REGISTERED NUMBER: 03031502 (England and Wales) |
GROUP STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 28 FEBRUARY 2023 |
FOR |
BENFLEET SCRAP CO LIMITED |
REGISTERED NUMBER: 03031502 (England and Wales) |
GROUP STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 28 FEBRUARY 2023 |
FOR |
BENFLEET SCRAP CO LIMITED |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
CONTENTS OF THE CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
Page |
Company Information | 1 |
Group Strategic Report | 2 |
Report of the Directors | 3 |
Report of the Independent Auditors | 4 |
Consolidated Statement of Comprehensive Income | 7 |
Consolidated Statement of Financial Position | 8 |
Company Statement of Financial Position | 9 |
Consolidated Statement of Changes in Equity | 10 |
Company Statement of Changes in Equity | 11 |
Consolidated Statement of Cash Flows | 12 |
Notes to the Consolidated Statement of Cash Flows | 13 |
Notes to the Consolidated Financial Statements | 14 |
BENFLEET SCRAP CO LIMITED |
COMPANY INFORMATION |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Statutory Auditor |
St James's House |
8 Overcliffe |
Gravesend |
Kent |
DA11 0HJ |
BANKERS: | Lloyds TSB Bank plc |
34 High Street |
Grays |
Essex |
RM17 6LZ |
SOLICITORS: |
Wallside House |
12 Mount Ephraim Road |
Tunbridge Wells |
Kent |
TN1 1EG |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
GROUP STRATEGIC REPORT |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
The directors present their strategic report of the company and the group for the year ended 28 February 2023. |
REVIEW OF BUSINESS |
The group operates mainly from Caxton House , Basildon, Essex. |
The market has been difficult but the directors have continued to explore opportunities to invest and expand the operations of the group throughout the year. The group has maintained a strong financial position, with large reserves held of liquid funds as at the balance sheet date. |
The group is aware of its social and environmental responsibilities and continually seek ways to improve their environment policies and investing in new technologies to reduce it's carbon footprint. |
Fair review of business and key performance indicators |
The directors consider that the key financial performance indicators (KPIs) are those factors by reference to which the performance, development and strength of the group's business can be measured by its members. These KPIs comprise turnover, gross profit percentage, operating profit and net assets. |
- Turnover for the year increased by 12.04% to £39.07 million (2022: increased by 90.28% to £34.87 million). |
- Gross profit percentage decreased to 13.84% (2022: decreased to 15.76%). |
- Operating profit for the year was £2.20 million (2022: Operating profit £2.12 million). |
- Net current assets decreased to £7.77 million (2022: increased to £9.14 million). |
Principal risks and uncertainties |
The operations and management of the business are subject to a number of risks. These risks are reviewed by the directors on an ongoing basis. The main risks identified by the director are as follows:- |
- Scrap prices are fixed by the end users and reflect supply and demand worldwide: as a result prices can be |
volatile and may fluctuate on a daily basis. |
- Scrap demand depends on both domestic and overseas levels of steel production and currency |
which in turn is closely linked to economic conditions. |
- Possible scrap shortage. |
- Continuing regulation of the industry will significantly increase the cost of compliance. |
- High transport costs. |
- Fluctuation in exchange rates, which affect exports and scrap prices. |
The group maintains a high level of liquid funds to mitigate some of the uncertainties in the business environment in which it operates. |
Financial risk, management objective and policies |
The group's principal financial instruments comprise cash balances. The group has no bank loans. |
The group has taken action to mitigate its liquidity risk by making sure all liabilities are paid on time and the group's cash has been spread over different financial institutions. |
ON BEHALF OF THE BOARD: |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
The directors present their report with the financial statements of the company and the group for the year ended 28 February 2023. |
DIVIDENDS |
An interim dividend of £4 per share was paid on the Ordinary B £1 shares on 5 April 2022. No dividends were paid on the Ordinary A £1 shares. |
The total distribution of dividends for the year ended 28 February 2023 will be £ 3,500 . |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 March 2022 to the date of this report. |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Group 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 the group and of the profit or loss of the group 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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
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 group'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 group's auditors are aware of that information. |
AUDITORS |
The auditors, The Carley Partnership, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
BENFLEET SCRAP CO LIMITED |
Opinion |
We have audited the financial statements of Benfleet Scrap Co Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 28 February 2023 which comprise the Consolidated Statement of Comprehensive Income, Consolidated Statement of Financial Position, Company Statement of Financial Position, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Statement of Cash Flows and Notes to the Consolidated Statement of Cash Flows, 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 group's and of the parent company affairs as at 28 February 2023 and of the group's 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 group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. |
Conclusions relating to going concern |
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. |
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and the parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. |
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Group 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 Group 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 Group 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 |
BENFLEET SCRAP CO LIMITED |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the parent company financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of directors' remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page three, 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 group's and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so. |
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: |
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, our approach was as follows: |
- we obtained an understanding of the nature of the industry and sector, including the legal and regulatory frameworks that are applicable to the company and of how the company is complying with those frameworks; |
- we enquired of management about their own identification and assessment of the risks of irregularities, including any known instances of fraud; |
- we discussed matters concerning non-compliance with laws and regulations and how fraud might occur including assessment of how the financial statements might be susceptible to fraud. |
As a result of these procedures we consider that the most significant laws and regulations relating to the financial statements are FRS102, the Companies Act 2006 and tax compliance regulations. We performed audit procedures to enable us to detect non-compliance with significant laws and regulations which may have a material impact on the financial statements which included reviewing disclosures within the financial statements and inspecting correspondence with tax authorities. |
We considered the risk of fraud through management override and revenue recognition as the areas where the financial statements were most susceptible to material misstatement due to fraud. In response, we incorporated testing of the appropriateness of journal entries, assessing judgements made by management in making accounting estimates and evaluating the business rationale for any significant unusual transactions or those outside the normal course of business. |
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 |
BENFLEET SCRAP CO 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 |
St James's House |
8 Overcliffe |
Gravesend |
Kent |
DA11 0HJ |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
TURNOVER | 3 | 39,070,130 | 34,871,814 |
Cost of sales | 33,663,274 | 29,375,732 |
GROSS PROFIT | 5,406,856 | 5,496,082 |
Administrative expenses | 3,203,965 | 3,426,729 |
2,202,891 | 2,069,353 |
Other operating income | - | 57,796 |
OPERATING PROFIT | 5 | 2,202,891 | 2,127,149 |
Income from interest in associated undertakings |
(294 |
) |
- |
Interest receivable and similar income | 6 | 45,198 | 17,598 |
44,904 | 17,598 |
2,247,795 | 2,144,747 |
Interest payable and similar expenses | 7 | 29,849 | 26,087 |
PROFIT BEFORE TAXATION | 2,217,946 | 2,118,660 |
Tax on profit | 8 | 901,532 | 374,918 |
PROFIT FOR THE FINANCIAL YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
1,316,414 |
1,743,742 |
Profit attributable to: |
Owners of the parent | 1,508,031 | 1,743,742 |
Non-controlling interests | (191,617 | ) | - |
1,316,414 | 1,743,742 |
Total comprehensive income attributable to: |
Owners of the parent | 1,508,031 | 1,743,742 |
Non-controlling interests | (191,617 | ) | - |
1,316,414 | 1,743,742 |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
CONSOLIDATED STATEMENT OF FINANCIAL POSITION |
28 FEBRUARY 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Tangible assets | 11 | 5,607,049 | 3,800,541 |
Investments | 12 |
Interest in associate | 371,556 | - |
Investment property | 13 | 3,670,000 | - |
9,648,605 | 3,800,541 |
CURRENT ASSETS |
Stocks | 14 | 1,290,917 | 1,709,791 |
Debtors | 15 | 5,503,065 | 6,254,015 |
Cash at bank and in hand | 7,819,912 | 6,523,739 |
14,613,894 | 14,487,545 |
CREDITORS |
Amounts falling due within one year | 16 | 7,211,722 | 5,343,499 |
NET CURRENT ASSETS | 7,402,172 | 9,144,046 |
TOTAL ASSETS LESS CURRENT LIABILITIES |
17,050,777 |
12,944,587 |
CREDITORS |
Amounts falling due after more than one year |
17 |
(8,111 |
) |
(146,382 |
) |
PROVISIONS FOR LIABILITIES | 19 | (1,692,330 | ) | (440,319 | ) |
NET ASSETS | 15,350,336 | 12,357,886 |
CAPITAL AND RESERVES |
Called up share capital | 20 | 500 | 500 |
Retained earnings | 21 | 13,861,917 | 12,357,386 |
SHAREHOLDERS' FUNDS | 13,862,417 | 12,357,886 |
NON-CONTROLLING INTERESTS | 1,487,919 | - |
TOTAL EQUITY | 15,350,336 | 12,357,886 |
The financial statements were approved by the Board of Directors and authorised for issue on 24 November 2023 and were signed on its behalf by: |
R B Leeman - Director |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
COMPANY STATEMENT OF FINANCIAL POSITION |
28 FEBRUARY 2023 |
2023 | 2022 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Tangible assets | 11 |
Investments | 12 |
Investment property | 13 |
CURRENT ASSETS |
Stocks | 14 |
Debtors | 15 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 16 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year |
17 |
( |
) |
( |
) |
PROVISIONS FOR LIABILITIES | 19 | ( |
) | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 20 |
Retained earnings | 21 |
SHAREHOLDERS' FUNDS |
Company's profit for the financial year | 1,611,973 | 1,743,742 |
The financial statements were approved by the Board of Directors and authorised for issue on |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
Called up |
share | Retained | Non-controlling | Total |
capital | earnings | Total | interests | equity |
£ | £ | £ | £ | £ |
Balance at 1 March 2021 | 500 | 10,616,144 | 10,616,644 | - | 10,616,644 |
Changes in equity |
Dividends | - | (2,500 | ) | (2,500 | ) | - | (2,500 | ) |
Total comprehensive income | - | 1,743,742 | 1,743,742 | - | 1,743,742 |
Balance at 28 February 2022 | 500 | 12,357,386 | 12,357,886 | - | 12,357,886 |
Changes in equity |
Dividends | - | (3,500 | ) | (3,500 | ) | - | (3,500 | ) |
Total comprehensive income | - | 1,508,031 | 1,508,031 | (191,617 | ) | 1,316,414 |
500 | 13,861,917 | 13,862,417 | (191,617 | ) | 13,670,800 |
Acquisition of non-controlling interest |
- |
- |
- |
1,679,536 |
1,679,536 |
Balance at 28 February 2023 | 500 | 13,861,917 | 13,862,417 | 1,487,919 | 15,350,336 |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
COMPANY STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 March 2021 |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - |
Balance at 28 February 2022 |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - |
Balance at 28 February 2023 |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
CONSOLIDATED STATEMENT OF CASH FLOWS |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
2023 | 2022 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 | 3,979,372 | 1,421,345 |
Interest element of hire purchase payments paid |
(29,849 |
) |
(26,087 |
) |
Tax paid | (331,501 | ) | (90,392 | ) |
Net cash from operating activities | 3,618,022 | 1,304,866 |
Cash flows from investing activities |
Purchase of tangible fixed assets | (3,175,776 | ) | (533,254 | ) |
Sale of tangible fixed assets | 764,301 | 88,000 |
Subsidiary's cash and equivalents b'fwd | 569,450 | - |
Interest received | 45,198 | 17,598 |
Net cash from investing activities | (1,796,827 | ) | (427,656 | ) |
Cash flows from financing activities |
Capital repayments in year | (351,633 | ) | (334,411 | ) |
Amount withdrawn by directors | (169,889 | ) | (30,246 | ) |
Equity dividends paid | (3,500 | ) | (2,500 | ) |
Net cash from financing activities | (525,022 | ) | (367,157 | ) |
Increase in cash and cash equivalents | 1,296,173 | 510,053 |
Cash and cash equivalents at beginning of year |
2 |
6,523,739 |
6,013,686 |
Cash and cash equivalents at end of year |
2 |
7,819,912 |
6,523,739 |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
NOTES TO THE CONSOLIDATED STATEMENT OF CASH FLOWS |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
1. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
2023 | 2022 |
£ | £ |
Profit before taxation | 2,217,946 | 2,118,660 |
Depreciation charges | 951,089 | 967,054 |
(Profit)/loss on disposal of fixed assets | (346,122 | ) | 560 |
Goodwill impairment | (180,683 | ) | - |
Interest in associate undertakings | 294 | - |
Finance costs | 29,849 | 26,087 |
Finance income | (44,904 | ) | (17,598 | ) |
2,627,469 | 3,094,763 |
Decrease/(increase) in stocks | 418,874 | (828,121 | ) |
Decrease/(increase) in trade and other debtors | 1,006,891 | (2,853,419 | ) |
(Decrease)/increase in trade and other creditors | (73,862 | ) | 2,008,122 |
Cash generated from operations | 3,979,372 | 1,421,345 |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts: |
Year ended 28 February 2023 |
28.2.23 | 1.3.22 |
£ | £ |
Cash and cash equivalents | 7,819,912 | 6,523,739 |
Year ended 28 February 2022 |
28.2.22 | 1.3.21 |
£ | £ |
Cash and cash equivalents | 6,523,739 | 6,013,686 |
3. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1.3.22 | Cash flow | At 28.2.23 |
£ | £ | £ |
Net cash |
Cash at bank and in hand | 6,523,739 | 1,296,173 | 7,819,912 |
6,523,739 | 1,296,173 | 7,819,912 |
Debt |
Finance leases | (505,372 | ) | 351,633 | (153,739 | ) |
(505,372 | ) | 351,633 | (153,739 | ) |
Total | 6,018,367 | 1,647,806 | 7,666,173 |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
1. | STATUTORY INFORMATION |
Benfleet Scrap Co Limited is a private company, limited by shares, registered in England and Wales. The Company's registered number and registered address can be found on the Company Information page. |
2. | ACCOUNTING POLICIES |
Statement of compliance |
These financial statements have been prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. |
Basis of preparing financial statements |
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through the statement of comprehensive income. |
The financial statements are presented in Sterling, which is the functional currency of the entity. |
Basis of consolidation |
The consolidated financial statements comprise the accounts of Benfleet Scrap Co Limited and its subsidiary undertaking, P W Leeman Limited, to 28th February 2023 prepared using the purchase method in accordance with FRS102. Intra group transactions and balances have been eliminated on consolidation. |
Significant judgements and estimates |
There are no significant estimates or assumptions made that have significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year. |
Revenue recognition |
Revenue refers to the amounts earned from the group's principal activity that was mainly the sale of scrap metal, plus amounts receivable for rent. |
The revenue shown in the income statement represents amounts invoiced during the year, exclusive of Value Added Tax. |
Tangible fixed assets |
Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. |
Depreciation |
Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter. |
Plant & machinery - 20% on reducing balance & 10% on cost |
Motor vehicles - 25% on reducing balance |
Short Leasehold - Amortised over period of lease or amortised at 20% on a straight line basis |
Investments in associates |
Associate undertakings are accounted for using the equity method in accordance with FRS102. |
Investment property |
Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss. |
Stocks |
Stocks are valued at the lower of cost and estimated selling price less costs to sell, after making due allowance for obsolete and slow moving items. The nature of the company's stock are scrap metal. |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
2. | ACCOUNTING POLICIES - continued |
Financial instruments |
Financial instruments are classified and accounted for, according to the substance of the contractual arrangement, as either financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities. |
The group has a long-term financial asset that is recognised at amortised cost. More details can be found in the related party disclosure note. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Hire purchase and leasing commitments |
Rentals paid under operating leases are charged to the profit and loss account on a straight line basis over the period of the lease. |
Assets obtained under hire purchase contracts and finance leases are capitalised as tangible assets and depreciated over the shorter of the lease term and their useful lives. Obligations under such agreements are included in creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to the profit and loss account so as to produce a constant periodic rate of charge on the net obligation outstanding in each period. |
Defined contribution plans |
Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund. |
Debtors |
Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment. |
Creditors |
Short term trade creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method. |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
2. | ACCOUNTING POLICIES - continued |
Provisions for liabilities |
Provisions are recognised when the company has a present obligation (legal or constructive) as a result of a past event, it is probable that the company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. |
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. |
Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value using a pre-tax discount rate. The amount of discount is recognised as finance cost in profit or loss in the period it arises. |
The company recognises a provision for annual leave accrued by employees as a result of services rendered in the current period, and which employees are entitled to carry forward and use within the next 12 months. The provision is measured at the salary cost payable for the period of absence. |
3. | TURNOVER |
The group does not disclose its turnover by geographic location as it considers that it would be detrimental to its business. |
4. | EMPLOYEES AND DIRECTORS |
2023 | 2022 |
£ | £ |
Wages and salaries | 3,388,219 | 3,039,918 |
Social security costs | 356,476 | 296,483 |
Other pension costs | 60,773 | 57,736 |
3,805,468 | 3,394,137 |
The average number of employees during the year was as follows: |
2023 | 2022 |
Administrative staff | 29 | 27 |
Operatives | 69 | 72 |
2023 | 2022 |
£ | £ |
Directors' remuneration | 182,000 | 132,000 |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes | 2 | 2 |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
5. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
2023 | 2022 |
£ | £ |
Hire of plant and machinery | 748,959 | 645,788 |
Other operating leases | 484,317 | 488,900 |
Depreciation - owned assets | 951,089 | 967,053 |
(Profit)/loss on disposal of fixed assets | (346,122 | ) | 560 |
Auditors' remuneration | 22,195 | 16,655 |
Foreign exchange differences | (38 | ) | 31 |
Operating profit or loss is the profit or loss from business operations before deduction of interest and taxes. |
6. | INTEREST RECEIVABLE AND SIMILAR INCOME |
2023 | 2022 |
£ | £ |
Deposit account interest | 4,358 | 343 |
Other interest received | 40,840 | 17,255 |
45,198 | 17,598 |
7. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2023 | 2022 |
£ | £ |
Hire purchase | 29,849 | 26,087 |
8. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
2023 | 2022 |
£ | £ |
Current tax: |
UK corporation tax | (238,734 | ) | 387,837 |
Deferred tax | 1,140,266 | (12,919 | ) |
Tax on profit | 901,532 | 374,918 |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
8. | TAXATION - continued |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
2023 | 2022 |
£ | £ |
Profit before tax | 2,217,946 | 2,118,660 |
Profit multiplied by the standard rate of corporation tax in the UK of 19 % (2022 - 19 %) |
421,410 |
402,545 |
Effects of: |
Expenses not deductible for tax purposes | 927 | 514 |
Capital allowances in excess of depreciation | (586,192 | ) | - |
Unrecognised deferred tax | - | (33 | ) |
Permanently disallowed depreciation | - | 890 |
Capital allowances super-deduction | - | (25,897 | ) |
Profit on disposal of fixed assets | (65,763 | ) | - |
Fixed assets proceeds in excess of cost | 10,480 | - |
Goodwill recognised in profit or loss | (34,329 | ) | - |
Subsidiary's pre-acquisition loss | 14,677 | - |
Share of associate's profit/loss | 56 | - |
Change in deferred tax rate | - | (3,101 | ) |
Deferred tax movement | 1,140,266 | - |
Total tax charge | 901,532 | 374,918 |
9. | INDIVIDUAL STATEMENT OF COMPREHENSIVE INCOME |
As permitted by Section 408 of the Companies Act 2006, the Statement of Comprehensive Income of the parent company is not presented as part of these financial statements. |
10. | DIVIDENDS |
2023 | 2022 |
£ | £ |
Ordinary B shares of £1 each |
Interim | 3,500 | 2,500 |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
11. | TANGIBLE FIXED ASSETS |
Group |
Fixtures |
Short | Plant and | and | Motor |
leasehold | machinery | fittings | vehicles | Totals |
£ | £ | £ | £ | £ |
COST |
At 1 March 2022 | 665,923 | 7,211,886 | 14,134 | 2,616,270 | 10,508,213 |
Additions | 45,502 | 2,398,479 | - | 731,795 | 3,175,776 |
Disposals | - | (880,917 | ) | (14,134 | ) | (439,815 | ) | (1,334,866 | ) |
At 28 February 2023 | 711,425 | 8,729,448 | - | 2,908,250 | 12,349,123 |
DEPRECIATION |
At 1 March 2022 | 541,974 | 4,446,414 | 14,134 | 1,705,150 | 6,707,672 |
Charge for year | 13,713 | 593,760 | - | 343,616 | 951,089 |
Eliminated on disposal | - | (530,802 | ) | (14,134 | ) | (371,751 | ) | (916,687 | ) |
At 28 February 2023 | 555,687 | 4,509,372 | - | 1,677,015 | 6,742,074 |
NET BOOK VALUE |
At 28 February 2023 | 155,738 | 4,220,076 | - | 1,231,235 | 5,607,049 |
At 28 February 2022 | 123,949 | 2,765,472 | - | 911,120 | 3,800,541 |
Company |
Short | Plant and | Motor |
leasehold | machinery | vehicles | Totals |
£ | £ | £ | £ |
COST |
At 1 March 2022 |
Additions |
Disposals | ( |
) | ( |
) | ( |
) |
At 28 February 2023 |
DEPRECIATION |
At 1 March 2022 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) | ( |
) |
At 28 February 2023 |
NET BOOK VALUE |
At 28 February 2023 |
At 28 February 2022 |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
11. | TANGIBLE FIXED ASSETS - continued |
Company |
Included above are assets held under finance leases or hire purchase contracts as follows: |
Plant & Machinery |
£ |
Net book values |
At 28 February 2023 | 644,074 |
At 29 February 2022 | 1,354,732 |
Depreciation charge for the year |
At 28 February 2023 | 161,019 |
At 29 February 2022 | 345,738 |
12. | FIXED ASSET INVESTMENTS |
Group |
Interest |
in |
associate |
£ |
COST |
Additions | 371,850 |
Share of profit/(loss) | (294 | ) |
At 28 February 2023 | 371,556 |
NET BOOK VALUE |
At 28 February 2023 | 371,556 |
Company |
Shares in | Interest |
group | in |
undertakings | associate | Totals |
£ | £ | £ |
COST |
Additions | 2,683,355 |
At 28 February 2023 | 2,683,355 |
NET BOOK VALUE |
At 28 February 2023 | 2,683,355 |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
12. | FIXED ASSET INVESTMENTS - continued |
The company's investments at the balance sheet date in the share capital of companies includes the following subsidiary and associate: |
Subsidiary - P W Leeman Limited |
Registered office: 8 Overcliffe, Gravesend, Kent, DA11 0HJ |
Nature of business: Property rental |
Class of shares |
No. of shares |
No. of shares held |
% holding |
Ordinary A | 16,666 | - | - |
Ordinary B | 50,000 | 33,333 | 66.67% |
Ordinary C | 11,000 | 9,215 | 83.77% |
Ordinary D | 971 | - | - |
Ordinary E | 11,000 | 11,000 | 100% |
89,637 | 53,548 | 59.74% |
Associate - The Thurrock Scrap Company Limited |
Registered office: 8 Overcliffe, Gravesend, Kent, DA11 0HJ |
Nature of business: Investment company |
Class of shares |
No. of shares |
No. of shares held |
% holding |
Ordinary | 1,000 | 500 | 50% |
13. | INVESTMENT PROPERTY |
Group |
Total |
£ |
FAIR VALUE |
At 1 March 2022 |
and 28 February 2023 | 3,670,000 |
NET BOOK VALUE |
At 28 February 2023 | 3,670,000 |
At 28 February 2022 | 3,670,000 |
The group's investment properties have been measured at fair value which is the open market value of the properties. The fair value adjustments have been taken through to the profit or loss acount. |
14. | STOCKS |
Group | Company |
2023 | 2022 | 2023 | 2022 |
£ | £ | £ | £ |
Stock | 1,290,917 | 1,709,791 |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
15. | DEBTORS |
Group | Company |
2023 | 2022 | 2023 | 2022 |
£ | £ | £ | £ |
Amounts falling due within one year: |
Trade debtors | 3,290,955 | 4,675,616 |
Bad debt provision | (2,644 | ) | (106,144 | ) | (2,644 | ) | (106,144 | ) |
Other debtors | 301,908 | 123,637 |
Directors' current accounts | - | 32,659 | - | 32,659 |
Tax | 259,361 | 56,383 |
Prepayments and accrued income | 472,816 | 191,195 |
4,322,396 | 4,973,346 |
Amounts falling due after more than one | year: |
Other debtors | 1,180,669 | 1,280,669 |
Aggregate amounts | 5,503,065 | 6,254,015 |
16. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
2023 | 2022 | 2023 | 2022 |
£ | £ | £ | £ |
Hire purchase contracts (see note 18) | 145,628 | 358,990 |
Trade creditors | 2,619,652 | 2,571,360 |
Tax | 20,614 | 387,871 |
Social security and other taxes | 385,120 | 691,302 |
VAT | 4,923 | - | - | - |
Other creditors | 51,081 | 34,212 |
Directors' current accounts | 2,478,957 | - | 2,478,957 | - |
Accrued expenses | 1,505,747 | 1,299,764 |
7,211,722 | 5,343,499 |
17. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
Group | Company |
2023 | 2022 | 2023 | 2022 |
£ | £ | £ | £ |
Hire purchase contracts (see note 18) | 8,111 | 146,382 |
Obligations under hire purchase agreements are secured on the associated assets. |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
18. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Group |
Hire purchase contracts |
2023 | 2022 |
£ | £ |
Net obligations repayable: |
Within one year | 145,628 | 358,990 |
Between one and five years | 8,111 | 146,382 |
153,739 | 505,372 |
Company |
Hire purchase contracts |
2023 | 2022 |
£ | £ |
Net obligations repayable: |
Within one year |
Between one and five years |
Group |
Non-cancellable operating | leases |
2023 | 2022 |
£ | £ |
Within one year | 313,220 | 278,346 |
Between one and five years | 540,713 | 669,311 |
In more than five years | 997,041 | 1,187,273 |
1,850,974 | 2,134,930 |
Company |
Non-cancellable operating | leases |
2023 | 2022 |
£ | £ |
Within one year |
Between one and five years |
In more than five years |
19. | PROVISIONS FOR LIABILITIES |
Group | Company |
2023 | 2022 | 2023 | 2022 |
£ | £ | £ | £ |
Deferred tax | 1,692,330 | 440,319 | 1,094,210 | 440,319 |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
19. | PROVISIONS FOR LIABILITIES - continued |
Group |
Deferred |
tax |
£ |
Balance at 1 March 2022 | 440,319 |
Charge to Statement of Comprehensive Income during year | 1,140,266 |
Subsidiary's provision b'fwd | 111,745 |
Balance at 28 February 2023 | 1,692,330 |
Company |
Deferred |
tax |
£ |
Balance at 1 March 2022 |
Charge to Statement of Comprehensive Income during year |
movement |
Balance at 28 February 2023 |
2023 | 2022 |
£ | £ |
Accelerated capital allowances | 1,094,107 | 440,319 |
Fair value adjustments | 598,223 |
Tax losses | - | - |
1,692,330 | 440,319 |
20. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2023 | 2022 |
value: | £ | £ |
Ordinary A | £1 | 125 | 125 |
Ordinary B | £1 | 375 | 375 |
500 | 500 |
Both classes of share rank equally in all respects with the exception of voting of dividends that may be declared on a class of share to the exclusion of the other or may be declared at varying rates. |
21. | RESERVES |
Group |
Retained |
earnings |
£ |
At 1 March 2022 | 12,357,386 |
Profit for the year | 1,508,031 |
Dividends | (3,500 | ) |
At 28 February 2023 | 13,861,917 |
BENFLEET SCRAP CO LIMITED (REGISTERED NUMBER: 03031502) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 28 FEBRUARY 2023 |
21. | RESERVES - continued |
Company |
Retained |
earnings |
£ |
At 1 March 2022 |
Profit for the year |
Dividends | ( |
) |
At 28 February 2023 |
22. | RELATED PARTY DISCLOSURES |
The directors/shareholders have significant control of another company. Benfleet Scrap Co Limited has an agreement in place whereby it would make available a maximum of £3,000,000 for the other company to draw down from 23rd August 2011. The loan is repayable in full by 23rd August 2046. The loan is secured by a legal mortgage over the other company's freehold property. Capital repayments of £25,000 per quarter commenced as at 21st September 2016 as per the agreement. |
The loan balance owed to Benfleet Scrap Co Limited as at 28th February 2023 was £1,280,669 (2022: £1,380,669), with £100,000 included in short-term debtors and £1,180,669 included in long-term debtors. Interest is charged on this loan at 1% above the Bank of England Base Rate. Interest owed to Benfleet Scrap Co Limited as at the balance sheet date was £14,671 (2022: £4,477) which is included in debtors due within one year. |
A separate short term cash flow loan was given to the other company during the year and the balance owed to Benfleet Scrap Co Limited as at 28th February 2023 was £150,000 (2022: nil). |
Benfleet Scrap Co Limited also made sales of £4,371,214 (2022: £2,245,713) and purchases of £4,867,807 (2022: £2,549,994) to the other company during the year, with there being a trade debtor balance of £802,825 (2022: £1,492,863) and a trade creditor balance of £697,560 (2022: £462,816) as at 28th February 2023. The subsidiary undertaking, P W Leeman Limited, made sales of £40,000 (2022: £40,000) to the other company during the year. All transactions were conducted under normal market conditions. |
The subsidiary undertaking, P W Leeman Limited, paid expenses on behalf of the associate undertaking, The Thurrock Scrap Company Limited, totalling £1,217 (2022: £561) during the year and a payable balance of £7,998 (2022: £6,781) is within other creditors falling due within one year at 28th February 2023. |
Benfleet Scrap Co Limited paid rent of £48,559 (2022: £46,000) to a pension scheme for which it is the sponsoring employer and as at 28th February 2023 the company was owed £4,376 (2022: nil). All transactions were conducted under normal market conditions. |
23. | ACQUISITION OF SUBSIDIARY UNDERTAKING |
The goodwill arising on the acquisition of the subsidiary undertaking during the period is as follows: |
£ |
Consideration | 2,311,505 |
Fair value of net assets at aquisition | (4,171,724 | ) |
Non-controlling interest at aquisition | 1,679,536 |
Goodwill | (180,683 | ) |
The fair value of the subsidiary undertaking's assets at acquisition were equal to the book values. |