Company Registration No. 02740285 (England and Wales)
HOWARD HUNT DIRECT LIMITED
ANNUAL REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2015
HOWARD HUNT DIRECT LIMITED
COMPANY INFORMATION
Directors
Mr L M Pigott
Mr M A Pigott
Secretary
Mr L M Pigott
Company number
02740285
Registered office
Crown House
151 High Road
Loughton
Essex
IG10 4LG
Auditors
Alwyns LLP
Crown House
151 High Road
Loughton
Essex
IG10 4LG
HOWARD HUNT DIRECT LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditors' report
4 - 5
Profit and loss account
6
Balance sheet
7
Cash flow statement
8
Notes to the cash flow statement
9
Notes to the financial statements
10 - 17
HOWARD HUNT DIRECT LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2015
- 1 -
The directors present the strategic report and financial statements for the year ended 30 September 2015.
Review of the business
The principal activity of the company continued to be that of direct marketing printing. The results for the year and the financial position at the year end were in line with the expectations of the directors who are confident the company will continue to be profitable in the current year.
A review of the group results of which the company is a member is included in the Strategic Report of its parent company, Howard Hunt (City) Limited.
Principal risks
The directors continually monitor key risks facing the company with a view to managing these risks. The principal risks and uncertainties currently facing the company are similar to those of the group which are economic downturn, competitor pressure leading to a reduction in both sales and margin and loss of key personnel.
On behalf of the board
Mr L M Pigott
Director
29 June 2016
HOWARD HUNT DIRECT LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2015
- 2 -
The directors present their report and financial statements for the year ended 30 September 2015.
Results and dividends
The results for the year are set out on page 6.
Directors
The following directors have held office since 1 October 2014:
Mr L M Pigott
Mr M A Pigott
Mr C E Shaylor
(Resigned 31 October 2014)
Financial instruments
The company's financial instruments are principally those directly arising from operations such as trade debtors and trade creditors.
Liquidity risk
The management of the company's cash and borrowing requirements is undertaken with its parent company in order to maximise interest income and minimise interest expense, whilst ensuring the company has sufficient liquid resources to meet the operating needs of the business.
Interest rate risk
The company is not significantly exposed to interest rate risk.
Credit risk
Investments in cash surpluses and borrowings are made through banks which must fulfil credit rating criteria approved by the Board.
The company obtains credit references for any significant new customers and stipulates strict payment terms. The directors regularly review trade debtors and pursue any outstanding debts on a timely basis. Where necessary, provisions are made for doubtful debts.
Auditors
Alwyns LLP will continue in office in accordance with the Companies Act 2006, s487 (2).
HOWARD HUNT DIRECT LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2015
- 3 -
Statement of directors' responsibilities
The directors are responsible for preparing the Strategic Report, Directors' 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;
- 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 auditors
(a) so far as the directors are aware, there is no relevant audit information of which the company's auditors are unaware, and
(b) they have taken all the steps that they ought to have taken as directors in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information.
On behalf of the board
Mr L M Pigott
Director
29 June 2016
HOWARD HUNT DIRECT LIMITED
INDEPENDENT AUDITORS' REPORT
TO THE MEMBERS OF HOWARD HUNT DIRECT LIMITED
- 4 -
We have audited the financial statements of Howard Hunt Direct Limited for the year ended 30 September 2015 set out on pages 6 to 17. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
This report is made solely to the company's members, as a body, in accordance with sections 495 and 496 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 auditors' 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.
Respective responsibilities of directors and auditors
As explained more fully in the Directors' Responsibilities Statement set out on page 3, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board's Ethical Standards for Auditors.
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the company's circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the directors; and the overall presentation of the financial statements. In addition, we read all the financial and non-financial information in the Annual Report to identify material inconsistencies with the audited financial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of performing the audit. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report.
Opinion on financial statements
In our opinion the financial statements: give a true and fair view of the state of the company's affairs as at 30 September 2015 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. In our opinion the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements.
-
give a true and fair view of the state of the company's affairs as at 30 September 2015 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.
Opinion on other matter prescribed by the Companies Act 2006
In our opinion the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements.
HOWARD HUNT DIRECT LIMITED
INDEPENDENT AUDITORS' REPORT (CONTINUED)
TO THE MEMBERS OF HOWARD HUNT DIRECT LIMITED
- 5 -
Matters on which we are required to report by exception
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.
David Stanley (Senior Statutory Auditor)
for and on behalf of Alwyns LLP
29 June 2016
Chartered Accountants
Statutory Auditor
Crown House
151 High Road
Loughton
Essex
IG10 4LG
HOWARD HUNT DIRECT LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30 SEPTEMBER 2015
- 6 -
2015
2014
Notes
£'000
£'000
Turnover
2
4,516
5,410
Cost of sales
(3,078)
(3,994)
Gross profit
1,438
1,416
Administrative expenses
(1,372)
(1,361)
Operating profit
3
66
55
Interest payable and similar charges
4
(12)
(9)
Profit on ordinary activities before taxation
54
46
Tax on profit on ordinary activities
5
15
(27)
Profit for the year
13
69
19
The profit and loss account has been prepared on the basis that all operations are continuing operations.
There are no recognised gains and losses other than those passing through the profit and loss account.
HOWARD HUNT DIRECT LIMITED
BALANCE SHEET
AS AT
30 SEPTEMBER 2015
30 September 2015
- 7 -
2015
2014
Notes
£'000
£'000
£'000
£'000
Fixed assets
Tangible assets
6
600
657
Current assets
Stocks
7
343
292
Debtors
8
1,624
1,127
1,967
1,419
Creditors: amounts falling due within one year
9
(1,891)
(1,449)
Net current assets/(liabilities)
76
(30)
Total assets less current liabilities
676
627
Provisions for liabilities
10
(63)
(83)
613
544
Capital and reserves
Called up share capital
12
-
-
Profit and loss account
13
613
544
Shareholders' funds
14
613
544
Approved by the Board and authorised for issue on 29 June 2016
Mr L M Pigott
Director
Company Registration No. 02740285
HOWARD HUNT DIRECT LIMITED
CASH FLOW STATEMENT
FOR THE YEAR ENDED 30 SEPTEMBER 2015
- 8 -
2015
2014
£'000
£'000
£'000
£'000
Net cash (outflow)/inflow from operating activities
(694)
44
Returns on investments and servicing of finance
Interest paid
(12)
(9)
Net cash outflow for returns on investments and servicing of finance
(12)
(9)
Taxation
(67)
(31)
Capital expenditure
Payments to acquire tangible assets
(60)
(155)
Net cash outflow for capital expenditure
(60)
(155)
Net cash outflow before management of liquid resources and financing
(833)
(151)
Repayment of loan
-
(5)
Net cash outflow from financing
-
(5)
Decrease in cash in the year
(833)
(156)
HOWARD HUNT DIRECT LIMITED
NOTES TO THE CASH FLOW STATEMENT
FOR THE YEAR ENDED 30 SEPTEMBER 2015
- 9 -
1
Reconciliation of operating profit to net cash (outflow)/inflow from operating activities
2015
2014
£'000
£'000
Operating profit
66
55
Depreciation of tangible assets
117
121
Increase in stocks
(51)
(5)
(Increase)/decrease in debtors
(488)
808
Decrease in creditors within one year
(338)
(935)
Net cash (outflow)/inflow from operating activities
(694)
44
2
Analysis of net debt
1 October 2014
Cash flow
Other non-cash changes
30 September 2015
£'000
£'000
£'000
£'000
Net cash:
Bank overdrafts
(166)
(833)
-
(999)
Net debt
(166)
(833)
-
(999)
3
Reconciliation of net cash flow to movement in net debt
2015
2014
£'000
£'000
Decrease in cash in the year
(833)
(156)
Cash (inflow)/outflow from (increase)/decrease in debt
-
5
Movement in net debt in the year
(833)
(151)
Opening net debt
(166)
(15)
Closing net debt
(999)
(166)
HOWARD HUNT DIRECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2015
- 10 -
1
Accounting policies
1.1
Accounting convention
The financial statements are prepared under the historical cost convention.
1.2
Compliance with accounting standards
The financial statements are prepared in accordance with applicable United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), which have been applied consistently (except as otherwise stated).
1.3
Turnover
Turnover represents amounts receivable for goods and services net of VAT and trade discounts.
1.4
Tangible fixed assets and depreciation
Tangible fixed assets are stated at cost less depreciation. Depreciation is provided at rates calculated to write off the cost less estimated residual value of each asset over its expected useful life, as follows:
Leasehold improvements
over the lease term
Plant and machinery
over 2 to 10 years
Fixtures, fittings & equipment
over 4 to 10 years
1.5
Leasing
Rentals payable under operating leases are charged against income on a straight line basis over the lease term.
1.6
Stock and work in progress
Stock and work in progress are valued at the lower of cost and net realisable value. Work in progress includes the appropriate proportion of production overheads.
1.7
Pensions
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.
1.8
Deferred taxation
Deferred taxation is provided in full in respect of taxation deferred by timing differences between the treatment of certain items for taxation and accounting purposes. The deferred tax balance has been discounted.
1.9
Liquid resources
Liquid resources for the purpose of preparing the cash flow statement includes cash at bank and in hand.
2
Turnover
The total turnover of the company for the year has been derived from its principal activity wholly undertaken in the United Kingdom.
HOWARD HUNT DIRECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2015
- 11 -
3
Operating profit
2015
2014
£'000
£'000
Operating profit is stated after charging:
Depreciation of tangible assets
117
122
Auditors' remuneration (including expenses and benefits in kind)
4
4
Directors' remuneration
-
-
No directors accrued any pension benefits from pension contributions made by the company.
4
Interest payable
2015
2014
£'000
£'000
On bank loans and overdrafts
3
9
Other interest
9
-
12
9
HOWARD HUNT DIRECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2015
- 12 -
5
Taxation
2015
2014
£'000
£'000
Domestic current year tax
U.K. corporation tax
24
25
Adjustment for prior years
(19)
-
Total current tax
5
25
Deferred tax
Origination and reversal of timing differences
(22)
2
Movement in deferred tax discount
2
-
(20)
2
(15)
27
Factors affecting the tax charge for the year
Profit on ordinary activities before taxation
54
46
Profit on ordinary activities before taxation multiplied by standard rate of UK corporation tax of 20.50% (2014 - 22.00%)
11
10
Effects of:
Non deductible expenses
3
1
Capital allowances/depreciation timing differences
10
14
Adjustments to previous periods
(19)
-
(6)
15
Current tax charge for the year
5
25
HOWARD HUNT DIRECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2015
- 13 -
6
Tangible fixed assets
Leasehold improvements
Plant and machinery
Fixtures, fittings & equipment
Total
£'000
£'000
£'000
£'000
Cost
At 1 October 2014
344
2,773
324
3,441
Additions
4
45
11
60
At 30 September 2015
348
2,818
335
3,501
Depreciation
At 1 October 2014
242
2,295
247
2,784
Charge for the year
18
82
17
117
At 30 September 2015
260
2,377
264
2,901
Net book value
At 30 September 2015
88
441
71
600
At 30 September 2014
102
478
77
657
7
Stocks and work in progress
2015
2014
£'000
£'000
Raw materials and consumables
123
218
Work in progress
220
74
343
292
8
Debtors
2015
2014
£'000
£'000
Trade debtors
757
461
Amounts owed by parent and fellow subsidiary undertakings
610
616
Corporation tax
9
-
Other debtors
204
18
Prepayments and accrued income
44
32
1,624
1,127
HOWARD HUNT DIRECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2015
- 14 -
9
Creditors: amounts falling due within one year
2015
2014
£'000
£'000
Bank loans and overdrafts (see below)
999
166
Trade creditors
514
815
Corporation tax
44
97
Other taxes and social security costs
276
312
Other creditors
9
7
Accruals and deferred income
49
52
1,891
1,449
During the year the company, it's parent and related entities obtained facilities from Santander UK Plc secured by fixed and floating charges and cross guarantees. The maximum facility under this arrangement at 30 September 2015 was £18,500,000.
10
Provisions for liabilities
The deferred tax liability is made up as follows:
2015
2014
£'000
£'000
Accelerated capital allowances
65
87
65
87
Discount
(2)
(4)
Discounted provision for deferred taxation
63
83
11
Retirement Benefits
Defined contribution scheme
2015
2014
£'000
£'000
Contributions payable by the company for the year
43
35
At 30 September 2015 contributions of £10,000 (2014 - £9,000) were outstanding.
HOWARD HUNT DIRECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2015
- 15 -
12
Share capital
2015
2014
£'000
£'000
Allotted, called up and fully paid
100 Ordinary shares of £1 each
-
-
13
Statement of movements on profit and loss account
Profit
and loss
account
£'000
Balance at 1 October 2014
544
Profit for the year
69
Balance at 30 September 2015
613
14
Reconciliation of movements in Shareholders' funds
2015
2014
£'000
£'000
Profit for the financial year
69
16
Opening Shareholders' funds
544
528
Closing Shareholders' funds
613
544
HOWARD HUNT DIRECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2015
- 16 -
15
Employees
Number of employees
The average monthly number of employees (including directors) during the year was:
2015
2014
Number
Number
Directors
2
3
Administration
10
7
Operatives
94
97
106
107
Employment costs
2015
2014
£'000
£'000
Wages and salaries
2,151
2,029
Social security costs
185
174
Other pension costs
43
35
2,379
2,238
16
Controlling party and parent undertaking
The company's immediate and ultimate parent undertaking in both the current and preceding year was Howard Hunt (City) Limited a company incorporated in the United Kingdom. The company's ultimate controlling party during the year was Mr M A Pigott by virtue of his ability to control Howard Hunt (City) Limited.
17
Related party relationships and transactions
During the year the company traded with its parent company, Howard Hunt (City) Limited.
The transactions were as follows:
2015
2014
£'000
£'000
Sales
4,523
5,410
Purchases and re-charged expenses
113
218
Management fees payable
641
641
At the year end the company was owed £1,361,000 (2014 - £1,009,000).
HOWARD HUNT DIRECT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2015
17
Related party relationships and transactions
(Continued)
- 17 -
The company also had transactions with Celerity Information Services Limited. A number of directors and shareholders of the parent company have interests in Celerity Information Services Limited.
2015
2014
£'000
£'000
Sales
5
25
At the year end £7,000 was owed by (2014 - £1,000) Celerity Information Services Limited.
The company also had transactions with Celerity Communications Limited, an entity controlled by a director of the company.
2015
2014
£'000
£'000
Sales
4
105
At the year end £5,000 (2014 - £1,000) was owed by Celerity Communications Limited.
The company also had transactions with Howard Hunt Mail Limited, an entity controlled by a director of the company.
2015
2014
£'000
£'000
Sales
145
-
At the year end £175,000 (2014 - £nil) was owed by Howard Hunt Mail Limited.
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