Girbau UK Limited - Limited company accounts 18.2
Girbau UK Limited - Limited company accounts 18.2
REGISTERED NUMBER: |
Strategic Report, Report of the Directors and |
Financial Statements for the Year Ended 31 December 2018 |
for |
Girbau UK Limited |
Girbau UK Limited (Registered number: 00641996) |
Contents of the Financial Statements |
for the Year Ended 31 December 2018 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 6 |
Report of the Independent Auditors | 8 |
Statement of Comprehensive Income | 10 |
Statement of Financial Position | 11 |
Statement of Changes in Equity | 12 |
Notes to the Financial Statements | 13 |
Girbau UK Limited |
Company Information |
for the Year Ended 31 December 2018 |
DIRECTORS: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Chartered Accountants |
and Statutory Auditor |
Unit 1B |
Focus 4 |
Fourth Avenue |
Letchworth |
Hertfordshire |
SG6 2TU |
Girbau UK Limited (Registered number: 00641996) |
Strategic Report |
for the Year Ended 31 December 2018 |
Girbau UK Limited (Registered number: 00641996) |
Strategic Report |
for the Year Ended 31 December 2018 |
REVIEW OF BUSINESS |
Girbau UK operates as three divisions, Commercial Sales, Industrial Sales and Service and Spares. During |
the year the business went through a significant restructure, with Girbau SA becoming the sole shareholder |
and owner of the business. Peter Marsh, Managing Director and Forbes MacDougall Financial Director |
resigned from their respective positions on the Board on the 28th November 2018. |
Peter Rankin was appointed as Acting Managing Director of the business on 1st November 2018 and then |
subsequently appointed as Managing Director along with the appointment of a new Board of Directors on the |
18th February 2019. |
A shortfall in Industrial Sales during the year resulted in revenues being down against 2017. One off |
exceptional restructuring charges and additional support costs resulted in the business making a loss for the |
year. However, a number of large industrial contracts were won at the end of the year and as a result the |
business goes into 2019 with a strong orderbook, a positive momentum of change and with the full support |
and engagement of Girbau SA. |
Commercial Sales |
Turnover for the year was £4.7M against £5M in 2017. This was primarily due to a restructuring in the |
commercial sales team, which resulted in significantly reduced headcount over the course of the year. |
However, individual sales performance remained strong and the majority of the sales team had their best year |
to date. We have now started a recruitment process to bring new sales talent into the business, which will |
strengthen our sales in 2019. Towards the end of the year we replaced our aging CRM solutions with |
Salesforce, which once fully adopted, will bring greater visibility and control into the sales process, allowing us |
to manage and support our customers, sales leads and sales opportunities more professionally. Brexit and |
its effect on the exchange rate continues to cause uncertainty in the market place and whilst we have put a |
robust plan and contingencies in place, it remains an area of concern for 2019. Margins in the care home |
sector continue to be under pressure as controls on local authority funding along with several other factors |
are causing our partners and ourselves to undertake detailed reviews of all existing supply contracts. |
Spares and Service |
Our Spares and Service division achieved a 5% Net sales growth during 2018, which was a positive result |
given that we allocated a significant amount of unplanned resources and materials to unfinished projects and |
warranty works during the year. In-order to further improve the level of service and support we provide to our |
customers as well as improving our own internal process, during the year we integrated a business |
intelligence package into our Service Management System. This has allowed our staff and our customers to |
see and analyse our real time performance of customer support calls, parts enquiries, response times and |
first time fix rates. Resulting in improved ownership, understanding and accountability across the business. |
Industrial Sales |
The Industrial Division had a disappointing year. Turnover was £2.3M compared to £4.6M for 2017, this was |
down to several factors, including personnel changes and the loss of the relationship and supply agreement |
between Lavatec and Girbau UK at the beginning of 2018. However, by the end of the year we had seen a |
significant recovery of our position and we finished the year with a strong orderbook to take us into 2019. |
During the year we secured a repeat order from an existing customer for a new major industrial laundry |
project just outside Cambridge. This is excellent news for the business, not only because it's a sizable order, |
but also because it confirms the confidence and trust our customers have in us in being able to supply, |
deliver, support and service such projects repeatedly. We expect 2019 to be a record year for this division as |
we transition from being a small player in this sector to significant competitor. |
Overall Performance |
The overall performance for the company was disappointing in 2018 with a turnover of £12.7M against |
£15.1M in 2017 and operating loss £1.2M against a loss of £89K in 2017. Turnover was affected by reduced |
sales in the Industrial Division, which was due to staff changes and a lack of significant large projects being |
won during the year. The operating loss for the year includes extraordinary items realised as a result of the |
change of ownership and Directors during the year as well as additional charges for unplanned works and |
restructuring across different divisions of the business over the course of the year. |
We are confident that the underlying business model and its sectors remain robust. This along with the |
operational advances that have been made during the year, a new Board of Directors in place to lead the |
business, we believe that 2019 will see us recover to a positive position and place us on track to grow |
significantly over the next 3-4 years. |
Girbau UK Limited (Registered number: 00641996) |
Strategic Report |
for the Year Ended 31 December 2018 |
PRINCIPAL RISKS AND UNCERTAINTIES |
Where possible the company will continue to reduce its reliance on the care industry and continue its |
expansion into the hotel and leisure sector which is seen as a major growth potential for the next 3-5 years. |
The medium-term impact of Brexit with its potential impact on UK exchange rates will continue to make for an |
interesting period and it is expected that we will see continuing periods of volatility both in the exchange rate |
as well as short-term demand as customers attempt to second guess various impacts on the UK economy. |
Exposure to foreign currency, credit and liquidity risks arises in the normal course of the Company's business. |
These risks are limited by the Company's financial management policies and practices described below: |
Foreign currency risk |
The Company has limited exposure to foreign currency risk. The majority of the Company's sales and |
purchases are denominated in Sterling. The Company monitors their foreign currency risk closely and takes |
steps to minimise this risk at an early stage. |
Credit risk |
The Company is at risk from its customers defaulting in making payments for goods and services that have |
been supplied to them. To minimise this risk the Company has procedures in place to ensure that customers |
have either demonstrated creditworthiness or can provide sufficient collateral prior to delivery of goods. The |
Company's exposure to this risk is continually monitored so that any potential problems are detected at an |
early stage. |
Liquidity risk |
The directors have ultimate responsibility for liquidity risk management in maintaining adequate reserves, |
banking facilities and reserve borrowing facilities.They do this by continually monitoring forecast and actual |
cash flows. |
Interest rate risk |
The Company is exposed to interest rate risk through the impact of rate changes on interest bearing |
borrowing. The interest rates and terms of repayment of the Company's bank loans are disclosed in note 17 |
to the financial statements. The Company's policy is to obtain the most favourable interest rates available for |
its borrowings. |
Interest is paid on assets purchased through finance leases. All financial leases have a fixed rate of interest |
which applies for the duration of the agreement, therefore there will be no affect to the interest payable in the |
event of future interest rate changes. |
USE OF FINANCIAL INSTRUMENTS |
The company operates a cautious view with regard to risk, and we are fortunate that our parent company |
allows us to buy from them in pounds sterling, as they are in a position to purchase forward and mitigate |
exchange risks. |
Robust policies exist for conducting day-to-day business. New accounts are checked for credit risk, and |
overall credit limits for customers are monitored by both the accounts department and the directors of the |
company. The use of an external credit checking agency is used where level of business justifies this. |
Creditors and debtors are monitored on a weekly basis with vigorous month-end reporting. Systems exist for |
chasing out of term debtors including formal proceedings if necessary. Material debtors outside terms are |
brought to the attention of both the finance manager and the directors. |
The company monitors credit terms given to its customers especially where amounts are material, such that |
these will not cause undue strain to liquidity or cash management. |
Girbau UK Limited (Registered number: 00641996) |
Strategic Report |
for the Year Ended 31 December 2018 |
FUTURE DEVELOPMENTS |
On February 18th 2019 the following changes were made to the Board of Directors of the business; |
- Mercè Girbau was appointed Director and Chairman of the Board |
- Peter Rankin was appointed as Managing Director |
- Eva Benito was appointed as a Director |
- Josep Ramon Veiga was appointed as a Director |
- Guillem Clofent resigned as a Director from the Board |
Alex Alamany remains a Director on the Board and was appointed as Company Secretary on the 21st March |
2019. |
Further to the changes to the Board, the business has also been restructured to more closely mirror that of |
the group, with both executive and functional management teams now in place to oversee the day to day |
running and operation of the business. |
We continue to believe that 2019 will be a positive year for the business. We have won a number of |
significant projects at the start of the year, which will be realised during 2019 and we continue to build upon |
our excellent reputation for delivering these on time, to budget and with minimal disruption to our customers |
operations and businesses. |
The care home sector and major groups continue to challenge us, both on price and contractual terms and |
whilst we have an excellent working relationship with them, established over many years of excellent service, |
we need to ensure that the business is sustainable and profitable going forward. |
Over the next two years we will continue to improve our adoption and integration of group wide systems, |
policies and values to further improve efficiencies and reduce costs. This will include the further integration of |
salesforce and introduction of SAP into the business, as well as better use of ICT systems throughout the |
company. |
ON BEHALF OF THE BOARD: |
Girbau UK Limited (Registered number: 00641996) |
Report of the Directors |
for the Year Ended 31 December 2018 |
The directors present their report with the financial statements of the company for the year ended 31 December 2018. |
PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of the import and sale of commercial |
laundry equipment, and the servicing thereof. |
DIVIDENDS |
No dividends will be distributed for the year ended 31 December 2018. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 January 2018 to the date of |
this report. |
Other changes in directors holding office are as follows: |
FINANCIAL INSTRUMENTS |
The financial risk management objectives are to ensure sufficient working capital for the company. This is |
achieved by careful management of cash balances and, where necessary, the use of bank overdraft facilities. |
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 ought to have taken as a director in order to make himself aware of any relevant audit information and |
to establish that the company's auditors are aware of that information. |
Girbau UK Limited (Registered number: 00641996) |
Report of the Directors |
for the Year Ended 31 December 2018 |
AUDITORS |
The auditors, George Hay Partnership LLP, will be proposed for re-appointment at the forthcoming Annual |
General Meeting. |
ON BEHALF OF THE BOARD: |
Report of the Independent Auditors to the Members of |
Girbau UK Limited |
Opinion |
We have audited the financial statements of Girbau UK Limited (the 'company') for the year ended |
31 December 2018 which comprise the Statement of Comprehensive Income, Statement of Financial |
Position, 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 2018 and of its loss for the year then ended; |
- | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
- | have been prepared in accordance with the requirements of the Companies Act 2006. |
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. |
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 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. |
Report of the Independent Auditors to the Members of |
Girbau UK Limited |
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 six, 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. |
for and on behalf of |
Chartered Accountants |
and Statutory Auditor |
Unit 1B |
Focus 4 |
Fourth Avenue |
Letchworth |
Hertfordshire |
SG6 2TU |
Girbau UK Limited (Registered number: 00641996) |
Statement of Comprehensive Income |
for the Year Ended 31 December 2018 |
2018 | 2017 |
Notes | £ | £ |
TURNOVER | 3 |
Cost of sales |
GROSS PROFIT |
Administrative expenses |
OPERATING LOSS | 5 | ( |
) | ( |
) |
Interest payable and similar expenses | 6 |
LOSS BEFORE TAXATION | ( |
) | ( |
) |
Tax on loss | 7 |
LOSS FOR THE FINANCIAL YEAR | ( |
) | ( |
) |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
( |
) |
( |
) |
Girbau UK Limited (Registered number: 00641996) |
Statement of Financial Position |
31 December 2018 |
2018 | 2017 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 9 |
Tangible assets | 10 |
Investments | 11 |
CURRENT ASSETS |
Stocks | 12 |
Debtors | 13 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 14 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year |
15 |
NET (LIABILITIES)/ASSETS | ( |
) |
CAPITAL AND RESERVES |
Called up share capital | 21 |
Capital redemption reserve | 22 |
Retained earnings | 22 | ( |
) |
SHAREHOLDERS' FUNDS | ( |
) |
The financial statements were approved by the Board of Directors on behalf by: |
Girbau UK Limited (Registered number: 00641996) |
Statement of Changes in Equity |
for the Year Ended 31 December 2018 |
Called up | Capital |
share | Retained | redemption | Total |
capital | earnings | reserve | equity |
£ | £ | £ | £ |
Balance at 1 January 2017 |
Changes in equity |
Dividends | - | ( |
) | - | ( |
) |
Total comprehensive income | - | ( |
) | ( |
) |
Balance at 31 December 2017 |
Changes in equity |
Total comprehensive income | - | ( |
) | ( |
) |
Balance at 31 December 2018 | ( |
) | ( |
) |
Girbau UK Limited (Registered number: 00641996) |
Notes to the Financial Statements |
for the Year Ended 31 December 2018 |
1. | STATUTORY INFORMATION |
Girbau UK Limited is a |
company's registered number and registered office address can be found on the Company Information |
page. |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
The financial statements have been prepared under the historical cost convention as modified by the |
revaluation of certain financial instruments measured at fair value in accordance with the accounting |
policies set out below. |
These financial statements have been prepared in compliance with FRS 102 - The Financial Reporting |
Standard applicable in the UK and Republic of Ireland and the Companies Act 2006. |
In preparing the financial statements management develops estimated and judgements that affect the |
reported amount of assets and liabilities, revenue and costs, and related disclosures of the financial |
statements. Actual results many differ from estimated under different assumptions and conditions. |
Going Concern |
At the balance sheet date the company had an overall balance sheet deficit of £66,046. The company |
continues to operate within its financial parameters and with the support its parent company, Girbau |
SA, which has confirmed its intention to continue to support the company for the foreseeable future. |
On this basis the directors consider it appropriate to prepare the financial statements on a going |
concern basis. |
Financial Reporting Standard 102 - reduced disclosure exemptions |
The company has taken advantage of the following disclosure exemption 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. |
Preparation of consolidated financial statements |
The financial statements contain information about Girbau UK Limited 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, Girbau S.A., Carretera de Manlleu, Km.1, 08500 Vic, Barcelona, |
Spain.. |
Girbau UK Limited (Registered number: 00641996) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2018 |
2. | ACCOUNTING POLICIES - continued |
Significant judgements and estimates |
In the application of the Company's accounting policies, which are described in note 2, management is |
required to make judgements, estimates and assumptions about the carrying values of assets and |
liabilities that are not readily apparent from other sources. The estimates and underlying assumptions |
are based on historical experience and other factors that are considered to be relevant. Actual results |
may differ from these estimates. |
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting |
estimates are recognised in the period in which the estimate is revised if the revision affects only that |
period, or in the period of the revision and future periods if the revision affects both current and future |
periods. |
The key sources of estimation uncertainty that have a significant effect on the amounts recognised in |
the financial statements are described below; |
Warranty provision - extended warranties are offered to some customers and these are accounted for |
in the financial statements based on a percentage of revenue which is deemed to be the best estimate |
attributable for this cost. See below for further details on the calculation method for the warranty |
provision. |
Extended warranties are offered to some customers as part of a machine sale, these range between 2 |
and 3 years. There are also extended warranties sold with some machines. |
Provision is made for the estimated costs of fulfilling the warranty based on the company's exposure to |
parts and labour costs. These are calculated differently depending on the type of sales. Warranties on |
commercial sales are calculated based on an estimated labour cost of 2% of revenue per year, and |
labour is 1% of revenue per year. Warranties on industrial sales are estimated based on the size and |
complexity of the job. |
Where warranties are sold revenues are recognised evenly over the period of the warranty and costs |
as incurred. Provision is also made for any expected losses as soon as they are known. |
Girbau UK Limited (Registered number: 00641996) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2018 |
2. | ACCOUNTING POLICIES - continued |
Turnover |
Turnover is the amount derived from ordinary activities, and is measured at the fair value of the |
consideration received or receivable. Revenue is reduced for estimated customer returns, rebates and |
other similar allowances, and is stated net of VAT. |
Revenue from the sale of parts and machines as specified in the strategic report is recognised when |
all the following conditions are satisfied: |
- the Company has transferred to the buyer the significant risks and rewards of ownership of the |
goods; |
- the Company retains neither continuing managerial involvement to the degree usually associated with |
ownership nor effective control over the goods sold; |
- the amount of revenue 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. |
Specifically, revenue from the sale of goods is recognised when goods are installed and legal title is |
passed. When such goods are sold under rental agreements revenue is recognised evenly over the |
term. |
Goodwill |
Intangible assets |
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured |
at cost less any accumulated amortisation and any accumulated impairment losses. |
Tangible fixed assets |
Short leasehold | - |
Plant and machinery | - |
Fixtures and fittings | - |
Motor vehicles | - |
Computer equipment | - |
Stocks |
Stocks and work in progress are valued at the lower of cost and net realisable value, after making due |
allowance for obsolete and slow moving items. |
Cost is calculated using the first-in, first-out method and includes all purchase, transport, and handling |
costs in bringing stocks to their present location and condition. |
Girbau UK Limited (Registered number: 00641996) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2018 |
2. | ACCOUNTING POLICIES - continued |
Related parties |
For the purposes of these financial statements, a party is considered to be related to the Company if: |
- the party has the ability, directly or indirectly, through one or more intermediaries, to control the |
Company or exercise significant influence over the company in making financial and operating policy |
decisions, or has joint control over the Company; |
- the Company and the party are subject to common control; |
- the party is an associate of the Company or a joint venture in which the Company is a venturer; |
- the party is a member of key management personnel of the Company or the Company’s parent, or a |
close family member of such an individual, or is an entity under the control, joint control or significant |
influence of such individuals; |
- the party is a close family member of a party referred to in (i) or is an entity under the control, joint |
control or significant influence of such individuals; |
- the party is a post-employment benefit plan which is for the benefit of employees of the Company or |
of any entity that is a related party of the Company; or |
- the party, or any member of a group of which it is part, provides key management personnel services |
to the company or its parent. |
Close family members of an individual are those family members who may be expected to influence, |
or be influenced by, that individual in their dealings with the entity. |
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 taxation |
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 |
The financial statements are presented in Sterling (GBP), which is also the functional currency of the |
Company. |
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at |
the statement of financial position 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. |
Girbau UK Limited (Registered number: 00641996) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2018 |
2. | ACCOUNTING POLICIES - continued |
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 payable under operating leases are charged to profit and loss on a straight line basis over the |
lease term. The aggregate benefit of a lease incentives are recognised as a reduction to the expense |
recognised over the lease term on a straight line basis. |
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. |
Warranty |
Extended warranties are offered to some customers as part of a machine sale, these range between 2 |
and 3 years. There are also extended warranties sold with some machines. |
Provision is made for the estimated costs of fulfilling the warranty based on the company's exposure to |
parts and labour costs. These are calculated differently depending on the type of sales. Warranties on |
commercial sales are calculated based on an estimated labour cost of 2% of revenue per year, and |
labour is 1% of revenue per year. Warranties on industrial sales are estimated based on the size and |
complexity of the job. |
Where warranties are sold revenues are recognised evenly over the period of the warranty and costs |
as incurred. Provision is also made for any expected losses as soon as they are known. |
Creditors |
Short term trade creditors are measured at the transaction price. Other financial liabilities, including |
bank loans, are measured initially at fair value, net of transaction costs, and are measured |
subsequently at amortised cost using the effective interest method unless the effect of discounting |
would be immaterial, in which case these are stated at cost. |
Debtors |
Short term debtors are measured at transaction price less impairment losses for bad and doubtful |
debts. |
3. | TURNOVER |
The turnover and loss 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 |
£ | £ |
Girbau UK Limited (Registered number: 00641996) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2018 |
4. | EMPLOYEES AND DIRECTORS |
2018 | 2017 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
2018 | 2017 |
Management and Directors | 3 | 3 |
Administration | 21 | 21 |
Commercial | 12 | 12 |
Production and Technical | 50 | 44 |
2018 | 2017 |
£ | £ |
Directors' remuneration |
Compensation to director for loss of office |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes |
Information regarding the highest paid director for the year ended 31 December 2018 is as follows: |
2018 |
£ |
Emoluments etc |
During the year the company underwent a restructuring process which resulted in compensation being |
payable to the existing Directors, this is reflected in the Directors remuneration disclosure this year. |
5. | OPERATING LOSS |
The operating loss is stated after charging/(crediting): |
2018 | 2017 |
£ | £ |
Other operating leases |
Depreciation - owned assets |
Depreciation - assets on hire purchase contracts |
Loss/(profit) on disposal of fixed assets | ( |
) |
Goodwill amortisation |
Auditors remuneration |
Foreign exchange differences | ( |
) |
Girbau UK Limited (Registered number: 00641996) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2018 |
6. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2018 | 2017 |
£ | £ |
Invoice discounting charges |
HMRC Interest |
Loan |
Hire purchase |
7. | TAXATION |
Analysis of the tax charge |
The tax charge on the loss for the year was as follows: |
2018 | 2017 |
£ | £ |
Deferred tax |
Tax on loss |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The |
difference is explained below: |
2018 | 2017 |
£ | £ |
Loss before tax | ( |
) | ( |
) |
Loss multiplied by the standard rate of corporation tax in the UK of |
( |
) |
( |
) |
Effects of: |
Expenses not deductible for tax purposes |
Capital allowances in excess of depreciation | - | ( |
) |
Depreciation in excess of capital allowances | - |
Tax losses carried forward | 186,443 | 23,588 |
Deferred tax on losses carried forward | 256 | 82,305 |
(Profit)/ Loss on disposal of assets | 248 | (2,337 | ) |
Total tax charge | 256 | 82,305 |
From 1 April 2017 the main rate of corporation tax was reduced from 20% to 19%. The Chancellor of |
the Exchequer announced previously that rate is set to reduce again from 1 April 2020 when the rate |
will be 17%, this will effect the company's future tax position. |
The company has tax losses to carry forward of £1,762,617 which will be utilised in future periods |
against trading profits. |
Deferred tax has been calculated at the rates at which it is expected to unwind. |
8. | DIVIDENDS |
2018 | 2017 |
£ | £ |
Ordinary shares of £1 each |
Interim |
Girbau UK Limited (Registered number: 00641996) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2018 |
9. | INTANGIBLE FIXED ASSETS |
Goodwill |
£ |
COST |
At 1 January 2018 |
and 31 December 2018 |
AMORTISATION |
At 1 January 2018 |
Amortisation for year |
At 31 December 2018 |
NET BOOK VALUE |
At 31 December 2018 |
At 31 December 2017 |
10. | TANGIBLE FIXED ASSETS |
Fixtures |
Short | Plant and | and |
leasehold | machinery | fittings |
£ | £ | £ |
COST |
At 1 January 2018 |
Additions |
At 31 December 2018 |
DEPRECIATION |
At 1 January 2018 |
Charge for year |
Eliminated on disposal |
At 31 December 2018 |
NET BOOK VALUE |
At 31 December 2018 |
At 31 December 2017 |
Girbau UK Limited (Registered number: 00641996) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2018 |
10. | TANGIBLE FIXED ASSETS - continued |
Motor | Computer |
vehicles | equipment | Totals |
£ | £ | £ |
COST |
At 1 January 2018 |
Additions |
Disposals | ( |
) | ( |
) |
At 31 December 2018 |
DEPRECIATION |
At 1 January 2018 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
At 31 December 2018 |
NET BOOK VALUE |
At 31 December 2018 |
At 31 December 2017 |
Fixed assets, included in the above, which are held under hire purchase contracts are as follows: |
Motor |
vehicles |
£ |
COST |
At 1 January 2018 |
Disposals | ( |
) |
Transfer to ownership | (43,541 | ) |
At 31 December 2018 |
DEPRECIATION |
At 1 January 2018 |
Charge for year |
Eliminated on disposal | ( |
) |
Transfer to ownership | (40,846 | ) |
At 31 December 2018 |
NET BOOK VALUE |
At 31 December 2018 |
At 31 December 2017 |
At the balance sheet date the gross amount of laundry machines held for use in operating leases was |
£574,490 (2017 - £567,134) with accumulated depreciation of £438,788 (2017 - £393,318). |
Girbau UK Limited (Registered number: 00641996) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2018 |
11. | FIXED ASSET INVESTMENTS |
The company's investments at the Statement of Financial Position date in the share capital of |
companies include the following: |
Registered office: As parent, see page 1. |
Nature of business: |
% |
Class of shares: | holding |
2018 | 2017 |
£ | £ |
Aggregate capital and reserves | ( |
) | ( |
) |
12. | STOCKS |
2018 | 2017 |
£ | £ |
Stocks |
Work-in-progress |
The amount of stock expensed during the year was £7,787,082 (2017 - £9,295,377). |
13. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2018 | 2017 |
£ | £ |
Trade debtors |
Amounts owed by group undertakings |
Amounts receivable in respect of finance leases |
Sundry Debtors and Prepayments |
Deferred tax asset |
14. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2018 | 2017 |
£ | £ |
Bank loans and overdrafts (see note 16) |
Hire purchase contracts (see note 17) |
Trade creditors |
Amounts owed to group undertakings |
Deferred income & warranty cos |
Sundry Creditors and Accruals |
Taxation & Social Security |
Girbau UK Limited (Registered number: 00641996) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2018 |
15. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
2018 | 2017 |
£ | £ |
Hire purchase contracts (see note 17) |
Deferred income & warranty cos | 487,876 | 524,520 |
16. | LOANS |
An analysis of the maturity of loans is given below: |
2018 | 2017 |
£ | £ |
Amounts falling due within one year or on demand: |
Bank loans |
The Company had a loan with Lloyds Bank which was repaid during the year, the balance outstanding |
at the start of the year was £19,662. The interest rate on the loan was base rate plus 3.34% per |
annum. |
17. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Hire purchase contracts |
2018 | 2017 |
£ | £ |
Net obligations repayable: |
Within one year |
Between one and five years |
Non-cancellable |
operating leases |
2018 | 2017 |
£ | £ |
Within one year |
Between one and five years |
In more than five years |
The Company leases premises under an operating lease. There is a break clause in the lease after 10 |
years and the next break clause is in 2024. The remaining minimum lease period is therefore 6 years. |
Girbau UK Limited (Registered number: 00641996) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2018 |
18. | SECURED DEBTS |
The following secured debts are included within creditors: |
2018 | 2017 |
£ | £ |
Hire purchase contracts | 932,849 | 1,223,870 |
Santander UK plc have secured the provision of an overdraft facility by way of a fixed and floating |
charge over the assets of the company. |
Lombard North Central plc have secured the provision of finance by way of a fixed charge over assets |
of the company. |
19. | FINANCIAL INSTRUMENTS |
The carrying amounts of the company's financial instruments are: |
2018 | 2017 |
Financial Assets |
Debt instruments measured at amortised cost |
- Trade debtors | 2,008,322 | 3,995,212 |
- Amounts due from group undertakings | 52,554 | 4,365 |
- Cash | 1,486,201 | 725,675 |
- Other debtors | 820 | 16,854 |
Financial Liabilities |
Measured at amortised cost |
- Bank loans and overdrafts | - | 19,662 |
- Hire purchase contracts | 932,849 | 1,223,870 |
- Trade creditors | 332,842 | 454,580 |
- Amounts owed to group undertakings | 2,224,349 | 3,397,543 |
- Other creditors and accruals | 1,111,733 | 473,052 |
20. | DEFERRED TAX |
£ |
Balance at 1 January 2018 | ( |
) |
Charge to Statement of Comprehensive Income during year |
Balance at 31 December 2018 | ( |
) |
The deferred tax asset relates to taxable losses carried forward at the period end which will be utilised |
against future profits. |
21. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2018 | 2017 |
value: | £ | £ |
Ordinary | £1 | 112,450 | 112,450 |
Deferred | 1p | 182 | 182 |
Preference | £1 | 1,000,000 | 1,000,000 |
1,112,632 | 1,112,632 |
Girbau UK Limited (Registered number: 00641996) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2018 |
21. | CALLED UP SHARE CAPITAL - continued |
Ordinary shares are irredeemable. Each holder of ordinary shares has one vote per share. The holders |
of the ordinary shares are entitled to the balance of any profit reserves available for distribution in any |
one year, subject to the satisfaction of the entitlements to dividends of the holders of deferred ordinary |
shares. On a winding up the ordinary shares rank pari passu with the deferred ordinary shares save |
that the holders of the ordinary shares are entitled to the entirety of the surplus assets once each |
deferred ordinary share has received its 1/12,521,000 share. |
Deferred ordinary shares are irredeemable. Each holder of a deferred ordinary share has one vote per |
share. The holders of deferred ordinary shares are entitled to 1/12,521,000 for each share held, of any |
profit reserves available for distribution in any one year. On a winding up the deferred ordinary shares |
rank pari passu with the ordinary shares to the extent of the repayments of the capital paid up thereon |
and, in addition, to a share, per ordinary deferred share, of 1/12,521,000 of any surplus assets. |
Preference shares are irredeemable and confer no voting rights. The holders of preference shares |
have no right to participate in the profits of the company. On a winding up the holders of preference |
shares are entitled to repayment of the nominal amount paid up on each share in priority to all other |
shareholders. |
22. | RESERVES |
Capital |
Retained | redemption |
earnings | reserve | Totals |
£ | £ | £ |
At 1 January 2018 | 23,552 |
Deficit for the year | ( |
) | ( |
) |
At 31 December 2018 | ( |
) | (1,178,678 | ) |
Called-up share capital - represents the nominal value of shares that have been issued. |
Capital redemption reserve - represents the nominal value of shares brought back by the company in |
previous periods. |
Profit and loss account - represents a fully distributable reserve which includes all current and prior |
period retained profits and losses. |
23. | PENSION COMMITMENTS |
The Company operates a defined contribution pension scheme. The assets of the scheme are held |
separately from those of the Company in independently administered funds. The pension cost charges |
represent contributions payable by the company to the funds and amounted to £42,161 (2017 - |
£22,043). |
24. | ULTIMATE PARENT COMPANY |
Girbau SA (incorporated in Spain ) is regarded by the directors as being the company's ultimate parent |
company. |
Girbau UK Limited (Registered number: 00641996) |
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2018 |
25. | RELATED PARTY DISCLOSURES |
2018 | 2017 |
£ | £ |
Sales to Girbau SA |
Purchases from Girbau SA |
Purchases from Girbau Continental | 358,204 | 436,618 |
Amount due to Girbau SA | ( |
) | ( |
) |
Amount due to Girbau Continental | ( |
) | ( |
) |
2018 | 2017 |
£ | £ |
Remuneration |
2018 | 2017 |
£ | £ |
Sales to GLE Rental Ltd |
Sales to GLE Finance Ltd |
Purchases from GLE Rental Ltd | - | 61,573 |
Management Charges from GLE Rental Ltd | 26,467 | 105,868 |
Purchases from GLE Finance Ltd | - | 11,149 |
Amount due to GLE Rental Ltd | ( |
) | ( |
) |