REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTOR AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
FOR |
ADVANCED INSTRUMENTS LTD. |
REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTOR AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
FOR |
ADVANCED INSTRUMENTS LTD. |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
CONTENTS OF THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
Page |
Strategic Report | 1 |
Report of the Director | 4 |
Report of the Independent Auditors | 5 |
Statement of Comprehensive Income | 7 |
Balance Sheet | 8 |
Statement of Changes in Equity | 9 |
Notes to the Financial Statements | 10 |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
The director presents her strategic report for the year ended 31 December 2022. |
REVIEW OF BUSINESS |
Advanced Instruments Ltd. ("AI") has continued to manufacture and distribute its instruments to customers in the clinical and bio pharma end markets. |
The company's performance for the year ended 31 December 2022 showed total revenues of £16.1m, a pro-rata increase of 26% on the six months ended 31 December 2021. The pro-rata increase in sales was driven by the addition of the distribution of the osmometer portfolio in the UK and parts of Europe in 2022. Demand for capital equipment in the bio pharma end market slowed down in 2022 following very robust buying in 2021. |
The company generated earnings before interest, taxation, depreciation and amortisation ("EBITDA") of £3.0m (2021: £2.1m). |
In the view of the director, the company's key accomplishments, against the high-level strategic objectives for its group, have been: |
- To continue to serve our customers in the important UK clinical and biopharma markets with timely delivery of high-quality products. |
- To prepare the company for increased investment in research and development. |
Beginning in July of 2022, AI distributed the osmometer portfolio of products of Advanced Instruments LLC (US), (the sole shareholder of Advanced Instruments Holdings Ltd,) in the UK to customers in the clinical and biopharma end markets. |
PRINCIPAL RISKS AND UNCERTAINTIES |
Geopolitical events and security of supply |
With the increasing prevalence of supply chain disruptions across the industry, the company has sought to mitigate supply chain risk by increasing both inventory levels and committed purchase orders. |
Product and market risk |
The company is in a very competitive market. It must continue to innovate its products to maintain a leadership position with customers in the cell line development space. |
Regulatory risks |
Due to the nature of the industry in which we operate, the company is exposed to traditional regulatory risks (associated with the ongoing compliance of its business operations and products). Internal quality and regulatory issues are a core commitment of the Board, so suitable skills and experience are brought to bear to ensure that associated risks are managed. |
Economic risks |
Financial risks, which are primarily associated with the collectability of accounts receivable, and recoverability of inventory acquired to support key customers. These risks are appropriately managed through detailed oversight of our expert finance team. |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
ANALYSIS OF KEY FINANCIAL PERFORMANCE INDICATORS |
Performance measure |
Twelve months 2022 |
Six months 2021 |
Pro-rata movement % |
Commentary |
Revenue | £m | 16.1 | 6.4 | 26 | The pro-rata increase in revenue was driven by the addition of the osmometer portfolio. |
Gross profit | £m | 8.5 | 4.3 | (1 | ) | Gross profit decreased on a pro-rata basis as the additional sales of the osmometer portfolio were at a distributor margin, while lower sales of the Solentim portfolio products were at a principal margin. Additionally, inventory reserves were recorded to address excess and obsolescence risk. |
Gross margin | % | 53 | 67 | (14 | ) | Purchase costs rose significantly more than revenue, resulting in a reduced gross margin. |
Operating profit | £m | 2.8 | 2.0 | (29 | ) | The reduction in gross profit and the pro-rata increase in operating expenses, including increased research and development drove the pro-rata reduction in operating profit. |
EBITDA | £m | 3.0 | 2.1 | (28 | ) | The pro-rata reduction in operating profit drove the pro-rata reduction in EBITDA. |
AREAS DEEMED TO BE OF KEY STRATEGIC IMPORTANCE |
Long-range plans |
We have a long-range plan for the business that includes continued investment in research and development staff to continuously innovate our products (to meet the needs of our customer base) and to expand our distribution capabilities across Europe. |
Employees |
To achieve our long range plans we need to attract and retain a talented workforce. We want to provide a challenging and stimulating workplace to both retain, develop and attract new team members. |
Business relationships |
We are committed to maintain strong relationships with our customers and suppliers. For our customers we seek to understand their unique needs, and to continuously innovate and bring those customers products and services to improve their workflows. Similarly, to serve those customers we need strong relationships with our suppliers to ensure that they are in a position to continue to meet our needs. |
Community and environment |
We are committed to supporting our community and reducing our CO2 emissions through various means. |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
FINANCIAL INSTRUMENTS |
The company has an interest-free, unsecured loan from its parent company of £10,262,648. The loan is repayable on demand. As described in note 2 to the financial statements, the director has obtained confirmation from the parent company that it will not require repayment of the loan in the foreseeable future. The director considers the exposure to credit, liquidity and cash flow risk to be limited. |
SIGNED BY THE DIRECTOR: |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
REPORT OF THE DIRECTOR |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
The director presents her report with the financial statements of the company for the year ended 31 December 2022. |
DIVIDENDS |
No dividends will be distributed for the year ended 31 December 2022. |
DIRECTOR |
DISCLOSURE IN THE STRATEGIC REPORT |
The company has chosen, in accordance with the Companies Act 2006 s414C(11), to set out in the company's strategic report information required by Schedule 7 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 to be contained in the directors' report. |
STATEMENT OF DIRECTOR'S RESPONSIBILITIES |
The director is responsible for preparing the Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations. |
Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless she is 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 director is required to: |
- | select suitable accounting policies and then apply them consistently; |
- | make judgements and accounting estimates that are reasonable and prudent; |
- | prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. |
The director is 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 her to ensure that the financial statements comply with the Companies Act 2006. She is 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. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the director is aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and she has taken all the steps that she ought to have taken as a director in order to make herself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
SIGNED BY THE DIRECTOR: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
ADVANCED INSTRUMENTS LTD. |
Opinion |
We have audited the financial statements of Advanced Instruments Ltd. (the 'company') for the year ended 31 December 2022 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 31 December 2022 and of its 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. |
Basis for opinion |
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. |
Conclusions relating to going concern |
In auditing the financial statements, we have concluded that the director's 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 director with respect to going concern are described in the relevant sections of this report. |
Other information |
The director is responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Director, but does not include the financial statements and our Report of the Auditors thereon. |
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. |
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether 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 the audit: |
- | the information given in the Strategic Report and the Report of the Director for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Director have been prepared in accordance with applicable legal requirements. |
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 Report of the Director. |
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | 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 director's remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
ADVANCED INSTRUMENTS LTD. |
Responsibilities of director |
As explained more fully in the Statement of Director's Responsibilities set out on page four, the director is 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 director determines 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 director is 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 director either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so. |
Auditors' 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 a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
Based on our understanding of the company and industry, we considered the risk of non-compliance with laws and regulations, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the financial statements such as the Companies Act 2006. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to revenue recognition, including cut-off. Audit procedures performed included: |
- Enquiring of management whether there were instances of non-compliance with laws and regulation or fraud; |
- Review of legal expenses for evidence of fees relating to non-compliance; |
- Review of provision estimates to ensure not influenced by management bias; |
- Review of journal entries, non-sales bank receipts and non-purchase bank payments for unusual accounting entries; and |
- Cut off procedures to test that revenue from goods and services were correctly recognised as revenue in the correct period. |
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. |
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 Report of the Auditors. |
Use of our 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 a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed. |
for and on behalf of |
Statutory Auditor |
Atlas Chambers |
33 West Street |
Brighton |
East Sussex |
BN1 2RE |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
STATEMENT OF COMPREHENSIVE |
INCOME |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
Period |
1.7.21 |
Year Ended | to |
31.12.22 | 31.12.21 |
Notes | £ | £ |
TURNOVER | 3 |
Cost of sales | ( |
) | ( |
) |
GROSS PROFIT |
Distribution costs | ( |
) | ( |
) |
Administrative expenses | ( |
) | ( |
) |
2,815,369 | 1,896,642 |
Other operating income |
OPERATING PROFIT |
Interest receivable and similar income |
PROFIT BEFORE TAXATION | 5 |
Tax on profit | 6 | ( |
) |
PROFIT FOR THE FINANCIAL YEAR |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
BALANCE SHEET |
31 DECEMBER 2022 |
2022 | 2021 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 7 |
Tangible assets | 8 |
Investments | 9 |
CURRENT ASSETS |
Stocks | 10 |
Debtors | 11 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 12 |
NET CURRENT LIABILITIES | ( |
) | ( |
) |
TOTAL ASSETS LESS CURRENT LIABILITIES |
PROVISIONS FOR LIABILITIES | 14 |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 15 |
Retained earnings | 16 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the director and authorised for issue on |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
Called up | Share |
share | Retained | option | Total |
capital | earnings | reserve | equity |
£ | £ | £ | £ |
Balance at 1 July 2021 |
Changes in equity |
Profit for the period | - | 1,452,339 | - | 1,452,339 |
Total comprehensive income | - |
Share based payment movement | - | 298,094 | (298,094 | ) | - |
Total transactions with owners, recognised directly in equity |
- |
298,094 |
(298,094 |
) |
- |
Balance at 31 December 2021 |
Changes in equity |
Profit for the year | - | 4,426,795 | - | 4,426,795 |
Total comprehensive income | - |
Total transactions with owners, recognised directly in equity |
- |
- |
- |
- |
Balance at 31 December 2022 |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
NOTES TO THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
1. | STATUTORY INFORMATION |
Advanced Instruments Ltd. is a |
Registered number: |
Registered office: |
The presentation currency of the financial statements is the Pound Sterling (£). |
The principal activity of the company is the manufacture and sale of cell line development instruments and associated services. |
The financial statements are for the twelve months from 1 January 2022 to 31 December 2022, whereas the comparatives are for the six months from 1 July 2021 to 31 December 2021. The balance sheet date was changed to align to the balance sheet date of the company's new parent company. The comparatives are not entirely comparable. |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Going concern |
The significant downward shift in the company's balance sheet position to a net current liability of £5,968,720 represents the impact of the funding terms for the investment made to acquire Advanced (Shanghai) Technology Co., Ltd. The funding for this investment was obtained through the £10,262,648 loan as disclosed in note 12. While the terms of this loan specify it is repayable on demand, a letter of support has been provided by the parent company, confirming repayment of the loan will not be demanded in the near future. |
The director's assessment of going concern takes into account the representation provided in the letter of support in conjunction with their assessment of the group's ability to provide such support. Group cash flow forecasts have provided the director with confidence the group will have no need for the loan to be repaid in the near future. |
Financial Reporting Standard 102 - reduced disclosure exemptions |
The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland": |
• | the requirements of Section 7 Statement of Cash Flows; |
• | the requirement of paragraph 3.17(d); |
• | the requirements of paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c); |
• | the requirement of paragraph 33.7. |
Preparation of consolidated financial statements |
The financial statements contain information about Advanced Instruments Ltd. as an individual company and do not contain consolidated financial information as the parent of a group. The company is exempt under Section 400 of the Companies Act 2006 from the requirements to prepare consolidated financial statements as it and its subsidiary undertaking are included by full consolidation in the consolidated financial statements of its parent, Advanced Instruments Holdings Ltd, 5th Floor One New Change, London EC4M 9AF. |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2. | ACCOUNTING POLICIES - continued |
Critical accounting judgements and key sources of estimation uncertainty |
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. |
The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below. |
i. Dilapidation provision |
Provision is made for dilapidations. This requires management’s best estimate of the expenditure that will be incurred based on contractual requirements. The provision has been calculated using market data for properties of a similar nature. |
ii. Investments valuation |
Annually, the group considers whether investments in subsidiaries may be impaired. Where an indication of impairment is identified the estimation of recoverable value requires estimation of the recoverable value of the cash generating unit (CGU). |
This requires estimation of the future cash flows from the CGUs and also selection of appropriate discount rates in order to calculate the net present value of those cash flows. The recoverable amount of the CGUs are a source of significant estimation uncertainty and determining this involved the use of significant assumptions. |
Turnover |
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Turnover is measured at the fair value of the consideration received or receivable net of VAT and trade discounts. The policies adopted for the recognition of turnover are as follows: |
Sale of goods |
Turnover from the sale of machines and consumables is recognised when significant risks and rewards of ownership of the goods have transferred to the buyer, the amount of turnover can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the company and the costs incurred or to be incurred in respect of the transaction can be measured reliably. This is usually on dispatch of the goods. |
Rendering of services |
When the outcome of a transaction can be estimated reliably, turnover from service agreements is recognised on a straight line basis over the service agreement. |
Where the outcome cannot be measured reliably, turnover is recognised only to the extent of the expenses recognised that are recoverable. |
Intangible assets |
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. |
The estimated useful lives range as follows (pending patents are not amortised): |
Patents and licences | - 5% on cost |
Tangible fixed assets |
Office equipment | - |
Plant and machinery | - |
Fixtures and fittings | - |
Computer equipment | - |
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2. | ACCOUNTING POLICIES - continued |
Investments in subsidiaries |
Investments in subsidiaries are measured at cost less accumulated impairment. |
Stocks |
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Stock is valued on a first in, first out basis. Work in progress and finished goods are valued for direct material only, and do not include labour or attributable overheads. |
At each balance sheet date, stocks are assessed for impairment, If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment is recognised immediately in the profit and loss. |
Financial instruments |
The company only enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties. |
Short term debtors and creditors are measured at the transaction price. Other financial instruments, including loans, are measured initially at fair value, net of transactions costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Research and development tax credit |
The R&D tax credit is recognised when it is certain that the tax credit in relation to research and development carried out will be received. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Research and development |
In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence are all recognised an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequent amortised on a straight line basis over their useful economic lives. |
Foreign currencies translation |
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result. |
Operating leases |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2. | ACCOUNTING POLICIES - continued |
Pensions |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
Provisions |
Provisions are recognised when the company has an obligation at the balance sheet date as a result of a past event, it is probable that an outflow of economic benefits will be required in settlement and the amount can be reliably estimated. |
3. | TURNOVER |
The turnover and profit before taxation are attributable to the one principal activity of the company. |
An analysis of turnover by geographical market is given below: |
Period |
1.7.21 |
Year Ended | to |
31.12.22 | 31.12.21 |
£ | £ |
United Kingdom |
Europe |
United States of America |
Asia |
Australasia | 122,717 | 12,601 |
Middle East | - | 16,896 |
Turnover is categorised as following: |
Year ended 31.12.22 | Period 1.7.21 to 31.12.21 |
£ | £ |
Sale of goods | 15,195,670 | 6,117,611 |
Rendering of services | 938,630 | 259,721 |
16,134,300 | 6,377,332 |
4. | EMPLOYEES AND DIRECTORS |
Period |
1.7.21 |
Year Ended | to |
31.12.22 | 31.12.21 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
4. | EMPLOYEES AND DIRECTORS - continued |
The average number of employees during the year was as follows: |
Period |
1.7.21 |
Year Ended | to |
31.12.22 | 31.12.21 |
Production | 40 | 31 |
Distribution | 7 | 7 |
Service | 5 | 4 |
Administration and management | 17 | 12 |
Period |
1.7.21 |
Year Ended | to |
31.12.22 | 31.12.21 |
£ | £ |
Directors' remuneration |
Directors' pension contributions to money purchase schemes |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes |
5. | PROFIT BEFORE TAXATION |
The profit is stated after charging/(crediting): |
Period |
1.7.21 |
Year Ended | to |
31.12.22 | 31.12.21 |
£ | £ |
Hire of plant and machinery |
Other operating leases |
Depreciation - owned assets |
Profit on disposal of fixed assets | ( |
) |
Patents and licences amortisation |
Auditors' remuneration |
Foreign exchange differences | ( |
) | ( |
) |
Research and development |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
6. | TAXATION |
Analysis of the tax (credit)/charge |
The tax (credit)/charge on the profit for the year was as follows: |
Period |
1.7.21 |
Year Ended | to |
31.12.22 | 31.12.21 |
£ | £ |
Current tax: |
UK corporation tax |
Prior period under/(over) provision | (557,520 | ) | 68,666 |
Total current tax | ( |
) |
Deferred tax | ( |
) |
Tax on profit | ( |
) |
UK corporation tax has been charged at 19% (2021 - 19%). |
Reconciliation of total tax (credit)/charge included in profit and loss |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
Period |
1.7.21 |
Year Ended | to |
31.12.22 | 31.12.21 |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of (2021 - |
Effects of: |
Expenses not deductible for tax purposes |
Depreciation in excess of capital allowances |
Utilisation of tax losses | ( |
) |
Adjustments to tax charge in respect of previous periods | ( |
) |
Timing difference | 337 | - |
Tax losses carried forward | (1,725,408 | ) | - |
Total tax (credit)/charge | (1,610,571 | ) | 531,848 |
An increase in the UK corporation rate from 19% to 25% is effective from 1 April 2023. |
Deferred tax at the balance sheet date has been measured at this tax rate since is was enacted on 24 May 2021. |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
7. | INTANGIBLE FIXED ASSETS |
Patents |
and |
licences | Trademarks | Totals |
£ | £ | £ |
COST |
At 1 January 2022 |
Additions |
At 31 December 2022 |
AMORTISATION |
At 1 January 2022 |
Amortisation for year |
At 31 December 2022 |
NET BOOK VALUE |
At 31 December 2022 |
At 31 December 2021 |
8. | TANGIBLE FIXED ASSETS |
Fixtures |
Office | Plant and | and | Computer |
equipment | machinery | fittings | equipment | Totals |
£ | £ | £ | £ | £ |
COST |
At 1 January 2022 |
Additions |
At 31 December 2022 |
DEPRECIATION |
At 1 January 2022 |
Charge for year |
At 31 December 2022 |
NET BOOK VALUE |
At 31 December 2022 |
At 31 December 2021 |
9. | FIXED ASSET INVESTMENTS |
Shares in |
group |
undertaking |
£ |
COST |
At 1 January 2022 |
Additions |
At 31 December 2022 |
NET BOOK VALUE |
At 31 December 2022 |
At 31 December 2021 |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
9. | FIXED ASSET INVESTMENTS - continued |
The company's investments at the Balance Sheet date in the share capital of companies include the following: |
Registered office: 600 W. Germantown Pike, Suite 110, Plymouth Meeting, Montgomery, PA, 19462, United States of America |
Nature of business: |
% |
Class of shares: | holding |
2022 | 2021 |
£ | £ |
Aggregate capital and reserves |
Profit for the year/period |
Solentim, Inc. was closed during the year. |
Registered office: Room 721, Building 1, No 22-23, Lane 466, Yindu Road, Minhang District, Shanghai, People's Republic of China |
Nature of business: |
% |
Class of shares: | holding |
2022 | 2021 |
£ | £ |
Aggregate capital and reserves |
(Loss)/profit for the year/period | ( |
) |
Registered office: 6th Floor, Riverpoint, Lower Mallow Street, Limerick, V94 WC6A, Ireland |
Nature of business: |
% |
Class of shares: | holding |
2022 | 2021 |
£ | £ |
Aggregate capital and reserves | ( |
) |
Loss for the year/period | ( |
) | ( |
) |
Registered office: Solent House, Johnson Road, Fernside Business Park, Wimborne, Dorset BH21 7SE |
Nature of business: |
% |
Class of shares: | holding |
SAL Scientific Limited was acquired on 1 August 2022. |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
9. | FIXED ASSET INVESTMENTS - continued |
Registered office: c/o Intertrust (Suisse) SA, Zahlerweg 6, 6300 Zug, Switzerland |
Nature of business: |
% |
Class of shares: | holding |
2022 |
£ |
Aggregate capital and reserves |
Advanced Instruments Life Sciences GmbH was incorporated on 11 February 2022. |
10. | STOCKS |
2022 | 2021 |
£ | £ |
Consumables |
Raw materials |
Work-in-progress |
Finished goods |
Stock is stated after provisions for impairment of £275,329 (2021: £20,000). |
11. | DEBTORS |
2022 | 2021 |
£ | £ |
Amounts falling due within one year: |
Trade debtors |
Amounts owed by group undertakings |
Other debtors |
Tax |
VAT |
Prepayments and accrued income |
Amounts falling due after more than one year: |
Deferred tax asset | 993,887 | - |
Aggregate amounts |
Deferred tax asset |
2022 |
£ |
Accelerated capital allowances | ( |
) |
Tax losses carried forward |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
12. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2022 | 2021 |
£ | £ |
Trade creditors |
Amounts owed to group undertakings |
Tax |
Social security and other taxes |
Other creditors |
Accruals and deferred income |
Amounts due to group undertakings includes £10,262,648 (2021: £9,969,606) which is an amount due to the company's parent undertaking and is interest-free, unsecured and repayable on demand. |
13. | LEASING AGREEMENTS |
Minimum lease payments under non-cancellable operating leases fall due as follows: |
2022 | 2021 |
£ | £ |
Within one year |
Between one and five years |
14. | PROVISIONS FOR LIABILITIES |
2022 | 2021 |
£ | £ |
Deferred tax |
Accelerated capital allowances |
Other provisions |
Warranty provision | 1,687 | 8,845 |
Dilapidation provision | 100,000 | 100,000 |
Aggregate amounts | 101,687 | 168,009 |
Deferred | Other |
tax | provisions |
£ | £ |
Balance at 1 January 2022 |
Credit to Statement of Comprehensive Income during year | ( |
) | ( |
) |
Balance at 31 December 2022 | ( |
) |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
14. | PROVISIONS FOR LIABILITIES - continued |
See note 11 for deferred tax asset. |
Other provisions include £100,000 for dilapidations (2021: £100,000) and £1,687 for warranties (2021: £8,845). |
Dilapidations provision |
As part of the company’s property leasing arrangements there is an obligation to repair damages which are incurred during the life of the lease, such as wear and tear. The cost is charged to profit and loss as the obligation arises. The provision is expected to be utilised in 2024 when the lease terminates. |
Warranty provision |
The company provides warranties for its instruments. The provision is an estimate of the expected costs to be incurred based on historical costs. |
15. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2022 | 2021 |
value: | £ | £ |
Ordinary | £0.0001 | 9 | 9 |
The shares have full voting, dividend and capital distribution rights. |
16. | RESERVES |
Retained |
earnings |
£ |
At 1 January 2022 |
Profit for the year |
At 31 December 2022 |
17. | PENSION COMMITMENTS |
The company operates a defined contribution pension plan for its employees. The amount recognised as an expense in the period was £139,938 (Six months ended 31 December 2021: £50,402). |
18. | ULTIMATE PARENT COMPANY |
Advanced Instruments Ltd is a subsidiary undertaking of Advanced Instruments Holdings Ltd, which is the immediate parent company. It's registered office is 5th Floor One New Change, London EC4M 9AF. |
The ultimate parent company is Investor AB, a company incorporated in Sweden. Its registered office is Arsenalsgatan 8C, 103 32 Stockholm . |
Advanced Instruments Holdings Ltd is the smallest group to consolidate these financial statements. The consolidated financial statements for Advanced Instruments Holdings Ltd are publicly available and can be obtained from www.find-and-update.company-information.service.gov.uk. Investor AB is the largest group to consolidate these financial statements. The consolidated financial statements for Investor AB are publicly available and can be obtained from www.investorab.com. |
19. | CONTINGENT LIABILITIES |
There are fixed and floating charges in place over the company's assets as security for loans. At 31 December 2022, the group debt outstanding, subject to these cross guarantees totalled $219.5 million (2021: £235 million). A further $32 million was borrowed under the facility in March 2023. |
20. | RELATED PARTY DISCLOSURES |
ADVANCED INSTRUMENTS LTD. (REGISTERED NUMBER: 07284911) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
20. | RELATED PARTY DISCLOSURES - continued |
2022 | 2021 |
£ | £ |
Sales |
21. | SHARE-BASED PAYMENT TRANSACTIONS |
Certain employees of the company were granted options over the shares in Advanced Instruments Ltd. The options were granted with a fixed exercise price, were exercisable on an exit event and expired ten years after the date of grant. |
A reconciliation of share option movements over the period to 31 December 2022 is shown below: |
December 2022number | Weighted average exercise price (£ | ) | December 2021 number | Weighted average exercise price (£ | ) |
Outstanding at 1 January (1 July) | - | - | 6,000 | 923.10 |
Exercised during the period | - | - | (6,000 | ) | 923.10 |
Outstanding at 31 December | - | - |