Company registration number 02802131 (England and Wales)
HANSENGROUP LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
HANSENGROUP LIMITED
COMPANY INFORMATION
Directors
H M K Hansen
T B Andersen
Secretary
J Mitchell
Company number
02802131
Registered office
Hub 26
Lawrence House
Riverside Drive
Cleckheaton
BD19 4DH
Auditor
MHA Moore and Smalley
80 Mosley Street
Manchester
M2 3FX
HANSENGROUP LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 24
HANSENGROUP LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 1 -
The directors present the strategic report for the year ended 30 June 2023.
Fair review of the business
The company has had another successful operating year. It continues to execute contracts adopting established principles and best practices to maintain control of its business activities.
Over the last 12 months it has implemented systems to drive efficiencies and is building strong client relationships allowing it to achieve repeat business with the intention of increasing turnover. As part of its continuous improvement programme, it remains focused on ensuring standards are not only preserved but enhanced.
The construction industry as a whole has felt the effects of rapidly increasing inflationary pressures. As a result, the company has had to endure programme slippage on a number of its live projects.
The company will continue to develop and cultivate all aspects of its business and expects to remain on an upward trajectory.
Principal risks and uncertainties
The following are considered to be the main risks to the business:
Price Risk
Whilst it is recognised that the construction industry is currently having to endure significant increases in the cost of material, fabrication of product and installation, the company benefits from utilising HansenGroup A/S production facilities in Poland and Denmark. As a result of being able to offer its own products and systems, the company is able to remain competitive in the market.
Credit Risk
Before entering into any contract with a new or existing client, the company undertakes a comprehensive due diligence exercise which includes financial and credit checks. In all cases, credit insurance is obtained to provide the company with additional security in the event of client delinquency. Additionally, management meetings are held at regular intervals where cash and accounts receivable are on the agenda.
Additionally, extensive cash and sales forecasts are produced to support proposals relating to payment plans.
Liquidity and Cashflow Risk
The company reviews cash and accounts receivable on a weekly basis to ensure any debtor issues are highlighted at the earliest opportunity, thus allowing its commercial team to act promptly and effectively. Whilst the company’s strategy of providing unitised curtain wall solutions transfers the majority of the risk from site to production, providing it with better control, especially as this is undertaken “in house”, it does involve the advance purchasing of significant quantities of material several months prior to its arrival on-site, which has the ability to put an initial strain on cashflow.
However, the company combats this issue by agreeing favourable terms and/or advance payments which are protected by the provision of appropriate bonds, if required. Further, annual budgets and quarterly forecasts are prepared and then monitored to track performance and identify any potential risk.
Operational Risk
The success of the company is dependent on its ability to generate sales revenue. The company prepares budgets to update costing structures and understand break even and profitability levels. Sales and marketing resources are allocated to achieving the appropriate level of business for the available engineering staff.
Employee Risk
The success of the company is built on the skill, knowledge, experience and behaviour of its staff and therefore, retaining appropriate personnel is key. The Directors endeavour to prevent the loss of employees by means of fair and sustainable remuneration and a strong development programme.
HANSENGROUP LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 2 -
Delivery Failure Risk
All contracts are only entered into subsequent to the completion of a rigorous review and negotiation of the documents that are to bind the company and its client. Thereafter, contracts are administered by dedicated project directors and commercial leads supported by wider project teams. Project teams constantly review and monitor all aspects of performance and meet regularly. Each month, individual project teams are responsible for presenting a contract specific ‘Project Review Meeting’ and ‘Cost to Complete’ exercise to the company’s management team. The presentation format has been devised to review all aspects of a contract from design to installation and beyond and includes a detailed analysis of actual cost plus forecasted versus original cost plan.
Supply Chain and Inflation Risk
Rising energy prices, the volatility of material costs and rapidly increasing labour rates resulting from the war in Ukraine, the aftermath of the global pandemic and Brexit, all possess the real potential to impose themselves upon the company’s supply chain and its ability to secure future contracts in an industry that seeks ‘fixed price’ tendering for projects, despite there often being a 1-to-2-year period between order receipt and on-site completion. In order to mitigate these risks, the company operates with well-established and financially secure supply chain members with whom it has history, secures material rates at the earliest opportunity and continues to follow the markets to track movement.
Exchange Rate Risk
The company provides services in the UK where all sales are GBP albeit most materials are purchased in PLN, EUR and DKK. To minimise the risk in exchange rates and to help provide cost certainty, the company secured rates by agreeing forward contracts with its bank.
Development and Performance
The Group supported by its subsidiaries continues to develop products that meet the performance needs of its clients. Research is heavily focused on achieving the clients performance needs sustainably and with minimal impact on the environment.
Key performance indicators
Turnover for year ended 30 June 2023 was £12,652,343 which is lower than the prior year (£19,278,912). This is due to programme slippage on live contracts and delays in the commencement of newly secured contracts, in both instances for reasons beyond the control of the company.
Gross profit of £2,169,376 (17.15%) has been generated in the year, compared to £2,562,555 in the prior year (13.3%). The increase in margin demonstrates sound project delivery.
The company has implemented and is continuing to develop a cloud-based IT system so that all information is available for every user at any given time. This information covers everything from sales forecasts, order intake, execution to anticipated sales output, margins, cost budgets, production planning, EBT etc. Further, there is a management meeting held every month where all managers are updated, in depth, on all relevant areas of the Group.
T B Andersen
Director
20 October 2023
HANSENGROUP LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 3 -
The directors present their annual report and financial statements for the year ended 30 June 2023.
Principal activities
The activity of the company has expanded from providing management services to the group to providing curtain wall, commercial windows, fire resistant and structural glazing and steel doors and glass installation services.
Results and dividends
The results for the year are set out on page 9.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
H M K Hansen
T B Andersen
Future developments
The company is continuing to develop in accordance with a re-focused and more selective market strategy, maintaining positive relationships with customers. The company is expected to increase its activity compared to 2022/23 by further utilising intergroup competitive advantages and to look for opportunities to develop their products and system.
Auditor
The auditor, MHA Moore and Smalley, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
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.
HANSENGROUP LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 4 -
Strategic report
The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of principal risk and uncertainties.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
On behalf of the board
T B Andersen
Director
20 October 2023
HANSENGROUP LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HANSENGROUP LIMITED
- 5 -
Opinion
We have audited the financial statements of HansenGroup Limited (the 'company') for the year ended 30 June 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity 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 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 30 June 2023 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
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.
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.
HANSENGROUP LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HANSENGROUP LIMITED
- 6 -
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
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 directors' report.
We have nothing to report in respect of the following matters in relation to which 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 remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
HANSENGROUP LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HANSENGROUP LIMITED
- 7 -
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 specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud, are detailed below:
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Auditing the risk of fraud and management override of revenue by incorporating data analytics into our sampling of source entries and testing specific transactions to determine the completeness of revenue.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation (i.e. gives a true and fair view).
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We identified the following areas as those most likely to have a material impact on the financial statements:
Because of the field in which the client operates, we identified the following areas as those most likely to have a material impact on the financial statements: Health and Safety, employment law and compliance with the UK Companies Act.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
HANSENGROUP LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HANSENGROUP LIMITED
- 8 -
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.
Alexander Kelly
Senior Statutory Auditor
For and on behalf of MHA Moore and Smalley
Chartered Accountants
Statutory Auditor
80 Mosley Street
Manchester
M2 3FX
20 October 2023
HANSENGROUP LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2023
- 9 -
2023
2022
Notes
£
£
Turnover
3
12,652,343
19,278,913
Cost of sales
(10,482,967)
(16,716,358)
Gross profit
2,169,376
2,562,555
Administrative expenses
(2,295,002)
(2,248,007)
Operating (loss)/profit
4
(125,626)
314,548
Interest receivable and similar income
8
39,728
348
Interest payable and similar expenses
9
(23,622)
(Loss)/profit before taxation
(85,898)
291,274
Tax on (loss)/profit
10
(33,050)
(Loss)/profit for the financial year
(85,898)
258,224
The statement of comprehensive income account has been prepared on the basis that all operations are continuing operations.
HANSENGROUP LIMITED
BALANCE SHEET
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
11
15,093
19,316
Tangible assets
12
10,393
16,200
25,486
35,516
Current assets
Debtors
13
3,928,746
11,353,962
Cash at bank and in hand
1,492,223
304,811
5,420,969
11,658,773
Creditors: amounts falling due within one year
14
(5,359,214)
(11,521,150)
Net current assets
61,755
137,623
Net assets
87,241
173,139
Capital and reserves
Called up share capital
16
1,275,002
1,275,002
Share premium account
3,400,000
3,400,000
Profit and loss reserves
(4,587,761)
(4,501,863)
Total equity
87,241
173,139
The financial statements were approved by the board of directors and authorised for issue on 20 October 2023 and are signed on its behalf by:
T B Andersen
Director
Company Registration No. 02802131
HANSENGROUP LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
- 11 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 July 2021
1,275,002
3,400,000
(6,317,918)
(1,642,916)
Year ended 30 June 2022:
Profit and total comprehensive income for the year
-
-
258,224
258,224
Capital contribution received
17
1,557,831
1,557,831
Balance at 30 June 2022
1,275,002
3,400,000
(4,501,863)
173,139
Year ended 30 June 2023:
Loss and total comprehensive income for the year
-
-
(85,898)
(85,898)
Balance at 30 June 2023
1,275,002
3,400,000
(4,587,761)
87,241
HANSENGROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
- 12 -
1
Accounting policies
Company information
HansenGroup Limited is a private company limited by shares incorporated in England and Wales. The registered office is Hub 26, Lawrence House, Riverside Drive, Cleckheaton, BD19 4DH.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of HansenGroup A/S. These consolidated financial statements are available from its registered office, Bredgade 4, 6940 Lem st., Denmark.
HANSENGROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 13 -
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company 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.
Following the re-structure of the HSHansen Group companies in the UK, the UK business unit has seen a positive bounce back with 3 impressive pre-fabricated major projects delivered.
The UK directors and management team are forecasting profitable trading with a number of new orders and well-run pre-fabricated projects in the order book.
Despite continued uncertainties in the British and Global market since the Russian invasion of Ukraine and supply price inflation, making it more difficult to forecast the business performance, the re-focused Hansen UK pre-fabrication strategy and order book provides profitable business expectations for the 23/24 finance year and the foreseeable future.
It is currently not clear how long the uncertainties in the market and the wider economy will continue, so should HansenGroup Limited require additional support, the parent undertaking HansenGroup A/S has confirmed that its intention is to make it available, for a period of at least 12 months from the date of the approval of the financial statements.
The directors believe that there is no material uncertainty and that the company is a going concern at this time.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
1.4
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Software
5 years
HANSENGROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 14 -
1.5
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Plant and equipment
5 years
Fixtures and fittings
5 years
Computers
5 years
Motor vehicles
5 years
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.6
Impairment of fixed assets
At each reporting period end date, the company 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.
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.
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.
1.7
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
HANSENGROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 15 -
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
HANSENGROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 16 -
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
HANSENGROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 17 -
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
1.14
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
HANSENGROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 18 -
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Contract accounting
The company's revenue and profit recognition policies are central to the way the company values its work each year and have been consistently applied.
The key judgements and estimates in determining the turnover and profits of the contracts are the costs to complete, achieving the agreed contractual program and recoverability of any claims or variations.
The estimation uncertainty is reduced by the significant experience of the team which includes qualified quantity surveyors. Nevertheless, profit recognition is a key estimate and is inherently judgemental in any contracting business.
Accounting for debt write off
Loans have been advanced from the parent undertaking in previous accounting periods. In the prior year accounting period debt forgiveness was provided by the parent and the loan balance was written off.
Management treated the forgiveness of the loan as a capital contribution from the parent. When the loan was advanced the intention was for it to be repaid in full. Therefore the forgiveness of the debt represents a form of capital contribution rather than income.
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Contract revenue recognised as revenue
12,652,343
19,278,913
2023
2022
£
£
Other revenue
Interest income
39,728
348
HANSENGROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 19 -
4
Operating (loss)/profit
2023
2022
Operating (loss)/profit for the year is stated after charging/(crediting):
£
£
Exchange losses
155,030
Depreciation of owned tangible fixed assets
2,413
42,022
Profit on disposal of tangible fixed assets
(16,467)
-
Amortisation of intangible assets
4,223
1,795
Operating lease charges
42,316
34,894
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
20,000
15,650
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
24
28
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
1,352,976
1,156,745
Social security costs
169,320
140,792
Pension costs
27,296
25,829
1,549,592
1,323,366
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
53,872
143,053
Company pension contributions to defined contribution schemes
440
1,101
54,312
144,154
HANSENGROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
7
Directors' remuneration
(Continued)
- 20 -
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2022 - 1).
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
33,542
348
Interest receivable from group companies
13,011
Other interest income
(6,825)
Total income
39,728
348
9
Interest payable and similar expenses
2023
2022
£
£
Interest payable to group undertakings
23,622
10
Taxation
2023
2022
£
£
HANSENGROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
10
Taxation
2023
2022
£
£
(Continued)
- 21 -
Deferred tax
Origination and reversal of timing differences
25,118
Changes in tax rates
7,932
Total deferred tax
33,050
The actual charge for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
(Loss)/profit before taxation
(85,898)
291,274
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 20.50% (2022: 19.00%)
(17,609)
55,342
Tax effect of expenses that are not deductible in determining taxable profit
368
580
Tax effect of income not taxable in determining taxable profit
(176)
(573)
Effect of change in corporation tax rate
7,932
Deferred tax not provided for
17,417
(30,231)
Taxation charge for the year
-
33,050
The company has tax losses of £3,724,256 available for use against future trading profits. No deferred tax asset has been recognised in relation to these losses due to the uncertainty over the timing of future trading profits.
11
Intangible fixed assets
Software
£
Cost
At 1 July 2022 and 30 June 2023
21,111
Amortisation and impairment
At 1 July 2022
1,795
Amortisation charged for the year
4,223
At 30 June 2023
6,018
Carrying amount
At 30 June 2023
15,093
At 30 June 2022
19,316
HANSENGROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 22 -
12
Tangible fixed assets
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 July 2022
4,000
104,756
3,766
28,490
141,012
Additions
3,727
3,727
Disposals
(28,490)
(28,490)
At 30 June 2023
4,000
104,756
7,493
116,249
Depreciation and impairment
At 1 July 2022
133
103,014
296
21,369
124,812
Depreciation charged in the year
800
386
1,227
2,413
Eliminated in respect of disposals
(21,369)
(21,369)
At 30 June 2023
933
103,400
1,523
105,856
Carrying amount
At 30 June 2023
3,067
1,356
5,970
10,393
At 30 June 2022
3,867
1,742
3,470
7,121
16,200
13
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
2,678,626
5,393,408
Gross amounts owed by contract customers
1,176,500
5,242,444
Amounts owed by group undertakings
671,607
Other debtors
41,074
11,257
Prepayments and accrued income
32,546
35,246
3,928,746
11,353,962
14
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
443,162
744,533
Amounts owed to group undertakings
3,747,583
8,615,301
Taxation and social security
48,164
249,585
Accruals and deferred income
1,120,305
1,911,731
5,359,214
11,521,150
All amounts owed to the immediate parent undertaking are secured by fixed and floating charges over all property and assets both present and future of the company
HANSENGROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 23 -
15
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
27,296
25,829
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
16
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
1,275,002
1,275,002
1,275,002
1,275,002
17
Capital contribution
2023
2022
£
£
At the beginning and end of the year
1,557,831
1,557,831
In the prior period the company recognised a capital contribution of £1,557,831. In June 2022 the company's shareholder waived the requirement for it to pay this balance, which was owed as part of a loan. Accordingly the company treated this as a capital contribution by the shareholder and recognised £1,557,831 directly within the Profit and loss reserve.
Whilst this amount is included within the Profit and loss reserve it isn't distributable under the Companies Act 2006.
18
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
46,964
45,617
Between two and five years
18,189
31,736
65,153
77,353
HANSENGROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 24 -
19
Related party transactions
Transactions with related parties
During the year the company entered into the following transactions with related parties:
During the year the company purchased goods totalling £703 and made sales of £13,123 to Hansen Thermospan Limited, a company. As at the year end the company had no outstanding balance with Hansen Thermospan Limited.
Hansen Thermospan Limited is a related party as it is under control of T B Andersen.
Other information
As the company accounts are consolidated in the accounts of HansenGroup A/S the entity has taken advantage of the reduced disclosure exemptions and has not disclosed transactions with fellow group companies. The accounts of HansenGroup A/S are publicly available.
20
Ultimate controlling party
The parent undertaking and controlling related party of this company is HansenGroup A/S incorporated in Denmark. The registered office of HansenGroup A/S is Bredgade 4, 6940 Lem st., Denmark. The ultimate controlling party is H M K Hansen.
These results will be consolidated in the group accounts of HansenGroup A/S which are publicly available.
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