G.J.Handy & Company Limited - Limited company accounts 18.2

REGISTERED NUMBER: 00551762 (England and Wales)

G.J.HANDY & COMPANY LIMITED

STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

AUDITED FINANCIAL STATEMENTS

FOR THE YEAR ENDED

30TH NOVEMBER 2018

Page

Company Information

1

Strategic Report

2

to

3

Report of the Directors

4

to

5

Report of the Independent Auditors

6

to

7

Statement of Comprehensive Income

8

Statement of Financial Position

9

Statement of Changes in Equity

10

Statement of Cash Flows

11

Notes to the Statement of Cash Flows

12

Notes to the Financial Statements

13

to

23

DIRECTORS:

Mr D L Belcher

Mr S A Belcher

Mrs D S Belcher

Mr S Bartlett

Mr M A Moseley

REGISTERED OFFICE:

Handy Distribution

Murdock Road

Dorcan

SWINDON

Wiltshire

SN3 5HY

REGISTERED NUMBER:

00551762 (England and Wales)

AUDITORS:

Morris Owen

Statutory Auditors

43-45 Devizes Road

SWINDON

Wiltshire

SN1 4BG

BANKERS:

National Westminster Bank Plc

84 Commercial Road

SWINDON

Wiltshire

SN1 5NW

The directors present their strategic report for the year ended 30th November 2018.

REVIEW OF BUSINESS

The principal activity of the company in the year under review was that of retailing and distribution of

domestic and professional garden machinery.

The sector in which the company trades is seasonal and is dependent to some degree on the weather at

key times.

2018 started strong and the company traded well until the end of May however the dry weather over the

summer then caused sales to slow.

Company performed well against many in the industry due to our clear strategy for growth and

development. The turnover for the year was £18,564,454, down by approximately £924,046 compared

to the previous year and over heads of £743,170 compare well with the previous year.

The Webb brand continues to grow at a strong pace alongside our other brands which compliment the

big brand names we represent.

As set out last year, our continued drive to have the best distribution infrastructure in our industry

coupled with a highly skilled and knowledgeable team of staff means we can continue to grow our

business and lead in our sector.

The company balance sheet has continued to strengthen as a result of the profitability of the company

and the directors continue to closely monitor overheads and stock levels. This has been done very

efficiently again this year with a greatly reduced year end stock holding.

PRINCIPAL RISKS AND UNCERTAINTIES

The company has two main risks and uncertainties. The main risk, similar to a lot of businesses that

import, is the implications of the BREXIT process; the major uncertainty is the weather, particularly at

certain times in the year.

With regard the direct risk associated with BREXIT, currently sales outside of the UK in the EU are very

limited, as is any trade in Euros.

The indirect risks of BREXIT are equally important to the company as this continues to cause exchange

rate fluctuations - the Directors continue to closely monitor the exchange rate risk, hedging where

appropriate, to reduce the impact on the business.

Weather is always the biggest uncertainty, the impact of this is mitigated where possible through closely

managed stock levels.

KEY PERFORMANCE INDICATORS

The directors have identified that the key performance indicators when looking at the business are the

monitoring of turnover on a monthly basis compared to the seasonalised budget, margin levels (2018

13.0%, 2017 10.4%), stock turn (2018 3.1, 2017 3.2), control of overheads compared to budget and

cash flow.

FUTURE DEVELOPMENTS

We are committed to developing sustainable business, so we can offer industry leading service and we

will continue to grow the business in a sensible way while the UK navigates through BREXIT. We are

partnered by the leading brands as well as our own brand offerings making us the one stop wholesaler in

our industry, we aim to further cement this position even further in the coming year.

ON BEHALF OF THE BOARD:

Mr S A Belcher - Director

8th February 2019

The directors present their report with the financial statements of the company for the year ended 30th November 2018.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of retailing and distribution of

domestic and professional garden machinery.

DIVIDENDS

Dividends totalling £12.32 per share were paid during the year. The total distribution of dividends for the

year end 30th November 2018 was £209,362

DIRECTORS

The directors shown below have held office during the whole of the period from 1st December 2017 to

the date of this report.

Mr D L Belcher

Mr S A Belcher

Mrs D S Belcher

Mr S Bartlett

Mr M A Moseley

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the

financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that

law the directors have elected to prepare the financial statements in accordance with United Kingdom

Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law),

including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and

Republic of Ireland'. Under company law the directors must not approve the financial statements unless

they are satisfied that they give a true and fair view of the state of affairs of the company and of the

profit or loss of the company for that period. In preparing these financial statements, the directors are

required to:

-	select suitable accounting policies 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 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.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are 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 each director has taken all the

steps that he or she ought to have taken as a director in order to make himself or herself aware of any

relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS

The auditors, Morris Owen, will be proposed for re-appointment at the forthcoming Annual General

Meeting.

ON BEHALF OF THE BOARD:

Mr S A Belcher - Director

8th February 2019

Opinion

We have audited the financial statements of G.J.Handy & Company Limited (the 'company') for the year

ended 30th November 2018 which comprise the Statement of Comprehensive Income, Statement of

Financial Position, Statement of Changes in Equity, Statement of Cash Flows and Notes to the Statement

of Cash Flows, 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 30th November 2018 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

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require

us to report to you where:

-	the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

-

the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

Other information

The directors are responsible for the other information. The other information comprises the information

in the Strategic Report and the Report of the Directors, 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 there is a material misstatement in the financial statements or a material

misstatement of the other information. 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.

Opinion 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 Directors 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 Directors 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 Directors.

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 directors' remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page four, 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 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.

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.

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.

Mr Ian Sumbler (Senior Statutory Auditor)

for and on behalf of Morris Owen

Statutory Auditors

43-45 Devizes Road

SWINDON

Wiltshire

SN1 4BG

14th February 2019

TURNOVER

3

18,564,454

19,488,500

Cost of sales

16,147,427

17,452,922

GROSS PROFIT

2,417,027

2,035,578

Administrative expenses

1,804,388

1,745,483

612,639

290,095

Other operating income

4

102,731

50,594

OPERATING PROFIT

6

715,370

340,689

Interest receivable and similar income

-

6,641

715,370

347,330

Interest payable and similar expenses

7

35,398

26,926

PROFIT BEFORE TAXATION

679,972

320,404

Tax on profit

8

189,436

60,359

PROFIT FOR THE FINANCIAL YEAR

490,536

260,045

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

490,536

260,045

FIXED ASSETS

Intangible assets

10

7,325

11,725

Tangible assets

11

402,515

237,917

409,840

249,642

CURRENT ASSETS

Stocks

12

4,238,288

4,746,942

Debtors

13

5,252,596

6,665,752

Cash at bank and in hand

429,599

899

9,920,483

11,413,593

CREDITORS

Amounts falling due within one year

14

3,588,009

5,263,506

NET CURRENT ASSETS

6,332,474

6,150,087

TOTAL ASSETS LESS CURRENT LIABILITIES

6,742,314

6,399,729

CREDITORS

Amounts falling due after more than one year

15

(111,046

)

(82,581

)

PROVISIONS FOR LIABILITIES

20

(78,726

)

(45,780

)

NET ASSETS

6,552,542

6,271,368

CAPITAL AND RESERVES

Called up share capital

21

17,000

17,000

Capital redemption reserve

22

9,000

9,000

Retained earnings

22

6,526,542

6,245,368

SHAREHOLDERS' FUNDS

6,552,542

6,271,368

The financial statements were approved and authorised for issue by the Board of Directors on 8th February 2019 and were signed on its behalf by:

Mr S A Belcher - Director

Mr D L Belcher - Director

Called up

Capital

share

Retained

redemption

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1st December 2016

17,000

6,112,366

9,000

6,138,366

Changes in equity

Dividends

-

(127,043

)

-

(127,043

)

Total comprehensive income

-

260,045

-

260,045

Balance at 30th November 2017

17,000

6,245,368

9,000

6,271,368

Changes in equity

Dividends

-

(209,362

)

-

(209,362

)

Total comprehensive income

-

490,536

-

490,536

Balance at 30th November 2018

17,000

6,526,542

9,000

6,552,542

Cash flows from operating activities

Cash generated from operations

1

1,231,532

(972,204

)

Interest paid

(28,744

)

(20,657

)

Interest element of hire purchase payments paid

(9,243

)

(5,424

)

Tax paid

(55,828

)

(120,310

)

Net cash from operating activities

1,137,717

(1,118,595

)

Cash flows from investing activities

Purchase of tangible fixed assets

(315,672

)

(50,068

)

Sale of tangible fixed assets

49,782

92,025

Net cash from investing activities

(265,890

)

41,957

Cash flows from financing activities

Capital repayments in year

(101,649

)

(97,573

)

Amount introduced by directors

3,177

658,000

Amount withdrawn by directors

(31,104

)

(244,052

)

Equity dividends paid

(209,362

)

(127,043

)

Net cash from financing activities

(338,938

)

189,332

Increase/(decrease) in cash and cash equivalents

532,889

(887,306

)

Cash and cash equivalents at beginning of year

2

(103,290

)

784,016

Cash and cash equivalents at end of year

2

429,599

(103,290

)

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2018

2017

£

£

Profit before taxation

679,972

320,404

Depreciation charges

295,152

162,106

Profit on disposal of fixed assets

(34,782

)

(62,511

)

Increase/(Decrease) in provision

(102

)

52

Finance costs

35,398

26,926

Finance income

-

(6,641

)

975,638

440,336

Decrease/(increase) in stocks

508,654

(1,525,038

)

Decrease/(increase) in trade and other debtors

1,409,979

(2,205,490

)

(Decrease)/increase in trade and other creditors

(1,662,739

)

2,317,988

Cash generated from operations

1,231,532

(972,204

)

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are

in respect of these Statement of Financial Position amounts:

Year ended 30th November 2018

30.11.18

1.12.17

£

£

Cash and cash equivalents

429,599

899

Bank overdrafts

-

(104,189

)

429,599

(103,290

)

Year ended 30th November 2017

30.11.17

1.12.16

£

£

Cash and cash equivalents

899

784,016

Bank overdrafts

(104,189

)

-

(103,290

)

784,016

1.	STATUTORY INFORMATION

G J Handy & Company Limited is private company, limited by shares, registered in England and

Wales.

The registered office address is Murdock Road, Dorcan, Swindon, Wiltshire, SN3 5HY.

These financial statements are presented in British Pounds (GBP), which is the company's

functional and presentational currency.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard

102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the

Companies Act 2006.

Significant judgements and estimates

The directors have calculated an annual stock provision for any slowing moving or obsolete third

party stock. The directors believe the most accurate way to calculate this provision is to review

each stock line held at the year end and compare this to sales post year end. All stock lines that

have had less than 20% sales are deemed to be slowing moving and/or obsolete. Of this total of

slowing moving and/or obsolete stock, the directors believe that 25% should be provided for The

period for the post year end review is considered to capture the seasonality of the business.For

this year, the directors have relied on calculations from previous years and provided for the same

%, as insufficient time has passed for the post year end trading figures to be available. The

provision has been calculated at £142,766 (2017: £154,009)

The directors also have determined an appropriate provision for bad and doubtful debts by

assessing the recoverability of all balances on a balance by balance basis.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, net of vat,

discounts, and rebates. Turnover is recognised when goods are despatched or made available for

collection. Turnover in foreign currencies is translated into sterling at the rates published by

HMRC.

Intangible fixed assets

Amortisation is provided over 3 years to write off the website costs over its estimated useful life.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Property improvements

-

10% on cost

Plant and machinery

-

20% on cost

Fixtures and fittings

-

20% on cost

Motor vehicles

-

40% on reducing balance

Computer equipment

-

20% on cost

Stocks and work in progress

Stocks are valued at the lower of cost and net realisable value, after make due allowance for

obsolete and slow moving items. The cost of inventories is measured using the first-in first-out

basis.

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 statement of financial position date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed

at the statement of financial position 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.

Foreign currencies

Transactions in all other 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.

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange

ruling at the statement of financial position date.

The company enters into a forward agreements to minimise against the risk of fluctuations in the

dollar.

Hire purchase and leasing commitments

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance

sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives.

Those held under finance leases are depreciated over their estimated useful lives or the lease

term, whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The

capital element of the future payments is treated as a liability.

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the

period of the lease.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme for employees. The assets of the

scheme are held separately from those of the company. The annual contributions payable are

charged to the profit and loss account.

Financial instruments

Financial instruments are classified by the directors as basic or advanced following the conditions

in FRS 102 Section 11. Basic financial instruments are recognised at amortised cost using the

effective interest method. The only advanced instruments recognised by the company are

derivatives (being forward foreign exchange contracts). Derivative financial instruments are

initially recorded at cost and thereafter at fair value with changes recognised in arriving at profit

before tax. Derivative assets are included in other debtors and derivative liabilities are included in

other creditors.

3.

TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the

company.

An analysis of turnover by class of business is given below:

2018

2017

£

£

Sale of goods

18,564,454

19,488,500

18,564,454

19,488,500

4.	OTHER OPERATING INCOME

2018

2017

£

£

Other income

102,731

46,086

Equipment rental

-

4,508

102,731

50,594

5.	EMPLOYEES AND DIRECTORS

2018

2017

£

£

Wages and salaries

1,420,633

1,444,276

Social security costs

142,997

141,646

Other pension costs

27,246

20,013

1,590,876

1,605,935

The average number of employees during the year was as follows:

2018

2017

Management staff

5

5

Administration staff

18

16

Sales, distribution & workshop staff

38

44

61

65

2018

2017

£

£

Directors' remuneration

136,363

196,455

Directors' pension contributions to money purchase schemes

4,840

4,499

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes

3

3