Company registration number 09076361 (England and Wales)
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
COMPANY INFORMATION
Directors
P M Ellis
M B France
J Bader
S Kershaw
DA Wade
(Appointed 21 December 2022)
J J Keech
(Appointed 9 February 2023)
Secretary
J J Keech
Company number
09076361
Registered office
1 Park Street
Maidenhead
Berkshire
SL6 1SL
Auditor
Spencer Gardner Dickins Audit LLP
3 Coventry Innovation Village
Cheetah Road
Coventry
CV1 2TL
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Profit and loss account
8
Group statement of comprehensive income
9
Group balance sheet
10
Company balance sheet
11
Group statement of changes in equity
12
Company statement of changes in equity
13
Group statement of cash flows
14
Notes to the financial statements
15 - 35
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 1 -
The directors present the strategic report for the year ended 31 March 2023.
FAIR REVIEW OF THE BUSINESS
Business review
In the year end to end March 2023 the business achieved an "Adjusted EBITDA" of £1,071k compared to an EBITDA of £601k in the previous year. An increase of £470k.
Its pleasing to note that in both years the EBITDA is stated after charitable donations of £207k (2022 - £28k). Prior to those donations our EBITDA would have been £1,278k (2022 - £629k). An increase of 103%.
The business achieved total sales growth of 24% with the Christopher Ward brand up 26% and our third-party business in Switzerland 2% up.
For the Christopher Ward brand sales were up 15% in the UK and up 34% internationally. With excellent USA growth of 41%.
With a policy of reduced discounting the overall gross profit margin was up by 2% points.
Outside of these factors the business continued to invest in marketing and in our overhead base to support growth. With marketing increasing by just over £800k and our overheads increasing by just over £700k.
Exceptional items of £76k (2022 - £107k) related principally to professional fees, see note 4.
After exceptional items our EBITDA was £995k (2022 - £495k)
Capital expenditure of £295k (2022 - £205k) relates to our continued investment in our systems and business infrastructure to support future growth.
Cash position and funding
As at the balance sheet date the Net Cash position of the group amounted to £6,543k (2022 - £1,426k); an increase of £5,117k.
In addition, as explained in note 20, the total banking facilities available in the UK and Switzerland amounted to £1,417 (2022 - £1,535k).
As a result of the above, the total liquidity available to the group amounts to £7,960k (2022 - £2,961k).
As a consequence of this robust position the directors believe the Group has sufficient liquidity to fund the future growth of the Christopher Ward brand.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -
PRINCIPAL RISKS AND UNCERTAINTIES
Economic risk
The group is exposed to developments in the overall retail market, the watch market in general together with the provision of the components required to produce the watches. These risks are constantly reviewed by the directors.
With the exception of watches which are sold directly to customers under the Christopher Ward brand, the group also provides and develops watches for a number of third-party customers. The group has a close working relationship with its customers and is actively involved in their business development. The amounts owing from these customers are actively managed to ensure amounts are collected within normal payment terms.
Liquidity risk
The company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and invest cash assets safely and profitably. The directors mitigate this risk by focusing on cash management and detailed cash flow forecasting.
Currency risk
The nature of the business is that it is exposed to some degree to currency risk as it principally incurs costs in Sterling, Swiss Francs and US dollars. In addition, it principally sells its products in Sterling, Swiss Francs and US dollars. This potential currency risk is managed by applying sensible currency assumptions to all purchasing decisions, utilising the natural exchange rate hedge that is afforded by operating in different currencies and supplementing this with currency hedging, principally forward exchange contracts.
Going Concern
In view of the Group's funding position which is covered earlier, the directors have assessed the group's position and are satisfied sufficient liquidity is available to meet its working capital and other capital requirements for the next twelve months.
KEY PERFORMANCE INDICATORS
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Net Cash position (cash less bank | | | | | |
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* This is after excluding cash/bank loans and overdrafts as well as accumulated interest on BGF and Founders Loan Notes.
P M Ellis
Director
6 July 2023
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 3 -
The directors present their annual report and financial statements for the year ended 31 March 2023.
Principal activities
The principal activity of the company continued to be that of a holding company for a group of companies engaged in the design, manufacture, supply and retail of watches and associated accessories.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
P M Ellis
M B France
J Bader
S Kershaw
P Oldham
(Resigned 21 December 2022)
DA Wade
(Appointed 21 December 2022)
J J Keech
(Appointed 9 February 2023)
Auditor
The auditor, Spencer Gardner Dickins Audit LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Strategic report
The group has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the group's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of financial risk management objectives, review of performance and future developments.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.
On behalf of the board
P M Ellis
Director
6 July 2023
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2023
- 4 -
The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company, 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 UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the ;
prepare the on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
- 5 -
Opinion
We have audited the financial statements of Christopher Ward (London) Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2023 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the group's and the parent company's affairs as at 31 March 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.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and 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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
- 6 -
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 their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept 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 directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the 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 parent company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below:
- Enquiring of management and those charged with governance around actual and potential litigation and claims;
- Enquiring of entity staff to identify any instances of non-compliance with laws and regulations;
- Reviewing minutes of meetings of those charged with governance;
- Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.
- Performing audit work over the risk of management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
- 7 -
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
Susan Thomas-Walls BSc BFP FCA (Senior Statutory Auditor)
For and on behalf of Spencer Gardner Dickins Audit LLP
6 July 2023
Chartered Accountants
Statutory Auditor
3 Coventry Innovation Village
Cheetah Road
Coventry
CV1 2TL
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2023
- 8 -
2023
2022
Notes
£'000
£'000
Turnover
3
16,885
13,648
Cost of sales
(10,835)
(8,956)
Gross profit
6,050
4,692
Administrative expenses
(4,979)
(4,091)
Adjusted EBITDA
1,071
601
Exceptional items
4
(76)
(107)
EBITDA
995
494
Depreciation
(87)
(111)
Amortisation
(479)
(485)
Profit on disposal
(2)
-
Operating profit/(loss)
5
427
(102)
Interest receivable and similar income
9
22
-
Other interest payable and similar expenses
10
(302)
(362)
Fair value movements
16
75
-
Profit/(loss) before taxation
222
(464)
Taxation
11
(129)
(33)
Profit/(loss) for the financial year
25
93
(497)
Total comprehensive income for the year is all attributable to the owners of the parent company.
The profit and loss account has been prepared on the basis that all operations are continuing operations.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
- 9 -
2023
2022
£'000
£'000
Profit/(loss) for the year
93
(497)
Other comprehensive income
Currency translation differences
128
163
Total comprehensive income for the year
221
(334)
Total comprehensive income for the year is all attributable to the owners of the parent company.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
GROUP BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 10 -
2023
2022
Notes
£'000
£'000
£'000
£'000
Fixed assets
Intangible assets
12
366
582
Tangible assets
13
131
167
497
749
Current assets
Stocks
17
4,372
3,245
Debtors
18
2,285
1,427
Cash at bank and in hand
6,543
1,460
13,200
6,132
Creditors: amounts falling due within one year
19
(9,152)
(2,539)
Net current assets
4,048
3,593
Total assets less current liabilities
4,545
4,342
Creditors: amounts falling due after more than one year
20
(5,654)
(5,703)
Provisions for liabilities
22
(209)
(178)
Net liabilities
(1,318)
(1,539)
Capital and reserves
Called up share capital
24
98
98
Share premium account
25
4,591
4,591
Legal reserve
25
18
18
Profit and loss reserves
25
(6,025)
(6,246)
Total equity
(1,318)
(1,539)
The financial statements were approved by the board of directors and authorised for issue on 6 July 2023 and are signed on its behalf by:
P M Ellis
Director
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
COMPANY BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 11 -
2023
2022
Notes
£'000
£'000
£'000
£'000
Fixed assets
Investments
14
3,019
3,019
Current assets
Debtors
18
5,239
4,751
Cash at bank and in hand
3
696
5,242
5,447
Creditors: amounts falling due within one year
19
(15)
(12)
Net current assets
5,227
5,435
Total assets less current liabilities
8,246
8,454
Creditors: amounts falling due after more than one year
20
(5,359)
(5,359)
Net assets
2,887
3,095
Capital and reserves
Called up share capital
24
98
98
Share premium account
25
4,591
4,591
Profit and loss reserves
25
(1,802)
(1,594)
Total equity
2,887
3,095
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s loss for the year was £208k (2022 - £421k loss).
The financial statements were approved by the board of directors and authorised for issue on 6 July 2023 and are signed on its behalf by:
2023-07-06
P M Ellis
Director
Company Registration No. 09076361
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 12 -
Share capital
Share premium account
Other reserves
Profit and loss reserves
Total
Notes
£'000
£'000
£'000
£'000
£'000
Balance at 1 April 2021
77
4,591
18
(5,912)
(1,226)
Year ended 31 March 2022:
Loss for the year
-
-
-
(497)
(497)
Other comprehensive income:
Currency translation differences
-
-
-
163
163
Total comprehensive income for the year
-
-
-
(334)
(334)
Issue of share capital
24
21
-
-
-
21
Balance at 31 March 2022
98
4,591
18
(6,246)
(1,539)
Year ended 31 March 2023:
Profit for the year
-
-
-
93
93
Other comprehensive income:
Currency translation differences
-
-
-
128
128
Total comprehensive income for the year
-
-
-
221
221
Balance at 31 March 2023
98
4,591
18
(6,025)
(1,318)
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 13 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£'000
£'000
£'000
£'000
Balance at 1 April 2021
77
4,591
(1,173)
3,495
Year ended 31 March 2022:
Loss and total comprehensive income for the year
-
-
(421)
(421)
Issue of share capital
24
21
-
-
21
Balance at 31 March 2022
98
4,591
(1,594)
3,095
Year ended 31 March 2023:
Loss and total comprehensive income for the year
-
-
(208)
(208)
Balance at 31 March 2023
98
4,591
(1,802)
2,887
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 14 -
2023
2022
Notes
£'000
£'000
£'000
£'000
Cash flows from operating activities
Cash generated from operations
29
5,802
890
Interest paid
(303)
(162)
Income taxes paid
(35)
(145)
Net cash inflow from operating activities
5,464
583
Investing activities
Purchase of intangible assets
(254)
(109)
Purchase of tangible fixed assets
(41)
(95)
Interest received
22
-
Net cash used in investing activities
(273)
(204)
Financing activities
Proceeds from issue of shares
-
21
Proceeds of other loans
-
750
Repayment of borrowings
(74)
(19)
Net cash (used in)/generated from financing activities
(74)
752
Net increase in cash and cash equivalents
5,117
1,131
Cash and cash equivalents at beginning of year
1,426
295
Cash and cash equivalents at end of year
6,543
1,426
Relating to:
Cash at bank and in hand
6,543
1,460
Bank overdrafts included in creditors payable within one year
-
(34)
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 15 -
1
Accounting policies
Company information
Christopher Ward (London) Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 1 Park Street, Maidenhead, Berkshire, SL6 1SL.
The group consists of Christopher Ward (London) Holdings Limited and all of its subsidiaries.
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 amounts in these financial statements are rounded to the nearest £'000.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:
1.2
Business combinations
In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.
Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 16 -
1.3
Basis of consolidation
The consolidated financial statements incorporate those of Christopher Ward (London) Holdings Limited and all of its subsidiaries (ie entities that the group controls through its power to govern the financial and operating policies so as to obtain economic benefits). Subsidiaries acquired during the year are consolidated using the purchase method. Their results are incorporated from the date that control passes.
All financial statements are made up to 31 March 2023 except for Christopher Ward London Limited which is made up to the last Friday of the financial year being 31 March 2023 (2022: 25 March 2022). Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
1.4
Going concern
The financial statements have been prepared on the going concern basis as the directors have undertaken a review of the future financing requirements for on-going operations of the group, and are satisfied that sufficient cash facilities are secured to meet its working capital requirements for at least 12 months from the date of signing of these financial statements.
1.5
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, allowing for the subsequent dispatch of goods in the week following the year end for orders placed prior to that date), 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.
1.6
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Positive goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.
1.7
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date if the fair value can be measured reliably.
Assets are included in intangible fixed assets as the cost is incurred. Applicable amortisation is provided from the date of use.
Amortisation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:
Software
33% straight line
Patents, trademarks and other capitalised costs
10% - 33% straight line
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 17 -
1.8
Tangible fixed assets
Tangible fixed assets are initially measured at cost, net of depreciation and any impairment losses.
Assets are included in tangible fixed assets as the cost is incurred. Applicable depreciation is provided from the date of use.
Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:
Land and buildings leasehold
Over the remaining term of the lease
Plant and machinery- tooling
20% straight line
Fixtures, fittings and equipment
20% straight line
Computer equipment
33% straight line
Motor vehicles
20% 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 recognised in the profit and loss account.
1.9
Fixed asset investments
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.10
Impairment of fixed assets
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
1.11
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, other direct costs that have been incurred in bringing the stocks to their present location and condition.
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.
1.12
Cash and cash equivalents
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.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 18 -
1.13
Financial instruments
The group 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 group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and 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.
Basic financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 19 -
1.14
Equity instruments
Equity instruments issued by the group 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 group.
1.15
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’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 if, and only if, there is 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.
1.16
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.17
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.18
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to income on a straight line basis over the term of the relevant lease.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 20 -
1.19
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 are included in the profit and loss account for the period.
Assets and liabilities of foreign subsidiaries denominated in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies reported in the profit and loss account are translated at the average exchange rates for the period. All differences are taken to the statement of changes in equity.
2
Judgements and key sources of estimation uncertainty
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Operating lease commitments
The group has entered into commercial leases as a lessee in order to obtain use of property, plant and equipment and motor vehicles. The classification of such leases as operating or finance lease requires the company to determine, based on an evaluation of the terms and conditions of the arrangements, whether it retains or acquires the significant risks and rewards of ownership of these assets and accordingly whether the lease requires an asset and liability to be recognised in the balance sheet.
Tangible fixed assets
Judgements are required on estimating the useful economic lives of tangible fixed assets. Where an indication of impairment is identified the estimation of recoverable value requires estimation.
Stock provisions
In recognising stock provisions in the financial statements management estimate the costs recoverable on the slow moving, old or damaged stock items. These estimates are based on expected net realisable value and estimated using business knowledge and professional judgement.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
2
Judgements and key sources of estimation uncertainty
(Continued)
- 21 -
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Returns provision
The company includes a 60:60 guarantee with all sales which includes the ability for customers to return an item within 60 days of purchase. As a result, it is necessary to consider the likely amount of returns expected and the associated provisioning required. When calculating the provision, management considers the level of sales made in the past 60 days and the historic trend of returns.
Accruals
In recognising accrued costs in the financial statements management estimate the costs directly attributable to the financial year. These estimates are based on the expected costs, business knowledge and professional judgement.
Prepayments
In recognising prepaid costs in the financial statements management estimate the costs directly attributable to the next financial year. These estimates are based on the actual costs to date, business knowledge and professional judgement.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 22 -
3
Turnover and other revenue
An analysis of the group's turnover is as follows:
2023
2022
£'000
£'000
Turnover analysed by geographical market
UK
5,801
5,044
Europe
3,170
2,787
USA
5,607
3,964
Rest of World
2,307
1,853
16,885
13,648
4
Exceptional item
2023
2022
£'000
£'000
Expenditure
Exceptional costs
76
107
76
107
Management have assessed the administrative expenses and categorised the above costs as exceptional in the year. For the current year these represent professional fees to do with executive searches, agency fees and scheme fees.
For the previous year the balance is related to professional fees to do with regulatory requirements and bank guarantees and certain stock provisions.
5
Operating profit/(loss)
2023
2022
£'000
£'000
Operating profit/(loss) for the year is stated after charging/(crediting):
Exchange (gains)/losses
(248)
82
Depreciation of owned tangible fixed assets
87
111
Loss on disposal of tangible fixed assets
2
-
Amortisation of intangible assets
479
485
Operating lease charges
197
175
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 23 -
6
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£'000
£'000
For audit services
Audit of the financial statements of the group and company
13
9
Audit of the financial statements of the company's subsidiaries
12
11
25
20
For other services
Taxation compliance services
2
2
7
Employees
The average monthly number of persons (including directors) employed by the group and company during the year was:
Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Office and production staff
55
55
5
5
Group
Company
2023
2022
2023
2022
£'000
£'000
£'000
£'000
Wages and salaries
2,767
2,503
30
30
Social security costs
347
312
3
3
Pension costs
99
94
-
-
3,213
2,909
33
33
8
Directors' remuneration
2023
2022
£'000
£'000
Remuneration for qualifying services
447
386
Company pension contributions to defined contribution schemes
9
8
456
394
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2022 - 1).
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
8
Directors' remuneration
(Continued)
- 24 -
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
£'000
£'000
Remuneration for qualifying services
136
126
9
Interest receivable and similar income
2023
2022
£'000
£'000
Interest income
Interest on bank deposits
22
-
2023
2022
Investment income includes the following:
£'000
£'000
Interest on financial assets not measured at fair value through profit or loss
22
-
10
Interest payable and similar expenses
2023
2022
£'000
£'000
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
28
25
Other interest on financial liabilities
274
337
302
362
Disclosed on the profit and loss account as follows:
Other interest payable and similar expenses
302
362
11
Taxation
2023
2022
£'000
£'000
Current tax
Foreign current tax on profits for the current period
98
77
Deferred tax
Origination and reversal of timing differences
31
(44)
Total tax charge
129
33
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
11
Taxation
(Continued)
- 25 -
The actual charge for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£'000
£'000
Profit/(loss) before taxation
222
(464)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
42
(88)
Tax effect of expenses that are not deductible in determining taxable profit
(20)
81
Unutilised tax losses carried forward
107
120
Effect of overseas tax rates
16
(70)
Impact of capital allowances super-deduction
(16)
(10)
Tax expense for the year
129
33
12
Intangible fixed assets
Group
Goodwill
Negative goodwill
Software
Patents, trademarks and other capitalised costs
Total
£'000
£'000
£'000
£'000
£'000
Cost
At 1 April 2022
2,411
(797)
1,420
70
3,104
Additions
-
-
254
-
254
Transfers
-
-
55
-
55
At 31 March 2023
2,411
(797)
1,729
70
3,413
Amortisation and impairment
At 1 April 2022
2,411
(797)
850
58
2,522
Amortisation charged for the year
-
-
479
-
479
Transfers
-
-
46
-
46
At 31 March 2023
2,411
(797)
1,375
58
3,047
Carrying amount
At 31 March 2023
-
-
354
12
366
At 31 March 2022
-
-
570
12
582
Transfers above relates to movements between the asset categories.
The company had no intangible fixed assets at 31 March 2023 or 31 March 2022.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 26 -
13
Tangible fixed assets
Group
Land and buildings leasehold
Plant and machinery- tooling
Fixtures, fittings and equipment
Computer equipment
Motor vehicles
Total
£'000
£'000
£'000
£'000
£'000
£'000
Cost
At 1 April 2022
29
487
448
204
61
1,229
Additions
3
-
5
33
-
41
Disposals
-
-
(3)
-
(9)
(12)
Transfers
69
-
(94)
(27)
-
(52)
Exchange adjustments
-
27
20
7
4
58
At 31 March 2023
101
514
376
217
56
1,264
Depreciation and impairment
At 1 April 2022
20
475
339
175
53
1,062
Depreciation charged in the year
21
2
39
25
-
87
Eliminated in respect of disposals
-
-
(1)
-
(1)
(2)
Transfers
24
-
(30)
(37)
-
(43)
Exchange adjustments
-
4
17
4
4
29
At 31 March 2023
65
481
364
167
56
1,133
Carrying amount
At 31 March 2023
36
33
12
50
-
131
At 31 March 2022
10
11
110
30
6
167
The company had no tangible fixed assets at 31 March 2023 or 31 March 2022.
The company had no tangible fixed assets at 31 March 2022 or 31 March 2021.
14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£'000
£'000
£'000
£'000
Investments in subsidiaries
15
-
-
3,019
3,019
In the opinion of the directors, the aggregate value of the company's investment in subsidiary undertakings is not less than the amount included in the balance sheet.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
14
Fixed asset investments
(Continued)
- 27 -
Movements in fixed asset investments
Company
Shares in group undertakings
£'000
Cost or valuation
At 1 April 2022 and 31 March 2023
3,019
Carrying amount
At 31 March 2023
3,019
At 31 March 2022
3,019
15
Subsidiaries
Registered office addresses (all UK unless otherwise indicated):
Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Christopher Ward London Limited
1
The design and retailing of watches and associated accessories
Ordinary
100.00
Christopher Ward SA
2
The manufacture of watches and associated accessories
Ordinary
100.00
CW Watches Inc
3
Retailing of watches and associated accessories
Ordinary
100.00
1
1 Park Street, Maidenhead, Berkshire, SL6 1SL, UK
2
Chemin de la Clôture 6, CH-2502 Biel/Bienne, Switzerland
3
15 Briarwood Ln, Dover, NH 03820-4274, USA
16
Financial instruments
Group
Company
2023
2022
2023
2022
£'000
£'000
£'000
£'000
Carrying amount of financial assets
Instruments measured at fair value through profit or loss
75
-
-
-
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 28 -
17
Stocks
Group
Company
2023
2022
2023
2022
£'000
£'000
£'000
£'000
Raw materials and consumables
2,631
1,953
Finished goods and goods for resale
1,741
1,292
4,372
3,245
18
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£'000
£'000
£'000
£'000
Trade debtors
502
437
Amounts owed by group undertakings
-
-
80
Derivative financial instruments
75
-
-
-
Other debtors
499
475
3
Prepayments and accrued income
1,209
515
2,285
1,427
83
-
Amounts falling due after more than one year:
Amounts owed by group undertakings
-
-
5,156
4,751
Total debtors
2,285
1,427
5,239
4,751
19
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£'000
£'000
£'000
£'000
Bank loans and overdrafts
21
74
103
Trade creditors
1,090
1,047
Corporation tax payable
133
70
Other taxation and social security
308
197
Deferred income
7,042
526
Other creditors
88
175
Accruals
417
421
15
12
9,152
2,539
15
12
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 29 -
20
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£'000
£'000
£'000
£'000
Unsecured Loan Notes
21
4,545
4,545
4,545
4,545
Bank loans and overdrafts
21
295
344
Loan Note interest
814
814
814
814
5,654
5,703
5,359
5,359
Amounts included above which fall due after five years are as follows:
Payable by instalments
945
1,929
945
1,895
21
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£'000
£'000
£'000
£'000
Unsecured loan notes
4,545
4,545
4,545
4,545
Bank loans
369
413
-
-
Bank overdrafts
-
34
-
-
4,914
4,992
4,545
4,545
Payable within one year
74
103
-
-
Payable after one year
4,840
4,889
4,545
4,545
Amounts included above which fall due after five years:
Payable by instalments
945
1,929
945
1,895
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
21
Loans and overdrafts
(Continued)
- 30 -
Unsecured loan notes comprise of BGF 2019 Loan Notes of £2.8m (2022: £2.8m) which carry an interest rate of 6% per annum (2022: 6% per annum). The interest is payable in quarterly instalments from 1 October 2021. The loan notes together with accrued interest to 30 September 2021 are repayable in half yearly instalments from June 2025. Christopher Ward London Limited has provided a full guarantee for the liability of the loan notes and related interest. Christopher Ward SA has provided a guarantee which is limited to the amount of unrestricted equity capital surplus available for distribution.
Within unsecured loan notes are Founders 2019 Loan Notes of £995k (2022: £995k) and Founders 2021 Loan Notes of £750k(2022: £750k) which carry an interest rate of 6% per annum (2021: 6% per annum) payable in quarterly installments from 1 October 2021. The principal and accrued interest relating to the Founders 2019 Loan Notes are repayable in half yearly instalments from June 2025.
The Founder 2021 Loan Notes carry an interest rate of 6% per annum. The Founders 2021 Loan Notes are repayable no later than 31 March 2025.
Within bank loans is £369k (2022: £413k) which relates to a COVID19 loan secured by the Swiss government. This loan is repayable in half yearly instalments £37k (CHF42k) from 1 April 2022 with the final payment being due September 2027. For the March 2023 year end this loan was interest free. From April 2023 the loan carries an interest rate at 1.5% per annum.
Included within bank overdrafts is a total of £nil (2022: £34k) which carried interest at 2.95% above the Bank's base rate per annum and was secured over certain of the assets of the group.
Banking facilities
As at 31 March 2023, the group had access to the following banking facilities:
Bank overdraft of £875k which incurs interest at a rate of 2.5% plus base rate per annum and is repayable on demand. As at the year end, £nil (2022: £34k) of this overdraft facility was drawn.
Commercial credit card facility of £310k (2022: £300k). As at the year end, £88k (2022: £153k) of this facility was being used.
Swiss banking facilities of £295k (CHF333k) which incurs interest at a rate of 3.5% per annum and is repayable on demand. These facilities were drawn.
Bank overdraft of £247k (CHF300k) which incurs interest at a rate of 3% per annum and is repayable on demand. These facilities were drawn.
22
Deferred taxation
Deferred tax assets and liabilities are offset where the group or company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
2023
2022
Group
£'000
£'000
Accelerated capital allowances
289
232
Provision for unrealised profits
(80)
(54)
209
178
The company has no deferred tax assets or liabilities.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
22
Deferred taxation
(Continued)
- 31 -
Group
Company
2023
2023
Movements in the year:
£'000
£'000
Liability at 1 April 2022
178
-
Charge to profit or loss
31
-
Liability at 31 March 2023
209
-
23
Retirement benefit schemes
2023
2022
Defined contribution schemes
£'000
£'000
Charge to profit or loss in respect of defined contribution schemes
99
94
Defined contribution pension schemes are operated in the UK and in Switzerland for all qualifying employees. The assets of the schemes are held separately from the group in independently administered funds.
24
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£'000
£'000
Issued and fully paid
A ordinary shares of 1p each
55,000
55,000
1
1
Ordinary shares of 1p each
145,000
145,000
1
1
Deferred shares of £1 each
96,000
96,000
96
96
296,000
296,000
98
98
All classes of shares rank pari passu and entitle the holder to attend and vote at any meeting of the company, to participate in the profits of the company that are available for distribution and to a return of capital on winding up to the extent that all other debts are settled.
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
24
Share capital
(Continued)
- 32 -
On 25 July 2019, the company repurchased 25 E ordinary shares for cash at par and subsequently cancelled these shares.
On 25 July 2019, 550 A ordinary shares of £1 each were issued for cash at a premium of £6,271.73 per share.
On 25 July 2019, the following shares were reclassified as Ordinary £1 shares:
50 A ordinary shares of £1 each
450 B ordinary shares of £1 each
450 C ordinary shares of £1 each
500 D ordinary shares of £1 each
On 23 December 2019 1,450 Ordinary £1 shares were subdivided into 145,000 1p ordinary shares.
On 23 December 2019 550 A ordinary £1 shares were subdivided into 55,000 1p A ordinary shares.
On the 30 July 2020 75,000 deferred shares of £1 each were issued for cash at par.
On 4 May 2021 21,000 deferred shares of £1 each were issued for cash at par.
25
Reserves
Share premium
The share premium account represents the amount received in excess of nominal value for shares purchased in the group.
Profit and loss reserves
Profit and loss reserves represent the retained earnings of the group since its inception.
Legal reserve
The legal reserve is held by Christopher Ward SA and relates to the mandatory retainment of part of the firm's earnings. This reserve is not available for distribution.
26
Financial commitments, guarantees and contingent liabilities
Company only
Christopher Ward (London) Holdings Limited is part of a group guarantor scheme regarding the commercial loans with Barclays. At the reporting date, Christopher Ward (London) Holdings Limited has fixed and floating charges over its assets to the value of £88k (2022: £153k).
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 33 -
27
Operating lease commitments
Lessee
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
Group
Company
2023
2022
2023
2022
£'000
£'000
£'000
£'000
Within one year
124
106
-
-
Between two and five years
85
145
-
-
209
251
-
-
28
Related party transactions
Transactions with related parties
During the year the group entered into the following transactions with related parties:
Rents paid
2023
2022
£'000
£'000
Group
Key management personnel
89
78
Finance costs
Consultancy
2023
2022
2023
2022
£'000
£'000
£'000
£'000
Group
Key management personnel
15
15
10
10
Finance costs paid to key management personnel are for the provision of personal guarantees.
The following amounts were outstanding at the reporting end date:
Amounts owed to related parties
2023
2022
£'000
£'000
Group
Shareholders' loans
5,359
5,359
Company
Shareholders' loans
5,359
5,359
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
28
Related party transactions
(Continued)
- 34 -
Amounts due to shareholders represents unsecured 2019 BGF Loan Notes of £2.8m (2022: £2.8m) which carries an interest rate of 6% per annum (2022: 6% per annum) together with rolled up interest of £601k (2022: £601k). The loan notes together with the rolled up interest are repayable in half yearly instalments from June 2025.
Amounts due to other shareholders also include:
Unsecured 2019 Founder Loan Notes of £995k (2022: £995k) which carries an interest rate of 6% per annum (2022: 6% per annum) payable quarterly together with rolled up interest of £214k (2022: £214k). The loan notes together with the rolled up interest are repayable in half yearly instalments from June 2025
Unsecured 2021 Founder Loan Notes of 750k (2022:£750k) which carries an interest rate of 6% per annum (2022: 6% per annum) payable quarterly. The loan notes are repayable no later than 31 March 2025.
Christopher Ward London Limited has provided a full guarantee for the liability of the loan notes and related interest. Christopher Ward SA has provided a guarantee which is limited to the amount of unrestricted equity capital surplus available for distribution.
Three of the directors are also 2019 and 2021 Founders Loan Note holders £105k (2022 - £52k) of Founders Loan Note interest was paid to these directors during the year and £168k (2022: £84k) of Investor Loan Note interest was paid to shareholders during the year.
The directors have provided personal guarantees over bank facilities limited to £1.2m (2022: £1.2m).
CHRISTOPHER WARD (LONDON) HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 35 -
29
Cash generated from group operations
2023
2022
£'000
£'000
Profit/(loss) for the year after tax
93
(497)
Adjustments for:
Taxation charged
129
33
Finance costs
302
363
Investment income
(22)
-
Loss on disposal of tangible fixed assets
2
-
Amortisation and impairment of goodwill
-
47
Amortisation and impairment of other intangible assets
479
438
Depreciation and impairment of tangible fixed assets
87
111
Fair value movements
(75)
-
EBITDA
995
495
Foreign exchange movement
137
188
1,132
683
Movements in working capital:
(Increase) in stocks
(1,128)
(154)
(Increase) in debtors
(781)
(419)
Increase in creditors
6,579
780
Cash generated from operations
5,802
890
EBITDA noted above of £994k (2022: (£495k) includes exceptional items of £76k (2022: £107k).
30
Analysis of changes in net funds/(debt) - group
1 April 2022
Cash flows
31 March 2023
£'000
£'000
£'000
Cash at bank and in hand
1,460
5,083
6,543
Bank overdrafts
(34)
34
-
1,426
5,117
6,543
Borrowings excluding overdrafts
(4,958)
44
(4,914)
(3,532)
5,161
1,629
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