Company registration number 03941136 (England and Wales)
EBUYER (UK) LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
EBUYER (UK) LIMITED
COMPANY INFORMATION
Directors
Mr M J Reed
(Appointed 3 April 2023)
Mr R S Marsden
(Appointed 3 April 2023)
Ms A Rose
(Appointed 4 April 2023)
Mr D G Brooks
(Appointed 1 June 2023)
Company number
03941136
Registered office
Ferry Road
Howdendyke
Goole
DN14 7UW
Auditor
Azets Audit Services Limited
Triune Court
Monks Cross Drive
York
YO32 9GZ
EBUYER (UK) LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 7
Independent auditor's report
8 - 10
Statement of comprehensive income
11
Balance sheet
12
Statement of changes in equity
13
Notes to the financial statements
14 - 24
EBUYER (UK) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Principal activities
The principal activity of the company is the online retailing of electrical products.
Section 172 (1) statement
The Section 172(1) Statement describes how the Directors, individually and collectively, acting in good faith have exercised their duties over the course of the year to promote the long-term success of the company for the benefit of its members as a whole, and in doing so have regard to the matters set out in Section 172(1) (a) to (f) of the Companies Act 2006.
The directors have set a long-term strategy for the group which is designed to be beneficial to all key stakeholders. The directors make decisions which support the strategy and always balance immediate and long-term impacts of decisions
The Directors recognise that employees within the group are fundamental to the future growth and success of the group and therefore consider the interests of employees by applying applicable group policies
The Directors actively engage with key stakeholders to build strong positive relationships which are essential for the successful delivery of the groups strategy
The directors understand that the company needs to minimize its impact on the environment while also providing jobs to the local community. Through this approach the directors aim to operate an ethical sustainable business for the future
The directors adhere to the group values which set out the standards and behaviors expected of all employees
The company activities support the wider strategy of the Realtime Holdings limited group, owing to the fact the company is a wholly owned subsidiary of Realtime Holdings Limited. The directors are required to balance the interests of corporate shareholders rather than any third parties
The successful delivery of the long-term plans requires positive relationships with a range of key stakeholders including its members, employees, customers, supply chain, regulator and our wider society.
The Board looks to achieve this by setting out its strategy and monitoring performance against its strategic objectives. In setting these objectives the Board takes into account the potential impact and outcomes on the aforementioned key stakeholders. It also seeks to align its strategy to generating increased shareholder value, creation of employment and contributing to the wider economy which includes taxation borne by the Company.
Review of the business
On 3 April 2023 Ebuyer (UK) Limited was acquired by Realtime Holdings Limited.
The market for electrical products and components declined further in 2023 in part driven by the reduction in discretionary spend because of the inflationary increases and the UK credit crunch.
The decline in the market has led to difficult trading conditions for the company with turnover mirroring the downturn with a reduction of 22% year on year. To address the difficult trading the directors initiated cost reduction and efficiency plans to improve both the short-term and long-term profitability of the business. These plans resulted in 50 employees leaving as the business right sized for the smaller turnover.
EBUYER (UK) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
Key performance indicators
The directors monitor business performance through the use of both financial and non-financial performance measures. From a financial point of view, key performance indicators for the company include turnover, gross profit, EBITDA and profit before tax. Non-financial key performance indicators include website hits, order conversion, orders placed, customer satisfaction and market share. EBITDA is calculated as profits on ordinary activities before tax adjusted by adding back interest, depreciation, and amortization. These values can be found in the notes to the financial statements.
For the year ended 31 December
Financial KPI’s
2023 2022
£’000 £’000
Turnover 136,502 174,252
% growth -22% -28%
Gross profit 16,416 19,884
% growth -17% -31%
EBITDA (1415) 525
% growth -370% -93%
Profit before tax (1,738) 109
% growth -1,694% -98%
Future Developments
The future plan for the company is to continue as an online retailer of electrical products but focus on growth and operational efficiency. Investment will be directed towards supporting talent within the organization and driving revenue growth. The company has significant room for expansion within its operational facilities, the company will continue to investigate options as they arise.
Principal risks and uncertainties
Aside from the impact of general economic factors, the company has some risks in the elements of stock it holds that are at risk of price deflation and obsolescence as a result of technological advances and changing consumer tastes. The company manages the risk by closely monitoring financial and non-financial KPIs and continually adjusting pricing to ensure that stock levels are commensurate with run rates for every stock line.
The company operates in a highly competitive market with sophisticated consumers who are willing to spend time carrying out research to ensure they are paying the right price for their products. To meet its customers’ demands the company has built up a diverse supplier base to service all their product needs.
EBUYER (UK) LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
Mr R S Marsden
Director
3 April 2024
EBUYER (UK) LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Future Developments
The future developments of the company are disclosed in the Strategic Report.
Results and dividends
The results for the year are set out on page 7.
Ordinary dividends were paid amounting to £2,518,500. The directors do not recommend payment of a further dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr M J Reed
(Appointed 3 April 2023)
Mr R S Marsden
(Appointed 3 April 2023)
Ms A Rose
(Appointed 4 April 2023)
Mr D G Brooks
(Appointed 1 June 2023)
Mr A D Grant
(Resigned 3 April 2023)
Mr M J Pullan
(Resigned 3 April 2023)
Ms J M Oldfield
(Resigned 3 April 2023)
Mr L R Weymouth
(Resigned 16 August 2023)
Ms A E Smith
(Resigned 18 August 2023)
Qualifying third party indemnity provisions
As permitted by the Articles of Association, the Directors have the benefit of an indemnity which is a qualifying third-party indemnity provision as defined by section 234 of the Companies Act 2006. The indemnity was in force throughout the last financial year and is currently in force. The group also purchased and maintained throughout the financial year Directors’ and Officers’ liability insurance in respect of itself and its Directors. The insurance does not provide cover in the event that the Directors’ is proved to have acted fraudulently.
Financial instruments
Credit risk
The directors regularly review the company’s cash position and its future cash flow forecasts. The Company has a strong balance sheet, available funding and the nature of the business is highly cash generative, therefore directors do not believe that the company is exposed to significant risk in this regard.
Liquidity and cash flow risk
The directors regularly review the company’s cash position and its future cash flow forecasts. The Company has a strong balance sheet, available funding and the nature of the business is highly cash generative, therefore directors do not believe that the company is exposed to significant risk in this regard.
Employee involvement
The company systematically provides employees with information on matters of concern to them, consulting them or their representatives regularly, so that their views can be taken into account when making decisions that are likely to affect their interests. Employee involvement in the company is encouraged, as achieving a common awareness on the part of all employees of the financial and economic factors affecting the company plays a major role in maintaining growth. The company encourages the involvement of employees by means of regular written and oral communications.
EBUYER (UK) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 5 -
Employment of disabled persons
The company is committed to employment policies, which follow best practice, based on equal opportunities for all employees, irrespective of sex, race, colour, disability or marital status. The company gives full and fair consideration to applications for employment for disabled persons, having regard to their particular aptitude and abilities. Appropriate arrangements are made for the continued employment and training, career development and promotion of disabled persons employed by the company. If members of staff become disabled the company continues their employment, either in the same or an alternative position, with appropriate retraining being given if necessary.
Going concern
The directors have reviewed the latest board approved two-year cashflow forecasts which indicate the company has sufficient cash reserves and funding facilities in place to satisfy all cash demands as they become due. In addition, sensitivities have been applied to the approved forecast to reflect recent trading performance and a low case trading performances and in all scenarios the company continues to have sufficient resources.
The directors believe that the cashflow forecast assessment is robust and sufficient to determine that the company has sufficient resources to continue to operate for a period of at least 12 months from the approval of this report. Thus, the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
Auditor
Azets Audit Services Limited were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, and is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Streamlined energy and carbon reporting
The directors present recognise the importance of sustainability and the environment and present the following information:
This is the group’s report under the SECR regulations covering the year ended 31 December 2023.
The company has initiatives to minimise emissions and looks to adopt greener technology were possible including the electrification of all warehouse vehicles.
EBUYER (UK) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 6 -
Quantification and reporting methodology
Intensity measurement
The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per £m of revenue.
2023 2022
Metric tonnes CO2e per £m of revenue 2.96 3.07
EBUYER (UK) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
Statement of directors' responsibilities
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 Policies, specifically FRS 102 (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and 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 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 financial statements;
assess the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and
use the going concern basis of accounting unless they either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
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 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.
Strategic report
The Directors have chosen in accordance with Section 414C (11) of the Companies Act 2006 to include in the Strategic Report matters otherwise required to be disclosed in the Directors Report as the Directors consider these are of strategic importance to the Company.
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 company’s auditor 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 company’s auditor is aware of that information.
On behalf of the board
Mr R S Marsden
Director
30 April 2024
EBUYER (UK) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF EBUYER (UK) LIMITED
- 8 -
Opinion
We have audited the financial statements of Ebuyer (UK) Limited (the 'company') for the year ended 31 December 2023 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity 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 company's affairs as at 31 December 2023 and of its loss 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 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 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.
EBUYER (UK) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF EBUYER (UK) LIMITED
- 9 -
Matters on which we are required to report by exception
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.
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, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of 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 company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
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.
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.
EBUYER (UK) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF EBUYER (UK) LIMITED
- 10 -
Extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.
We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework. Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.
In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:
Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud;
Reviewing minutes of meetings of those charged with governance;
Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the company through enquiry and inspection;
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 bias and 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 indicators of potential bias;
Performing audit work over the timing and recognition of revenue and in particular whether it has been recorded in the correct accounting period.
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 of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
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.
Martin Davey
Senior Statutory Auditor
For and on behalf of Azets Audit Services Limited
3 April 2024
Chartered Accountants
Statutory Auditor
Triune Court
Monks Cross Drive
York
YO32 9GZ
EBUYER (UK) LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
2023
2022
Notes
£
£
Turnover
3
136,501,569
174,251,936
Cost of sales
(120,086,050)
(154,367,491)
Gross profit
16,415,519
19,884,445
Administrative expenses
(18,508,083)
(19,798,553)
Other operating income
249,516
Operating (loss)/profit
4
(1,843,048)
85,892
Interest receivable and similar income
7
78,269
23,268
(Loss)/profit before taxation
(1,764,779)
109,160
Tax on (loss)/profit
8
384,448
(5,169)
(Loss)/profit for the financial year
(1,380,331)
103,991
The profit and loss account has been prepared on the basis that all operations are continuing operations.
EBUYER (UK) LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 12 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
10
746,041
1,031,227
Current assets
Stocks
11
15,525,799
15,711,648
Debtors
12
17,608,679
11,103,464
Cash at bank and in hand
1,191,988
5,792,620
34,326,466
32,607,732
Creditors: amounts falling due within one year
13
(27,252,580)
(21,920,201)
Net current assets
7,073,886
10,687,531
Net assets
7,819,927
11,718,758
Capital and reserves
Called up share capital
16
730,000
730,000
Profit and loss reserves
7,089,927
10,988,758
Total equity
7,819,927
11,718,758
The financial statements were approved by the board of directors and authorised for issue on 3 April 2024 and are signed on its behalf by:
Mr R S Marsden
Director
Company Registration No. 03941136
EBUYER (UK) LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 January 2022
730,000
10,884,767
11,614,767
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
103,991
103,991
Balance at 31 December 2022
730,000
10,988,758
11,718,758
Year ended 31 December 2023:
Loss and total comprehensive income for the year
-
(1,380,331)
(1,380,331)
Dividends
9
-
(2,518,500)
(2,518,500)
Balance at 31 December 2023
730,000
7,089,927
7,819,927
EBUYER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
1
Accounting policies
Company information
Ebuyer (UK) Limited is a private company limited by shares incorporated in England and Wales. The registered office is Ferry Road, Howdendyke, Goole, DN14 7UW.
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.
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 £1.
The financial statements have been prepared under the historical cost convention, modified to include certain financial instruments at fair value. The principal accounting policies adopted are set out below.
This 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:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The company has applied section 33.1A of FRS 102 permitting it to not disclose related party transactions with wholly owned group companies.
The financial statements of the company are consolidated in the financial statements of Realtime Holdings Limited. These consolidated financial statements are available from its registered office, The Pavillion, Kingfisher Way, Hinchingbrooke Business Park, Huntingdon, PE29 6FN.
1.2
Going concern
The directors have reviewed the latest board approved two-year cashflow forecasts which indicate the company has sufficient cash reserves and funding facilities in place to satisfy all cash demands as they become due. In addition, sensitivities have been applied to the approved forecast to reflect recent trading performance and a low case trading performances and in all scenarios the company continues to have sufficient resources.true
The directors believe that the cashflow forecast assessment is robust and sufficient to determine that the company has sufficient resources to continue to operate for a period of at least 12 months from the approval of this report. Thus, the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services 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.
EBUYER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Plant and equipment
Straight line over 10 years
Fixtures and fittings
Straight line over 10 years
Computers
Straight line over 3 years
Motor vehicles
Straight line over 4 years
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.5
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
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, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
EBUYER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
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.
1.7
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
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 company 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.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
EBUYER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
EBUYER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -
1.11
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 or fixed assets.
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.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
1.14
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
In the application of the company’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.
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.
Stock provisioning
Management considers the recoverability of the carrying value of stock and makes estimates for any associated provision required. When calculating the stock provision, management considers the nature, age and condition of its stock in addition to assumptions around future usage.
EBUYER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
3
Turnover
2023
2022
£
£
Turnover analysed by class of business
Sale of goods
136,501,569
174,251,936
2023
2022
£
£
Turnover analysed by geographical market
UK
136,501,569
174,251,936
4
Operating (loss)/profit
2023
2022
Operating (loss)/profit for the year is stated after charging/(crediting):
£
£
Exchange gains
(173,864)
(245,618)
Fees payable to the company's auditor for the audit of the company's financial statements
68,000
70,000
Depreciation of owned tangible fixed assets
401,092
438,619
Profit on disposal of tangible fixed assets
(13,064)
(25,105)
Operating lease charges
1,327,821
1,428,780
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Distribution
84
89
Administration
106
149
Total
190
238
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
5,962,281
6,196,983
Social security costs
557,694
448,318
Pension costs
122,289
117,981
6,642,264
6,763,282
EBUYER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
331,649
252,733
Company pension contributions to defined contribution schemes
2,836
30,940
334,485
283,673
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
132,500
111,492
Company pension contributions to defined contribution schemes
2,818
13,757
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
78,269
23,268
8
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
57,389
Adjustments in respect of prior periods
(127,266)
Total current tax
(69,877)
Deferred tax
Origination and reversal of timing differences
(32,640)
Changes in tax rates
(11,254)
Adjustment in respect of prior periods
118,940
Tax losses carried forward
(384,448)
Total deferred tax
(384,448)
75,046
Total tax (credit)/charge
(384,448)
5,169
EBUYER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
8
Taxation
(Continued)
- 21 -
The actual (credit)/charge for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
(Loss)/profit before taxation
(1,764,779)
109,160
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 23.50% (2022: 19.00%)
(414,723)
20,740
Tax effect of expenses that are not deductible in determining taxable profit
4,009
Adjustments in respect of prior years
(8,326)
Effect of change in corporation tax rate
(11,254)
Other
30,275
Taxation (credit)/charge for the year
(384,448)
5,169
9
Dividends
2023
2022
£
£
Final paid
2,518,500
10
Tangible fixed assets
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2023
3,933,889
2,482,452
2,336,268
190,159
8,942,768
Additions
18,767
679
102,279
121,725
Disposals
(8,236)
(32,387)
(52,243)
(92,866)
At 31 December 2023
3,952,656
2,474,895
2,406,160
137,916
8,971,627
Depreciation and impairment
At 1 January 2023
3,421,370
2,361,962
2,058,178
70,031
7,911,541
Depreciation charged in the year
112,942
52,955
188,543
46,652
401,092
Eliminated in respect of disposals
(4,812)
(29,991)
(52,244)
(87,047)
At 31 December 2023
3,534,312
2,410,105
2,216,730
64,439
8,225,586
Carrying amount
At 31 December 2023
418,344
64,790
189,430
73,477
746,041
At 31 December 2022
512,519
120,490
278,090
120,128
1,031,227
EBUYER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
11
Stocks
2023
2022
£
£
Finished goods and goods for resale
15,525,799
15,711,648
12
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
5,740,631
6,588,398
Corporation tax recoverable
198,315
152,712
Amounts owed by group undertakings
8,259,070
Other debtors
156,407
936,521
Prepayments and accrued income
2,849,256
3,405,281
17,203,679
11,082,912
Deferred tax asset (note 14)
405,000
20,552
17,608,679
11,103,464
Amounts owed by group undertakings are interest free and are repayable on demand.
13
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
20,996,763
17,529,210
Taxation and social security
777,099
1,117,131
Other creditors
3,663,784
22,060
Accruals and deferred income
1,814,934
3,251,800
27,252,580
21,920,201
Included within other creditors is an invoice discounting facility of £3,545,781 (2022 - £nil) which is secured on trade debtors.
EBUYER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
14
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Assets
Assets
2023
2022
Balances:
£
£
Accelerated capital allowances
-
20,552
Short term timing differences
405,000
-
405,000
20,552
2023
Movements in the year:
£
Asset at 1 January 2023
(20,552)
Credit to profit or loss
(384,448)
Asset at 31 December 2023
(405,000)
The deferred tax asset set out above is expected to reverse within the next two years and relates to the utilisation of tax losses against future expected profits of the same period.
15
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
122,289
117,981
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
16
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
730,000
730,000
730,000
730,000
EBUYER (UK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 24 -
17
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
1,366,048
1,366,048
Between two and five years
5,464,192
5,464,192
In over five years
10,726,284
12,066,757
17,556,524
18,896,997
18
Related party transactions
Transactions with related parties
During the year the company entered into the following transactions with related parties:
The comapny made sales of £84,865 (2022 - £nil) and paid rent of £nil (2022 - £349,118) to connected companies.
19
Ultimate controlling party
The ultimate parent company is Realtime Holdings Limited, a company registered in England and Wales.
The financial statements of the company are consolidated in the financial statements of Realtime Holdings Limited. Copies of the financial statements are available from Realtime Holdings Limited whose registered office, The Pavillion, Kingfisher Way, Hinchingbrooke Business Park, Huntingdon, PE29 6FN. Realtime Holdings Limited is the smallest and largest group into which Ebuyer (UK) Limited is consolidated.
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