Company Registration No. 03533716 (England and Wales)
SPI (MATERIALS) LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 29 SEPTEMBER 2019
PAGES FOR FILING WITH REGISTRAR
SPI (MATERIALS) LIMITED
CONTENTS
Page
Balance sheet
1 - 2
Notes to the financial statements
3 - 9
SPI (MATERIALS) LIMITED
BALANCE SHEET
AS AT
29 SEPTEMBER 2019
29 September 2019
- 1 -
2019
2018
Notes
£
£
£
£
Fixed assets
Tangible assets
3
99,385
146,633
Current assets
Stocks
4,227,755
2,831,860
Debtors
5
2,710,986
2,597,525
Cash at bank and in hand
33,220
26,876
6,971,961
5,456,261
Creditors: amounts falling due within one year
6
(6,741,694)
(4,108,780)
Net current assets
230,267
1,347,481
Total assets less current liabilities
329,652
1,494,114
Creditors: amounts falling due after more than one year
7
(16,219)
(36,025)
Provisions for liabilities
(4,449)
(10,635)
Net assets
308,984
1,447,454
Capital and reserves
Called up share capital
8
132
133
Capital redemption reserve
1
-
Profit and loss reserves
308,851
1,447,321
Total equity
308,984
1,447,454
The director of the company has elected not to include a copy of the profit and loss account within the financial statements.
true
For the financial period ended 29 September 2019 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
The director acknowledges his responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
T
he members have not required the company to obtain an audit of its financial statements for the period in question in accordance with section 476
.
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
SPI (MATERIALS) LIMITED
BALANCE SHEET (CONTINUED)
AS AT
29 SEPTEMBER 2019
29 September 2019
- 2 -
The financial statements were approved and signed by the director and authorised for issue on 29 September 2020
M Holt
Director
Company Registration No. 03533716
SPI (MATERIALS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 29 SEPTEMBER 2019
- 3 -
1
Accounting policies
Company information
SPI (Materials) Limited is a
private
company
limited by shares
incorporated in England and Wales.
The registered office is
3 Coventry Innovation Village, Cheetah Road, Coventry, CV1 2TL.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are prepared in
sterling
, which is the functional currency of the company.
Monetary a
mounts
in these financial statements are
rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include certain financial instruments at fair value. The principal accounting policies adopted are set out below.
1.2
Going concern
At the time of approving the financial statements, the director has assessed the company’s situation regarding the COVID-19 pandemic and the likely impact on the company. The director has a reasonable expectation that the company has adequate resources and working capital to continue in operational existence for the foreseeable future to deal with the issues arising from the COVID-19 pandemic. Thus the director continues to adopt the going concern basis of accounting in preparing the financial statements.
true
1.3
Reporting period
The reporting period for these financial statements is from 30 March 2018 to 29 September 2019. The comparative period is from 31 March 2017 to 29 March 2018.
1.4
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods provided in the normal course of business
, and
is shown net of VAT and other sales related taxes
.
The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates
.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer
(usually on dispatch of the goods)
, the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
1.5
Tangible fixed assets
Tangible fixed assets
are initially measured at cost and subsequently measured at cost, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:
Plant and equipment
33% straight line
Fixtures and fittings
33% straight line
Motor vehicles
25% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and
is credited or charged to profit or loss
.
SPI (MATERIALS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 29 SEPTEMBER 2019
1
Accounting policies
(Continued)
- 4 -
1.6
Impairment of fixed assets
At each reporting
period
end date, the
company
reviews the carrying amounts of its tangible
assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
1.7
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.8
Cash at bank and in hand
Cash at bank and in hand
are basic financial assets
and
include cash in hand, deposits held at call with banks
and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.9
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset
, with
the net amounts presented in the financial statements
,
when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account in other administrative expenses.
1.10
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.11
Derivatives
Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.
A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.
The company enters into foreign exchange forward contracts and foreign exchange swaps in order to manage its exposure to foreign exchange risk.
1.12
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
SPI (MATERIALS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 29 SEPTEMBER 2019
1
Accounting policies
(Continued)
- 5 -
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The
company’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the
company
has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.13
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense
.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
1.14
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.15
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair
value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases,
including
any lease incentives received, are charged to
profit or loss
on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease
s
asset are consumed.
1.16
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation
in the period
are included in profit or loss.
SPI (MATERIALS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 29 SEPTEMBER 2019
- 6 -
2
Employees
The average monthly number of persons (including directors) employed by the company during the period was:
2019
2018
Number
Number
Total
26
25
3
Tangible fixed assets
Plant and machinery etc
£
Cost
At 30 March 2018
424,068
Additions
66,634
Disposals
(34,024)
At 29 September 2019
456,678
Depreciation and impairment
At 30 March 2018
277,435
Depreciation charged in the period
107,286
Eliminated in respect of disposals
(27,428)
At 29 September 2019
357,293
Carrying amount
At 29 September 2019
99,385
At 29 March 2018
146,633
4
Financial instruments
2019
2018
£
£
Carrying amount of financial assets
Instruments measured at fair value through profit or loss
15,768
-
Carrying amount of financial liabilities
Measured at fair value through profit or loss
- Other financial liabilities
6,579
The company enters into foreign exchange forward contracts and foreign exchange swaps in order to manage its exposure to foreign exchange risk.
The fair value of the derivatives at the year end has been determined by the Bank of Scotland valuations department.
SPI (MATERIALS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 29 SEPTEMBER 2019
- 7 -
5
Debtors
2019
2018
Amounts falling due within one year:
£
£
Trade debtors
2,364,372
2,158,323
Amounts owed by group undertakings
-
183,835
Derivative financial instruments
15,768
-
Other debtors
130,109
47,795
Prepayments and accrued income
200,737
207,572
2,710,986
2,597,525
6
Creditors: amounts falling due within one year
2019
2018
£
£
Bank loans and overdrafts
63,715
15,266
Obligations under finance leases
29,279
49,544
Other borrowings
1,989,196
1,612,251
Trade creditors
1,152,735
734,765
Amounts owed to group undertakings
1,561,322
786,110
Corporation tax
27,508
30,147
Other taxation and social security
26,037
42,497
Derivative financial instruments
-
6,579
Other creditors
442,754
108,215
Accruals and deferred income
1,449,148
723,406
6,741,694
4,108,780
The bank loans and overdrafts are secured by fixed and floating charges over the assets of the company.
Other borrowings comprises an invoice financing facility which is secured by fixed and floating charges over the assets of the company.
Included within amounts due to group undertakings is £461,322 (2018 - £786,110) which is secured by fixed and floating charges over the assets of the company.
Obligations under finance leases are secured over the assets to which they relate.
7
Creditors: amounts falling due after more than one year
2019
2018
Notes
£
£
Obligations under finance leases
16,219
36,025
Obligations under finance leases are secured over the assets to which they relate.
SPI (MATERIALS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 29 SEPTEMBER 2019
- 8 -
8
Called up share capital
2019
2018
£
£
Ordinary share capital
Issued and fully paid
132 Ordinary shares of £1 each
132
132
0 Redeemable share of £1 each
1
132
133
On the 28 September 2019 the £1 redeemable share was redeemed for £1.
9
Financial commitments, guarantees and contingent liabilities
During the reporting period the European Anti Fraud Office concluded an investigation regarding the suspected evasion of anti-dumping duties imposed on seamless pipes and tubes pipes of stainless steel originating in the People's Republic of China.
As a result of this, the company has been charged additional duty costs of £681,070 as a result of purchases made from the investigated suppliers.
The company is currently disputing this liability. No provision has been made in these financial statements as the company's management do not consider that there is any probable loss.
10
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
2019
2018
£
£
1,201,740
1,419,720
11
Events after the reporting date
At the time of approval of the financial statements, the United Kingdom is subject to lockdown measures due to the COVID-19 pandemic. The directors estimate that this may have an adverse impact on the company's
activities
during this lockdown period, however it is not currently possible to reliably estimate the full financial effect on the company.
SPI (MATERIALS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 29 SEPTEMBER 2019
- 9 -
12
Related party transactions
The following amounts were outstanding at the reporting end date:
2019
2018
Amounts due to related parties
£
£
Entities with control, joint control or significant influence over the company
461,322
786,110
Key management personnel
165,001
70,000
Amounts due to key management personnel comprises of interest free loans with no fixed terms of repayment.
In 2019 and 2018 amounts due to entities with control, joint control or significant influence over the company comprises of a loan with no fixed terms of repayment, market rate interest was charged on this loan.