated after provisions for impairment of £nil (2021: £82,777). |
14. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
2022 | 2021 | 2022 | 2021 |
£ | £ | £ | £ |
Trade debtors | 2,088,127 | 2,649,461 |
Amounts owed by group undertakings | - | - |
Other debtors | 130,664 | 109,139 |
Tax | 94,802 | - |
VAT | 81,533 | - |
Prepayments and accrued income | 1,150,711 | 370,853 |
3,545,837 | 3,129,453 |
15. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
2022 | 2021 | 2022 | 2021 |
£ | £ | £ | £ |
Payments on account | 190,788 | - |
Trade creditors | 700,445 | 879,829 | ( |
) |
Amounts owed to group undertakings | 11,190,908 | 177,117,819 |
Tax | 1,089,843 | 1,702,254 |
Social security and other taxes | 237,035 | 348,009 |
Other creditors | 388,815 | 31,135 |
Accruals and deferred income | 1,680,513 | 2,409,586 |
15,478,347 | 182,488,632 |
In 2021, a group undertaking loaned Advanced Instruments Holdings Ltd £176,035,583 (2020: £nil) to finance the acquisition of the Advanced Instruments group. Interest was payable on £167,823,875 of the loan at the applicable federal rate plus 0.6% until 21 March 2022. On 21 March 2022, the debt was restructured with £75,000,000 capitalised and £100,000,000 subject to a new loan agreement (see note 15). The remaining £6,902,678, includes accrued interest which is payable quarterly in arrears with any unpaid interest payable on the loan due date. |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
16. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
Group | Company |
2022 | 2021 | 2022 | 2021 |
£ | £ | £ | £ |
Amounts owed to group undertakings | 100,000,000 | - | 100,000,000 | - |
On 21 March 2022, debt due to a group undertaking was restructured with £100,000,000 subject to a new loan agreement. Interest was payable on the loan at 6.3% from 21 March 2022. The loan is repayable, other than by instalment, by 21 March 2030. |
17. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Group |
Non-cancellable operating | leases |
2022 | 2021 |
£ | £ |
Within one year | 139,419 | 212,439 |
Between one and five years | 57,983 | 200,019 |
197,402 | 412,458 |
The operating leases are in respect of property, vehicles and office equipment. |
Company |
Non-cancellable operating | leases |
2022 | 2021 |
£ | £ |
Within one year |
Between one and five years |
The operating leases are in respect of property, motor vehicles and office equipment. |
Group and company: |
As lessor: |
The total future minimum lease payments receivable under non-cancellable operating leases are as follows: |
2022 | 2021 |
£ | £ |
Within one year | 25,758 | 26,243 |
Between one and five years | 46,554 | 41,228 |
72,312 | 67,471 |
The operating leases are in respect of medical instruments. |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
18. | PROVISIONS FOR LIABILITIES |
Group | Company |
2022 | 2021 | 2022 | 2021 |
£ | £ | £ | £ |
Deferred tax |
Accelerated capital allowances | 138,377 | 67,300 |
Tax losses carried forward | (1,129,846 | ) | - |
Timing difference on fair value of acquired assets |
21,606,107 |
23,216,378 |
- |
- |
20,614,638 | 23,283,678 | - | 8,136 |
Other provisions |
Warranty provision | 1,687 | 8,845 | - | - |
Dilapidation provision | 100,000 | 100,000 | - | - |
101,687 | 108,845 |
Aggregate amounts | 20,716,325 | 23,392,523 | - | 8,136 |
Group |
Deferred | Other |
tax | provisions |
£ | £ |
Balance at 1 January 2022 | 23,283,678 | 108,845 |
Credit to Statement of Comprehensive Income during year | (2,671,459 | ) | (7,158 | ) |
Business combination | 2,419 | - |
Balance at 31 December 2022 | 20,614,638 | 101,687 |
Company |
Deferred |
tax |
£ |
Balance at 1 January 2022 |
Credit to Income Statement during year | ( |
) |
Balance at 31 December 2022 |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
18. | PROVISIONS FOR LIABILITIES - continued |
Deferred tax |
Deferred tax includes £21,606,107 (2021: £23,216,378) arising as a result of the fair value uplift of stock and the recognition of technology intangibles on acquisition of a subsidiary in the year. £1,610,272 (2021: £708,134) of this adjustment unwound during the year. In addition, £2,419 (2021: £26,978) of deferred tax was acquired through the business combination in relation to timing differences. |
The deferred tax liability expected to reverse in 2023 is £1,578,840. This relates to the reversal of timing differences on the technology intangibles fair value uplift and timing differences between acquired tangible assets capital allowances and depreciation. |
Other provisions |
Other provisions include £100,000 (2021: £100,000) for dilapidations and £1,687 (2021: £8,845) for warranties. |
Dilapidations provision |
As part of the group’s property leasing arrangements there is an obligation to repair damages which are incurred during the life of the lease, such as wear and tear. The cost is charged to profit and loss as the obligation arises. The provision is expected to be utilised in 2024 as the leases terminate. |
Warranty provision |
The group provides warranties for its instruments. The provision is an estimate of the expected costs to be incurred based on historical costs. |
19. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2022 | 2021 |
value: | £ | £ |
Ordinary | £1 | 75,000,070 | 70 |
75,000,000 Ordinary shares of £1 each were allotted and fully paid for |
The company has one class of ordinary shares which carry full voting, dividends and capital distribution (including on winding up) rights. |
20. | RESERVES |
Group |
Capital | Foreign |
Retained | redemption | translation |
earnings | reserve | reserve | Totals |
£ | £ | £ | £ |
At 1 January 2022 | (1,012,321 | ) | 35 | - | (1,012,286 | ) |
Deficit for the year | (13,842,575 | ) | (13,842,575 | ) |
Currency translation differences | 73,566 | - | - | 73,566 |
Transfer between reserves | (78,337 | ) | - | 78,337 | - |
At 31 December 2022 | (14,859,667 | ) | 35 | 78,337 | (14,781,295 | ) |
Company |
Capital |
Retained | redemption |
earnings | reserve | Totals |
£ | £ | £ |
At 1 January 2022 | 2,425,641 |
Deficit for the year | ( |
) | ( |
) |
At 31 December 2022 | ( |
) | (2,840,671 | ) |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
20. | RESERVES - continued |
21. | PENSION COMMITMENTS |
The group operates defined contribution pension plans for its employees. The amounts recognised as an expense in the year were: |
Group: £324,910 (2021: £80,735) |
Company: £21,409 (2021: £46,911) |
22. | ULTIMATE PARENT COMPANY |
Advanced Instruments Limited is a subsidiary undertaking of Advanced Instruments LLC, which is the immediate parent company and incorporated in the United States of America. Its registered office is Two Technology Way, Norwood, MA 02062. |
The ultimate parent company is Investor AB, a company incorporated in Sweden. Its registered office is Arsenalsgatan 8C, 103 32 Stockholm. |
Advanced Instruments LLC is the smallest group to consolidate these financial statements. Investor AB is the largest group to consolidate these financial statements. The consolidated financial statements for Investor AB are publicly available and can be obtained from www.investorab.com. |
23. | CONTINGENT LIABILITIES |
There are fixed and floating charges in place over the group's assets as security for loans. At 31 December 2022, the group debt outstanding, subject to these cross guarantees totalled $219.5 million (2021: $235 million). A further $32 million was borrowed under the facility in March 2023. |
24. | RELATED PARTY DISCLOSURES |
Key management personnel of the entity or its parent (in the aggregate) |
2022 | 2021 |
£ | £ |
Amount due to related party | 1,784 | - |
During the year, a total of key management personnel compensation of £ 1,232,882 (2021 - £ 795,279 ) was paid. |
25. | RECONCILIATION OF LOSS BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
2022 | 2021 |
£ | £ |
Loss before taxation | (17,042,044 | ) | (2,406,186 | ) |
Depreciation charges | 13,718,628 | 4,426,657 |
Profit on disposal of fixed assets | (73,718 | ) | (107,748 | ) |
Provisions | (7,158 | ) | (2,270 | ) |
Loss on disposal of investment | 1,216,049 | - |
Finance costs | 5,382,320 | 484,850 |
Finance income | (4,469 | ) | (1,926 | ) |
3,189,608 | 2,393,377 |
(Increase)/decrease in stocks | (2,608,086 | ) | 592,187 |
Increase in trade and other debtors | (201,166 | ) | (770,014 | ) |
Increase in trade and other creditors | 1,988,425 | 969,004 |
Cash generated from operations | 2,368,781 | 3,184,554 |
ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
26. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 31 December 2022 |
31.12.22 | 1.1.22 |
£ | £ |
Cash and cash equivalents | 3,725,048 | 6,688,611 |
Year ended 31 December 2021 |
31.12.21 | 1.1.21 |
£ | £ |
Cash and cash equivalents | 6,688,611 | 1,777,872 |
27. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1.1.22 | Cash flow | Acquired | At 31.12.22 |
£ | £ | £ | £ |
Net cash |
Cash at bank |
and in hand | 6,688,611 | (3,295,701 | ) | 332,138 | 3,725,048 |
6,688,611 | (3,295,701 | ) | 332,138 | 3,725,048 |
Total | 6,688,611 | (3,295,701 | ) | 332,138 | 3,725,048 |
28. | MAJOR NON-CASH TRANSACTIONS |
The group was charged interest of £5,382,252 (2021: £484,850) by its parent company. The interest was credited to intercompany creditors. |
During the year, £75,000,000 (2021: £nil) of the £176,035,576 group loan was capitalised into 75,000,000 £1 ordinary shares. |