Company Registration No. 02354253 (England and Wales)
BAINBRIDGE INTERNATIONAL LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2020
BAINBRIDGE INTERNATIONAL LIMITED
COMPANY INFORMATION
Directors
A Smith
G Lacey
Company number
02354253
Registered office
Unit 8, Flanders Park
Flanders Road
Hedge End
Southampton
Hampshire
SO30 2FZ
Auditors
Fiander Tovell Limited
Stag Gates House
63/64 The Avenue
Southampton
Hampshire
SO17 1XS
Business address
Unit 8, Flanders Park
Flanders Road
Hedge End
Southampton
Hampshire
SO30 2FZ
BAINBRIDGE INTERNATIONAL LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 5
Statement of comprehensive income
6
Balance sheet
7
Statement of changes in equity
8
Notes to the financial statements
9 - 22
BAINBRIDGE INTERNATIONAL LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 1 -
The directors present the strategic report for the year ended 30 September 2020.
Fair review of the business
The principal activities of the company are the design, manufacture and sale of sail cloth and associated hardware and the manufacturing, sale, marketing and distribution of leisure marine products.
Over the last year, the company has been significantly impacted by the Covid-19 pandemic. This had a huge impact on all areas of the business and turnover has fallen by around 35% from the previous year. This has prompted a need to look even more closely at costs and the employee numbers have been cut considerably from 52 to 41. This has helped to manage costs throughout the period more efficiently and although the accounts are still showing a loss, the loss is much smaller than in the previous year. It is felt that costs are much easier to control with the current staffing levels and that this must remain for the next year at least.
The Covid-19 pandemic has posed a number of challenges which the company will need to cope with. Conservation of cash will be a key priority of the company going forward and due to the inherent uncertainty that exists as the country attempts to emerge from the pandemic, management will be monitoring cash receipts and commitments extremely closely. Capex has been budgeted to be zero in the coming year and this will only be changed if required and can be afforded by increased sales and an improved cash position.
The supply line will need to be managed more carefully and wisely to ensure that goods are only held for the level of sales expected and that the stocks of goods which cannot be sold are not being held.
Staff costs have been reduced substantially and therefore resources within the company are stretched. If there are unexpected orders in the busy season then temporary staff may be required to cope with the demand.
The company will continue to bring manufacturing inside the company, in line with the policy to use the properties available to the full.
Principal Risks and Uncertainties
With the exception of the risks identified above, the directors consider that the company's principal business risks are normal trading risks. The directors have systems in place to identify and mitigate the risks and uncertainties that the group faces in carrying out its business.
Key performance indicators
As part of the continual management reporting and key trend analysis of the business by the Board of Directors, two leading Key Performance
I
ndicators from the dashboard reports are taken as reliable bellwethers of the business. These are gross profit and overheads as a proportion of turnover.
20
20
201
9
Gross Profit
1,837,630 2,853,690
Gross Profit Margin 2
6.9
%
26.9
%
Overheads
2,297,212
3,291,769
Overheads as percentage of turnover
33.6%
31.0
%
Gross profit margin has remained consistent with a slight
increase
on last year. Overheads
have been reduced but are consistent as a percentage of turnover.
A Smith
Director
25 June 2021
BAINBRIDGE INTERNATIONAL LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 2 -
The directors present their annual report and financial statements for the year ended 30 September 2020.
Principal activities
The principal activity
of the business is the design, manufacture, marketing and distribution of sail cloth and boat fittings.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr J O'Connor
(Resigned 20 July 2020)
A Smith
G Lacey
Results and dividends
The results for the year are set out on page 6.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Financial instruments
Treasury operations and financial instruments
The primary financial risk that the business activities expose the company to is the risk of changes in foreign currency exchange rates.
Liquidity risk
In respect of bank balances, the liquidity risk is managed by maintaining a balance between the continuity of funding and flexibility through the use of invoice discounting. All of the company's cash balances are held in such a way that achieves a competitive rate of interest. The business makes use of money market facilities where funds are available.
Loans comprise loans from financial institutions. The interest rates and monthly repayments are fixed. The business manages the liquidity risk by ensuring that there are sufficient funds to meet the payments.
Credit risk
Trade debtors are managed in respect of credit and cash flow risk by policies concerning the credit offered to customers and the regular monitoring of amounts outstanding for both time and credit limits. The amounts presented in the balance sheet are net of allowances for doubtful debtors.
Trade creditors' liquidity risk is managed by ensuring sufficient funds are available to meet amounts due.
Pricing risk
The directors consider that the company faces the usual pricing risk of any other company operating in a
competitive, commercial environment.
Auditor
The auditors, Fiander Tovell Limited, are deemed to be reappointed under section 487(2) of the Companies Act 2006.
BAINBRIDGE INTERNATIONAL LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 3 -
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
-
select suitable accounting policies and then apply them consistently;
-
make judgements and accounting estimates that are reasonable and prudent;
-
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
-
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
On behalf of the board
A Smith
Director
25 June 2021
BAINBRIDGE INTERNATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BAINBRIDGE INTERNATIONAL LIMITED
- 4 -
Opinion
We have audited the financial statements of Bainbridge International Limited (the 'company') for the year ended 30 September 2020 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity 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 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 company's affairs as at 30 September 2020 and of its 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.
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
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
-
the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
-
the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue
.
The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the
financial statements
does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
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' r
eport 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.
BAINBRIDGE INTERNATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BAINBRIDGE INTERNATIONAL LIMITED
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identifie
d
material misstatements in the strategic report and the directors'
r
eport
.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
-
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
-
the financial statements are not in agreement with the accounting records and returns; or
-
certain disclosures of directors' remuneration specified by law are not made; or
-
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors'
r
esponsibilities
s
tatement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the company
'
s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the
Financial Reporting Council’s website at: http://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.
Andrew Jay ACA FCCA (Senior Statutory Auditor)
for and on behalf of Fiander Tovell Limited
25 June 2021
Chartered Accountants
Statutory Auditor
Stag Gates House
63/64 The Avenue
Southampton
Hampshire
SO17 1XS
BAINBRIDGE INTERNATIONAL LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 6 -
2020
2019
Notes
£
£
Turnover
3
6,840,244
10,617,584
Cost of sales
(5,002,614)
(7,763,894)
Gross profit
1,837,630
2,853,690
Administrative expenses
(2,297,212)
(3,291,769)
Other operating income
336,145
Operating loss
4
(123,437)
(438,079)
Interest payable and similar expenses
7
(5,705)
(8,781)
Loss before taxation
(129,142)
(446,860)
Tax on loss
8
11,560
14,514
Loss for the financial year
(117,582)
(432,346)
The profit and loss account has been prepared on the basis that all operations are continuing operations.
BAINBRIDGE INTERNATIONAL LIMITED
BALANCE SHEET
AS AT
30 SEPTEMBER 2020
30 September 2020
- 7 -
2020
2019
Notes
£
£
£
£
Fixed assets
Tangible assets
9
274,690
308,532
Investments
10
101
101
274,791
308,633
Current assets
Stocks
12
2,384,642
3,145,050
Debtors
13
1,667,639
2,212,335
Cash at bank and in hand
139,981
77,298
4,192,262
5,434,683
Creditors: amounts falling due within one year
14
(2,731,435)
(3,910,142)
Net current assets
1,460,827
1,524,541
Total assets less current liabilities
1,735,618
1,833,174
Creditors: amounts falling due after more than one year
15
(90,065)
(61,215)
Provisions for liabilities
18
(10,476)
(19,300)
Net assets
1,635,077
1,752,659
Capital and reserves
Called up share capital
21
2,343,447
2,343,447
Profit and loss reserves
(708,370)
(590,788)
Total equity
1,635,077
1,752,659
The financial statements were approved by the board of directors and authorised for issue on 25 June 2021 and are signed on its behalf by:
A Smith
Director
Company Registration No. 02354253
BAINBRIDGE INTERNATIONAL LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 8 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 October 2018
2,343,447
(158,442)
2,185,005
Year ended 30 September 2019:
Loss and total comprehensive income for the year
-
(432,346)
(432,346)
Balance at 30 September 2019
2,343,447
(590,788)
1,752,659
Year ended 30 September 2020:
Loss and total comprehensive income for the year
-
(117,582)
(117,582)
Balance at 30 September 2020
2,343,447
(708,370)
1,635,077
BAINBRIDGE INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 9 -
1
Accounting policies
Company information
Bainbridge International Limited is a
private
company
limited by shares
incorporated in England and Wales.
The registered office is
Unit 8, Flanders Park, Flanders Road, Hedge End, Southampton, Hampshire, SO30 2FZ.
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 a
mounts
in these financial statements are
rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares
publicly available consolidated financial statements
, including this company,
which are
intended to give a true and fair view of the assets, liabilities,
financial position and profit or loss
of the group
.
T
he company has
therefore
taken advantage of
e
xemptions from the following disclosure requirements:
- Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
-
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’
:
Interest income/expense and net gains/losses for each category of financial instrument;
basis
of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income
;
-
Section 26 ‘Share based Payment’
:
Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements
;
-
Section 33 ‘Related Party Disclosures’
:
Compensation for key management personnel
.
The financial statements of the company are consolidated in the financial statements of
Blue Strand Marine Limited
. These consolidated financial statements are available from its registered office,
Unit 8 Flanders Park, Hedge End, Southampton, Hampshire, SO30 2FZ.
The company has taken advantage of the exemption under section 400 of the
Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group
.
1.2
Going concern
The financial statements have been prepared on the going concern basis on the assumption that the company will continue for the foreseeable future.
true
Considering recent reported losses and continued trading headwinds in some parts of the business, the directors have reviewed the business structure and overheads and produced a viable plan that sees the company return to profit next year. They are satisfied that with continued close management of working capital and operational spend there is sufficient comfort that the company will be able to meet its ongoing financial obligations.
BAINBRIDGE INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
1
Accounting policies
(Continued)
- 10 -
1.3
Turnover
The turnover shown in the income statement represents amounts invoiced during the year, exclusive of value added tax. Turnover is recognised when the risks and rewards of ownership of stock is transferred to the customer. This occurs when stock is delivered to the customer or is collected by them from the point of sale. As such, invoices are raised on delivery or collection and recognised immediately.
1.4
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
.
1.5
Tangible fixed assets
Tangible fixed assets
are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Leasehold improvements
10% straight line basis
Plant and machinery
10% straight line basis
Fixtures & fittings
25% straight line basis
Computer equipment
20-33% straight line basis
Motor vehicles
20-33% straight line basis
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and
is credited or charged to profit or loss
.
1.6
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
The investments are assessed for impairment at each reporting date
and
any
impairment
losses or reversals of impairment losses are recognised immediately in profit or loss.
1.7
Impairment of fixed assets
At each reporting
period
end date, the
company
reviews the carrying amounts of its tangible
assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
1.8
Stocks
Stocks
are stated at the lower of cost and
estimated selling price less costs to complete and sell.
The AVCO method is applied upon valuation of stock.
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.
BAINBRIDGE INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
1
Accounting policies
(Continued)
- 11 -
1.9
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's
balance sheet
when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset
, with
the net amounts presented in the financial statements
,
when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
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.
Impairment of financial assets
Financial assets, other than those
held
at
fair value through profit and loss
, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected.
If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when
the company
transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
BAINBRIDGE INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
1
Accounting policies
(Continued)
- 12 -
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
paymen
ts 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. A
m
ounts 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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations
expire or are discharged or cancelled.
1.10
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The
company’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the
company
has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
BAINBRIDGE INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
1
Accounting policies
(Continued)
- 13 -
1.12
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.13
Retirement benefits
The company operates a defined contribution scheme for the benefit of its employees. Contributions payable are charged to the profit and loss account in the year they are payable.
1.14
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 the profit and loss account 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 lease
s
asset are consumed.
1.15
Government grants
Government grants
relate to furlough claims and are recognised in the profit and loss account in the same period as the costs to which they relate.
1.16
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation
in the period
are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
BAINBRIDGE INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
2
Judgements and key sources of estimation uncertainty
(Continued)
- 14 -
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are
as follows.
Stock provisions
Stock is held at the lower of cost and net realisable value. Stock is reviewed monthly to evaluate the age and movement of stock items and provision is made for old and slow moving stock. All stock items in excess of one year old, after allowing for 12 months sales, are provisioned on a sliding scale from 25% to 100% of value depending on the age of the stock. The stock provision at the period end was £558,230 (2019: £430,561).
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2020
2019
£
£
Turnover
Sale of goods
6,840,244
10,617,584
Other significant revenue
Furlough income received
167,678
-
Rental income
120,000
-
In the opinion of the directors the disclosure of turnover attributable to geographical markets outside the United Kingdom would be seriously prejudicial to the interest of the company and has therefore not been provided.
4
Operating loss
2020
2019
Operating loss for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
(19,496)
49,598
Research and development costs
453
6,803
Fees payable to the company's auditor for the audit of the company's financial statements
9,000
12,030
Depreciation of owned tangible fixed assets
31,003
39,897
Depreciation of tangible fixed assets held under finance leases
28,681
28,681
Profit/(loss) on disposal of tangible fixed assets
(1,729)
1,686
Operating lease charges
340,119
354,818
BAINBRIDGE INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 15 -
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2020
2019
Number
Number
Manufacturing, sales and distribution staff
38
47
Office management staff
3
5
Total
41
52
Their aggregate remuneration comprised:
2020
2019
£
£
Wages and salaries
1,065,577
1,453,840
Social security costs
98,532
133,694
Pension costs
36,046
65,457
1,200,155
1,652,991
6
Directors' remuneration
2020
2019
£
£
Remuneration for qualifying services
156,518
338,338
Company pension contributions to defined contribution schemes
6,694
27,502
163,212
365,840
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2019 - 3).
Remuneration disclosed above include the following amounts paid to the highest paid director:
2020
2019
£
£
Remuneration for qualifying services
n/a
89,112
As total directors' remuneration was less than £200,000 in the current year, no disclosure is provided for that year.
BAINBRIDGE INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 16 -
7
Interest payable and similar expenses
2020
2019
£
£
Interest on bank overdrafts and loans
61
Interest on finance leases and hire purchase contracts
5,705
8,720
5,705
8,781
8
Taxation
2020
2019
£
£
Deferred tax
Origination and reversal of timing differences
(8,824)
(14,514)
Adjustment in respect of prior periods
(2,736)
Total deferred tax
(11,560)
(14,514)
The actual credit for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
2020
2019
£
£
Loss before taxation
(129,142)
(446,860)
Expected tax credit based on the standard rate of corporation tax in the UK of 19.00% (2019: 19.00%)
(24,537)
(84,903)
Tax effect of expenses that are not deductible in determining taxable profit
4,365
(2,129)
Change in unrecognised deferred tax assets
8,557
70,811
Research and development tax credit
(2,216)
Deferred tax adjustment in respect of change in tax rates
2,271
1,707
Taxation credit for the year
(11,560)
(14,514)
BAINBRIDGE INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 17 -
9
Tangible fixed assets
Leasehold improvements
Plant and machinery
Fixtures & fittings
Computer equipment
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 October 2019
357,776
235,868
36,763
224,102
62,339
916,848
Additions
5,221
20,124
895
26,240
Disposals
(1,010)
(15,479)
(16,489)
At 30 September 2020
362,997
255,992
36,763
223,987
46,860
926,599
Depreciation and impairment
At 1 October 2019
131,050
175,215
35,492
221,535
45,024
608,316
Depreciation charged in the year
36,266
14,070
1,269
1,282
6,797
59,684
Eliminated in respect of disposals
(1,010)
(15,081)
(16,091)
At 30 September 2020
167,316
189,285
36,761
221,807
36,740
651,909
Carrying amount
At 30 September 2020
195,681
66,707
2
2,180
10,120
274,690
At 30 September 2019
226,726
60,653
1,271
2,567
17,315
308,532
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2020
2019
£
£
Leasehold Improvements
118,514
140,772
Motor vehicles
9,845
16,267
128,359
157,039
10
Fixed asset investments
2020
2019
Notes
£
£
Investments in subsidiaries
11
101
101
BAINBRIDGE INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
10
Fixed asset investments
(Continued)
- 18 -
Movements in fixed asset investments
Shares in group undertakings
£
Cost or valuation
At 1 October 2019 & 30 September 2020
101
Carrying amount
At 30 September 2020
101
At 30 September 2019
101
11
Subsidiaries
These financial statements are separate company financial statements for Bainbridge International Limited.
Details of the company's subsidiaries at 30 September 2020 are as follows:
Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Aqua-Marine International Limited
England and Wales
Dormant
Ordinary
100.00
Bainbridge Marine Limited
England and Wales
Dormant
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)
£
£
Aqua-Marine International Limited
1
Bainbridge Marine Limited
100
12
Stocks
2020
2019
£
£
Finished goods and goods for resale
2,384,642
3,145,050
Impairment losses of £148,432 (2019: £64.290) have been recognised on stock.
BAINBRIDGE INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 19 -
13
Debtors
2020
2019
Amounts falling due within one year:
£
£
Trade debtors
965,208
1,443,071
Amounts owed by group undertakings
594,600
592,600
Other debtors
18,582
38,577
Prepayments and accrued income
89,249
138,087
1,667,639
2,212,335
Trade debtors disclosed above are measured at amortised cost.
14
Creditors: amounts falling due within one year
2020
2019
Notes
£
£
Bank loans
16
1,099,207
1,925,346
Obligations under finance leases
17
51,068
51,068
Other borrowings
16
2,500
Trade creditors
1,192,298
1,584,346
Taxation and social security
79,432
38,958
Other creditors
65
5,929
Accruals and deferred income
306,865
304,495
2,731,435
3,910,142
15
Creditors: amounts falling due after more than one year
2020
2019
Notes
£
£
Obligations under finance leases
17
15,852
61,215
Other borrowings
16
47,500
Taxation and social security
26,713
90,065
61,215
BAINBRIDGE INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 20 -
16
Loans and overdrafts
2020
2019
£
£
Bank loans
1,099,207
1,925,346
Other loans
50,000
1,149,207
1,925,346
Payable within one year
1,101,707
1,925,346
Payable after one year
47,500
Bank loans and overdrafts are secured by a fixed and floating charge over the assets of the company and over £548,925 (2019: £854,237) of the stock held in the company.
17
Finance lease obligations
2020
2019
Future minimum lease payments due under finance leases:
£
£
Within one year
51,068
51,068
In two to five years
15,852
61,215
66,920
112,283
Finance lease payments represent rentals payable by the company for certain leasehold improvements and motor vehicles. 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 5 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
Obligations under finance leases are secured over the assets to which they relate.
18
Provisions for liabilities
2020
2019
Notes
£
£
Deferred tax liabilities
19
10,476
19,300
BAINBRIDGE INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 21 -
19
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2020
2019
Balances:
£
£
Accelerated capital allowances
46,576
45,961
Other short term timing differences
(36,100)
(26,661)
10,476
19,300
2020
Movements in the year:
£
Liability at 1 October 2019
19,300
Credit to profit or loss
(8,824)
Liability at 30 September 2020
10,476
20
Retirement benefit schemes
2020
2019
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
36,046
65,457
The company operates a defined contribution pension scheme for all qualifying employees.
The assets of the scheme are held separately from those of the company in an independently administered fund.
21
Share capital
2020
2019
£
£
Ordinary share capital
Issued and fully paid
2,343,447 ordinary shares of £1 each
2,343,447
2,343,447
22
Financial commitments, guarantees and contingent liabilities
Lloyds Bank
PLC holds guarantees in favour of HMRC for £
45,000
(201
9
: £
45,000
).
BAINBRIDGE INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 22 -
23
Operating lease commitments
Lessee
Operating lease payments represent rentals payable by the company for certain of its properties, vehicles and office equipment.
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2020
2019
£
£
Within one year
355,626
338,283
Between two and five years
1,333,828
1,280,118
In over five years
316,879
1,689,454
1,935,280
Lessor
At the reporting end date the company had contracted with tenants for the following minimum lease payments:
2020
2019
£
£
Within one year
120,000
Between two and five years
474,411
594,411
24
Related party transactions
During the year the company operated an interest free loan account with its parent company, Blue Strand Marine Limited. At the balance sheet date £592,610 (2019: £592,600) was owed to the company.
25
Ultimate controlling party
The parent company is Blue Strand Marine Limited. The ultimate controlling party is Andrew Smith by virtue of his shareholding in Blue Strand Marine Limited.
The results of Bainbridge International Limited are consolidated into the accounts for Blue Strand Marine Limited, a company incorporated in England & Wales. The address for Blue Strand Marine Limited is the same as for Bainbridge International Limited. Copies of the consolidated accounts can be obtained from Companies House.
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