Company Registration No. 02321021 (England and Wales)
GEMACO HOLDINGS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
GEMACO HOLDINGS LIMITED
COMPANY INFORMATION
Directors
A Lodge
J Lodge
Company number
02321021
Registered office
32-40 Harwell Road
Nuffield Industrial Estate
Poole
Dorset
BH17 0GE
Auditor
Hill Osborne Ltd
Tower House
Parkstone Road
Poole
Dorset
BH15 2JH
Business address
32-40 Harwell Road
Nuffield Industrial Estate
Poole
Dorset
BH17 0GE
GEMACO HOLDINGS LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Profit and loss account
7
Group statement of comprehensive income
8
Group balance sheet
9
Company balance sheet
10
Group statement of changes in equity
11
Company statement of changes in equity
12
Group statement of cash flows
13
Company statement of cash flows
14
Notes to the financial statements
15 - 34
GEMACO HOLDINGS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 1 -
The directors present the strategic report for the year ended 31 December 2022.
Fair review of the business
The principal objective of the group continues to be the increased delivery of our specialised products and services to a wide range of customers on a global basis.
Our investment in R & D and the latest technological developments, plus our commercial property portfolio ensures we have adequate factory space for expansion thereby securing our future in this competitive market.
The directors look forward to the future with confidence.
The results for the year and the financial position at the year end were considered satisfactory by the directors who expect continued growth in the foreseeable future.
Principal risks and uncertainties
Principal risks and uncertainties are government legislations across the world that are out of our control.
The key business risks and uncertainties are challenges from competitors and retention of key employees.
Development and performance
The commercial environment is expected to be challenging for the year ahead, but the directors are confident they will see an increase in the growth of the business due to securing a number of large contracts and having recently expanded its investment property portfolio.
Key performance indicators
The directors use a number of measures, both financial and non-financial, to monitor the performance of the group.
They regard the following as the key financial indicators of performance:-
2022
2021
£
£
Turnover
9,784,525
8,039,352
Profit before tax (inluding increase in fair value of investment properties)
1,392,423
1,295,290
%
%
Gross profit margin
36.00
36.50
Net profit margin
10.95
12.32
A Lodge
Director
1 June 2023
GEMACO HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 2 -
The directors present their annual report and financial statements for the year ended 31 December 2022.
Principal activities
The principal activity of the group continued to be that of cable manufacture and the letting of industrial properties.
Results and dividends
The results for the year are set out on page 7.
Ordinary dividends were paid amounting to £229,200. The directors do not recommend payment of a further dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
A Lodge
J Lodge
Auditor
In accordance with the company's articles, a resolution proposing that Hill Osborne Ltd be reappointed as auditor of the group will be put at a General Meeting.
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 auditor of the company 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 auditor of the company is aware of that information.
On behalf of the board
A Lodge
Director
1 June 2023
GEMACO HOLDINGS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 3 -
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 group and company, 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;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the ;
prepare the on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
GEMACO HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF GEMACO HOLDINGS LIMITED
- 4 -
Opinion
We have audited the financial statements of Gemaco Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2022 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows, the company 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 FRS 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 the parent company's affairs as at 31 December 2022 and of the group's 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 group's and 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.
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.
GEMACO HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GEMACO HOLDINGS LIMITED
- 5 -
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 strategic report and the directors' report.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept 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 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 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 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.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Extent to which the audit was considered capable of detecting irregularities, including fraud
We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures in response to those risks, including obtaining appropriate audit evidence to provide a basis for our opinion.
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and and regulations we considered the following:
- the nature of the industry and the laws and regulations that the company must comply with, in particular regarding health and safety
- the company's own assessment of the risks that irregularities may occur as a result of fraud or error
- results of our enquiries of management
Audit response to risks identified
Our procedures to respond to the risks identified included the following:
- reviewing the financial statement disclosures
-enquiring of management
-reviewing insurance certificates are up to date
-in addressing the risk of fraud through management override we have assessed whether the judgements made made in making accounting estimates are indicative of a potential bias and tested the appropriateness of journal entries.
GEMACO HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GEMACO HOLDINGS LIMITED
- 6 -
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.
James Hill (Senior Statutory Auditor)
For and on behalf of Hill Osborne Ltd
1 June 2023
Chartered Accountants
Statutory Auditor
Tower House
Parkstone Road
Poole
Dorset
BH15 2JH
GEMACO HOLDINGS LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 7 -
2022
2021
Notes
£
£
Turnover
3
9,784,525
8,039,352
Cost of sales
(6,251,747)
(5,105,699)
Gross profit
3,532,778
2,933,653
Administrative expenses
(2,052,930)
(1,778,257)
Other operating income
2,475
-
Operating profit
4
1,482,323
1,155,396
Interest receivable and similar income
8
10,326
20,414
Interest payable and similar expenses
9
(190,226)
(119,161)
Fair value gains and losses on investment properties
90,000
238,641
Profit before taxation
1,392,423
1,295,290
Tax on profit
10
(200,684)
(304,841)
Profit for the financial year
1,191,739
990,449
Profit for the financial year is all attributable to the owners of the parent company.
The profit and loss account has been prepared on the basis that all operations are continuing operations.
GEMACO HOLDINGS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022
- 8 -
2022
2021
£
£
Profit for the year
1,191,739
990,449
Other comprehensive income
-
-
Total comprehensive income for the year
1,191,739
990,449
Total comprehensive income for the year is all attributable to the owners of the parent company.
GEMACO HOLDINGS LIMITED
GROUP BALANCE SHEET
AS AT
31 DECEMBER 2022
31 December 2022
- 9 -
2022
2021
Notes
£
£
£
£
Fixed assets
Intangible assets
12
66,619
104,453
Tangible assets
13
6,515,760
6,068,079
Investment properties
14
3,750,656
3,660,656
10,333,035
9,833,188
Current assets
Stocks
18
2,195,381
1,962,787
Debtors
19
2,009,459
1,869,058
Cash at bank and in hand
559,360
382,187
4,764,200
4,214,032
Creditors: amounts falling due within one year
20
(1,831,513)
(1,821,525)
Net current assets
2,932,687
2,392,507
Total assets less current liabilities
13,265,722
12,225,695
Creditors: amounts falling due after more than one year
21
(4,488,316)
(4,458,076)
Provisions for liabilities
Deferred tax liability
24
562,639
515,391
(562,639)
(515,391)
Net assets
8,214,767
7,252,228
Capital and reserves
Called up share capital
27
4,000
4,000
Share premium account
70,000
70,000
Non-distributable profits reserve
2,946,243
2,878,743
Capital redemption reserve
500
500
Profit and loss reserves
5,194,024
4,298,985
Total equity
8,214,767
7,252,228
The financial statements were approved by the board of directors and authorised for issue on 1 June 2023 and are signed on its behalf by:
01 June 2023
A Lodge
Director
GEMACO HOLDINGS LIMITED
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2022
31 December 2022
- 10 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
13
9,554
12,739
Investment properties
14
11,759,999
10,306,471
Investments
15
102
102
11,769,655
10,319,312
Current assets
Debtors
19
639,274
522,574
Cash at bank and in hand
35,397
32,121
674,671
554,695
Creditors: amounts falling due within one year
20
(1,533,829)
(1,159,710)
Net current liabilities
(859,158)
(605,015)
Total assets less current liabilities
10,910,497
9,714,297
Creditors: amounts falling due after more than one year
21
(4,323,808)
(4,249,546)
Provisions for liabilities
Deferred tax liability
24
1,019,681
729,026
(1,019,681)
(729,026)
Net assets
5,567,008
4,735,725
Capital and reserves
Called up share capital
27
4,000
4,000
Share premium account
70,000
70,000
Non distributable profit reserve
4,356,332
3,484,365
Capital redemption reserve
500
500
Profit and loss reserves
1,136,176
1,176,860
Total equity
5,567,008
4,735,725
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £1,060,483 (2021 - £817,611 profit).
The financial statements were approved by the board of directors and authorised for issue on 1 June 2023 and are signed on its behalf by:
01 June 2023
A Lodge
Director
Company Registration No. 02321021
GEMACO HOLDINGS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
- 11 -
Share capital
Share premium account
Non-distributable profit reserve
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
£
Balance at 1 January 2021
4,000
70,000
2,754,030
500
3,634,049
6,434,347
Year ended 31 December 2021:
Profit and total comprehensive income for the year
-
-
-
-
990,449
990,449
Dividends
11
-
-
-
-
(200,800)
(200,800)
Transfers
-
-
-
-
(124,713)
(124,713)
Other movements
-
-
124,713
-
-
124,713
Balance at 31 December 2021
4,000
70,000
2,878,743
500
4,298,985
7,252,228
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
-
-
1,191,739
1,191,739
Dividends
11
-
-
-
-
(229,200)
(229,200)
Transfers
-
-
-
-
(67,500)
(67,500)
Other movements
-
-
67,500
-
-
67,500
Balance at 31 December 2022
4,000
70,000
2,946,243
500
5,194,024
8,214,767
GEMACO HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
- 12 -
Share capital
Share premium account
Non-distributable profit reserve
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
£
Balance at 1 January 2021
4,000
70,000
3,134,141
500
910,273
4,118,914
Year ended 31 December 2021:
Profit and total comprehensive income for the year
-
-
-
-
817,611
817,611
Dividends
11
-
-
-
-
(200,800)
(200,800)
Transfers
-
-
-
-
(350,224)
(350,224)
Other movements
-
-
350,224
-
-
350,224
Balance at 31 December 2021
4,000
70,000
3,484,365
500
1,176,860
4,735,725
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
-
-
1,060,483
1,060,483
Dividends
11
-
-
-
-
(229,200)
(229,200)
Transfers
-
-
-
-
(871,967)
(871,967)
Other movements
-
-
871,967
-
-
871,967
Balance at 31 December 2022
4,000
70,000
4,356,332
500
1,136,176
5,567,008
GEMACO HOLDINGS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 13 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
33
1,398,582
982,975
Interest paid
(190,226)
(119,161)
Income taxes paid
(48,167)
(161,543)
Net cash inflow from operating activities
1,160,189
702,271
Investing activities
Purchase of intangible assets
-
(78)
Purchase of tangible fixed assets
(684,397)
(2,030,126)
Proceeds from other investments and loans
(92,931)
(28,541)
Interest received
10,326
20,414
Net cash used in investing activities
(767,002)
(2,038,331)
Financing activities
Proceeds from borrowings
93,225
22,837
Proceeds of new bank loans
300,000
1,395,000
Repayment of bank loans
(216,108)
(255,505)
Payment of finance leases obligations
(123,050)
(110,467)
Dividends paid to equity shareholders
(229,200)
(200,800)
Net cash (used in)/generated from financing activities
(175,133)
851,065
Net increase/(decrease) in cash and cash equivalents
218,054
(484,995)
Cash and cash equivalents at beginning of year
341,306
826,301
Cash and cash equivalents at end of year
559,360
341,306
Relating to:
Cash at bank and in hand
559,360
382,187
Bank overdrafts included in creditors payable within one year
-
(40,881)
GEMACO HOLDINGS LIMITED
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 14 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
34
661,741
909,807
Interest paid
(165,228)
(104,553)
Income taxes paid
(24,198)
(111,138)
Net cash inflow from operating activities
472,315
694,116
Investing activities
Purchase of investment property
(290,906)
(1,936,471)
Receipts arising from loans made
(92,932)
(28,542)
Interest received
10,107
20,385
Dividends received
50,000
250,000
Net cash used in investing activities
(323,731)
(1,694,628)
Financing activities
Proceeds of new bank loans
300,000
1,395,000
Repayment of bank loans
(216,108)
(205,505)
Dividends paid to equity shareholders
(229,200)
(200,800)
Net cash (used in)/generated from financing activities
(145,308)
988,695
Net increase/(decrease) in cash and cash equivalents
3,276
(11,817)
Cash and cash equivalents at beginning of year
32,121
43,938
Cash and cash equivalents at end of year
35,397
32,121
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 15 -
1
Accounting policies
Company information
Gemaco Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 32-40 Harwell Road, Nuffield Industrial Estate, Poole, Dorset, BH17 0GE.
The group consists of Gemaco Holdings Limited and all of its subsidiaries.
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, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
1.2
Basis of consolidation
The consolidated group financial statements consist of the financial statements of the parent company Gemaco Holdings Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.
All financial statements are made up to 31 December 2022. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
1.3
Going concern
At the time of approving the financial statements, the directors have a reasonable expectation that the group 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.
1.4
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
1.5
Research and development expenditure
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 16 -
1.6
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
Amortisation 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:
Development Costs
10 years straight line
1.7
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.
Tangible fixed assets are stated at cost or valuation less depreciation. Depreciation is provided at rates calculated to write off the cost or valuation less estimated residual value of each asset over its expected useful life, as follows:
Land and buildings Freehold
2% straight line
Land and buildings Leasehold
10 years straight line
Plant and machinery
25% reducing balance
Fixtures, fittings & equipment
25% reducing balance
Motor vehicles
25% reducing balance
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 recognised in the profit and loss account.
1.8
Investment properties
Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.
Property rented to a group entity is accounted for as tangible fixed assets.
1.9
Fixed asset investments
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 17 -
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.
Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.
In the parent company financial statements, investments in associates are accounted for at cost less impairment.
1.10
Impairment of fixed assets
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible 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.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
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.
1.11
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.12
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.
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 18 -
1.13
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 to all of its financial instruments.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and 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.
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 group 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 group after deducting all of its liabilities.
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 19 -
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.
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 group's contractual obligations expire or are discharged or cancelled.
1.14
Equity instruments
Equity instruments issued by the group 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 group.
1.15
Derivatives
Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.
A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.
1.16
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 group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 20 -
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 if, and only if, there is 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.
1.17
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense.
1.18
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.19
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
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 leased asset are consumed.
1.20
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.
2
Judgements and key sources of estimation uncertainty
In the application of the group’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.
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 21 -
3
Turnover and other revenue
An analysis of the group's turnover is as follows:
2022
2021
£
£
Turnover
Manufacturing sales
9,491,081
7,758,153
Rental income
287,514
275,269
Management charges
5,930
5,930
9,784,525
8,039,352
Other significant revenue
Interest income
10,326
20,414
4
Operating profit
2022
2021
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange gains
(116)
(679)
Research and development costs
3,504
Depreciation of owned tangible fixed assets
235,562
141,938
Depreciation of tangible fixed assets held under finance leases
704
59,239
Profit on disposal of tangible fixed assets
450
Amortisation of intangible assets
37,834
37,834
Cost of stocks recognised as an expense
3,446,112
2,938,543
Operating lease charges
39,982
37,420
5
Auditor's remuneration
2022
2021
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
7,500
7,050
Audit of the financial statements of the company's subsidiaries
18,500
18,060
26,000
25,110
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 22 -
6
Employees
The average monthly number of persons (including directors) employed by the group and company during the year was:
Group
Company
2022
2021
2022
2021
Number
Number
Number
Number
Administration
82
80
4
6
Directors
2
2
2
2
Total
84
82
6
8
Their aggregate remuneration comprised:
Group
Company
2022
2021
2022
2021
£
£
£
£
Wages and salaries
3,007,745
2,475,560
299,446
222,219
Social security costs
280,981
212,033
39,522
19,652
Pension costs
25,564
18,725
3,314,290
2,706,318
338,968
241,871
7
Directors' remuneration
2022
2021
£
£
Remuneration for qualifying services
93,777
44,138
8
Interest receivable and similar income
2022
2021
£
£
Interest income
Interest on bank deposits
10
29
Other interest income
10,316
20,385
Total income
10,326
20,414
Investment income includes the following:
Interest on financial assets not measured at fair value through profit or loss
10
29
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 23 -
9
Interest payable and similar expenses
2022
2021
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
159,428
96,743
Other interest on financial liabilities
2,750
1,361
162,178
98,104
Other finance costs:
Interest on finance leases and hire purchase contracts
12,802
12,780
Other interest
15,246
8,277
Total finance costs
190,226
119,161
10
Taxation
2022
2021
£
£
Current tax
UK corporation tax on profits for the current period
198,725
215,898
Adjustments in respect of prior periods
(45,290)
(35,511)
Total current tax
153,435
180,387
Deferred tax
Origination and reversal of timing differences
47,249
124,454
Total tax charge
200,684
304,841
The actual charge 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
1,392,423
1,295,290
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
264,560
246,105
Tax effect of expenses that are not deductible in determining taxable profit
1,774
1,774
Adjustments in respect of prior years
(45,290)
Permanent capital allowances in excess of depreciation
(38,052)
9,490
Under/(over) provided in prior years
(35,510)
Deferred tax
47,248
128,324
Tax on increase in fair value of investment properties
(17,100)
(45,342)
(12,456)
Taxation charge
200,684
304,841
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 24 -
11
Dividends
2022
2021
Recognised as distributions to equity holders:
£
£
Interim paid
229,200
200,800
12
Intangible fixed assets
Group
Development Costs
£
Cost
At 1 January 2022 and 31 December 2022
434,727
Amortisation and impairment
At 1 January 2022
330,274
Amortisation charged for the year
37,834
At 31 December 2022
368,108
Carrying amount
At 31 December 2022
66,619
At 31 December 2021
104,453
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 25 -
13
Tangible fixed assets
Group
Land and buildings Freehold
Land and buildings Leasehold
Plant and machinery
Fixtures, fittings & equipment
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 January 2022
5,761,431
26,566
2,744,500
274,346
56,400
8,863,243
Additions
290,906
161,250
217,148
15,094
684,398
Disposals
(21,269)
(5,515)
(26,784)
At 31 December 2022
6,052,337
187,816
2,940,379
283,925
56,400
9,520,857
Depreciation and impairment
At 1 January 2022
165,852
23,451
2,330,449
226,952
48,460
2,795,164
Depreciation charged in the year
42,601
18,782
157,313
15,585
1,985
236,266
Eliminated in respect of disposals
(20,952)
(5,381)
(26,333)
At 31 December 2022
208,453
42,233
2,466,810
237,156
50,445
3,005,097
Carrying amount
At 31 December 2022
5,843,884
145,583
473,569
46,769
5,955
6,515,760
At 31 December 2021
5,595,579
3,115
414,051
47,394
7,940
6,068,079
Company
Plant and machinery
Fixtures, fittings & equipment
Motor vehicles
Total
£
£
£
£
Cost
At 1 January 2022 and 31 December 2022
499,386
84,185
31,514
615,085
Depreciation and impairment
At 1 January 2022
491,051
83,374
27,921
602,346
Depreciation charged in the year
2,084
203
898
3,185
At 31 December 2022
493,135
83,577
28,819
605,531
Carrying amount
At 31 December 2022
6,251
608
2,695
9,554
At 31 December 2021
8,335
811
3,593
12,739
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
13
Tangible fixed assets
(Continued)
- 26 -
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
Group
Company
2022
2021
2022
2021
£
£
£
£
Plant and machinery
134,559
174,900
Motor vehicles
2,113
2,817
2,113
2,817
136,672
177,717
2,113
2,817
14
Investment property
Group
Company
2022
2022
£
£
Fair value
At 1 January 2022
3,660,656
10,306,471
Additions through external acquisition
-
290,906
Net gains or losses through fair value adjustments
90,000
1,162,622
At 31 December 2022
3,750,656
11,759,999
Investment property comprises three properties. The fair value of the investment property has been arrived at on the basis of a valuation carried out by the directors' of the company. The valuation was made on an open market value basis by reference to market evidence of transaction prices for similar properties.
15
Fixed asset investments
Group
Company
2022
2021
2022
2021
Notes
£
£
£
£
Investments in subsidiaries
16
102
102
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 January 2022 and 31 December 2022
102
Carrying amount
At 31 December 2022
102
At 31 December 2021
102
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 27 -
16
Subsidiaries
Details of the company's subsidiaries at 31 December 2022 are as follows:
Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Cable First Limited
32-40 Harwell Road, Poole, Dorset, BH17 0GE
Cable manufacturers
Ordinary
100.00
Concept Cables Limited
Concept House, Shaftesbury Road, Blandford Heights, Blandford Forum, Dorset, DT11 7TE
Cable manufacturers
Ordinary
100.00
Plasticable Limited
Concept House, Shaftesbury Road, Blandford Heights, Blandford Forum, Dorset, DT11 7TE
Cable manufacturers
Ordinary
100.00
The aggregate capital and reserves and the result for the year of the subsidiaries noted above was as follows:
Name of undertaking
Capital and Reserves
Profit/(Loss)
£
£
Cable First Limited
2,279,726
728,081
Concept Cables Limited
1,946,156
300,242
Plasticable Limited
88,895
17
Financial instruments
Group
Company
2022
2021
2022
2021
£
£
£
£
Carrying amount of financial assets
Debt instruments measured at amortised cost
1,890,193
1,762,961
563,908
437,004
Carrying amount of financial liabilities
Measured at amortised cost
5,586,325
5,687,768
5,679,295
5,237,310
18
Stocks
Group
Company
2022
2021
2022
2021
£
£
£
£
Raw materials and consumables
2,195,381
1,962,787
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 28 -
19
Debtors
Group
Company
2022
2021
2022
2021
Amounts falling due within one year:
£
£
£
£
Trade debtors
1,336,441
1,341,325
11,270
29,949
Other debtors
582,212
459,680
580,779
444,780
Prepayments and accrued income
90,806
68,053
47,225
47,845
2,009,459
1,869,058
639,274
522,574
20
Creditors: amounts falling due within one year
Group
Company
2022
2021
2022
2021
Notes
£
£
£
£
Bank loans and overdrafts
22
232,575
263,826
232,575
222,945
Obligations under finance leases
23
120,854
106,657
Other borrowings
22
97,600
97,600
95,000
95,000
Trade creditors
604,431
716,871
20,421
14,100
Amounts owed to group undertakings
983,595
634,701
Corporation tax payable
433,124
327,855
122,049
113,975
Other taxation and social security
275,019
238,617
9,682
11,360
Deferred income
25
25,361
25,361
46,611
46,611
Other creditors
15,089
12,211
14,896
12,018
Accruals and deferred income
27,460
32,527
9,000
9,000
1,831,513
1,821,525
1,533,829
1,159,710
21
Creditors: amounts falling due after more than one year
Group
Company
2022
2021
2022
2021
Notes
£
£
£
£
Bank loans and overdrafts
22
4,323,808
4,249,546
4,323,808
4,249,546
Obligations under finance leases
23
164,508
208,530
4,488,316
4,458,076
4,323,808
4,249,546
Amounts included above which fall due after five years are as follows:
Payable by instalments
3,442,342
3,297,033
3,442,342
3,297,033
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 29 -
22
Loans and overdrafts
Group
Company
2022
2021
2022
2021
£
£
£
£
Bank loans
4,556,383
4,472,491
4,556,383
4,472,491
Bank overdrafts
40,881
Other loans
97,600
97,600
95,000
95,000
4,653,983
4,610,972
4,651,383
4,567,491
Payable within one year
330,175
361,426
327,575
317,945
Payable after one year
4,323,808
4,249,546
4,323,808
4,249,546
The long-term loans are secured by fixed charges over the company's assets
The long-term loans are secured by fixed charges over the group's assets.
23
Finance lease obligations
Group
Company
2022
2021
2022
2021
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
24,222
106,657
In two to five years
29,278
208,530
53,500
315,187
-
-
Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 3 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
24
Deferred taxation
Deferred tax assets and liabilities are offset where the group or company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
2022
2021
Group
£
£
Accelerated capital allowances
89,874
65,126
Revaluations
472,765
450,265
562,639
515,391
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
24
Deferred taxation
(Continued)
- 30 -
Liabilities
Liabilities
2022
2021
Company
£
£
Revaluations
1,019,681
729,026
Group
Company
2022
2022
Movements in the year:
£
£
Liability at 1 January 2022
515,391
729,026
Charge to profit or loss
47,248
290,655
Liability at 31 December 2022
562,639
1,019,681
25
Deferred income
Group
Company
2022
2021
2022
2021
£
£
£
£
Other deferred income
25,361
25,361
46,611
46,611
26
Retirement benefit schemes
2022
2021
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
25,564
18,725
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 31 -
27
Share capital
Group and company
2022
2021
Ordinary share capital
£
£
Authorised
40,000 Ordinary shares class A of 10p each
4,000
4,000
5,000 Ordinary shares class C of 10p each
500
500
4,500
4,500
Issued and fully paid
40,000 Ordinary shares class A of 10p each
4,000
4,000
The company has one class of ordinary shares which carry no right to fixed income.
28
Financial commitments, guarantees and contingent liabilities
The group's bankers hold an Unlimited Multilateral Guarantee over Gemaco Holdings Limited and its subsidiary companies.
29
Operating lease commitments
Lessor
The operating leases represent leases to third parties. The leases are negotiated over terms of 10 years.
At the reporting end date the group had contracted with tenants for the following minimum lease payments:
Group
Company
2022
2021
2022
2021
£
£
£
£
Within one year
525,046
525,046
525,046
525,046
Between two and five years
948,573
958,574
948,573
958,574
In over five years
394,167
554,167
394,167
554,167
1,867,786
2,037,787
1,867,786
2,037,787
30
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel is as follows.
2022
2021
£
£
Aggregate compensation
312,973
279,403
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
30
Related party transactions
(Continued)
- 32 -
Transactions with related parties
Wages and salaries
During the year the company paid wages amounting to £75,700 (2021; £53,004) to close family members of the directors' and shareholders.
Shareholder loan
During the year the group advanced £158,344 to a majority shareholder of the group. They repaid £114,606 and paid interest amounting to £2,728. At the year end they owed the group £161,001 (2021: £114,535).
Related party loan
During 2018 the group advanced £160,000 to A J Kewley a director of Concept Cables Ltd. Interest was charged on this loan at a rate of 2.5%. At the year end the balance due to the group was £180,651.
31
Directors' transactions
Dividends totalling £114,594 (2021 - £100,395) were paid in the year in respect of shares held by the company's directors.
Loans have been granted by the group to its directors as follows:
Description
% Rate
Opening balance
Amounts advanced
Interest charged
Amounts repaid
Closing balance
£
£
£
£
£
Loan
2.00
114,535
158,333
2,728
(114,594)
161,002
114,535
158,333
2,728
(114,594)
161,002
32
Controlling party
The ultimate controlling party is Mr P Lodge, by virtue of the fact that he owns 50.0025% of the 'A' class ordinary shares issued.
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 33 -
33
Cash generated from group operations
2022
2021
£
£
Profit for the year after tax
1,191,739
990,449
Adjustments for:
Taxation charged
200,684
304,841
Finance costs
190,226
119,161
Investment income
(10,326)
(20,414)
Loss on disposal of tangible fixed assets
450
-
Amortisation and impairment of intangible assets
37,834
37,834
Depreciation and impairment of tangible fixed assets
236,266
201,177
Revaluation of investment properties
(90,000)
(238,641)
Movements in working capital:
(Increase) in stocks
(232,594)
(321,139)
(Increase) in debtors
(57,053)
(261,626)
(Decrease)/increase in creditors
(68,643)
171,333
Cash generated from operations
1,398,583
982,975
33
Cash generated from operations - company
2022
2021
£
£
Profit for the year after tax
1,060,483
817,611
Adjustments for:
Taxation charged
322,927
324,712
Finance costs
165,228
104,553
Investment income
(60,107)
(270,385)
Depreciation and impairment of tangible fixed assets
3,185
4,246
Revaluation of investment properties
(1,162,622)
(624,000)
Movements in working capital:
(Increase)/decrease in debtors
(33,352)
13,135
Increase in creditors
365,999
539,935
Cash generated from operations
661,741
909,807
GEMACO HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 34 -
35
Analysis of changes in net debt - group
1 January 2022
Cash flows
New finance leases
31 December 2022
£
£
£
£
Cash at bank and in hand
382,187
177,173
-
559,360
Bank overdrafts
(40,881)
40,881
-
341,306
218,054
-
559,360
Borrowings excluding overdrafts
(4,570,091)
(83,892)
-
(4,653,983)
Obligations under finance leases
(315,187)
123,050
(93,225)
(285,362)
(4,543,972)
257,212
(93,225)
(4,379,985)
36
Analysis of changes in net debt - company
1 January 2022
Cash flows
31 December 2022
£
£
£
Cash at bank and in hand
32,121
3,276
35,397
Borrowings excluding overdrafts
(4,567,491)
(83,892)
(4,651,383)
(4,535,370)
(80,616)
(4,615,986)
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