Kelta Limited - Limited company accounts 18.2

REGISTERED NUMBER: 09231573 (England and Wales)

GROUP STRATEGIC REPORT, REPORT OF THE DIRECTOR AND

CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018

FOR

KELTA LIMITED

Page

Company Information

1

Group Strategic Report

2

Report of the Director

4

Report of the Independent Auditors

5

Consolidated Income Statement

7

Consolidated Other Comprehensive Income

8

Consolidated Statement of Financial Position

9

Company Statement of Financial Position

10

Consolidated Statement of Changes in Equity

11

Company Statement of Changes in Equity

12

Consolidated Statement of Cash Flows

13

Notes to the Consolidated Statement of Cash Flows

14

Notes to the Consolidated Financial Statements

15

DIRECTOR:

P Mehta

REGISTERED OFFICE:

Eagle House

28 Billing Road

Northampton

Northamptonshire

NN1 5AJ

REGISTERED NUMBER:

09231573 (England and Wales)

AUDITORS:

DNG Dove Naish LLP, Statutory Auditor

Eagle House

28 Billing Road

Northampton

Northamptonshire

NN1 5AJ

The director presents his strategic report of the company and the group for the year ended

31 December 2018.

The trading results for the year and the group's financial position at the end of the year are shown in the

attached financial statements.

REVIEW OF BUSINESS

Group turnover has decreased by $22.29m (25.66%) on the prior year to $64.59m.

Gross profit margin has reduced from 53.3% to 49.2% as a result of reduction in turnover and unfavorable

product mix.

Income from listed investments increased by 65% on the prior period.

The group has reported a net profit before tax of $21.90m compared to $53.96 in the prior period.

Total shareholders funds decreased from $180.37m to $91.80m.

The group continues to work with its customers on the development of new products and service offerings to

house new and evolving technologies. The group continues to invest and expand its operations, premises,

manpower and machinery.

PRINCIPAL RISKS AND UNCERTAINTIES

Risk is a key element of the group's strategic management, whereby it addresses the risks attached to each

of its activities. This is reflected in the group's Business Continuity plan, which incorporates Risk Tolerance

Matrices, Business Impact Analyses and Action Plans.

Regular reviews of the group's Business Continuity plan, policies, quality control and health and safety

procedures are undertaken as part of the group's risk management process.

In common with many manufacturing businesses the group continues to be exposed to the effects of global

competition but focuses on providing quality products and solutions for its customers.

The group's activities expose it to a number of financial risks including liquidity risk and currency risk. The

group does not use derivative financial instruments for speculative purposes.

Liquidity risk

In order to maintain liquidity to ensure that sufficient funds are available for on-going operations and future

developments, the group uses a mixture of long-term and short-term debt finance and equity funding and

inter-company treasury management.

Currency risk

The group undertakes trading transactions in currencies other than US Dollars and has funding instruments

denominated in foreign currency. The foreign exchange risk is managed by holding cash resources in foreign

currency.

KEY PERFORMANCE INDICATORS

The group operates with a range of key performance indicators, the principal measures fall within the

following categories; profitability, sales & customer service, resource & cost effectiveness. These are

reviewed at regularly.

SIGNED BY ORDER OF THE DIRECTORS:

P Mehta - Director

25 September 2019

The director presents his report with the financial statements of the company and the group for the year

ended 31 December 2018.

PRINCIPAL ACTIVITIES

The principal activities of the group in the year under review were those of design, manufacture and sale of

engineered products and the holding of investments.

DIVIDENDS

The total distribution of dividends for the year ended 31 December 2018 will be $ 109,055,212 .

DIRECTOR

P Mehta held office during the whole of the period from 1 January 2018 to the date of this report.

STATEMENT OF DIRECTOR'S RESPONSIBILITIES

The director is responsible for preparing the Group 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 he is satisfied that

they give a true and fair view of the state of affairs of the company and the group and of the profit or loss of

the group 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 and the group's transactions and disclose with reasonable accuracy at any time the financial

position of the company and the group and enable him to ensure that the financial statements comply with the

Companies Act 2006. He is also responsible for safeguarding the assets of the company and the group 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 group's auditors are unaware, and he 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 group's auditors are aware of that information.

AUDITORS

The auditors, DNG Dove Naish LLP, Statutory Auditor, will be proposed for re-appointment at the

forthcoming Annual General Meeting.

SIGNED BY ORDER OF THE DIRECTORS:

P Mehta - Director

25 September 2019

Opinion

We have audited the financial statements of Kelta Limited (the 'parent company') and its subsidiaries (the

'group') for the year ended 31 December 2018 which comprise the Consolidated Income Statement,

Consolidated Other Comprehensive Income, Consolidated Statement of Financial Position, Company

Statement of Financial Position, Consolidated Statement of Changes in Equity, Company Statement of

Changes in Equity, Consolidated Statement of Cash Flows and Notes to the Consolidated 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 group's and of the parent company affairs as at 31 December 2018 and of the group's 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

group 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 group'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

Group 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.

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 Group 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 Group 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 group and the parent company and its environment

obtained in the course of the audit, we have not identified material misstatements in the Group 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

-	the parent company 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 four, the director is

responsible for the preparation of the financial statements and for being satisfied that they give a true and fair

view, and for such internal control as the director determines necessary to enable the preparation of financial

statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the director is responsible for assessing the group's and the parent

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 group or the

parent 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.

Andrew Clifford (Senior Statutory Auditor)

for and on behalf of DNG Dove Naish LLP, Statutory Auditor

Eagle House

28 Billing Road

Northampton

Northamptonshire

NN1 5AJ

26 September 2019

TURNOVER

3

64,594,516

86,881,039

Cost of sales

32,811,171

40,597,353

GROSS PROFIT

31,783,345

46,283,686

Administrative expenses

3,904,037

3,038,710

27,879,308

43,244,976

Other operating income

79,909

149,356

OPERATING PROFIT

5

27,959,217

43,394,332

Income from fixed asset investments

1,286,205

1,046,025

Interest receivable and similar income

1,316,399

532,671

2,602,604

1,578,696

30,561,821

44,973,028

Amounts written off investments

6

323,239

114,985

Gain/loss on revaluation of investments

8,310,185

(9,131,398

)

8,633,424

(9,016,413

)

21,928,397

53,989,441

Interest payable and similar expenses

7

30,393

24,756

PROFIT BEFORE TAXATION

21,898,004

53,964,685

Tax on profit

8

778,634

978,652

PROFIT FOR THE FINANCIAL YEAR

21,119,370

52,986,033

Profit attributable to:

Owners of the parent

21,119,370

52,986,033

PROFIT FOR THE YEAR

21,119,370

52,986,033

OTHER COMPREHENSIVE (LOSS)/INCOME

Currency translation differences

(635,479

)

638,149

Income tax relating to other comprehensive (loss)/income

-

-

OTHER COMPREHENSIVE (LOSS)/INCOME FOR THE YEAR, NET OF INCOME TAX

(635,479

)

638,149

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

20,483,891

53,624,182

Total comprehensive income attributable to:

Owners of the parent

20,483,891

53,624,182

FIXED ASSETS

Intangible assets

11

905,206

1,160,842

Tangible assets

12

6,358,316

6,546,549

Investments

13

Interest in associate

5,398,031

5,721,270

Other investments

64,301,880

123,781,176

76,963,433

137,209,837

CURRENT ASSETS

Stocks

14

9,426,858

10,331,411

Debtors

15

5,453,150

6,216,226

Cash at bank and in hand

11,948,311

36,243,936

26,828,319

52,791,573

CREDITORS

Amounts falling due within one year

16

11,743,974

9,356,568

NET CURRENT ASSETS

15,084,345

43,435,005

TOTAL ASSETS LESS CURRENT LIABILITIES

92,047,778

180,644,842

PROVISIONS FOR LIABILITIES

18

248,442

274,185

NET ASSETS

91,799,336

180,370,657

CAPITAL AND RESERVES

Called up share capital

19

1,555

1,555

Translation reserve

20

(1,846,379

)

(1,210,900

)

Surplus reserve

20

581,002

535,387

Retained earnings

20

93,063,158

181,044,615

SHAREHOLDERS' FUNDS

91,799,336

180,370,657

The financial statements were approved by the director on 25 September 2019 and were signed by:

P Mehta - Director

FIXED ASSETS

Intangible assets

11

-

-

Tangible assets

12

-

-

Investments

13

89,944,580

150,378,668

89,944,580

150,378,668

CURRENT ASSETS

Debtors

15

-

100,000

Cash at bank

2,000,812

29,914,046

2,000,812

30,014,046

CREDITORS

Amounts falling due within one year

16

146,053

22,057

NET CURRENT ASSETS

1,854,759

29,991,989

TOTAL ASSETS LESS CURRENT LIABILITIES

91,799,339

180,370,657

CAPITAL AND RESERVES

Called up share capital

19

1,555

1,555

Retained earnings

20

91,797,784

180,369,102

SHAREHOLDERS' FUNDS

91,799,339

180,370,657

Company's profit for the financial year

20,483,894

53,624,184

The financial statements were approved by the director on 25 September 2019 and were signed by:

P Mehta - Director

Called up

share

Retained

Translation

Surplus

Total

capital

earnings

reserve

reserve

equity

$

$

$

$

$

Balance at 1 January 2017

1,555

128,593,969

(1,849,049

)

-

126,746,475

Changes in equity

Total comprehensive income

-

52,450,646

638,149

535,387

53,624,182

Balance at 31 December 2017

1,555

181,044,615

(1,210,900

)

535,387

180,370,657

Changes in equity

Dividends

-

(109,055,212

)

-

-

(109,055,212

)

Total comprehensive income

-

21,073,755

(635,479

)

45,615

20,483,891

Balance at 31 December 2018

1,555

93,063,158

(1,846,379

)

581,002

91,799,336

Called up

share

Retained

Total

capital

earnings

equity

$

$

$

Balance at 1 January 2017

1,555

126,744,918

126,746,473

Changes in equity

Total comprehensive income

-

53,624,184

53,624,184

Balance at 31 December 2017

1,555

180,369,102

180,370,657

Changes in equity

Dividends

-

(109,055,212

)

(109,055,212

)

Total comprehensive income

-

20,483,894

20,483,894

Balance at 31 December 2018

1,555

91,797,784

91,799,339

Cash flows from operating activities

Cash generated from operations

1

27,983,492

42,099,487

Interest paid

(30,393

)

(24,756

)

Tax paid

(847,167

)

(475,925

)

Net cash from operating activities

27,105,932

41,598,806

Cash flows from investing activities

Purchase of tangible fixed assets

(925,105

)

(2,691,770

)

Purchase of fixed asset investments

(28,454,009

)

(62,693,790

)

Sale of tangible fixed assets

44,518

140

Sale of fixed asset investments

80,480,400

21,586,546

Interest received

1,316,399

532,671

Dividends received

1,286,205

1,046,025

Net cash from investing activities

53,748,408

(42,220,178

)

Cash flows from financing activities

Loans to group

-

(1,475,731

)

Loans from group

3,905,247

-

Other loan repayments

-

(6,650

)

Capital repayments in year

-

(3,366

)

Equity dividends paid

(109,055,212

)

-

Net cash from financing activities

(105,149,965

)

(1,485,747

)

Decrease in cash and cash equivalents

(24,295,625

)

(2,107,119

)

Cash and cash equivalents at beginning of year

2

36,243,936

38,351,055

Cash and cash equivalents at end of year

2

11,948,311

36,243,936

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

2018

2017

$

$

Profit before taxation

21,898,004

53,964,685

Depreciation charges

1,067,346

1,186,254

Profit on disposal of fixed assets

(843,044

)

(1,868,586

)

Loss/(gain) on revaluation of fixed assets

8,310,185

(9,131,398

)

Translation differences

(418,903

)

411,631

Amounts written off investments

323,239

120,421

Finance costs

30,393

24,756

Finance income

(2,602,604

)

(1,578,696

)

27,764,616

43,129,067

Decrease/(increase) in stocks

904,553

(1,386,021

)

Decrease in trade and other debtors

762,191

1,010,320

Decrease in trade and other creditors

(1,447,868

)

(653,879

)

Cash generated from operations

27,983,492

42,099,487

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 31 December 2018

31/12/18

1/1/18

$

$

Cash and cash equivalents

11,948,311

36,243,936

Year ended 31 December 2017

31/12/17

1/1/17

$

$

Cash and cash equivalents

36,243,936

38,351,055

1.	STATUTORY INFORMATION

Kelta Limited 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 General Information

page.

The presentation currency of the financial statements is the US Dollar ($).

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 as modified by the revaluation of certain assets.

Basis of consolidation

The consolidated financial statements incorporate the financial statements of the company and entities

controlled by the company (its subsidiaries an joint ventures) made up to 31 December each period.

Control is achieved where the company has the power to govern the financial and operating policies of

an entity so as to obtain benefits from its activities.

Subsidiaries

Subsidiaries are fully consolidated from the date on which control is transferred to the group and

de-consolidated from the date that control ceases.

Inter-company transactions, balances and unrealised gains on transactions between group companies

are eliminated. Unrealised losses are also eliminated. Accounting policies of subsidiaries have been

changed where necessary to ensure consistency with the policies adopted by the group.

The consolidated financial statements incorporate the assets, liabilities and results of the following

entities in accordance with the accounting policy described above:

Name of entity

Registered office

Country of incorporation

Class ofshares held

Equity holding %

Tii Technologies Limited

As Kelta Limited

UK

Ordinary

100

Eurocraft Technologies Limited

Cinderbank, Dudley DY2 9AE

UK

Ordinary

100

Kelta Hong Kong Ltd

Rooms 2702-3, 27th Floor, Harbour View Centre, 56 Gloucester Road, Wan Chai, Hong Kong

Hong Kong

Ordinary

100

Ping Xiang Tii Technologies Company Limited

As Kelta Hong Kong Ltd

China

Ordinary

100

Dongguan Kelta Electro Mechanical Products Co Ltd

As Kelta Hong Kong Ltd

China

Ordinary

100

Tii Porta Tech SA de CV

Mexico

Ordinary

100

Tii Tecnologia Ltda

Brazil

Ordinary

100

Significant judgements and estimates

The preparation of financial statements requires the use of certain critical accounting estimates. It also

requires management to exercise its judgement in the process of applying the company accounting

policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions

and estimates are significant to the financial statements are disclosed within the individual accounting

policies below.