P R Marriott Drilling Limited - Limited company accounts 18.2

REGISTERED NUMBER: 02592487 (England and Wales)

GROUP STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018

FOR

P R MARRIOTT DRILLING LIMITED

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Consolidated Income Statement

8

Consolidated Other Comprehensive Income

9

Consolidated Balance Sheet

10

Company Balance Sheet

11

Consolidated Statement of Changes in Equity

12

Company Statement of Changes in Equity

14

Consolidated Cash Flow Statement

15

Notes to the Consolidated Cash Flow Statement

16

Notes to the Consolidated Financial Statements

17

DIRECTORS:

A J Beswick

J W Hobday

SECRETARY:

D I Jones

REGISTERED OFFICE:

Springwater House

Pilsley Road

Danesmoor

Chesterfield

Derbyshire

S45 9BQ

REGISTERED NUMBER:

02592487 (England and Wales)

AUDITORS:

Hollis and Co Limited

Chartered Accountants

Statutory Auditor

35 Wilkinson Street

Sheffield

South Yorkshire

S10 2GB

The directors present their strategic report of the company and the group for the year ended 31 December 2018.

REVIEW OF BUSINESS

During 2018 the activity remained at its subdued levels, with no major overseas contracts operating. However, a number

of significant overseas contract were won by the Marriott Drilling Group during the year, these contracts will all

commence operations in the later half of 2019, which will lead towards a profitable future for the group. In addition to

the new contacts in hand, the company is also still being invited to tender a number varied and interesting projects in both

new and existing markets.

Marriott Drilling maintains a strong team working ethos and a proactive approach to ensure its customers' needs are met

as well as being competitive with pricing and remaining commercially realistic. Marriott Drilling has successfully

maintained a minimal down time rate for drilling rigs and associated equipment due to comprehensive routine

maintenance programmes that have kept project delivery lead times on target. The group's emphasis on providing highly

skilled staff has ensured another accident free year within the various projects, further strengthening our reputation of

providing a safe and quality drilling service, which is becoming increasingly valuable in today's competitive market.

Over the coming year, the group plans to continue consolidating its position in the key markets where Marriott Drilling

has a market leading position and also seeks to expand into new markets and territories where the right opportunities

exist. Marriott Drilling considers the geothermal industry in selective locations as being a key target industry area and

will strive to increase their market share within this part of the deep drilling industry.

The group is committed to an expansion in its activities in East Africa, through geothermal activities and oil exploration

and oilfield development, areas where the Directors envisage increase in activity in the next few years. Marriott Drilling is

ideally placed to capitalise on these opportunities, supported by very successful previous contracts both in the geothermal

sector and in oil exploration.

PRINCIPAL RISKS AND UNCERTAINTIES

Exchange rate exposure over the long term nature of our contracts can be a concern for the business, however a

significant natural hedge is created by purchases being made in overseas currencies

Oil price reductions may not affect the short term prospects for the business but may be an issue long term, so the

company is actively seeking to expand upon its geothermal and non oil/gas based markets to assist with negating the long

term risk.

Political uncertainty both at home and in the various overseas territories in which we are currently operating always

means the company needs to be on its guard.

With regards to employee protection for both health and security, third party services are utilised where necessary.

Default or non-payment by a major customer will always be a risk, but the blue chip and sovereign nature of our

customers, whilst not fully negating the risk, certainly helps to minimise it.

KEY PERFORMANCE INDICATORS

There are a number of key performance indicators ("KPI") that the management team use to monitor the performance of

the business. These are as follows:

12 Months ended 31 December 2018

12 Months ended 31December 2017

Turnover

£7.7m

£15.8m

Operating (Loss)/ Profit

(27%

)

16%

Return on Capital Employed

(6.2%

)

7.5%

FUTURE PROSPECTS

In the home market our Groundwater Engineering Division continues to go from strength to strength by both increasing

market share within its existing market and diversification.

The Marriott Drilling Group continues to invest in the latest drilling technology to ensure that the company has the

technical capability of providing a quality service. The company will also continue to maintain and extend our ISO

standards certification to further increase its business credentials as well as continue to offer competitive pricing and

innovative contracting solutions.

Due for the number of new and exciting contracts in hand the company has strengthened the management team for both

UK and overseas operations, Not only does this assist in the operation and governance of the existing work load, but it

has proven to expand our capacity to tender for new prospects as they arise.

ON BEHALF OF THE BOARD:

J W Hobday - Director

28 October 2019

The directors present their report with the financial statements of the company and the group for the year ended

31 December 2018.

PRINCIPAL ACTIVITY

The principal activity of the group in the year under review was that of drilling and related services to the oil, gas, gas

storage, shale gas, CBM, geothermal, mining and water supply industries.

DIVIDENDS

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

RESEARCH AND DEVELOPMENT

During the year, the group continued to reinvest in the research and development of new and innovative processes to

gain a competitive advantage in new and existing markets.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2018 to the date of this

report.

A J Beswick

J W Hobday

QUALIFYING THIRD PARTY INDEMNITY PROVISION

During the financial year and at the time the directors report is approved, a Qualifying Third Party Indemnity Provision

for the benefit of the directors is in force.

DISCLOSURE IN THE STRATEGIC REPORT

As required by Section 414C(11) Companies Act 2006, this statement confirms that certain items that are required to be

disclosed in the directors report are set out in the strategic report.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Group 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). 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 the group and of the profit or loss of the group 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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the

company and the group 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 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 directors are 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 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 group's auditors are

aware of that information.

AUDITORS

The auditors, Hollis and Co Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

J W Hobday - Director

28 October 2019

Opinion

We have audited the financial statements of P R Marriott Drilling 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 Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in

Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated

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 group's and of the parent company affairs as at 31 December 2018 and of the group's 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 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 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 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 directors are responsible for the other information. The other information comprises the information in the Group

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 Group 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 Group Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the 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

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 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 directors' remuneration specified by law are not made; or

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

Responsibilities of directors

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

for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such

internal control as the directors determine necessary to enable the preparation of financial statements that are free from

material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the 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 directors either intend to liquidate the group or the parent 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.

Peter Hollis (Senior Statutory Auditor)

for and on behalf of Hollis and Co Limited

Chartered Accountants

Statutory Auditor

35 Wilkinson Street

Sheffield

South Yorkshire

S10 2GB

28 October 2019

TURNOVER

4

7,694,806

15,747,763

Cost of sales

5,329,314

7,020,296

GROSS PROFIT

2,365,492

8,727,467

Distribution costs

356,834

236,058

Administrative expenses

4,248,853

5,904,669

4,605,687

6,140,727

(2,240,195

)

2,586,740

Other operating income

5

133,800

-

OPERATING (LOSS)/PROFIT

7

(2,106,395

)

2,586,740

Interest receivable and similar income

153,038

18,398

(1,953,357

)

2,605,138

Interest payable and similar expenses

8

225,342

492,596

(LOSS)/PROFIT BEFORE TAXATION

(2,178,699

)

2,112,542

Tax on (loss)/profit

9

(584,169

)

927,716

(LOSS)/PROFIT FOR THE FINANCIAL YEAR

(1,594,530

)

1,184,826

(Loss)/profit attributable to:

Owners of the parent

(1,249,491

)

725,908

Non-controlling interests

(345,039

)

458,918

(1,594,530

)

1,184,826

(LOSS)/PROFIT FOR THE YEAR

(1,594,530

)

1,184,826

OTHER COMPREHENSIVE INCOME

Currency translation differences on

foreign currency net investments

347,530

(1,244,429

)

Reduction in revaluation reserve

-

(338,117

)

Deferred tax on revaluation reserve

Income tax relating to components of other comprehensive income

140,774

-

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

488,304

(1,582,546

)

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(397,720

)

Note

Prior year adjustment

11

243,678

TOTAL COMPREHENSIVE INCOME SINCE LAST ANNUAL REPORT

(862,548

)

Total comprehensive income attributable to:

Owners of the parent

(604,391

)

(545,531

)

Non-controlling interests

(258,157

)

147,811

(862,548

)

(397,720

)

FIXED ASSETS

Tangible assets

12

27,559,248

27,532,980

Investments

13

-

-

27,559,248

27,532,980

CURRENT ASSETS

Stocks

14

349,700

302,072

Debtors

15

6,365,171

5,561,787

Cash at bank and in hand

4,611,365

3,813,359

11,326,236

9,677,218

CREDITORS

Amounts falling due within one year

16

4,788,486

3,127,324

NET CURRENT ASSETS

6,537,750

6,549,894

TOTAL ASSETS LESS CURRENT LIABILITIES

34,096,998

34,082,874

CREDITORS

Amounts falling due after more than one year

17

(17,543,827

)

(15,854,575

)

PROVISIONS FOR LIABILITIES

21

(1,881,762

)

(2,450,664

)

NET ASSETS

14,671,409

15,777,635

CAPITAL AND RESERVES

Called up share capital

22

73,002

73,002

Revaluation reserve

23

3,014,203

3,084,800

Capital redemption reserve

23

73,000

73,000

Other reserves

23

1,323,712

837,187

Retained earnings

23

8,922,655

10,186,652

SHAREHOLDERS' FUNDS

13,406,572

14,254,641

NON-CONTROLLING INTERESTS

24

1,264,837

1,522,994

TOTAL EQUITY

14,671,409

15,777,635

The financial statements were approved by the Board of Directors on 28 October 2019 and were signed on its behalf by:

J W Hobday - Director

FIXED ASSETS

Tangible assets

12

10,142,980

10,117,349

Investments

13

586

586

10,143,566

10,117,935

CURRENT ASSETS

Stocks

14

349,700

302,072

Debtors

15

7,009,485

7,382,091

Cash at bank and in hand

4,416,239

403,533

11,775,424

8,087,696

CREDITORS

Amounts falling due within one year

16

3,591,301

1,049,693

NET CURRENT ASSETS

8,184,123

7,038,003

TOTAL ASSETS LESS CURRENT LIABILITIES

18,327,689

17,155,938

CREDITORS

Amounts falling due after more than one year

17

(8,868,278

)

(7,654,575

)

PROVISIONS FOR LIABILITIES

21

(1,144,925

)

(1,113,276

)

NET ASSETS

8,314,486

8,388,087

CAPITAL AND RESERVES

Called up share capital

22

73,002

73,002

Revaluation reserve

3,014,203

3,084,800

Capital redemption reserve

73,000

73,000

Retained earnings

5,154,281

5,157,285

SHAREHOLDERS' FUNDS

8,314,486

8,388,087

Company's loss for the financial year

(214,375

)

(1,195,474

)

The financial statements were approved by the Board of Directors on 28 October 2019 and were signed on its behalf by:

J W Hobday - Director

Called up

Capital

share

Retained

Revaluation

redemption

capital

earnings

reserve

reserve

£

£

£

£

Balance at 1 January 2017

73,002

9,220,744

3,662,917

73,000

Changes in equity

Profit for the year

-

482,230

-

-

Other comprehensive income

-

-

(338,117

)

-

Total comprehensive income

-

482,230

(338,117

)

-

Reserve transfer

-

240,000

(240,000

)

-

Balance at 31 December 2017

73,002

9,942,974

3,084,800

73,000

Prior year adjustment

-

243,678

-

-

As restated

73,002

10,186,652

3,084,800

73,000

Changes in equity

Deficit for the year

-

(1,249,491

)

-

-

Other comprehensive income

-

(225,877

)

140,774

-

Total comprehensive income

-

(1,475,368

)

140,774

-

Reserve transfer

-

211,371

(211,371

)

-

Balance at 31 December 2018

73,002

8,922,655

3,014,203

73,000

Other

Non-controlling

Total

reserves

Total

interests

equity

£

£

£

£

Balance at 1 January 2017

1,770,509

14,800,172

1,375,183

16,175,355

Changes in equity

Profit for the year

-

482,230

458,918

941,148

Other comprehensive income

(933,322

)

(1,271,439

)

(311,107

)

(1,582,546

)

Total comprehensive income

(933,322

)

(789,209

)

147,811

(641,398

)

Balance at 31 December 2017

837,187

14,010,963

1,522,994

15,533,957

Prior year adjustment

-

243,678

-

243,678

As restated

837,187

14,254,641

1,522,994

15,777,635

Changes in equity

Deficit for the year

-

(1,249,491

)

(345,039

)

(1,594,530

)

Other comprehensive income

486,525

401,422

86,882

488,304

Total comprehensive income

486,525

(848,069

)

(258,157

)

(1,106,226

)

Balance at 31 December 2018

1,323,712

13,406,572

1,264,837

14,671,409

Called up

Capital

share

Retained

Revaluation

redemption

Total

capital

earnings

reserve

reserve

equity

£

£

£

£

£

Balance at 1 January 2017

73,002

6,112,759

3,662,917

73,000

9,921,678

Changes in equity

Deficit for the year

-

(1,195,474

)

-

-

(1,195,474

)

Other comprehensive income

-

-

(338,117

)

-

(338,117

)

Total comprehensive income

-

(1,195,474

)

(338,117

)

-

(1,533,591

)

Reserve transfer

-

240,000

(240,000

)

-

-

Balance at 31 December 2017

73,002

5,157,285

3,084,800

73,000

8,388,087

Changes in equity

Deficit for the year

-

(214,375

)

-

-

(214,375

)

Other comprehensive income

-

-

140,774

-

140,774

Total comprehensive income

-

(214,375

)

140,774

-

(73,601

)

Reserve transfer

-

211,371

(211,371

)

-

-

Balance at 31 December 2018

73,002

5,154,281

3,014,203

73,000

8,314,486