Registered number:
FOR THE YEAR ENDED 31 MARCH 2021
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LAMEX FOODS EUROPE (NI) LIMITED
COMPANY INFORMATION
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LAMEX FOODS EUROPE (NI) LIMITED
CONTENTS
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LAMEX FOODS EUROPE (NI) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2021
The Directors of Lamex Foods Europe (NI) Limited present the annual accounts for the financial year ended 31.3.2021. The turnover of the company increased in the year (from £178 million to £193 million) as a reflection of market prices for pork and chicken, but the gross margin has been significantly improved from £5,813K in 2020 to £7,930K in 2021. The Directors consider gross profit to be a key performance indicator. During the year, the Directors moved sourcing from Thailand and Brazil to Continental Europe and this trend is continuing in 2021 – 2022.
The company believes that because of its longstanding relationships with suppliers and customers and the maintenance of reliable, accurate logistics and administration it remains well placed to continue to safeguard and grow its profits. The directors invest too in substantial technical resource and have BRC accreditation which is part of its risk management and gives added assurance to customers and suppliers. Despite the continued challenge of covid through the financial year 2021 to 2022, the large number of retail customers serviced by Lamex Foods Europe (NI) Limited has enabled the Company to maintain its profitability thus far this financial year. The challenge of Brexit has been faced this year and successfully navigated despite the dramatic increase in paperwork. The Directors would like to acknowledge the professionalism, hard work and dedication with which all our staff have worked in these extraordinary times. They are the bedrock of our success.
Business risk
The company has always actively managed its risks, and this has enabled it to deliver continued growth in terms of products, geography and profitability. The keyword of the company is “balance” and this is evident within the geographic areas it operates, the currencies it trades in, and the products sold. Technical risk There is always a risk that suppliers fail the ever-increasing technical requirements enforced by customers. The company manages this risk through the employment of highly dedicated, qualified and experienced teams of technical personnel, who ensure that all requirements are complied with prior to shipment. Disease risk Historically, the outbreaks of disease have occurred in zones around the world, and once discovered the governing bodies contain the disease and limit the spread by placing travel embargos on the respective products. In principle, when one market is affected, buyers and consumers turn to an alternative source of the same protein and business continues. Problems that affect free import and export (such as diseases) are usually known to the traders at Lamex Foods Ireland Limited long before they are made public. Intelligence comes from a variety of sources, primarily from the Traders being in constant contact with the suppliers and buyers of produce around the world, and it is this expertise that is partly responsible for damage limitation. Currency risk Traders minimise the currency risk by matching the buying and selling of foreign currency. Where there is a currency exposure on a certain deal, using the projected receipt dates, the traders secure the exchange value using forward contracts. As a result the board have applied hedge accounting and any gains/losses have been recognised in other comprehensive income rather than in the profit and loss.
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LAMEX FOODS EUROPE (NI) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2021
Trade barriers
The marketplace for food is often affected by quota systems, such as licensing and tariffs. The company is actively involved in lobbying and industry representation to minimise the risk. Again, experience and knowledge is the key to managing this risk. COVID-19 The COVID 19 outbreak has continued throughout 2020-2021, and continues still, with a significant number of infections. In addition to the already known effects of the COVID 19 outbreak and resulting government measures, the macroeconomic uncertainty causes disruption to economic activity, and it is unknown what the longer-term impact on our business may be. We have taken and will continue to take several measures to monitor and prevent the effects of the COVID 19 virus. This includes safety and health measures for our people (like social distancing and working from home). We will continue to follow the policies and advice of the various national institutes and at the same time do our best to continue our activities in the best and safest way possible without endangering the health of our employees. Closely coordinating activities between suppliers, customers, and staff we have managed to reduce the damage and risk caused by COVID 19 thus far. Outlook In addition, as part of its preparation and management of the current crisis, the Directors investigated the impact of the COVID 19 virus for the company. For the coming financial year 2021 2022, the Directors anticipate that the company will be profitable. However, given a lack of assurance at this stage, the exact impact on our business for the rest of 2021- 2022 and beyond cannot be predicted. Management estimates that the company has sufficient financial buffer to have confidence in the going concern of the business. Financial risk management objectives and policies The company finances its operations through a mixture of retained profits and where necessary to fund expansion or capital expenditure programs through bank borrowings. The management objectives are to: - retain sufficient liquid funds to enable it to meet its day to day objectives as they fall due whilst maximising returns on surplus funds. - minimise the company’s exposure to fluctuating interest rates when seeking new borrowings; and - match the repayment schedule of any external borrowings or overdraft with the expected future cash flows expected to arise from the group’s trading activities.
The directors of the company take seriously The Companies Act requirements of section 172 to promote the success of the company for the long term. In compliance, the directors have regard to the interests of the shareholders and employees as well as the wider community. Initiatives such as work to ensure compliance with anti-slavery legislation, following GDPR requirements to protect the information of employees, suppliers and customers, welfare initiatives for animals and a push for recycling wherever possible, are just some examples.
This report was approved by the board
and signed on its behalf.
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LAMEX FOODS EUROPE (NI) LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2021
The Directors present their report and the financial statements for the year ended 31 March 2021.
The Directors who served during the year were:
The Directors are responsible for preparing the Strategic Report, the Directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.
In preparing these financial statements, the Directors are required to:
∙
select suitable accounting policies for the Company's financial statements and then apply them consistently;
∙
make judgments 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 financial statements;
∙
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and 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 also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The profit for the year, after taxation, amounted to £
1,848
thousand
(2020 -
£
1,327
thousand)
.
Dividends of £6 million were paid during the year (2020: £100 thousand).
Details of future developments can be found in the strategic report.
It is part of our normal business practice for our trading staff to regularly visit customers and suppliers. This is
followed by contact with our technical audit staff who will visit and ensure compliance with international standard such as BRC. The onset of COVID has challenged the regular visits which are seen by us as essential to build and maintain relationship and to ensure technical standards but remote contacts have continued throughout.
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LAMEX FOODS EUROPE (NI) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2021
The Company has not disclosed information in respect of greenhouse gas emissions, energy consumption and energy efficiency action as its energy consumption in the United Kingdom for the year is 40,000kWh or lower.
There have been no significant events affecting the Company since the year end.
The auditor, James Cowper Kreston, will be proposed for reappointment in accordance with
section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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LAMEX FOODS EUROPE (NI) LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF LAMEX FOODS EUROPE (NI) LIMITED
We have audited the financial statements of Lamex Foods Europe (NI) Limited (the 'Company') for the year ended 31 March 2021, which comprise the Statement of Comprehensive Income, the Balance Sheet, the Statement of Changes in Equity
and the related notes, 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).
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.
In auditing the financial statements, we have concluded that the Directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the Annual Report other than the financial statements and our Auditor's Report thereon. The Directors are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
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LAMEX FOODS EUROPE (NI) LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF LAMEX FOODS EUROPE (NI) LIMITED (CONTINUED)
In our opinion, based on the work undertaken in the course of the 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.
In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.
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.
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.
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LAMEX FOODS EUROPE (NI) LIMITED
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF LAMEX FOODS EUROPE (NI) LIMITED (CONTINUED)
The specific procedures for this engagement that we designed and performed to detect material misstatements in respect of irregularities, including fraud, were as follows:
∙
Enquiry of management and those charged with governance around actual and potential litigation and claims;
∙
Enquiry of management and those charged with governance to identify any material instances of non-compliance with laws and regulations;
∙
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
∙
Perfoforming audit work to address the risk of irregularities due to 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 evidence of bias.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at:
www.frc.org.uk/auditorsresponsibilities
. This description forms part of our Auditor's Report.
This report is made solely to the Company's members, as a body,
in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in 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.
for and on behalf of
Chartered Accountants and Statutory Auditor
2 Communications Road
Greenham Business Park
Greenham
Berkshire
RG19 6AB
Date:
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LAMEX FOODS EUROPE (NI) LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2021
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LAMEX FOODS EUROPE (NI) LIMITED
REGISTERED NUMBER:
NI062000
BALANCE SHEET
AS AT
31 MARCH 2021
The financial statements were approved and authorised for issue by the board and were signed on its behalf by
:
The notes on pages 11 to 24 form part of these financial statements.
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LAMEX FOODS EUROPE (NI) LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED
31 MARCH 2021
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED
31 MARCH 2020
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LAMEX FOODS EUROPE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
Lamex Foods Europe (NI) Limited is a private company limited by share capital and incorporated in Northern Ireland. The address of the registered office and principal place of business is River House, Castle Lane, Coleraine, Londonderry, BT51 3DP. The principal activity of the business is that of international food trading.
2.
Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in
the UK and the Republic of Ireland and the Companies Act 2006
.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
∙
the requirements of Section 7 Statement of Cash Flows;
∙
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
∙
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
∙
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
∙
the requirements of Section 26 Share-based Payment paragraphs 26.18(b), 26.19 to 26.21 and 26.23;
∙
the requirements of Section 33 Related Party Disclosures paragraph 33.7.
This information is included in the consolidated financial statements of Lamex Food Group Limited as at 31 March 2021 and these financial statements may be obtained from the registered office.
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LAMEX FOODS EUROPE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
2.
Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on a reducing balance basis.
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
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LAMEX FOODS EUROPE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
2.
Accounting policies (continued)
The Company 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, loans to related parties and investments in non-puttable ordinary shares.
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LAMEX FOODS EUROPE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
2.
Accounting policies (continued)
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 other comprehensive income. The group has applied hedge accounting for foreign exchange derivatives during the year.
Functional and presentation currency
The Company's functional and presentational currency is GBP. Transactions and balances Foreign currency transactions are translated into the functional currency using the forward contract rate applicable to the individual contract. At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined. Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Comprehensive Income except when deferred in other comprehensive income as qualifying cash flow hedges. During the period the company reviewed its accounting policy in respect of foreign exchange differences arising on foreign exchange forward contracts. Previously the fair value of these contracts were recognised in other group companies because, in the view of management, it was not practicable to split the fair value of the contracts between different group companies. During the year due to improvements in reporting of the fair values management were able to split this fair value between companies. Following this change it was also decided that the unrealised gains and losses that related to the debtors and creditors to which these forward contracts related should also be reported in this entity. A retrospecitve review of prior years indicated that the amounts were not material to prior years and therefore no prior year adjustment was made to apply this accounting policy to retrospectively in this entity.
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LAMEX FOODS EUROPE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
2.
Accounting policies (continued)
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the Balance Sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. When payments are eventually made, they are charged to the provision carried in the Balance Sheet.
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LAMEX FOODS EUROPE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
2.
Accounting policies (continued)
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LAMEX FOODS EUROPE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
Revenue recognition The key judgment made by management in respect of revenue is the point at which that revenue should be recognised. Management consider the underlying contract terms and conclude upon the most appropriate point of the cycle at which to recognise revenue based upon these terms and in particular where the risks and rewards of ownership transfer. Taxation The company establishes provisions based on reasonable estimates, for possible consequences of audits by the tax authorities. The amount of such provisions is based on various factors, such as experience with previous tax submissions. Management estimation is required to determine the amount of deferred tax assets that can be recognised, based upon likely timing and level of future taxable profits together with an assessment of the effect of future tax planning strategies. Operating lease commitments The company has entered into commercial lease contracts and as a lessee it obtains use of property, plant and equipment. 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. Profit recognition on open contracts at year end When a contract has been delivered to the customer at the year end but not yet closed management make an estimate of the future costs that will be incurred on those contracts on a contract by contract basis. These costs are estimated with reference to the expected profit that will be made on those contracts. Traders estimate profits based upon their experience of the products and customers to which the contact relates. Where management estimate that any contract is going to be in a loss making position that loss is recognised in full as soon as it becomes probable. Stock provisions Management review stock at periodic intervals and consider the requirement for a provision to ensure stock is held at the lower of cost and net realisable value. Management estimate these provisions based upon their experience of the net realisable value of different products and of market conditions that are prevailing at the point of review, which, for the purposes of these financial statements, is the balance sheet date.
The whole of the turnover is attributable to the principal activity of the company.
The directors consider that it would be commercially prejudicial to disclose the analysis of turnover by geographical location and profit before tax of the different classes of business.
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LAMEX FOODS EUROPE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
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LAMEX FOODS EUROPE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
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LAMEX FOODS EUROPE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
9.
Taxation (continued)
In the Spring Budget 2021, the Government announced that from 1 April 2023 the main corporation tax rate will increase to 25%. As a result of the rate change the corporation tax expense for the period has decreased and the deferred tax asset has increased. The impact of these changes is not expected to be material.
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LAMEX FOODS EUROPE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
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LAMEX FOODS EUROPE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
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LAMEX FOODS EUROPE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
Cash flow hedge reserve
Profit & loss account
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LAMEX FOODS EUROPE (NI) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
The company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the group in an independently administered fund. The pension cost charge represents contributions payable by the company to the fund and amounted to £20 thousand (2020: £19 thousand). No contributions were payable to the fund at the balance sheet date (2020: £nil).
The ultimate parent company at the balance sheet date was Lamex Food Group Limited.
The parent of both the smallest and the largest group for which group accounts including Lamex Foods Europe (NI) Limited are drawn up is Lamex Food Group Limited. Copies of these accounts may be obtained from the registered office.
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