Tratos (UK) Limited - Limited company accounts 20.1

GROUP STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2019

FOR

TRATOS (UK) LIMITED

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

5

Report of the Independent Auditor

7

Consolidated Income Statement

9

Consolidated Other Comprehensive Income

10

Consolidated Balance Sheet

11

Company Balance Sheet

12

Consolidated Statement of Changes in Equity

13

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:

Dr Albano Bragagni

Dr Maurizio Bragagni

Mr Germano Bragagni

Dr Ennio Bragagni Capaccini

Dr Elisabetta Bragagni Capaccini

Dr Enrico Scambia

Mr Kevin Martin

SECRETARY:

Mr Kevin Martin

REGISTERED OFFICE:

Randles Road

Knowsley Business Park

Knowsley

L34 9HX

REGISTERED NUMBER:

01524815 (England and Wales)

SENIOR STATUTORY AUDITOR:

Mr James Timothy Card FCCA

AUDITOR:

Hewitt Card Limited

Statutory Auditor

70-72 Nottingham Road

Mansfield

Nottinghamshire

NG18 1BN

The directors present their strategic report of the company and the group for the year ended 31 December 2019.

Our objectives are to provide a reliable, competitive and high quality supply of cable, and after sales care to the public and

corporate customers. This is backed up by specialist knowledge built up through the combined experience of our staff.

Through this we aim to achieve an acceptable return for the shareholders and provide for longer term planning to secure the

future of the Group.

REVIEW OF BUSINESS

Uncertainty is what we have been left with after the multiple events that have affected our world this year. There is no

certainty of what will happen in the future and no certainty of what impact these events will have on the economic, social and

political aspects of our lives; we have been left with lots of questions and very few answers.

There is the uncertainty of what Brexit might bring, there is the risk of a trade conflict between China and the United States,

there is the unpredictability of COVID-19 which has suddenly spread around the world and has massively affected our lives,

our ways of doing business and our economy.

In these challenging times, I believe that the only certainty that we can count on is the fact that we are going towards an

uncertain future. Using a metaphor, the sky is full of clouds and we cannot predict the dimension of the storm that those

clouds will produce.

Seeing the unpredictability we are now facing, especially from a business point of view, it is neither coherent or responsible

to make a plan and to try to predict what will happen in the future. At the moment what we are asked to do is to face reality

bearing in mind the values and mission we stand for. The only solution that we have is to act accordingly to our values

independently from the circumstances we will have to deal with.

Therefore, I believe, it is fundamental to reiterate those values and their importance to deal with this "storm" that we will soon

be involved in.

The values and principles Tratos has been standing for are the seventeen sustainable development goals of the United

Nations. These goals have been embedded in Tratos' culture and mission since 1966. These are goals that the company has

always attempted to achieve when conducting business. These are the values that it is important to keep in mind and that

must guide us independently from the adversities that we will face.

The seventeen goals of the United Nations are:

" GOAL 1: No Poverty

" GOAL 2: Zero Hunger

" GOAL 3: Good Health and Well-being

" GOAL 4: Quality Education

" GOAL 5: Gender Equality

" GOAL 6: Clean Water and Sanitation

" GOAL 7: Affordable and Clean Energy

" GOAL 8: Decent Work and Economic Growth

" GOAL 9: Industry, Innovation and Infrastructure

" GOAL 10: Reduced Inequality

" GOAL 11: Sustainable Cities and Communities

" GOAL 12: Responsible Consumption and Production

" GOAL 13: Climate Action

" GOAL 14: Life Below Water

" GOAL 15: Life on Land

" GOAL 16: Peace and Justice Strong Institutions

" GOAL 17: Partnerships to achieve the Goal

We are one of the few companies that has been committed to achieve all these goals since. At Tratos we have always strived

to create jobs in poor areas, to promote growth in local communities, to guarantee equal opportunities and many other

activities which are aimed at having a positive impact in our world. These goals inspired our credo and our culture and must

constitute the basement for our past present and future actions.

Tratos has always had a clear vision: we produce cables for a moving world, we produce innovative cable solutions to keep

people connected. Innovation is the foundation of our work, we innovate to give a valuable contribution to the world. Our

efforts to innovate granted us the opportunity to receive the Queen's Award for Enterprise and, proud of the recognition

received by Her Majesty the Queen, we must go forward and we must attempt to bring new innovative solutions also in the

future.

2019 was a challenging year, a year where the first effects of an upcoming crisis started to appear. Now we are aware of that

crisis and with such awareness we have to follow a path which will support our actions and decisions in this moment of

ambiguity and uncertainty.

We will stand for our values and we will make sure that those values will be embraced by our shareholders. It is fundamental

to understand the paramount importance of having ideals which guides our decisions. Therefore, as it has happened in the

past, Tratos will continue to operate basing its actions on those seventeen goals that are at its roots.

In these challenging times, where uncertainty reigns, it is not possible to delineate a more detailed report. The only thing that

we can do is to be consistent and loyal to what we have built until now.

We will go through difficult times but if we have faith in what we stand for we will be able to overcome even the biggest

obstacles.

The key performance indicators by which financial performance is measured are as follows:-

2019

2018

Turnover

£19.5m

£23.7m

Gross profit percentage

20.58%

20.94%

Net (loss)/profit

(£586k

)

£47k

Shareholders funds

£4.6m

£5.1m

PRINCIPAL RISKS AND UNCERTAINTIES

The principal risks that we face are those arising from competition in the marketplace particularly in the form of price and

supply.

In addition effective working capital management is required to ensure that products are available at the right time.

The provision of specialist knowledge is also key to adding value and achieving our aim of a quality service and so retention

of experienced and knowledgeable staff is a risk we face.

ON BEHALF OF THE BOARD:

Mr Kevin Martin - Secretary

1 June 2020

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

31 December 2019.

PRINCIPAL ACTIVITIES

The principal activities of the group in the year under review were those of the manufacture and distribution of electrical

cables.

DIVIDENDS

No dividends will be distributed for the year ended 31 December 2019.

DIRECTORS

The directors during the year under review were:

Dr Albano Bragagni

Dr Maurizio Bragagni

Mr Germano Bragagni

Dr Ennio Bragagni Capaccini

Dr Elisabetta Bragagni Capaccini

Dr Enrico Scambia

Mr Kevin Martin

The beneficial interests of the directors holding office on 31 December 2019 in the issued share capital of the company were

as follows:

31.12.19

1.1.19

Ordinary A £1 shares

Dr Albano Bragagni

22,060

22,060

Dr Maurizio Bragagni

375,020

375,020

Mr Germano Bragagni

-

-

Dr Ennio Bragagni Capaccini

176,480

176,480

Dr Elisabetta Bragagni Capaccini

176,480

176,480

Dr Enrico Scambia

-

-

Mr Kevin Martin

-

-

Ordinary B £1 shares

Dr Albano Bragagni

-

-

Dr Maurizio Bragagni

-

-

Mr Germano Bragagni

-

-

Dr Ennio Bragagni Capaccini

-

-

Dr Elisabetta Bragagni Capaccini

-

-

Dr Enrico Scambia

-

-

Mr Kevin Martin

-

-

Ordinary C £1 shares

Dr Albano Bragagni

-

-

Dr Maurizio Bragagni

-

-

Mr Germano Bragagni

-

-

Dr Ennio Bragagni Capaccini

-

-

Dr Elisabetta Bragagni Capaccini

-

-

Dr Enrico Scambia

-

-

Mr Kevin Martin

-

-

FINANCIAL INSTRUMENTS

The Company's main risks are the maintenance of sufficient product stock to ensure a continuous supply to market together

with the maintenance of a competitive price base.

This is achieved through regular review of inventory levels together with review of sales trends and market analysis.

In addition liquid funds are reviewed and managed on a daily basis by the directors to ensure funds are available to meet the

on going and anticipated future commitments of the company.

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 auditor is 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 group's auditor is

aware of that information.

AUDITOR

The auditor, Hewitt Card Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Mr Kevin Martin - Secretary

1 June 2020

Opinion

I have audited the financial statements of Tratos (UK) Limited (the 'parent company') and its subsidiaries (the 'group') for the

year ended 31 December 2019 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 my 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 2019 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

I conducted my audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. My

responsibilities under those standards are further described in the Auditor responsibilities for the audit of the financial

statements section of my report. I am independent of the group in accordance with the ethical requirements that are relevant

to my audit of the financial statements in the UK, including the FRC's Ethical Standard, and I have fulfilled my other ethical

responsibilities in accordance with these requirements. I believe that the audit evidence I have obtained is sufficient and

appropriate to provide a basis for my opinion.

Conclusions relating to going concern

I have nothing to report in respect of the following matters in relation to which the ISAs (UK) require me 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 my Report of the Auditor

thereon.

My opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly

stated in my report, I do not express any form of assurance conclusion thereon.

In connection with my audit of the financial statements, my responsibility is to read the other information and, in doing so,

consider whether the other information is materially inconsistent with the financial statements or my knowledge obtained in

the audit or otherwise appears to be materially misstated. If I identify such material inconsistencies or apparent material

misstatements, I am 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 I have performed, I conclude that there is a material misstatement

of this other information, I am required to report that fact. I have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In my 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 I am 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, I have not identified material misstatements in the Group Strategic Report or the Report of the Directors.

I have nothing to report in respect of the following matters where the Companies Act 2006 requires me to report to you if, in

my opinion:

-	adequate accounting records have not been kept by the parent company, or returns adequate for my audit have not been received from branches not visited by me; 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

-	I have not received all the information and explanations I require for my 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 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.

Auditor's responsibilities for the audit of the financial statements

My 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 Auditor that includes my 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 my 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 my Report of the Auditor.

Use of my 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. My audit work has been undertaken so that I might state to the company's members those matters I am required to

state to them in a Report of the Auditor and for no other purpose. To the fullest extent permitted by law, I do not accept or

assume responsibility to anyone other than the company and the company's members as a body, for my audit work, for this

report, or for the opinions I have formed.

Mr James Timothy Card FCCA (Senior Statutory Auditor)

for and on behalf of Hewitt Card Limited

Statutory Auditor

70-72 Nottingham Road

Mansfield

Nottinghamshire

NG18 1BN

1 June 2020

TURNOVER

19,516,201

23,698,560

Cost of sales

15,500,083

18,733,931

GROSS PROFIT

4,016,118

4,964,629

Administrative expenses

4,692,089

4,478,798

(675,971

)

485,831

Other operating income

258,127

(143,912

)

OPERATING (LOSS)/PROFIT

4

(417,844

)

341,919

Interest payable and similar expenses

5

206,606

278,252

(LOSS)/PROFIT BEFORE TAXATION

(624,450

)

63,667

Tax on (loss)/profit

6

(37,835

)

16,386

(LOSS)/PROFIT FOR THE FINANCIAL YEAR

(586,615

)

47,281

(Loss)/profit attributable to:

Owners of the parent

(586,615

)

47,281

(LOSS)/PROFIT FOR THE YEAR

(586,615

)

47,281

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(586,615

)

47,281

Total comprehensive income attributable to:

Owners of the parent

(586,615

)

47,281

FIXED ASSETS

Intangible assets

9

308,862

241,109

Tangible assets

10

17,784,936

17,910,238

Investments

11

-

-

18,093,798

18,151,347

CURRENT ASSETS

Stocks

12

8,385,130

6,849,854

Debtors

13

2,351,163

4,490,993

Cash at bank and in hand

1,468,708

286,718

12,205,001

11,627,565

CREDITORS

Amounts falling due within one year

14

12,824,426

11,418,740

NET CURRENT (LIABILITIES)/ASSETS

(619,425

)

208,825

TOTAL ASSETS LESS CURRENT LIABILITIES

17,474,373

18,360,172

CREDITORS

Amounts falling due after more than one year

15

(12,382,215

)

(12,638,279

)

PROVISIONS FOR LIABILITIES

19

(484,554

)

(527,674

)

NET ASSETS

4,607,604

5,194,219

CAPITAL AND RESERVES

Called up share capital

20

4,000,080

4,000,080

Capital redemption reserve

21

32

32

Retained earnings

21

607,492

1,194,107

SHAREHOLDERS' FUNDS

4,607,604

5,194,219

The financial statements were approved by the Board of Directors and authorised for issue on 1 June 2020 and were signed

on its behalf by:

Dr Maurizio Bragagni - Director

FIXED ASSETS

Intangible assets

9

308,862

241,109

Tangible assets

10

17,779,140

17,873,829

Investments

11

100

100

18,088,102

18,115,038

CURRENT ASSETS

Stocks

12

8,385,130

6,849,854

Debtors

13

2,478,869

4,607,774

Cash at bank and in hand

1,321,514

201,932

12,185,513

11,659,560

CREDITORS

Amounts falling due within one year

14

12,800,706

11,419,394

NET CURRENT (LIABILITIES)/ASSETS

(615,193

)

240,166

TOTAL ASSETS LESS CURRENT LIABILITIES

17,472,909

18,355,204

CREDITORS

Amounts falling due after more than one year

15

(12,382,215

)

(12,638,279

)

PROVISIONS FOR LIABILITIES

19

(484,554

)

(526,314

)

NET ASSETS

4,606,140

5,190,611

CAPITAL AND RESERVES

Called up share capital

20

4,000,080

4,000,080

Capital redemption reserve

21

32

32

Retained earnings

21

606,028

1,190,499

SHAREHOLDERS' FUNDS

4,606,140

5,190,611

Company's (loss)/profit for the financial year

(584,471

)

45,510

The financial statements were approved by the Board of Directors and authorised for issue on 1 June 2020 and were signed on its behalf by:

Dr Maurizio Bragagni - Director

Called up

Capital

share

Retained

redemption

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 January 2018

4,000,080

1,146,826

32

5,146,938

Changes in equity

Total comprehensive income

-

47,281

-

47,281

Balance at 31 December 2018

4,000,080

1,194,107

32

5,194,219

Changes in equity

Total comprehensive income

-

(586,615

)

-

(586,615

)

Balance at 31 December 2019

4,000,080

607,492

32

4,607,604

Called up

Capital

share

Retained

redemption

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 January 2018

4,000,080

1,144,989

32

5,145,101

Changes in equity

Total comprehensive income

-

45,510

-

45,510

Balance at 31 December 2018

4,000,080

1,190,499

32

5,190,611

Changes in equity

Total comprehensive income

-

(584,471

)

-

(584,471

)

Balance at 31 December 2019

4,000,080

606,028

32

4,606,140

Cash flows from operating activities

Cash generated from operations

1

383,139

3,318,024

Interest paid

(206,606

)

(278,678

)

Interest element of hire purchase or finance lease rental payments paid

-

426

Tax paid

(5,283

)

(10,901

)

Net cash from operating activities

171,250

3,028,871

Cash flows from investing activities

Purchase of intangible fixed assets

(186,663

)

(111,096

)

Purchase of tangible fixed assets

(488,595

)

(936,909

)

Sale of tangible fixed assets

20,991

-

Net cash from investing activities

(654,267

)

(1,048,005

)

Cash flows from financing activities

Loan repayments in year

(441,328

)

(427,918

)

Net cash from financing activities

(441,328

)

(427,918

)

(Decrease)/increase in cash and cash equivalents

(924,345

)

1,552,948

Cash and cash equivalents at beginning of year

2

(252,721

)

(1,805,669

)

Cash and cash equivalents at end of year

2

(1,177,066

)

(252,721

)