Sil-Mid Limited - Limited company accounts 18.2

REGISTERED NUMBER: 01460851 (England and Wales)

SIL-MID LIMITED

Strategic Report, Report of the Directors and

Audited Financial Statements

for the Year Ended 31 December 2018

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

to

4

Report of the Independent Auditors

5

to

7

Income Statement

8

Other Comprehensive Income

9

Balance Sheet

10

Statement of Changes in Equity

11

Cash Flow Statement

12

Notes to the Cash Flow Statement

13

Notes to the Financial Statements

14

to

21

DIRECTORS:

A D Nickson

Mrs J N Jarvis

SECRETARY:

Mrs J N Jarvis

REGISTERED OFFICE:

Unit 1 & 2 Roman Park

Roman Way

Coleshill

Birmingham

West Midlands

B46 1HG

REGISTERED NUMBER:

01460851 (England and Wales)

AUDITORS:

Eden Currie Limited

Chartered Accountants

and Statutory Auditor

2 Highlands Court

Cranmore Avenue

Solihull

West Midlands

B90 4LE

The directors present their strategic report for the year ended 31 December 2018.

REVIEW OF BUSINESS

The company operates as a distributor of sealants and lubricants in the United Kingdom and overseas

markets.

The company continued to trade well and achieved a profit after taxation for the financial year of £1,299,441

(2017 : £1,280,848).

PRINCIPAL RISKS AND UNCERTAINTIES

As for many businesses of our size, the business environment in which we operate continues to be

challenging. The company is exposed to risks within the markets it operates in and also the general business

environment. Factors such as increased competition or loss of customers or suppliers would all affect the

company's future performance and we continue to monitor these factors and take action to minimise the risks

wherever possible. With these risks and uncertainties in mind, we are aware that any plans for future

development of the business may be subject to unforeseen future events outside our control.

DEVELOPMENT AND PERFORMANCE

The directors are pleased with the results achieved during the year. They are happy to report an increase in

gross and net profit and will continue to develop all areas of the business.

KEY PERFORMANCE INDICATORS

The key performance indicators help the directors to measure performance against our strategic priorities and

business plan.

We consider our financial key performance indicators to be those ratios which communicate the financial

performance of the company as a whole:

2018

2017

Increase in operating profit

1.0%

20.2%

Increase in gross profit

12.0%

18.7%

The key performance indicators show the company's continuing positive performance.

ON BEHALF OF THE BOARD:

Mrs J N Jarvis - Secretary

31 October 2019

The directors present their report with the financial statements of the company for the year ended 31 December 2018.

DIVIDENDS

Total dividends paid during the year ended 31 December 2018 were £101,475.

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 D Nickson

Mrs J N Jarvis

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). 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

Save as set out below, so far as the directors are aware, there is no relevant audit information (as defined by

Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has

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

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

Both A Nickson and J Jarvis have provided the auditors written confirmation statements as defined by

Section 418 of the Companies Act 2006 for this company and its parent undertaking Cildarn Limited. M

Field, who is a director of Cildarn Limited only, is involved in an ongoing dispute with the other directors in

respect of his rights under a private shareholders agreement and has declined to provide his assurance under

Section 418 in relation to Cildarn Limited. His written explanation for declining, which refers to the Sil-Mid

Limited financial statements, has been fully investigated by the auditors who have confirmed that there is

nothing that would constitute relevant audit information that affects the presented financial statements. The

board of Sil-Mid Limited are fully satisfied that the financial statements can be filed.

AUDITORS

The auditors, Eden Currie Limited, will be proposed for re-appointment at the forthcoming Annual General

Meeting.

ON BEHALF OF THE BOARD:

Mrs J N Jarvis - Secretary

31 October 2019

Opinion

We have audited the financial statements of Sil-Mid Limited (the 'company') for the year ended

31 December 2018 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet,

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

Financial Statements, including a summary of significant accounting policies. The financial reporting

framework that has been applied in their preparation is applicable law and United Kingdom Accounting

Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the

UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 December 2018 and of its profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and

applicable law. Our responsibilities under those standards are further described in the Auditors'

responsibilities for the audit of the financial statements section of our report. We are independent of the

company in accordance with the ethical requirements that are relevant to our audit of the financial statements

in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in

accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and

appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

to report to you where:

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

-

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

Emphasis of matter

We draw attention to the Statement as to Disclosure of Information to Auditors included in the Report of the

Directors. Our opinion is not modified in respect of this matter.

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.

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 three, 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.

Caroline Webb FCA (Senior Statutory Auditor)

for and on behalf of Eden Currie Limited

Chartered Accountants

and Statutory Auditor

2 Highlands Court

Cranmore Avenue

Solihull

West Midlands

B90 4LE

31 October 2019

TURNOVER

3

17,798,617

15,662,739

Cost of sales

12,943,460

11,326,343

GROSS PROFIT

4,855,157

4,336,396

Distribution costs

19,667

17,526

Administrative expenses

3,237,612

2,733,174

3,257,279

2,750,700

OPERATING PROFIT

5

1,597,878

1,585,696

Interest receivable and similar income

7,636

1,918

1,605,514

1,587,614

Interest payable and similar expenses

6

36

237

PROFIT BEFORE TAXATION

1,605,478

1,587,377

Tax on profit

7

306,037

306,529

PROFIT FOR THE FINANCIAL YEAR

1,299,441

1,280,848

PROFIT FOR THE YEAR

1,299,441

1,280,848

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,299,441

1,280,848

FIXED ASSETS

Tangible assets

9

379,649

396,863

CURRENT ASSETS

Stocks

10

1,850,078

1,652,265

Debtors

11

3,954,571

3,600,078

Cash at bank

2,328,988

1,390,093

8,133,637

6,642,436

CREDITORS

Amounts falling due within one year

12

2,718,206

2,440,461

NET CURRENT ASSETS

5,415,431

4,201,975

TOTAL ASSETS LESS CURRENT LIABILITIES

5,795,080

4,598,838

PROVISIONS FOR LIABILITIES

15

64,737

66,461

NET ASSETS

5,730,343

4,532,377

CAPITAL AND RESERVES

Share capital

16

5,000

5,000

Other reserves

17

5,000

5,000

Retained earnings

17

5,720,343

4,522,377

SHAREHOLDERS' FUNDS

5,730,343

4,532,377

The financial statements were approved by the Board of Directors on 31 October 2019 and were signed on its behalf by:

A D Nickson - Director

Share

Retained

Other

Total

capital

earnings

reserves

equity

£

£

£

£

Balance at 1 January 2017

5,000

3,483,646

5,000

3,493,646

Changes in equity

Dividends

-

(242,117

)

-

(242,117

)

Total comprehensive income

-

1,280,848

-

1,280,848

Balance at 31 December 2017

5,000

4,522,377

5,000

4,532,377

Changes in equity

Dividends

-

(101,475

)

-

(101,475

)

Total comprehensive income

-

1,299,441

-

1,299,441

Balance at 31 December 2018

5,000

5,720,343

5,000

5,730,343

Cash flows from operating activities

Cash generated from operations

1

1,406,980

1,834,793

Interest paid

(36

)

(237

)

Tax paid

(297,980

)

(241,291

)

Net cash from operating activities

1,108,964

1,593,265

Cash flows from investing activities

Purchase of tangible fixed assets

(75,401

)

(113,794

)

Interest received

7,636

1,918

Net cash from investing activities

(67,765

)

(111,876

)

Cash flows from financing activities

Capital repayments on HP financing

(829

)

(1,575

)

Equity dividends paid

(101,475

)

(242,117

)

Net cash from financing activities

(102,304

)

(243,692

)

Increase in cash and cash equivalents

938,895

1,237,697

Cash and cash equivalents at beginning of year

2

1,390,093

152,396

Cash and cash equivalents at end of year

2

2,328,988

1,390,093

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

2018

2017

£

£

Profit before taxation

1,605,478

1,587,377

Depreciation charges

92,533

78,682

Loss on disposal of fixed assets

81

-

Finance costs

36

237

Finance income

(7,636

)

(1,918

)

1,690,492

1,664,378

Increase in stocks

(197,813

)

(516,835

)

(Increase)/decrease in trade and other debtors

(354,493

)

177,581

Increase in trade and other creditors

268,794

509,669

Cash generated from operations

1,406,980

1,834,793

2.	CASH AND CASH EQUIVALENTS

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

respect of these Balance Sheet amounts:

Year ended 31 December 2018

31/12/18

1/1/18

£

£

Cash and cash equivalents

2,328,988

1,390,093

Year ended 31 December 2017

31/12/17

1/1/17

£

£

Cash and cash equivalents

1,390,093

152,396

1.	STATUTORY INFORMATION

Sil-Mid 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 Company Information

page.

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.

Turnover

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

discounts, rebates, value added tax and other sales taxes.

Tangible fixed assets

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

Leasehold property alterations

-

straight line over the life of the lease

Plant and machinery

-

20% on reducing balance

Fixtures and fittings

-

33% on cost, 20% on cost and 15% on reducing balance

Stocks

Stock is valued at the lower of cost and net realisable value, after due regard for obsolete and slow

moving stocks. Net realisable value is based on selling price less anticipated costs to completion and

selling costs.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement,

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 balance sheet date.

Deferred tax

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

the balance sheet 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

Profit and loss account transactions in foreign currencies are translated into sterling at the exchange

rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign

currencies are translated into sterling at the closing rates at the balance sheet date and the exchange

differences are included in the profit and loss account.

Hire purchase and finance lease contracts

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

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

under finance leases are depreciated over their estimated useful lives or the lease term, whichever is

the shorter.

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

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

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

of the lease.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the

company's pension scheme are charged to profit or loss in the period to which they relate.

Operating leases

Rentals payable under operating leases are charged in the profit and loss account on a straight line

basis over the lease term.

3.

TURNOVER

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

An analysis of turnover by geographical market is given below:

2018

2017

£

£

United Kingdom

12,213,275

10,861,118

Foreign markets

5,585,342

4,801,621

17,798,617

15,662,739

4.	EMPLOYEES AND DIRECTORS

2018

2017

£

£

Wages and salaries

1,757,106

1,409,014

Social security costs

169,268

136,440

Other pension costs

59,359

48,360

1,985,733

1,593,814

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

2018

2017

Office and administrative

44

35

Warehouse operatives

14

14

58

49

2018

2017

£

£

Directors' remuneration

204,958

70,458

Directors' pension contributions to money purchase schemes

14,490

12,400

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

Money purchase schemes

2

2

Information regarding the highest paid director for the year ended 31 December 2018 is as follows:

2018

£

Emoluments etc

109,045

Pension contributions to money purchase schemes

7,245

5.	OPERATING PROFIT

The operating profit is stated after charging:

2018

2017

£

£

Hire of plant and machinery

3,410

2,860

Depreciation - owned assets

92,028

78,051

Depreciation - assets on hire purchase contracts

505

631

Loss on disposal of fixed assets

81

-

Auditors' remuneration

16,780

15,920

Auditors' remuneration for non audit work

500

500

Foreign currency losses

9,396

5,525

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

2018

2017

£

£

HP interest

36

237

7.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2018

2017

£

£

Current tax:

UK corporation tax

307,761

297,980

Deferred tax

(1,724

)

8,549

Tax on profit

306,037

306,529

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

£

£

Profit before tax

1,605,478

1,587,377

Profit multiplied by the standard rate of corporation tax in the UK of 19% (2017 - 19.247%)

305,041

305,522

Effects of:

Expenses not deductible for tax purposes

996

1,119

Changes of tax rate on deferred tax opening provision

-

(112

)

Total tax charge

306,037

306,529

8.

DIVIDENDS

2018

2017

£

£

Interim

101,475

242,117