REGISTERED NUMBER:
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Strategic Report, |
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Report of the Directors and |
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Audited Financial Statements |
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FOR THE PERIOD |
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1 August 2019 to 31 August 2020 |
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for
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HATS GROUP LTD |
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REGISTERED NUMBER:
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Strategic Report, |
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Report of the Directors and |
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Audited Financial Statements |
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FOR THE PERIOD |
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1 August 2019 to 31 August 2020 |
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for
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HATS GROUP LTD |
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HATS GROUP LTD (REGISTERED NUMBER: 03135655)
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Contents of the Financial Statements
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FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
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Page
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Company Information
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1
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Strategic Report
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2
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Report of the Directors
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4
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Directors' Responsibilities Statement
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6
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Report of the Independent Auditors
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7
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Income Statement
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10
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Other Comprehensive Income
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11
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Balance Sheet
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12
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Statement of Changes in Equity
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13
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Cash Flow Statement
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14
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Notes to the Cash Flow Statement
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15
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Notes to the Financial Statements
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18
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HATS GROUP LTD
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Company Information
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FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
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DIRECTORS:
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REGISTERED OFFICE:
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REGISTERED NUMBER:
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SENIOR STATUTORY
AUDITOR:
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AUDITORS:
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Newport House
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Newport Road
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Stafford
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Staffordshire
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ST16 1DA
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HATS GROUP LTD (REGISTERED NUMBER: 03135655)
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Strategic Report
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FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
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The directors present their strategic report for the period 1 August 2019 to 31 August 2020.
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REVIEW OF BUSINESS
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The results for the year and financial position of the company are shown in the annexed financial
statements.The principal activity of the company is the supply of logistical solutions to Local
Government & the NHS and private sector.
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PRINCIPAL RISKS AND UNCERTAINTIES
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The company operates in an uncertain environment that may result in increased risk, cost
pressure and time pressures. Due to the nature of the industry additional pressures from
customers can arise without time to plan for them. The following are the key risks that face the
company;
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-Financing risks
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The financial risk to the company going forward is dependent on the current market. As the
company deals in transportation logistics over short and medium length contracts this mitigates
immediate financing risk, however not long term risks. The company's finances are supported by
its ability to gain a competitive advantage over its competitors.
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-Market and other regulatory requirements
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Existing and possible future legislation, regulations and actions could cause additional operational
expense, capital expenditure, reduction in scope and further product development change, the
extent of which cannot be predicted. The company takes responsibility for ensuring that all
relevant legislation is met.
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-Operation risks
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These include equipment failure, damage or substandard service, and include changes in
customer operations and targets. The risk of oil price changes affecting the cost of sales is an
uncontrollable risk for the company. The company seeks to minimise these risks by investing in
environmentally advanced equipment, improvements in training and customer engagement whilst
closely monitoring the legislation developments within its market.
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EMPLOYEES
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The company has continued to give full and fair consideration to applications made by persons of
all diversities, having regard to their respective aptitudes and abilities, and to ensure that they
benefit from training and career development programmes in common with all employees. The
company has continued its policy of employee involvement by making information available to
employees through the medium of frequent staff meetings, together with personal appraisals and
feedback sessions.
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PAYMENT OF CREDITORS
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The company does not follow any published code or statement on payment practice. However, it is
the company's policy to settle all amounts due to its creditors on a timely basis, taking into
account the credit terms by each supplier.
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HATS GROUP LTD (REGISTERED NUMBER: 03135655)
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Strategic Report
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FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
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LIKELY FUTURE DEVELOPMENTS
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HATS Group are expected to continue with strong growth throughout 2020/2021.
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During the year we continued to make efficiencies, especially in respect of our capital assets
(vehicles). The full year impact of these savings has continued to show trough the results of the
business. A strong performance through the COVID-19 pandemic is expected to continue through
next year & this has helped to strengthen the company and its ability to react to changes in the
trading environment.
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We are also on course to continue to grow our client base, both organically and through new
contracts in the field of patient transport services and passengers with special educational needs
and disabilities (SEND).
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KEY PERFORMANCE INDICATORS
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At HATS Group we recognise that we can only continue to deliver excellent standards of service to
our clients by having a successful, sustainable and dynamic company.
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To enable this, we use two Key Performance Indicators; Revenue and Net Profit. Both of these
KPI's have been achieved.
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These figures are for an increased 13 month period not 12 months so some of the increases are
due to this.
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We have seen a dynamic growth in 2019,20, with turnover increasing from £34,235,448 in
2018/19 to £41,069,891 a growth of 11% on a pro rata basis.
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This growth has been driven by the full impact of new patient transport service contracts (PTS)
plus additional transport requirements throughout the COVID-19 pandemic. SEND transport
contracts for London Boroughs and new clients in the Home Counties contracts have been slightly
lower than the previous year due to the COVID-19 Pandemic and closure of schools.
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2019/20 reads a very good period for HATS Group, with a gross profit increase of £837,523 to
£4,843,488. This strong growth marks a 18% increase in gross profit compared from the previous
year on a pro rata basis.
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Additionally, net profit increased to £2,188,464. This marks a 31% increase in net profit on a pro
rata basis.
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Our ability to increase net profit at an accelerated rate compared to gross profit is due to our
increasing capacity to achieve continued operational effectiveness. These benefits include
increased synergies across our two principal departments (patient transport and home to school)
as well as economies of scale benefits arising from increased growth.
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We are exceptionally proud of our commercial performance, especially when combined with our
excellent front line services levels and regulatory compliance.
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ON BEHALF OF THE BOARD:
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HATS GROUP LTD (REGISTERED NUMBER: 03135655)
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Report of the Directors
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FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
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The directors present their report with the financial statements of the company for the period 1 August 2019 to 31 August 2020.
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DIVIDENDS
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No dividends will be distributed for the period ended 31 August 2020.
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EVENTS SINCE THE END OF THE PERIOD
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Information relating to events since the end of the period is given in the notes to the financial statements.
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DIRECTORS
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The directors shown below have held office during the whole of the period from 1 August 2019 to
the date of this report.
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RESULTS REVIEW
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The company's key performance numbers within the year were:
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Year
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2020
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2019
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Turnover
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41,069,891
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34,235,448
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Gross Profit
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4,843,488
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4,005,965
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Net Assets
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5,748,818
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4,048,825
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During the 13 month period there was a 40% increase in patient transport services for NHS
trusts, this was a combination of a full period of trade for new contracts and the affects and
requirements due to the COVID-19 pandemic. However there was a decrease in the turnover of
SEND transport contracts for London Boroughs and in the Home Counties contracts due to the
COVID-19 Pandemic and closure of schools. These 13 month figures also include 2 months of
August where schools are closed.
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With these two factors it was still a strong year of growth and a full school year with no additional
closures except for standard school holidays should will show strong growth again into next year.
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The company aims to continue to grow its client base organically. The target growth areas are
within vulnerable adults & passengers with special educational needs and disabilities (SEND) &
within patient transport area of NHS trusts.
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The company has the structure in place and operational scope to grow in these target areas.
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STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
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So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
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Report of the Directors
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FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
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AUDITORS
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The auditors, Howards Limited, will be proposed for re-appointment at the forthcoming Annual
General Meeting. We appointed new auditors following the passing away of our previous auditor,
there were no other circumstances to be notified in the change of auditors.
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ON BEHALF OF THE BOARD:
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HATS GROUP LTD (REGISTERED NUMBER: 03135655)
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Directors' Responsibilities Statement
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FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
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The directors are responsible for preparing the financial statements in accordance with applicable law and regulations. |
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Company law requires the directors to prepare the financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with Financial Reporting Standards 102 as adopted for use in the UK and Republic of Ireland. The financial statements are required by law to 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 year. In preparing these financial statements, the directors are required to |
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- select suitable accounting policies and then apply them consistently; |
- make judgements and 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. |
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The directors are responsible for keeping adequate accounting records which disclose with reasonable accuracy at any time the financial position of the company and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
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The directors are responsible for the maintenance and integrity of corporate and financial information on the company's website. |
Report of the Independent Auditors to the Members of
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HATS Group Ltd
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Opinion
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We have audited the financial statements of HATS Group Ltd (the 'company') for the period ended 31 August 2020 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
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In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 31 August 2020 and of its profit for the period 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. |
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Basis for opinion
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We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK))
and applicable law. Our responsibilities under those standards are further described in the
Auditors' responsibilities for the audit of the financial statements section of our report. We are
independent of the company in accordance with the ethical requirements that are relevant to our
audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have
fulfilled our other ethical responsibilities in accordance with these requirements. We believe that
the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
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Conclusions relating to going concern
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We have nothing to report in respect of the following matters in relation to which the ISAs (UK)
require us to report to you where:
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the directors' use of the going concern basis of accounting in the preparation of the financial
statements is not appropriate; or
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the directors have not disclosed in the financial statements any identified material uncertainties
that may cast significant doubt about the company's ability to continue to adopt the going
concern basis of accounting for a period of at least twelve months from the date when the
financial statements are authorised for issue.
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Other information
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The directors are responsible for the other information. The other information comprises the
information in the Strategic Report, the Report of the Directors and the Directors' Responsibilities
Statement, but does not include the financial statements and our Report of the Auditors thereon.
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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.
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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 there is a material misstatement in the
financial statements or a material misstatement of the other information. 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.
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Report of the Independent Auditors to the Members of
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HATS Group Ltd
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Opinions on other matters prescribed by the Companies Act 2006
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In our opinion, based on the work undertaken in the course of the audit:
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the information given in the Strategic Report and the Report of the Directors for the financial
year for which the financial statements are prepared is consistent with the financial statements;
and
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the Strategic Report and the Report of the Directors have been prepared in accordance with
applicable legal requirements.
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Matters on which we are required to report by exception
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In the light of the knowledge and understanding of the company and its environment obtained in
the course of the audit, we have not identified material misstatements in the Strategic Report or
the Report of the Directors.
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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:
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adequate accounting records have not been kept, or returns adequate for our audit have not
been received from branches not visited by us; or
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the financial statements are not in agreement with the accounting records and returns; or
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certain disclosures of directors' remuneration specified by law are not made; or
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we have not received all the information and explanations we require for our audit.
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Responsibilities of directors
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As explained more fully in the Directors' Responsibilities Statement set out on page six, 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.
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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.
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Report of the Independent Auditors to the Members of
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HATS Group Ltd
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Auditors' responsibilities for the audit of the financial statements
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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.
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As part of an audit in accordance with ISAs (UK), we exercise professional judgement and
maintain professional scepticism throughout the audit. We also:
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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
audit 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.
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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.
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Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
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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 Report of the Auditors 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 Report of the Auditors. However, future events or
conditions may cause the company to cease to continue as a going concern.
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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.
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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.
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Use of our report
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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.
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for and on behalf of
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Newport House
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Newport Road
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Stafford
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Staffordshire
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ST16 1DA
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HATS GROUP LTD (REGISTERED NUMBER: 03135655)
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Income Statement
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FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
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Period
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Period
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1/8/19
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1/6/19
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to
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to
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31/8/20
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31/7/19
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as
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restated
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Notes
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£
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£
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TURNOVER
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Cost of sales
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GROSS PROFIT
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Administrative expenses
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OPERATING PROFIT
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4
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Interest payable and similar
expenses
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5
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PROFIT BEFORE TAXATION
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Tax on profit
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6
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PROFIT FOR THE FINANCIAL
PERIOD
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HATS GROUP LTD (REGISTERED NUMBER: 03135655)
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Other Comprehensive Income
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FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
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Period
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Period
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1/8/19
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1/6/19
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to
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to
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31/8/20
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31/7/19
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as
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restated
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Notes
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£
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£
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PROFIT FOR THE PERIOD
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OTHER COMPREHENSIVE INCOME
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Income tax relating to other
comprehensive income
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OTHER COMPREHENSIVE INCOME
FOR THE PERIOD, NET OF INCOME
TAX
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TOTAL COMPREHENSIVE INCOME
FOR THE PERIOD
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2,231,304
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Note
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Prior year adjustment
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7
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TOTAL COMPREHENSIVE INCOME
SINCE LAST ANNUAL REPORT
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HATS GROUP LTD (REGISTERED NUMBER: 03135655)
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Balance Sheet
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31 AUGUST 2020
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31/8/20
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31/7/19
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as restated
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Notes
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£
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£
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£
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£
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FIXED ASSETS
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Intangible assets
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8
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Tangible assets
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9
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CURRENT ASSETS
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Debtors
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10
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Cash at bank and in hand
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CREDITORS
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Amounts falling due within one year
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11
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NET CURRENT ASSETS
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TOTAL ASSETS LESS CURRENT
LIABILITIES
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CREDITORS
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Amounts falling due after more than
one year
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12
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(
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(
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PROVISIONS FOR LIABILITIES
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16
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(
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(
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NET ASSETS
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CAPITAL AND RESERVES
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Called up share capital
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17
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Revaluation reserve
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18
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Retained earnings
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18
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3,969,848
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SHAREHOLDERS' FUNDS
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4,048,825
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The financial statements were approved by the Board of Directors and authorised for issue on
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HATS GROUP LTD (REGISTERED NUMBER: 03135655)
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Statement of Changes in Equity
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FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
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Called up
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share
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Retained
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Revaluation
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Total
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capital
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earnings
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reserve
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equity
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£
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£
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£
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£
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Balance at 1 June 2019
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Changes in equity
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Total comprehensive income
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-
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Prior year adjustment
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-
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-
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(848,325
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)
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(848,325
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Balance at 31 July 2019
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Prior year adjustment
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-
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-
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As restated
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Changes in equity
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Total comprehensive income
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-
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Balance at 31 August 2020
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HATS GROUP LTD (REGISTERED NUMBER: 03135655)
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Cash Flow Statement
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FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
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Period
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Period
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1/8/19
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1/6/19
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to
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to
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31/8/20
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31/7/19
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as
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restated
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Notes
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£
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£
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Cash flows from operating activities
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Cash generated from operations
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1
|
|
|
|
|
|
Interest paid
|
(
|
)
|
(
|
)
|
|
Interest element of hire purchase
payments paid
|
(
|
)
|
(
|
)
|
|
Tax paid
|
(
|
)
|
(
|
)
|
|
Net cash from operating activities
|
|
|
|
|
|
|
Cash flows from investing activities
|
Purchase of tangible fixed assets
|
(
|
)
|
(
|
)
|
|
Sale of tangible fixed assets
|
|
|
|
|
|
Net cash from investing activities
|
(
|
)
|
(
|
)
|
|
|
Cash flows from financing activities
|
New finance in year
|
|
|
(
|
)
|
|
Capital repayments in year
|
(
|
)
|
|
|
|
Net cash from financing activities
|
(
|
)
|
|
|
|
|
Increase in cash and cash equivalents
|
|
|
|
|
|
Cash and cash equivalents at
beginning of period
|
2
|
|
|
(221,027
|
)
|
|
|
Cash and cash equivalents at end
of period
|
2
|
1,441,650
|
|
38,159
|
|
|
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
|
|
Notes to the Cash Flow Statement
|
FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
|
|
1.
|
RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM
OPERATIONS
|
|
Period
|
|
Period
|
|
1/8/19
|
|
1/6/19
|
|
to
|
|
to
|
|
31/8/20
|
|
31/7/19
|
|
as
|
restated
|
|
£
|
£
|
|
|
Profit before taxation
|
|
|
|
|
|
|
Depreciation charges
|
|
|
|
|
|
|
Loss on disposal of fixed assets
|
|
|
|
|
|
|
Finance costs
|
396,063
|
|
326,802
|
|
|
3,150,539
|
|
2,459,969
|
|
|
|
Decrease in stocks
|
|
|
|
|
|
|
Decrease/(increase) in trade and other debtors
|
|
|
(
|
)
|
|
|
Increase in trade and other creditors
|
|
|
|
|
|
|
Cash generated from operations
|
|
|
|
|
|
|
2.
|
CASH AND CASH EQUIVALENTS
|
|
|
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents
are in respect of these Balance Sheet amounts:
|
|
|
Period ended 31 August 2020
|
|
31/8/20
|
|
1/8/19
|
£
|
£
|
|
|
Cash and cash equivalents
|
1,441,650
|
|
38,159
|
|
|
|
Period ended 31 July 2019
|
|
31/7/19
|
|
1/6/19
|
|
as restated
|
|
£
|
£
|
|
|
Cash and cash equivalents
|
38,159
|
|
574
|
|
|
|
Bank overdrafts
|
|
|
(
|
)
|
|
38,159
|
|
(221,027
|
)
|
|
|
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
|
|
Notes to the Cash Flow Statement
|
FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
|
|
3.
|
ANALYSIS OF CHANGES IN NET DEBT
|
|
|
At 1/8/19
|
Cash flow
|
At 31/8/20
|
£
|
£
|
£
|
|
|
Net cash
|
|
|
Cash at bank and in hand
|
38,159
|
|
1,403,491
|
|
1,441,650
|
|
|
38,159
|
|
|
|
1,441,650
|
|
|
|
Debt
|
|
Finance leases
|
(2,542,653
|
)
|
(264,665
|
)
|
(2,807,318
|
)
|
|
|
Debts falling due within 1 year
|
(1,553,957
|
)
|
1,553,957
|
|
-
|
|
|
(4,096,610
|
)
|
1,289,292
|
|
(2,807,318
|
)
|
|
|
Total
|
(4,058,451
|
)
|
2,692,783
|
|
(1,365,668
|
)
|
|
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
|
|
Error Messages from the Cash Flow Statement
|
FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
|
|
|
**
|
LAST YEAR - MOVEMENT IN CASH AND CASH EQUIVALENTS
|
|
AS CALCULATED IN CASH FLOW STATEMENT
|
|
DOES NOT AGREE TO MOVEMENT PER BALANCE SHEET
|
|
|
COMPARE MOVEMENT ON CASH FLOW STATEMENT
|
=
|
1,578,222
|
|
|
|
|
|
TO
|
MOVEMENT PER BALANCE SHEET
|
|
|
CASH AND CASH EQUIVALENTS LESS BANK OVERDRAFTS
|
37,585
|
|
|
-
|
(221,601
|
)
|
|
=
|
259,186
|
|
|
|
|
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
|
|
Notes to the Financial Statements
|
FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
|
|
1.
|
STATUTORY INFORMATION
|
|
|
HATS Group Ltd is a private company, limited by shares, registered in England and Wales.
|
|
|
Registered Office:
|
|
c/o LSR Management Limited
|
|
C2A Comet Studios
|
|
De Havilland Court, Penn Street
|
|
Amersham
|
|
Buckinghamshire
|
|
HP7 0PX
|
|
|
Registered number: 03135655
|
|
|
Head Office:
|
|
44 Weir Road
|
|
Wimbledon
|
|
SW19 8UG
|
|
|
2.
|
ACCOUNTING POLICIES
|
|
|
Basis of preparing the financial statements
|
|
The financial statements have been prepared under the historical cost convention and in
accordance with Financial Reporting Standard 102 ("FRS 102"), the financial reporting
standard applicable in the United Kingdom and the Republic of Ireland and the Companies
Act 2006.
|
|
|
Judgements in applying accounting policies and estimation uncertainty
|
In determining and applying accounting policies, judgement is often required in respect of items where the choice of specific policy, accounting estimate or assumption to be followed could materially affect the reported results or net asset position of the company; it may later be determined that a different choice would have been more appropriate. Management considers that certain accounting estimates and assumptions relating to revenue, taxation, work in progress, provisions and contingent liabilities and accruals are its critical accounting estimates. |
|
|
Cash & cash equivalents
|
Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value. |
|
|
Turnover
|
|
Turnover is measured at the fair value of the consideration received or receivable, excluding
discounts, rebates, value added tax and other sales. All billable journey's are reconciled to
billing and approved by local authorities only once approved are they recognised as
turnover.
|
|
|
Goodwill
|
|
|
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
|
|
Notes to the Financial Statements - continued
|
FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
|
|
2.
|
ACCOUNTING POLICIES - continued
|
|
|
Intangible assets
|
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. |
|
|
Tangible fixed assets
|
|
|
|
Short leasehold
|
-
|
|
|
Plant and machinery
|
-
|
|
|
Fixtures and fittings
|
-
|
|
|
Motor vehicles
|
-
|
|
|
|
Financial instruments
|
The company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares. |
|
|
Taxation
|
Taxation for the period comprises current and deferred tax. Tax is recognised in the Income Statement, 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 balance sheet date. |
|
|
Deferred tax
|
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet 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 period 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
|
Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter. |
|
The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the future payments is treated as a liability. |
|
|
Pension costs and other post-retirement benefits
|
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
|
|
Notes to the Financial Statements - continued
|
FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
|
|
2.
|
ACCOUNTING POLICIES - continued
|
|
|
Going concern
|
|
The directors review the on going working capital of the company to ensure that there are
sufficient resources to meet its financial liabilities to continue trading in the foreseeable
future. On this basis, the directors consider it appropriate to prepare the financial
statements on going concern basis.
|
|
|
Financial instruments
|
|
The company only enters into basic financial instruments transactions that result in the
recognition of financial assets and liabilities like trade and other accounts receivable and
payable, loans from banks and other third parties, and loans to related parties.
|
|
|
Debt instruments (other than those wholly repayable or receivable within one year),
including loans and other accounts receivable and payable, are initially measured at present
value of the future cash flows and subsequently amortised at cost using the effective
interest method. Debt instruments that are payable or receivable within one year, typically
trade payables or receivables, are measured, initially and subsequently, at the discounted
amount of the cash or other consideration, expected to be paid or received. However if
arrangements of a short-term instrument constitute a financing transaction, like the
payment of trade debt deferred beyond normal business terms or financed at a rate of
interest that is not a market rate or in case of an out-right short-term loan at market rate,
the financial asset or liability is measured, initially at the present value of the future cash
flow discounted at a market rate of interest for a similar debt instrument and subsequently
at amortised cost.
|
|
|
Financial assets measured at amortised cost are assessed at the end of each reporting
period for objective evidence of impairment. If objective evidence of impairment is found, an
impairment loss is recognised in the Profit and Loss Account.
|
|
|
For financial assets measured at amortised cost, the impairment loss is measured as the
difference between an asset's carrying amount and the present value of estimated cash flows
discounted at the asset's original effective interest rate. If a financial asset has a variable
interest rate, the discount rate for measuring any impairment loss is the current effective
interest rate determined under the contract.
|
|
|
For financial assets measured at cost less impairment, the impairment loss is measured as
the difference between an asset's carrying amount and best estimate, which is an
approximation of the amount that the company would receive for the asset if it were sold at
the balance sheet date.
|
|
|
Financial assets and liabilities are offset and the net amount reported in the Balance Sheet
when there is an 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.
|
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
|
|
Notes to the Financial Statements - continued
|
FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
|
|
2.
|
ACCOUNTING POLICIES - continued
|
|
|
Impairment of non financial assets
|
|
At each reporting date non-financial assets not carried at fair value, like tangible fixed
assets, are reviewed to determine whether there is an indication that an asset may be
impaired. If there is an indication of possible impairment, the recoverable amount of any
asset or group of related assets, which is the higher of value in use and the fair value less
cost to sell, is estimated and compared with its carrying amount. If the recoverable amount
is lower, the carrying amount of the asset is reduced to its recoverable amount and an
impairment loss is recognised immediately in profit or loss.
|
|
If an impairment loss is subsequently reversed, the carrying amount of the asset or group of
related assets is increased to the revised estimate of its recoverable amount, but not to
exceed the amount that would have been determined had no impairment loss been
recognised for the asset or group of related assets in prior periods. A reversal of an
impairment loss is recognised immediately in profit or loss.
|
|
3.
|
EMPLOYEES AND DIRECTORS
|
|
Period
|
|
Period
|
|
1/8/19
|
|
1/6/19
|
|
to
|
|
to
|
|
31/8/20
|
|
31/7/19
|
|
as
|
restated
|
|
£
|
£
|
|
|
Wages and salaries
|
|
|
|
|
|
|
Social security costs
|
|
|
|
|
|
|
Other pension costs
|
|
|
|
|
|
|
|
|
|
|
|
|
The average number of employees during the period was as follows:
|
|
Period
|
|
Period
|
|
1/8/19
|
|
1/6/19
|
|
to
|
|
to
|
|
31/8/20
|
|
31/7/19
|
|
as
|
restated
|
|
|
|
Administration
|
|
|
|
|
|
|
|
Period
|
|
Period
|
|
1/8/19
|
|
1/6/19
|
|
to
|
|
to
|
|
31/8/20
|
|
31/7/19
|
|
as
|
restated
|
|
£
|
£
|
|
|
Directors' remuneration
|
|
|
|
|
|
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
|
|
Notes to the Financial Statements - continued
|
FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
|
|
4.
|
OPERATING PROFIT
|
|
|
The operating profit is stated after charging:
|
|
|
Period
|
|
Period
|
|
1/8/19
|
|
1/6/19
|
|
to
|
|
to
|
|
31/8/20
|
|
31/7/19
|
|
as
|
restated
|
|
£
|
£
|
|
|
Depreciation - owned assets
|
|
|
|
|
|
|
Depreciation - assets on hire purchase contracts
|
|
|
|
|
|
|
Loss on disposal of fixed assets
|
|
|
|
|
|
|
Auditors' remuneration
|
|
|
|
|
|
|
5.
|
INTEREST PAYABLE AND SIMILAR EXPENSES
|
|
|
Period
|
|
Period
|
|
1/8/19
|
|
1/6/19
|
|
to
|
|
to
|
|
31/8/20
|
|
31/7/19
|
|
as
|
restated
|
|
£
|
£
|
|
|
Factoring costs
|
|
|
|
|
|
|
Other interest payable
|
|
|
|
|
|
|
Hire purchase
|
|
|
|
|
|
|
|
|
|
|
|
6.
|
TAXATION
|
|
|
Analysis of the tax charge
|
|
The tax charge on the profit for the period was as follows:
|
|
Period
|
|
Period
|
|
1/8/19
|
|
1/6/19
|
|
to
|
|
to
|
|
31/8/20
|
|
31/7/19
|
|
as
|
restated
|
|
£
|
£
|
|
|
Current tax:
|
|
UK corporation tax
|
|
|
|
|
|
|
|
Deferred tax
|
|
|
|
|
|
|
Tax on profit
|
|
|
|
|
|
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
|
|
Notes to the Financial Statements - continued
|
FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
|
|
6.
|
TAXATION - continued
|
|
|
Reconciliation of total tax charge included in profit and loss
|
|
The tax assessed for the period is higher than the standard rate of corporation tax in the
UK. The difference is explained below:
|
|
|
Period
|
|
Period
|
|
1/8/19
|
|
1/6/19
|
|
to
|
|
to
|
|
31/8/20
|
|
31/7/19
|
|
as
|
restated
|
|
£
|
£
|
|
|
Profit before tax
|
|
|
|
|
|
|
Profit multiplied by the standard rate of corporation tax in
the UK of
|
|
|
|
|
|
|
|
Effects of:
|
|
Expenses not deductible for tax purposes
|
|
|
|
|
|
|
Capital allowances in excess of depreciation
|
(
|
)
|
(
|
)
|
|
|
Utilisation of tax losses
|
(
|
)
|
|
|
|
|
|
Deferred tax on accelerated capital allowances
|
418,471
|
|
39,597
|
|
|
|
Enhanced expenditure
|
(190,684
|
)
|
(17,432
|
)
|
|
|
Total tax charge
|
418,471
|
|
134,910
|
|
|
|
|
Tax effects relating to effects of other comprehensive
|
income
|
|
|
|
1/6/19 to 31/7/19
|
|
|
Gross
|
|
Tax
|
|
Net
|
|
£
|
£
|
£
|
|
|
Revaluation of vehicles
|
|
|
-
|
|
848,325
|
|
|
|
7.
|
PRIOR YEAR ADJUSTMENT
|
|
The financial statements have been restated to incorporate the impact of a misclassification of tangible fixed assets and the related hire purchase/finance lease liabilities. The change has resulted in profits available for distribution at 31 July 2019 increasing by £285,039. |
|
Summary of the prior period accounting impact: |
|
Increase in tangible fixed assets - motor vehicles |
|
Increase in tangible fixed assets - motor vehicles | 1,834,995 |
Increase in creditors - amounts due under hire purchase contracts | 1,549,956 |
Prior period adjustment - increase in distributable profits | 285,039 |
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
|
|
Notes to the Financial Statements - continued
|
FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
|
|
8.
|
INTANGIBLE FIXED ASSETS
|
|
Goodwill
|
£
|
|
|
COST
|
|
At 1 August 2019
|
|
and 31 August 2020
|
|
|
|
|
AMORTISATION
|
|
At 1 August 2019
|
|
and 31 August 2020
|
|
|
|
|
NET BOOK VALUE
|
|
At 31 August 2020
|
|
|
|
|
At 31 July 2019
|
|
|
|
|
9.
|
TANGIBLE FIXED ASSETS
|
|
Fixtures
|
|
|
Short
|
|
Plant and
|
|
and
|
|
Motor
|
|
|
leasehold
|
|
machinery
|
|
fittings
|
|
vehicles
|
|
Totals
|
£
|
£
|
£
|
£
|
£
|
|
|
COST OR VALUATION
|
|
At 1 August 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
Additions
|
|
|
|
|
|
|
|
|
|
|
|
|
At 31 August 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
DEPRECIATION
|
|
At 1 August 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
Charge for period
|
|
|
|
|
|
|
|
|
|
|
|
|
At 31 August 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
NET BOOK VALUE
|
|
At 31 August 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
At 31 July 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
The asset value of all fixed assets was reviewed within the financial period. Within the review it was noted that some vehicles were treated as rented within the prior year and should have been included within the fixed asset register. This has been corrected within the current period and the revaluation of last year reversed. All assets are now held at their market written down value level. |
|
Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their useful lives or the lease term, whichever is the shorter. |
|
The interest element of those obligations is charged to the profit and loss account over the relevant period. The capital element of the future payments is treated as a liability. |
|
Rentals paid under operating leases are charged to the profit and loss account on a straight line basis over the period of the lease. |
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
|
|
Notes to the Financial Statements - continued
|
FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
|
|
10.
|
DEBTORS
|
|
31/8/20
|
|
31/7/19
|
|
as
|
restated
|
|
£
|
£
|
|
|
Amounts falling due within one year:
|
|
Trade debtors
|
|
|
|
|
|
|
Other debtors
|
|
|
|
|
|
|
Prepayments and accrued income
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts falling due after more than one year:
|
|
Other debtors
|
|
|
|
|
|
|
|
Aggregate amounts
|
|
|
|
|
|
|
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. |
|
11.
|
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
|
|
|
31/8/20
|
|
31/7/19
|
|
as
|
restated
|
|
£
|
£
|
|
|
Bank loans and overdrafts (see note
13)
|
|
|
|
|
|
|
Hire purchase contracts (see note
14)
|
|
|
|
|
|
|
Trade creditors
|
|
|
|
|
|
|
Tax
|
|
|
|
|
|
|
Social security and other taxes
|
|
|
|
|
|
|
VAT
|
1,020,179
|
|
69,846
|
|
|
|
Accrued expenses
|
|
|
|
|
|
|
|
|
|
|
|
Short term 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. |
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
|
|
Notes to the Financial Statements - continued
|
FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
|
|
12.
|
CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN
ONE YEAR
|
|
|
31/8/20
|
|
31/7/19
|
|
as
|
restated
|
|
£
|
£
|
|
|
Hire purchase contracts (see note
14)
|
|
|
|
|
|
|
Other creditors
|
|
|
|
|
|
|
|
|
|
|
|
13.
|
LOANS
|
|
|
An analysis of the maturity of loans is given below:
|
|
|
31/8/20
|
|
31/7/19
|
|
as
|
restated
|
|
£
|
£
|
|
|
Amounts falling due within one year or on demand:
|
|
Bank loans
|
|
|
|
|
|
|
14.
|
LEASING AGREEMENTS
|
|
|
Minimum lease payments under hire purchase fall due as follows:
|
|
|
31/8/20
|
|
31/7/19
|
|
|
as
|
restated
|
|
£
|
£
|
|
|
Net obligations repayable:
|
|
Within one year
|
|
|
|
|
|
|
Between one and five years
|
|
|
|
|
|
|
|
|
|
|
|
15.
|
SECURED DEBTS
|
|
|
The following secured debts are included within creditors:
|
|
|
31/8/20
|
|
31/7/19
|
|
as
|
restated
|
|
£
|
£
|
|
|
Hire purchase contracts
|
2,807,318
|
|
2,542,653
|
|
|
|
|
Hire purchase liabilities are secured against relevant assets.
|
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
|
|
Notes to the Financial Statements - continued
|
FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
|
|
16.
|
PROVISIONS FOR LIABILITIES
|
|
31/8/20
|
|
31/7/19
|
|
as
|
restated
|
|
£
|
£
|
|
|
Deferred tax
|
|
Accelerated capital allowances
|
|
|
|
|
|
|
|
Deferred
|
|
|
tax
|
|
£
|
|
|
Balance at 1 August 2019
|
|
|
|
|
Provided during period
|
|
|
|
|
Balance at 31 August 2020
|
|
|
|
|
17.
|
CALLED UP SHARE CAPITAL
|
|
|
|
Allotted, issued and fully paid:
|
|
Number:
|
Class:
|
Nominal
|
31/8/20
|
|
31/7/19
|
|
value:
|
|
as
restated
|
|
£
|
£
|
|
|
|
Ordinary
|
£1
|
10,000
|
|
10,000
|
|
|
|
18.
|
RESERVES
|
|
Retained
|
|
Revaluation
|
|
|
earnings
|
|
reserve
|
|
Totals
|
£
|
£
|
£
|
|
|
|
At 1 August 2019
|
|
|
|
|
3,753,786
|
|
|
|
Prior year adjustment
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the period
|
|
|
|
|
|
|
At 31 August 2020
|
|
|
|
|
5,738,818
|
|
|
|
19.
|
PENSION COMMITMENTS
|
|
The company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension costs charge represents contributions payable by the company and amounted to £23,610 (2019: £14,505). Contributions totalling £4,565 were payable at the year end and are included in creditors. |
|
20.
|
POST BALANCE SHEET EVENTS
|
|
There were no events after the reporting period. |
HATS GROUP LTD (REGISTERED NUMBER: 03135655)
|
|
Notes to the Financial Statements - continued
|
FOR THE PERIOD 1 AUGUST 2019 TO 31 AUGUST 2020
|
|
21.
|
FUNCTIONAL & PRESENTATIONAL CURRENCY
|
|
|
The company's functional and presentational currency is GBP (£).
|