The directors present the strategic report for the year ended 30 September 2021.
Principal activities
The principal activity of the group continued to be that of international trading in coffee , consumables , edible nuts and fruits.
The Key Performance Indicators of the group over the last two years are detailed below:
2021 20 20
Turnover (GBP £'000) 211,003 358,934
Gross profit % 5.56 5.70
Net profit % before tax 3.05 4.26
Net assets (GBP £'000) 43,910 39,033
The results for the year are lower than the prior year as the group had an exceptional year in 2020. The results and the financial position at the year end were considered satisfactory by the directors who expect to improve on these in the foreseeable future.
Turnover has seen a decrease of 41.21% during the year. Gross profit margins have decreased slightly from 5.70% in 2020 to 5.56% in the year. The net profit margin before tax and dividends also decreased from 4.2 6 % in 2020 to 3.05% in the year. This is principally due to the decrease in turnover combined with an increase in administrative expenses.
The group is in a strong financial position at the balance sheet date with net assets having increased by 12.49% over the course of the financial year. The directors hope to further improve upon this in order to increase group growth and enhance reported results in future years.
The principal risks and uncertainties facing Loudwater Trade and Finance Limited are:
Financial instruments
The group's principal financial instruments comprise bank loans, overdrafts and trade payables. The main purpose of these financial instruments is to raise finance for the group's operations. The group has various other financial assets such as trade receivables, cash and short-term deposits which arise directly from its operations.
The main risks arising from the group's financial instruments are credit risk, liquidity risk, foreign currency exposure and interest rate risk. The Board reviews and agrees policies for managing each of these risks and they are summarised below.
Credit risk
The group's credit risk is primarily attributable to its customers. The group performs ongoing credit evaluations of its customers and to date has not experienced any material losses.
Liquidity risk
Liquidity risk arises in relation to the group's management of working capital and the risk that the group will encounter difficulties in meeting financial obligations as and when they fall due. To minimise this risk, the liquidity position and ongoing working capital requirements are regularly reviewed by the directors.
Foreign currency exposure
The group is subject to foreign exchange risks as it sells to and purchases from various countries. Group management regularly monitors its foreign exchange risk and attempts to limit such risks by managing its cash and credit positions. In addition forward exchange contracts are used to hedge against currency risk.
Interest rate risk
The group finances its operations through equity, bank financing and working capital. The group is subject to interest rate risks. This is mitigated by continually monitoring the rates available to the group.
Brexit risk
The group trades with entities based in the European Union and the exit therefrom poses a risk for the group. This is mitigated by the loyal customer base with which the group has traded with for a number of years. The group's management are monitoring the situation and will respond as necessary.
Coronavirus pandemic risk
The group is subject to the risk arising from market uncertainty due to the worldwide outbreak of C oronavirus . At various times the UK Government imposed restrictions that have since been lifted. Similarly, governments across the world have imposed various restrictions to deal with the pandemic. This can impact the group's chain of supply and deliveries. The group's management monitors the situation and responds to changes as necessary.
Development and performance
The directors consider the results for the year and the financial position at the year end to be encouraging as the group results indicate continued profit year on year.
Interests of members of the group
The company is a private company and a parent of Loudwater Management Limited, GMH Trading Limited and Loudwater Med Limited. The group has two directors, both having representation on the Board. The day-to-day operations of the group are managed by the directors who are closely involved in the activities of the group and provide day-to-day support as and when required.
In common with many private companies the interests of the Board and the ultimate shareholders are broadly aligned, in that the group should create value by generating strong and sustainable results.
Board decisions during the year
Dividends of £668,950 were voted and paid in the year.
During the year we have aimed to continue our position in the market and have managed to navigate successfully around various obstacles such as the global C oronavirus pandemic.
No other major board decisions were made during the year.
The interests of employees
We continue to focus on training and supporting our employees in the understanding that a well informed and trained workforce is essential for the group’s ongoing success. We hold regular staff meetings, attended by members of the Board. We encourage feedback from our staff and where possible and practical implement suggestions made to improve our procedures and to improve our working environment.
The average number of staff in the group for the year was 28 (2020: 25).
We consider that we offer our employees competitive remuneration packages.
The interests of our customers
We have developed and maintained unique relationships with our customers, and we do this by engaging with our customers, ensuring our prices remain competitive, deliveries maintained to a high standard and implement recommendations made by our customers. The success of this is highlighted by the loyalty shown by our customers over the years.
The interests of our suppliers
Due to the nature of our activities many of the group's suppliers are based overseas. We maintain regular contact with our suppliers to plan delivery schedules and receive feedback. However due to the geographical spread of our suppliers, much of the communication is carried out by email or telephone calls. Where possible we meet with our suppliers to inspect crops, plan delivery schedules and receive feedback.
We continue to endeavour to pay all our suppliers promptly and within the terms agreed. Some of our suppliers are also our customers, therefore we have tailored agreements on some of the transactions.
The impact of the company’s operations on the community and the environment
We exclusively procure our goods from suppliers who best meet the quality, price and food safety criteria expected by our buyers. The product is inspected, shipped and delivered to customers’ premises or their nominated stores across five continents. We have no agency or other exclusivity agreement and we are completely free to seek out the best source of supply to meet our customers' requirements. Our experience over many years has shaped a depth of knowledge and understanding of origin, its suppliers and business practices as well as of inspection, storage and transit requirements which make us uniquely positioned to effectively meet our customers’ needs.
Many of our suppliers have carbon offset programmes. We encourage all our suppliers to take steps to be as energy efficient as possible.
Group members are also members of Synergy Compliance, a Packaging Compliance scheme registered under the Producer Responsibility Obligations (Packaging Waste) Regulations 2007.
The group are also avid charitable supporters and have made donations to UK registered charities in the year totalling £809,273.
Maintaining a reputation for high standards of business conduct
We are committed to maintaining a reputation of high standards of business conduct. We have an ethics policy for all employees to follow and review this annually. Each year we consider and approve our modern slavery statement which explains the activities we have taken to demonstrate our commitment to seeking to ensure that there is no slavery, forced labour or human trafficking within any part of our business or supply chains. Our statement can be found on our website at www.loudwateruk.com.
On behalf of the board
The directors present their annual report and financial statements for the year ended 30 September 2021.
The results for the year are set out on page 12.
Ordinary dividends were paid amounting to £668,950. The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
The current year's results are more in line with 2019. The directors expect growth in the present level of turnover and profits for the foreseeable future.
The auditor, RDP Newmans LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
We have followed the 2019 HM Government Environmental Reporting Guidelines. We have also used the GHG Reporting Protocol – Corporate Standard and have used the 2020 UK Government’s Conversion Factors for Company Reporting.
The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per site, the recommended ratio for the sector.
We have audited the financial statements of Loudwater Trade and Finance Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 September 2021 which comprise 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).
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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.
Other information
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' 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.
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 identifie d 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.
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 group's and parent company ' s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group and company or to cease operations, or have no realistic alternative but to do so.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an 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 .
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
we identified the laws and regulations applicable to the group through discussions with directors and other management, and from our commercial knowledge and experience of the sector;
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the group , including the Companies Act 2006, taxation legislation and data protection, anti-bribery, employment, environmental and health and safety legislation;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the group ’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.
To address the risk of fraud through management bias and override of controls, we:
performed analytical procedures to identify any unusual or unexpected relationships;
reviewed and tested journal entries to identify unusual transactions and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business;
assessed whether judgements and assumptions made in determining the accounting estimates set out in note 2 were indicative of potential bias; and
investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
reviewing and agreeing financial statement disclosures and testing to underlying supporting documentation;
enquiring of management as to actual and potential litigation and claims; and
reviewing correspondence with HMRC and bankers.
No instances of material non-compliance were identified. However, the likelihood of detecting irregularities, including fraud, is limited by the inherent difficulty in detecting irregularities, the effectiveness of the entity’s controls, and the nature, timing and extent of the audit procedures performed. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
A further description of our responsibilities 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.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in 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.
As permitted by s408 Companies Act 2006, the c ompany has not presented its own statement of comprehensive income and related notes. The c ompany’s profit for the year was £4,538,439 (2020 - £11,817,290 ).
Loudwater Trade and Finance Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales . The registered office is Honeypot House, 56a Crewys Road, London, NW2 2AD.
The group consists of Loudwater Trade and Finance Limited and all of its subsidiaries.
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.
The consolidated financial statements incorporate those of Loudwater Trade and Finance Limited and all of its subsidiaries (ie entities that the g roup controls through its power to govern the financial and operating policies so as to obtain economic benefits). Subsidiaries acquired during the year are consolidated using the purchase method. Their results are incorporated from the date that control passes.
All financial statements are made up to 30 September 2021 . 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 g roup.
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.
Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.
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.
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. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buye r , 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.
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 .
Equity in vest ments 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.
I n 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.
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 g roup’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 c ompany financial statements, investments in associates are accounted for at cost less impairment.
Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities .
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.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
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 classified and accounted for according to the substance of the contractual arrangement, as either financial assets, financial liabilities or forward commitments associated with commodity sales.
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, 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 m ethod 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, 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.
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.
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.
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.
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. 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.
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 remeasured 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 though 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.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
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.
The tax expense represents the sum of the tax currently payable and deferred 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.
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.
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.
Government grants are recognised at the fair value of the asset receive d or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met . Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable . A grant received before the recognition criteria are satisfied is recognised as a liability.
Transactions in foreign currencies are translated at the exchange rate ruling at the date of the transaction or, where forward foreign currency contracts have been taken out, at contractual rates. Monetary assets and liabilities are retranslated at the rates of exchange ruling at the balance sheet date. Exchange gains and losses are taken to the profit and loss account.
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.
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
The directors have assessed the impact of the Coronavirus pandemic on the group and are of the opinion that, despite there being a short term impact on the business, this should not materially impact the group in the long term.
An analysis of the group's turnover is as follows:
In the opinion of the directors it would be seriously prejudicial to the interest of the group to disclose the particulars of the turnover of the company. Consequently, in accordance with the provisions of the Companies Act 2006, the directors have not disclosed the particulars of turnover.
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
Investment income includes the following:
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:
Details of the company's subsidiaries at 30 September 2021 are as follows:
Registered office addresses (all UK unless otherwise indicated):
Loudwater Management Limited is the parent company of Barrow, Lane & Ballard Limited, whose principal activity is that of import, export and distribution of edible nuts and dry fruits.
Details of associates at 30 September 2021 are as follows:
Longson - BLB Company Limited is an associate company of Barrow,Lane & Ballard Limited.
The bank borrowings of the group of £31,378,722 (2020: £ 2 6,123,385) are secured by way of a mortgage debenture and fixed and floating charges over the group's property and assets.
The bank borrowings of the company of £8,273,578 (2020: £7,248,221) are secured by way of a mortgage debenture and fixed and floating charges over the company's property and assets.
Included within the company borrowings are:
A mortgage with Barclays Bank PLC. The balance outstanding at the year end was £151,010 (2020: £183,500) and is payable by May 2026. The mortgage has a variable interest rate of 1.5% above the Bank of England base rate.
A loan with Mizrahi Tefahot Bank Ltd. The balance outstanding at the year end was £nil (2020: £225,000). The loan has a variable interest rate of 3% above the bank's three month sterling LIBOR rate.
A short term loan with Mizrahi Tefahot Bank Ltd. The balance outstanding at the year end was £nil (2020: £100,000). The loan has a variable interest rate of 2% above the bank's three month sterling LIBOR rate.
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:
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.
The Ordinary A and B shares constitute different classes of shares for the purposes of the Companies Act 2006. The Ordinary A shares and B shares rank pari passu in all respects except that the directors are empowered to declare dividends to any one or more of the share categories separately.
The group has a customs guarantee agreement to the value of £100,000. Given the financial position and operating policies of the group, the guarantee is not expected to be called upon.
Subsequent to the year end Loudwater Trade and Finance Limited disposed of its holding in Loudwater Management Limited.
Dividends totalling £668,950 (2020: £1,233,736) were paid in the year in respect of shares held by the company's directors.
The company's key management personnel are considered to be the directors. Their remuneration during the year is shown in note 7.
All of these companies are incorporated in England and Wales and related by virtue of having common directors.
Africa Textiles Limited
Atlantix Commodities (UK) Limited
Aventrix Limited
Citywell Corporation Ltd
Crewys Estates Ltd
EMO (MAU) Limited
Katfort Trading Limited
Leigh Nominees Limited
Project P Ltd
Stanmau Limited
Stanmir Ltd
Stanpark Estates Ltd
The Highland Egg Company Limited
Wayridge Properties Ltd
Atlantix Commodities LLC (incorporated in USA) and Continental Supply BV (incorporated in Netherlands) are entities related by virtue of having common directors.
Discount My Fashion (Pty) Limited, incorporated in South Africa, a subsidiary of Africa Textiles Limited, a company in which Mr S S Stimler and Mr M Stimler are the directors and shareholders. Cardona Investments 374 (Proprietary) Limited is a shareholder of Discount My Fashion (Pty) Ltd.
Longson - BLB (UK) Limited, incorporated in England and Wales, a subsidiary of Barrow,Lane & Ballard Limited.
Longson - BLB Company Limited, incorporated in Vietnam, an associate of Barrow,Lane & Ballard Limited.
The Loudwater 2 Pension Scheme.
The group has taken advantage of the exemption available in FRS 102 Section 33.1A "Related party disclosures" whereby it has not disclosed transactions with any wholly owned subsidiary undertaking.
During the year, the group made sales of £557,465 (2020: £4,440,687) to Cardona Investments 374 (Proprietary) Limited. Included within trade debtors is an amount of £43,514 (2020: £2,342,073) due from Cardona Investments 374 (Proprietary) Limited.
Included within other debtors are the following amounts due from:
|
|
2021 |
2020 |
|
|
£ |
£ |
Africa Textiles Limited |
|
55,973 |
nil |
Atlantix Commodities (UK) Limited |
|
30,479 |
25,379 |
Atlantix Commodities LLC |
|
2,805,023 |
2,890,416 |
Aventrix Limited |
|
691,402 |
889,693 |
Citywell Corporation Ltd |
|
1,626 |
1,626 |
Continental Supply BV - Netherlands |
|
12,575 |
nil |
Crewys Estates Ltd |
|
268,859 |
nil |
Discount my Fashion (Pty) Limited |
|
25,498 |
nil |
EMO (MAU) Limited |
|
1,479 |
440 |
The Highland Egg Company Limited |
|
220,504 |
266,653 |
Katfort Trading Limited |
|
21,701 |
8,548 |
Leigh Nominees Limited |
|
750 |
nil |
Loudwater 2 Pension Scheme |
|
162,500 |
nil |
Project P Ltd |
|
1,154,098 |
nil |
Stanmau Limited |
|
2,626,825 |
804,274 |
Stanmir Ltd |
|
260,000 |
260,000 |
Stanpark Estates Ltd |
|
85,218 |
nil |
Wayridge Properties Ltd |
|
2,726,365 |
nil |
|
|
|
|
|
|
|
|
Included within other creditors are the following amounts due to: |
|
||
|
|
2021 |
2020 |
|
|
£ |
£ |
Africa Textiles Limited |
|
nil |
18,583 |
Atlantix Commodities (UK) Limited |
|
278,944 |
291,518 |