X1 Developments Ltd - Limited company accounts 18.2

REGISTERED NUMBER: 07065987 (England and Wales)

Strategic Report, Report of the Director and

Financial Statements for the Year Ended 31 May 2018

for

X1 Developments Ltd

Page

Company Information

1

Strategic Report

2

Report of the Director

3

Report of the Independent Auditors

4

Statement of Comprehensive Income

6

Balance Sheet

8

Statement of Changes in Equity

9

Cash Flow Statement

10

Notes to the Cash Flow Statement

11

Notes to the Financial Statements

12

DIRECTOR:

Mrs L Smith

REGISTERED OFFICE:

116 Duke Street

Liverpool

Merseyside

L1 5JW

REGISTERED NUMBER:

07065987 (England and Wales)

AUDITORS:

Cobham Murphy

Statutory Auditors

116 Duke Street

Liverpool

Merseyside

L1 5JW

The director presents her strategic report for the year ended 31 May 2018.

REVIEW OF BUSINESS

X1 Developments Limited has been the main contractor for several residential and student developments across the

North West. 2018 has been another successful year with a net profit in excess of £1 million. Gross profit has remained

consistent at 4.7%. X1 Developments Limited has continued to create employment opportunities in both Liverpool and

Manchester and across the X1 group now employs in excess of 60 staff. The company has continued to be nominated for

awards and in 2018 two developments, X1 The Tower and X1 The Campus were named Best Residential Developments

within their regions.

The main trading activity of main contractor has ceased in December 2017, this is due to a restructure of the group and

the company remained profitable post year end as it continues to hold investment property.

Financial risk is minimised by pre selling the units prior to construction and maintaining a high level of investors

satisfaction through providing a high level of occupancy of the units post sale.

ON BEHALF OF THE BOARD:

Mrs L Smith - Director

24 May 2019

The director presents her report with the financial statements of the company for the year ended 31 May 2018.

DIVIDENDS

No dividends will be distributed for the year ended 31 May 2018.

DIRECTOR

Mrs L Smith held office during the whole of the period from 1 June 2017 to the date of this report.

DISCLOSURE IN THE STRATEGIC REPORT

The strategic report contains information on future developments and financial risk and exposure.

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), including Financial Reporting Standard 102 'The

Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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.

AUDITORS

The auditors, Cobham Murphy, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Mrs L Smith - Director

24 May 2019

Opinion

We have audited the financial statements of X1 Developments Ltd (the 'company') for the year ended 31 May 2018

which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow

Statement and Notes to the Cash Flow Statement, 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 May 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 director's use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

-

the director has 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 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 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 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.

Responsibilities of director

As explained more fully in the Statement of Director's Responsibilities set out on page three, 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.

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.

Philip Harrison BSc ACA (Senior Statutory Auditor)

for and on behalf of Cobham Murphy

Statutory Auditors

116 Duke Street

Liverpool

Merseyside

L1 5JW

24 May 2019

TURNOVER

-

29,578,950

29,578,950

Cost of sales

-

(28,169,428

)

(28,169,428

)

GROSS PROFIT

-

1,409,522

1,409,522

Administrative expenses

(1,053

)

(601,864

)

(602,917

)

(1,053

)

807,658

806,605

Other operating income

7,200

-

7,200

OPERATING PROFIT

4

6,147

807,658

813,805

Interest receivable and similar income

214,915

-

214,915

Interest payable and similar expenses

6

(4,993

)

(2,814

)

(7,807

)

PROFIT BEFORE TAXATION

216,069

804,844

1,020,913

Tax on profit

7

-

4,240

4,240

PROFIT FOR THE FINANCIAL YEAR

216,069

809,084

1,025,153

OTHER COMPREHENSIVE INCOME

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,025,153

TURNOVER

58,774,019

-

58,774,019

Cost of sales

(55,971,148

)

-

(55,971,148

)

GROSS PROFIT

2,802,871

-

2,802,871

Administrative expenses

(2,479,550

)

-

(2,479,550

)

323,321

-

323,321

Other operating income

13,600

-

13,600

OPERATING PROFIT

4

336,921

-

336,921

Interest receivable and similar income

152,381

-

152,381

Interest payable and similar expenses

6

(4,635

)

-

(4,635

)

PROFIT BEFORE TAXATION

484,667

-

484,667

Tax on profit

7

(135,329

)

-

(135,329

)

PROFIT FOR THE FINANCIAL YEAR

349,338

-

349,338

OTHER COMPREHENSIVE INCOME

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

349,338

FIXED ASSETS

Tangible assets

8

18,656

31,864

Investment property

9

200,000

200,000

218,656

231,864

CURRENT ASSETS

Debtors

10

13,654,931

13,925,810

Cash at bank

21,464

10,603

13,676,395

13,936,413

CREDITORS

Amounts falling due within one year

11

8,588,136

9,882,689

NET CURRENT ASSETS

5,088,259

4,053,724

TOTAL ASSETS LESS CURRENT LIABILITIES

5,306,915

4,285,588

CREDITORS

Amounts falling due after more than one year

12

(102,359

)

(105,585

)

PROVISIONS FOR LIABILITIES

16

(11,400

)

(12,000

)

NET ASSETS

5,193,156

4,168,003

CAPITAL AND RESERVES

Called up share capital

17

1

1

Retained earnings

18

5,193,155

4,168,002

SHAREHOLDERS' FUNDS

5,193,156

4,168,003

The financial statements were approved by the director on 24 May 2019 and were signed by:

Mrs L Smith - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 June 2016

1

3,818,664

3,818,665

Changes in equity

Total comprehensive income

-

349,338

349,338

Balance at 31 May 2017

1

4,168,002

4,168,003

Changes in equity

Total comprehensive income

-

1,025,153

1,025,153

Balance at 31 May 2018

1

5,193,155

5,193,156

Cash flows from operating activities

Cash generated from operations

1

(2,931,823

)

3,257,754

Interest paid

(7,807

)

(4,635

)

Tax paid

(78,911

)

(36,351

)

Net cash from operating activities

(3,018,541

)

3,216,768

Cash flows from investing activities

Purchase of tangible fixed assets

-

(27,713

)

Interest received

214,915

152,381

Net cash from investing activities

214,915

124,668

Cash flows from financing activities

Loan repayments in year

(5,812

)

(8,399

)

Amount introduced by directors

168,433

-

Amount withdrawn by directors

(1,566,186

)

(3,422,237

)

Participating interests

4,218,052

31,422

Net cash from financing activities

2,814,487

(3,399,214

)

Increase/(decrease) in cash and cash equivalents

10,861

(57,778

)

Cash and cash equivalents at beginning of year

2

10,603

68,381

Cash and cash equivalents at end of year

2

21,464

10,603

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

31.5.18

31.5.17

£

£

Profit before taxation

1,020,913

484,667

Depreciation charges

13,208

18,088

Finance costs

7,807

4,635

Finance income

(214,915

)

(152,381

)

827,013

355,009

Decrease in trade and other debtors

3,738

416,558

(Decrease)/increase in trade and other creditors

(3,762,574

)

2,486,187

Cash generated from operations

(2,931,823

)

3,257,754

2.	CASH AND CASH EQUIVALENTS

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

Balance Sheet amounts:

Year ended 31 May 2018

31.5.18

1.6.17

£

£

Cash and cash equivalents

21,464

10,603

Year ended 31 May 2017

31.5.17

1.6.16

£

£

Cash and cash equivalents

10,603

68,381

1.	STATUTORY INFORMATION

X1 Developments Ltd is a private company, limited by shares , registered in England and Wales. The company's

registered number and registered office address can be found on the Company Information page.

The presentation currency of the financial statements is the Pound Sterling (£).

The principal place of business is 27 Old Haymarket Street, Liverpool, L1 6ER.

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. The financial statements have been prepared under the historical cost convention.

The financial statements have been prepared under the historical cost convention, except for the modification to

a fair value basis for certain fixed assets, as specified in the accounting policies below.

The comparative figures represent a period of 18 months.

Significant judgements and estimates

There are no judgements (apart from those involving estimates) that have had a significant effect on amounts

recognised in the financial statements.

Critical accounting judgements and key sources of estimation uncertainty

The preparation of financial statements in accordance with FRS102 requires the use of certain critical accounting

estimates. It also requires management to exercise its judgement in the process of applying the company's

accounting policies.

Estimates and judgements and 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.

Critical judgements in applying accounting policies

There are no judgements (apart from those involving estimates) that have had a significant effect on the amounts

recognised in the financial statements

Key accounting estimates and assumptions

Investment property- the fair value of investment property is based on assumptions and estimates using the

director's knowledge of the local market. The fair value at the balance sheet date is £200,000.

Turnover

Turnover is derived from ordinary activates and represents completion stages of developments, exclusive of

value added tax. Income is recognised when contractors valuations are raised and agreed.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful

life.

Fixtures & fittings - 15% on cost

Motor vehicles - 25% on cost

Computer equipment - 33% on cost

Tangible fixed assets are held at cost less any provisions for impairment where applicable.

Investment property

Investment properties are properties held for rental and capital appreciation. Investment properties are initially

measured at cost and subsequently measured at fair value at the end of every reporting period.

Any changes in fair value are recognised in the profit and loss account in the period in which they arise.

Financial instruments

Other loans are initially measured at the present value of future payments, discounted at a market rate of interest,

and subsequently at amortised cost using the effective interest method.

Directors loans and intercompany loans (being repayable on demand), trade debtors and trade creditors are

measured at the undiscounted amount of the cash or other consideration expected to be paid or received.

Financial assets that are measured at amortised cost are assessed at the end of each reporting period for objective

evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in profit

and loss.

Hire purchase and leasing commitments

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. Contributions payable to the company's pension

scheme are charged to profit or loss in the period to which they relate.

Financial instruments

Trade debtors are recognised initially at fair value and subsequently measured at amortised cost less provision

for impairment. A provision for impairment in trade receivables is established when there is evidence that the

company will not be able to collect all amounts due.

Directors loans and intercompany loans, including amounts owed from/to participating interest, (being repayable

on demand), trade debtors and trade creditors are measured at the undiscounted amount of the cash or other

consideration expected to be paid or received.

Financial assets that are measured at amortised cost are assessed at the end of each reporting period for objective

evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in profit

and loss.

Other loans are initially measured at the present value of future payments, discounted at a market rate of interest,

and subsequently at amortised cost.

3.	EMPLOYEES AND DIRECTORS

31.5.18

31.5.17

£

£

Wages and salaries

279,619

366,899

Other pension costs

4,208

6,940

283,827

373,839

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

31.5.18

31.5.17

Staff

36

41

The company has a group contract of employment with other subsidiaries within the group. The wage cost of

some employees may be included within the expenses of other companies.

31.5.18

31.5.17

£

£

Director's remuneration

4,760

8,077

4.	OPERATING PROFIT

The operating profit is stated after charging:

31.5.18

31.5.17

£

£

Hire of plant and machinery

-

11,996

Depreciation - owned assets

13,208

18,086

Auditors' remuneration

23,808

18,000

Taxation advisory services

8,879

26,000

Other non- audit services

16,024

20,314

5.	EXCEPTIONAL ITEMS

31.5.18

31.5.17

£

£

Exceptional items

-

(1,732,230

)

Exceptional items in the prior year relate to a loan of £894,729 that was made to X1 The Studios Limited and

written off during that year. A provision has been made against loans made to other related parties of £270,823

and £566,679 who are currently in a net liability position.

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

31.5.18

31.5.17

£

£

Bank loan interest

4,993

2,355

HMRC Interest

2,814

2,280

7,807

4,635

7.

TAXATION

Analysis of the tax (credit)/charge

The tax (credit)/charge on the profit for the year was as follows:

31.5.18

31.5.17

£

£

Current tax:

UK corporation tax

-

135,329

Over provision

(3,640

)

-

Total current tax

(3,640

)

135,329

Deferred tax

(600

)

-

Tax on profit

(4,240

)

135,329

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:

31.5.18

31.5.17

£

£

Profit before tax

1,020,913

484,667

Profit multiplied by the standard rate of corporation tax in the UK of 19% (2017 - 19.833%)

193,973

96,124

Effects of:

Expenses not deductible for tax purposes

-

355,806

Capital allowances in excess of depreciation

-

(2,066

)

Depreciation in excess of capital allowances

2,387

-

Adjustments to tax charge in respect of previous periods

(3,640

)

-

Group relief- losses surrendered from group

(196,360

)

(314,535

)

Deferred tax charge

(600

)

-

Total tax (credit)/charge

(4,240

)

135,329

8.	TANGIBLE FIXED ASSETS

Fixtures

and

Motor

Computer

fittings

vehicles

equipment

Totals

£

£

£

£

COST

At 1 June 2017

and 31 May 2018

19,358

29,638

54,764

103,760

DEPRECIATION

At 1 June 2017

15,611

5,888

50,397

71,896

Charge for year

2,654

7,409

3,145

13,208

At 31 May 2018

18,265

13,297

53,542

85,104

NET BOOK VALUE

At 31 May 2018

1,093

16,341

1,222

18,656

At 31 May 2017

3,747

23,750

4,367

31,864

9.	INVESTMENT PROPERTY

Total

£

FAIR VALUE

At 1 June 2017

and 31 May 2018

200,000

NET BOOK VALUE

At 31 May 2018

200,000

At 31 May 2017

200,000