REGISTERED NUMBER: |
Strategic Report, Report of the Directors and |
Financial Statements for the Year Ended 31st December 2022 |
for |
F2 CHEMICALS LIMITED |
REGISTERED NUMBER: |
Strategic Report, Report of the Directors and |
Financial Statements for the Year Ended 31st December 2022 |
for |
F2 CHEMICALS LIMITED |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Contents of the Financial Statements |
for the Year Ended 31st December 2022 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 4 |
Report of the Independent Auditors | 6 |
Income Statement | 10 |
Other Comprehensive Income | 11 |
Balance Sheet | 12 |
Statement of Changes in Equity | 13 |
Cash Flow Statement | 14 |
Notes to the Cash Flow Statement | 15 |
Notes to the Financial Statements | 16 |
F2 CHEMICALS LIMITED |
Company Information |
for the Year Ended 31st December 2022 |
DIRECTORS: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
SENIOR STATUTORY AUDITOR: |
AUDITORS: |
Statutory Auditor |
Chartered Certified Accountants |
41 St Thomas's Road |
Chorley |
Lancashire |
PR7 1JE |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Strategic Report |
for the Year Ended 31st December 2022 |
The directors present their strategic report for the year ended 31st December 2022. |
REVIEW OF BUSINESS |
The company has achieved an increase in turnover of 14% during 2022. The increase is in the main due to significant increases in demand for both liquid and gas products predominantly from the UK and North America. |
Operating margin is consistent with last year despite the increased operating costs that the company has incurred |
with inflation in raw materials, payroll and energy costs. |
The company continues to receive full support from its parent company, Resonac Corporation (name change from Showa Denko KK in January 2023). |
KEY PERFORMANCE INDICATORS ("KPI") |
The directors monitor progress on the company's strategy by reference to the following KPI's: |
KPI | 2022 | 2021 |
Sales growth/(decline) (%) | 14 | 16 |
Operating margin (%) | 14 | 14 |
ENVIRONMENTAL AND OTHER RISKS |
The company continues to closely monitor and evaluate, environmental, and other, regulatory matters which could have a major impact on its activities. |
The company is keen to eliminate all injuries, occupational illnesses, unsafe practices and incidents of environmental harm from our activities. The health and safety of its employees, the local community and the environment is the number one priority of F2 Chemicals Ltd. |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Strategic Report |
for the Year Ended 31st December 2022 |
PRINCIPAL RISKS AND UNCERTAINTIES |
FINANCIAL RISK MANAGEMENT |
The company's operations expose it to a variety of financial risks that include the effects of credit risk and liquidity risk. The company has in place a risk management programme that seeks to limit the adverse effects on the financial performance of the company. |
Credit risk: |
The company enacts policies that require appropriate credit checks on both potential customers and suppliers before sales/purchases are made. |
Liquidity risk: |
The company actively maintains short term debt finance that is designed to ensure the company has sufficient funds for operations.The movement in short term borrowings is the repayment of short term debt surplus to the company's working capital requirement. |
Foreign exchange risk: |
The company operates foreign currency bank accounts and also deals with both buying and selling products in a range of currencies. |
Brexit: |
In 2022 sales to Europe accounted for 40.4% of turnover (2021: 43.3%). Indications from the customer base in Europe is that demand for the products remains strong. The impact of Brexit has created logistical and administrative complications for both distributing product and importing raw materials, these issues abated to some degree. The changes do not appear to have impacted the appetite to trade with Europe. |
The company seeks to reduce risk by diversifying and has continued to take advantage of opportunities and partnerships outside the EC. This has been reflected in sales to Asian regions, which total almost £2m in 2022. Sales to Asian countries account for 14.55% of the company's total sales and remained strong despite the impact of the embargo on sales to Russia and Ukraine. This compares to 25.5% of sales to Asia in 2021. |
BUSINESS MODEL |
The company's business model is to sell speciality fluorochemical products into specialist niche markets both domestically and internationally. Shareholder value for the sole shareholder is generated by the supply of high added value products in a diverse range of markets. In 2022, 87% (2021: 93%) of the company's sales were for export. |
ON BEHALF OF THE BOARD: |
17th May 2023 |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Report of the Directors |
for the Year Ended 31st December 2022 |
The directors present their report with the financial statements of the company for the year ended 31st December 2022. |
PRINCIPAL ACTIVITIES |
The Company's principal activities during the twelve months continued to be the manufacture and supply of perfluorocarbon products using cobalt fluoride technology and other fluorine containing organic chemicals principally using its selective direct fluorination technology. |
DIVIDENDS |
No dividends will be distributed for the year ended 31st December 2022. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1st January 2022 to the date of this report. |
Other changes in directors holding office are as follows: |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations. |
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and 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 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. |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Report of the Directors |
for the Year Ended 31st December 2022 |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
ON BEHALF OF THE BOARD: |
Report of the Independent Auditors to the Members of |
F2 Chemicals Limited |
Opinion |
We have audited the financial statements of F2 Chemicals Limited (the 'company') for the year ended 31st December 2022 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 31st December 2022 and of its 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. |
Basis for opinion |
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the 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 company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. |
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. |
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. |
Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of the audit: |
- | the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
Report of the Independent Auditors to the Members of |
F2 Chemicals Limited |
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 identified material misstatements in the Strategic Report or the Report of the Directors. |
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | adequate accounting records have not been kept, 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 Statement of Directors' Responsibilities set out on page four, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. |
In preparing the financial statements, the directors are responsible for assessing the 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. |
Report of the Independent Auditors to the Members of |
F2 Chemicals Limited |
Auditors' responsibilities for the audit of the financial statements |
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
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 company through discussions with directors and other management, and from our commercial knowledge and experience of the chemical products 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 company, including the Companies Act 2006, taxation legislation and data protection, REACH regulations, anti-bribery, employment, environmental regulations 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 company’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; |
- tested journal entries to identify unusual transactions; |
- assessed whether judgements and assumptions made in determining the accounting estimates set out in note 3 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: |
- agreeing financial statement disclosures to underlying supporting documentation; |
- reading the minutes of meetings of those charged with governance; |
- enquiring of management as to actual and potential litigation and claims; and |
- reviewing correspondence with HMRC, relevant regulators including the Health and Safety Executive, and the company’s legal advisors. |
There are inherent limitations in our audit procedures described above. 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 www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
Report of the Independent Auditors to the Members of |
F2 Chemicals Limited |
Use of our report |
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed. |
for and on behalf of |
Statutory Auditor |
Chartered Certified Accountants |
41 St Thomas's Road |
Chorley |
Lancashire |
PR7 1JE |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Income Statement |
for the Year Ended 31st December 2022 |
31.12.22 | 31.12.21 |
Notes | £ | £ | £ | £ |
TURNOVER | 3 |
Raw materials and consumables |
Staff costs | 4 |
Depreciation |
Other operating expenses |
4,870,011 | 5,073,098 |
OPERATING PROFIT | 6 |
Interest receivable and similar income | 7 |
Interest payable and similar expenses | 8 | ( |
) | ( |
) |
PROFIT BEFORE TAXATION |
Tax on profit | 9 |
PROFIT FOR THE FINANCIAL YEAR |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Other Comprehensive Income |
for the Year Ended 31st December 2022 |
31.12.22 | 31.12.21 |
Notes | £ | £ |
PROFIT FOR THE YEAR |
OTHER COMPREHENSIVE INCOME |
Remeasurements on Pensions scheme | ( |
) | ( |
) |
Income tax relating to other comprehensive income |
OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX |
( |
) |
( |
) |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Balance Sheet |
31st December 2022 |
31.12.22 | 31.12.21 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 11 |
Tangible assets | 12 |
CURRENT ASSETS |
Stocks | 13 |
Debtors | 14 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 15 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
PROVISIONS FOR LIABILITIES | 17 |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 18 |
Retained earnings | 19 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Statement of Changes in Equity |
for the Year Ended 31st December 2022 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1st January 2021 | ( |
) |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - |
Balance at 31st December 2021 |
Changes in equity |
Total comprehensive income | - |
Balance at 31st December 2022 |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Cash Flow Statement |
for the Year Ended 31st December 2022 |
31.12.22 | 31.12.21 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 |
Interest paid | ( |
) | ( |
) |
Pension contribution excess | ( |
) | ( |
) |
Tax paid | ( |
) | ( |
) |
Net cash from operating activities |
Cash flows from investing activities |
Purchase of tangible fixed assets | ( |
) | ( |
) |
Interest received |
Net cash from investing activities | ( |
) | ( |
) |
Cash flows from financing activities |
Capital repayments in year | ( |
) |
Dividends paid in year | ( |
) |
Net cash from financing activities | ( |
) | ( |
) |
(Decrease)/increase in cash and cash equivalents | ( |
) |
Cash and cash equivalents at beginning of year |
2 |
3,141,963 |
Cash and cash equivalents at end of year | 2 | 1,857,811 | 3,268,154 |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Notes to the Cash Flow Statement |
for the Year Ended 31st December 2022 |
1. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
31.12.22 | 31.12.21 |
£ | £ |
Profit before taxation |
Depreciation charges |
Finance costs | 4,923 | 16,971 |
Finance income | (5,338 | ) | (910 | ) |
2,479,942 | 2,295,143 |
(Increase)/decrease in stocks | ( |
) |
Increase in trade and other debtors | ( |
) | ( |
) |
Increase/(decrease) in trade and other creditors | ( |
) |
Cash generated from operations |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 31st December 2022 |
31.12.22 | 1.1.22 |
£ | £ |
Cash and cash equivalents | 1,857,811 | 3,268,154 |
Year ended 31st December 2021 |
31.12.21 | 1.1.21 |
£ | £ |
Cash and cash equivalents | 3,268,154 | 3,141,963 |
3. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1.1.22 | Cash flow | At 31.12.22 |
£ | £ | £ |
Net cash |
Cash at bank | 3,268,154 | (1,410,343 | ) | 1,857,811 |
3,268,154 | ( |
) | 1,857,811 |
Total | 3,268,154 | (1,410,343 | ) | 1,857,811 |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Notes to the Financial Statements |
for the Year Ended 31st December 2022 |
1. | STATUTORY INFORMATION |
F2 Chemicals Limited is a |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Revenue recognition |
Turnover is the value of goods, net of value added tax, provided to customers during the year. |
Revenue is recognised when the following conditions are satisfied: |
-the company has transferred to the buyer the significant risks and rewards of ownership of the goods |
-the amount of revenue and related costs can be measured reliably |
Intangible assets |
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. |
Tangible fixed assets |
Depreciation is provided on all tangible fixed assets at rates calculated to write off the cost, less estimated residual value, of each assets evenly over its expected useful life, as follows: |
Flutec plant | - | 6.6% straight line |
Leasehold Improvements | - | 6.6% straight line |
Research laboratory | - | 10% straight line |
Plant and equipment | - | 20% straight line |
Office equipment, fixtures and fittings | - | 10% straight line |
Computer equipment | - | 33% straight line |
Motor vehicles | - | 25% straight line |
Impairment of assets |
At each reporting date fixed assets are reviewed to determine whether there is any indication that those assets have suffered an impairment loss. If there is an indication of possible impairment, the recoverable amount of any affected asset is estimated and compared with its carrying amount. If estimated recoverable amount is lower, the carrying amount is reduced to its estimated recoverable amount, and an impairment loss is recognised immediately in profit or loss. |
If an impairment loss subsequently reverses, the carry amount of the asset is increased to the revised estimate of its recoverable amount, but not in excess of the amount that would have been determined had no impairment loss been recognised for the asset in prior years. A reversal of an impairment loss is recognised immediately in profit or loss. |
Stocks |
Stocks are stated at the lower of cost and net realisable value. Cost includes all costs incurred in bringing each product to its present location and condition and, where appropriate, attributable overheads based on a normal level of activity. Net realisable value is based on estimated selling price less any further costs expected to be incurred to completion and disposal. |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Notes to the Financial Statements - continued |
for the Year Ended 31st December 2022 |
2. | ACCOUNTING POLICIES - continued |
Financial instruments |
The company has elected to apply the provisions of Section 11 'Basic Financial Instruments' and Section 12 'Other Financial Instruments' of FRS 102 to all 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. |
Financial assets: |
Basic financial assets, which include debtors, loans to common controlled companies and cash and bank balances, are initially measured at transaction price including transaction costs. They 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: |
All the company's financial assets fall to be classified as basic financial assets under Section 11 of FRS 102 and the company therefore holds no other financial assets. |
Financial liabilities: |
Basic financial liabilities, including creditors, 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 receipts 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: |
All the companies financial liabilities fall to be classified as basic financial liabilities under Section 11 of FRS 102 and the company therefore has no other financial instruments. |
Research and development |
Research and development expenditure on projects not specifically recoverable directly from customers is written off as incurred. |
Foreign currencies |
Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the balance sheet date. Exchange differences are taken to the profit and loss account. |
Hire purchase and leasing commitments |
Rentals payable under operating leases are charged in the profit and loss account on a straight line basis over the lease term. |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Notes to the Financial Statements - continued |
for the Year Ended 31st December 2022 |
2. | ACCOUNTING POLICIES - continued |
Pensions |
The company operates a defined benefit pension scheme that requires contributions to be made to a separately administered fund. The contributions to this fund are based on independent actuarial valuations designed to secure the benefits as set out in the rule. Contributions are charged in the profit and loss account so as to spread the cost of the employees' working lives with the company. The regular cost is attributed to individual years using a projected unit credit method. Variations in pension cost, which are identified as a result of actuarial valuations, are amortised over the average expected remaining working lives of employees in proportion to their expected payroll costs. |
In October 2009 the defined benefit pension scheme was closed to new entrants for new employees eligible for pension contributions and the company makes payments to employees individual private pension plans. |
On the 31st December 2015, the pension scheme was closed with the remaining liability to be paid off by the company in the subsequent years. |
Cash and cash equivalents |
Cash and cash equivalents includes cash in hand, deposits held with banks, and bank overdrafts. Bank overdrafts, when applicable, are shown within borrowings in current liabilities. |
3. | TURNOVER |
The turnover and profit before taxation are attributable to the principal activities of the company. |
An analysis of turnover by geographical market is given below: |
31.12.22 | 31.12.21 |
£ | £ |
United Kingdom |
Europe |
United States of America |
Other | 2,166,359 | 3,231,604 |
4. | EMPLOYEES AND DIRECTORS |
31.12.22 | 31.12.21 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
31.12.22 | 31.12.21 |
Manufacturing | 28 | 29 |
Administration | 16 | 15 |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Notes to the Financial Statements - continued |
for the Year Ended 31st December 2022 |
5. | DIRECTORS' EMOLUMENTS |
31.12.22 | 31.12.21 |
£ | £ |
Directors remuneration | 121,101 | 113,742 |
6. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
31.12.22 | 31.12.21 |
£ | £ |
Other operating leases |
Depreciation - owned assets |
Patents and licences amortisation |
Audit services |
Pension scheme audit services |
Foreign exchange differences | ( |
) |
7. | INTEREST RECEIVABLE AND SIMILAR INCOME |
31.12.22 | 31.12.21 |
£ | £ |
Deposit account interest |
8. | INTEREST PAYABLE AND SIMILAR EXPENSES |
31.12.22 | 31.12.21 |
£ | £ |
Bank loan interest & charges |
9. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
31.12.22 | 31.12.21 |
£ | £ |
Current tax: |
UK corporation tax |
Tax credit from prior year | (63,514 | ) | (40,961 | ) |
Total current tax | ( |
) |
Deferred tax |
Tax on profit |
UK corporation tax has been charged at 19% (2021 - 19%). |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Notes to the Financial Statements - continued |
for the Year Ended 31st December 2022 |
9. | TAXATION - continued |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
31.12.22 | 31.12.21 |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of (2021 - |
Effects of: |
Expenses not deductible for tax purposes |
Capital allowances in excess of depreciation | ( |
) | ( |
) |
Adjustments to tax charge in respect of previous periods | ( |
) | ( |
) |
Deferred tax | 273,071 | 23,643 |
Total tax charge | 258,192 | 342,641 |
Tax effects relating to effects of other comprehensive income |
31.12.22 |
Gross | Tax | Net |
£ | £ | £ |
Remeasurements on Pensions scheme | ( |
) | - | (100,500 | ) |
31.12.21 |
Gross | Tax | Net |
£ | £ | £ |
Remeasurements on Pensions scheme | ( |
) | - | (78,000 | ) |
10. | DIVIDENDS |
31.12.22 | 31.12.21 |
£ | £ |
Final |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Notes to the Financial Statements - continued |
for the Year Ended 31st December 2022 |
11. | INTANGIBLE FIXED ASSETS |
Patents |
and |
licences |
£ |
COST |
At 1st January 2022 |
and 31st December 2022 |
AMORTISATION |
At 1st January 2022 |
Amortisation for year |
At 31st December 2022 |
NET BOOK VALUE |
At 31st December 2022 |
At 31st December 2021 |
12. | TANGIBLE FIXED ASSETS |
Plant & |
equipment |
and |
Long | office |
leasehold | equipment | Totals |
£ | £ | £ |
COST |
At 1st January 2022 |
Additions |
At 31st December 2022 |
DEPRECIATION |
At 1st January 2022 |
Charge for year |
At 31st December 2022 |
NET BOOK VALUE |
At 31st December 2022 |
At 31st December 2021 |
13. | STOCKS |
31.12.22 | 31.12.21 |
£ | £ |
Raw materials and consumables |
Work-in-progress |
Finished goods |
The difference between purchase price or production cost of stocks and their replacement cost is not material. |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Notes to the Financial Statements - continued |
for the Year Ended 31st December 2022 |
14. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.12.22 | 31.12.21 |
£ | £ |
Trade debtors |
Other debtors |
Prepayments and accrued income |
15. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.12.22 | 31.12.21 |
£ | £ |
Trade creditors |
Tax | ( |
) |
Social security and other taxes |
Other creditors |
Accruals and deferred income |
16. | LEASING AGREEMENTS |
Minimum lease payments under non-cancellable operating leases fall due as follows: |
31.12.22 | 31.12.21 |
£ | £ |
Within one year |
Between one and five years |
17. | PROVISIONS FOR LIABILITIES |
31.12.22 | 31.12.21 |
£ | £ |
Deferred tax | 479,384 | 206,313 |
Deferred |
tax |
£ |
Balance at 1st January 2022 |
Charge to Income Statement during year |
Balance at 31st December 2022 |
18. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 31.12.22 | 31.12.21 |
value: | £ | £ |
Ordinary | £1 | 11,125,000 | 11,125,000 |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Notes to the Financial Statements - continued |
for the Year Ended 31st December 2022 |
19. | RESERVES |
Retained |
earnings |
£ |
At 1st January 2022 |
Profit for the year |
Pension reserve | (100,500 | ) |
At 31st December 2022 |
20. | EMPLOYEE BENEFIT OBLIGATIONS |
The company operates a defined benefit pension scheme for its employees. The assets of the schemes are held in a separate trustee-administered fund. The pension scheme has been closed to future accruals on the 31/12/2015. |
The latest actuarial valuation report was completed on 10th February 2023. |
The amounts recognised in profit or loss are as follows: |
Defined benefit |
pension plans |
31.12.22 | 31.12.21 |
£ | £ |
Current service cost | - | - |
Past service cost | - | - |
- | - |
Actual return on plan assets | (7,214,000 | ) | 598,000 |
Changes in the present value of the defined benefit obligation are as follows: |
Defined benefit |
pension plans |
31.12.22 | 31.12.21 |
£ | £ |
Opening defined benefit obligation |
Interest cost |
Actuarial losses/(gains) | ( |
) | ( |
) |
Benefits paid | ( |
) | ( |
) |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Notes to the Financial Statements - continued |
for the Year Ended 31st December 2022 |
20. | EMPLOYEE BENEFIT OBLIGATIONS - continued |
Changes in the fair value of scheme assets are as follows: |
Defined benefit |
pension plans |
31.12.22 | 31.12.21 |
£ | £ |
Opening fair value of scheme assets |
Contributions by employer |
Asset Ceiling | 1,973,000 | (1,181,000 | ) |
Expected return | 285,000 | 201,000 |
Actuarial gains/(losses) | ( |
) |
Benefits paid | (210,000 | ) | (167,000 | ) |
The amounts recognised in other comprehensive income are as follows: |
Defined benefit |
pension plans |
31.12.22 | 31.12.21 |
£ | £ |
Remeasurements | ( |
) | ( |
) |
(518,000 | ) | (78,000 | ) |
The major categories of scheme assets as a percentage of total scheme assets are as follows: |
Defined benefit |
pension plans |
31.12.22 | 31.12.21 |
Equities & cash | 74.84% | 83.79% |
Gilts | 25.16% | 16.21% |
100.00% | 100.00% |
Principal actuarial assumptions at the balance sheet date (expressed as weighted averages): |
31.12.22 | 31.12.21 |
Discount rate |
Price inflation rate (CPI) |
Price inflation rate (RPI) |
Pensions-in-payment increase rate 5% |
Pensions-in-payment increase rate 2.5% |
F2 CHEMICALS LIMITED (REGISTERED NUMBER: 02680159) |
Notes to the Financial Statements - continued |
for the Year Ended 31st December 2022 |
20. | EMPLOYEE BENEFIT OBLIGATIONS - continued |
The above percentages relate to the weighted-average assumptions to determine defined benefit obligations. |
The following percentages relate to the weighted-average assumptions to determine cost relating to defined benefit plans. |
31.12.22 | 31.12.21 |
Discount rate | 1.85% | 1.35% |
Price inflation rate (CPI) | 2.40% | 2.05% |
Price inflation rate (RPI) | 3.20% | 2.85% |
Pensions-in-payment increase rate | 3.10% | 2.80% |
21. | ULTIMATE PARENT COMPANY |
The Company's ultimate parent company is Resonac Corporation, registered in Japan. |
22. | CAPITAL COMMITMENTS |
31.12.22 | 31.12.21 |
£ | £ |
Contracted but not provided for in the |
financial statements |
23. | RELATED PARTY DISCLOSURES |
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |
24. | ULTIMATE CONTROLLING PARTY |
The Company's immediate holding company is Resonac Corporation. |
Copies of its group accounts, which include the Company, are available from Resonac Corporation, 13-9, Shiba Daimon 1-Chome, Minato-ku, Tokyo, 105-8518, Japan. |