PBShop.Co.UK Limited - Limited company accounts 20.1

REGISTERED NUMBER: 09366362 (England and Wales)

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

AUDITED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 JULY 2019

FOR

PBSHOP.CO.UK LIMITED

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

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

DIRECTORS:

A Gillett

P J Woolley

REGISTERED OFFICE:

Swatton Barn

Badbury

Swindon

Wiltshire

SN4 0EU

REGISTERED NUMBER:

09366362 (England and Wales)

SENIOR STATUTORY AUDITOR:

Benjamin Herbert

AUDITORS:

d&t

Chartered Accountants & Statutory Auditors

Swatton Barn

Badbury

Swindon

Wiltshire

SN4 0EU

The directors present their strategic report for the year ended 31 July 2019.

REVIEW OF BUSINESS

The company's principal activity is the sourcing of books from the UK internationally and their sale on online

platforms in various markets including the UK, Europe, USA, Canada, Japan and India. The software for

handling the purchase and sale of large volumes of books is developed in house to provide flexibility and a

strategic advantage in a very competitive market.

The company continued to invest in its infrastructure, personnel and technology during the year.

The net current assets of the company have moved into a positive position at year end.

The Covid-19 virus had a significant impact on working practices in March 2020. The demand for books was

at unprecedented levels. The company continued to operate after taking appropriate measures to protect its

employees.

The directors do not believe the exit of the European Union will have a significant impact on the company.

The results for the period and financial position of the company are as shown in the annexed accounts. The

key financial highlights are as follows:

2019

2018

2017

£'000

£'000

£'000

Turnover

36,420

28,093

32,118

Gross profit

1,386

380

552

Profit before tax

717

12

121

Shareholders funds

507

322

520

The company has had a major turnaround in performance, reporting a profit before taxation of £717,343.

This was driven by the expansion of sales in the USA, facilitated by improved distribution processes.

Overheads continue to be kept to a minimum, and through fair and thoughtful management of its human

resources, the company continues to retain and enhance its team of dedicated and skilled workers.

The work to nurture and develop strong relationships with new and existing suppliers, including timely

payments, has been maintained to good effect throughout the year and is key to the competitiveness and

success of the company.

PRINCIPAL RISKS AND UNCERTAINTIES

The principle risks in our business are competition from other online booksellers, failure to meet various

performance criteria required by online selling platforms and erosion of gross profit. Internal controls for

monitoring our exposure to all of these risks have been maintained and, through the last two quarters,

significantly improved.

Significant fluctuations in foreign exchange are a further risk to the business. Frequent monitoring of

exchange rates ensure exposure is kept to a minimum.

GOING CONCERN

The directors have prepared forecasts to July 2021 for the company and its parent, which show continuing

profitability and cashflows from retained profits.

The directors have considered the balance sheet position together with the expected performance in the

period to July 2021. In considering this the directors have taken into account all factors currently known to

them in relation to the company's activities. The directors are satisfied that those forecasts, which take into

account trading performance, provide a reasonable expectation that the company has adequate resources to

continue in operational existence for the foreseeable future. For this reason, the company continues to adopt

the going concern basis.

ON BEHALF OF THE BOARD:

P J Woolley - Director

23 July 2020

The directors present their report with the financial statements of the company for the year ended 31 July 2019.

DIVIDENDS

An interim dividend of £450 per share was paid on 31 July 2019. The directors recommend that no final dividend be paid.

The total distribution of dividends for the year ended 31 July 2019 will be £ 450,000 .

DIRECTORS

A Gillett has held office during the whole of the period from 1 August 2018 to the date of this report.

Other changes in directors holding office are as follows:

P J Woolley was appointed as a director after 31 July 2019 but prior to the date of this report.

D J Cherrington ceased to be a director after 31 July 2019 but prior to the date of this report.

FINANCIAL INSTRUMENTS

The company's principal financial instruments comprise bank balances, trade debtors and trade creditors.

The main purpose of these instruments is to raise funds for the company's operations and to finance the

company's activities.

Due to the nature of the financial instruments used by the company, there is a low exposure to price risk.

The company's approach to managing other risks applicable to the financial instruments concerned is shown

below.

Trade debtors are managed in respect of credit and cash flow risk by policies concerning the credit offered to

customers and the regular monitoring of amounts outstanding for both time and credit limits. The director

considers that the principal trade debtors of the company to be low risk.

Foreign exchange risk is managed by having multi currency bank accounts. The company then transfers

funds to their sterling bank accounts when they consider the exchange rates are favourable.

Trade creditor liquidity risk is managed by ensuring that sufficient funds are available to meet liabilities as

they fall due.

DIRECTORS' QUALIFYING THIRD PARTY INDEMNITY PROVISION

The company has granted an indemnity to its directors against liability in respect of proceedings brought by

third parties, subject to the conditions set out in the Companies Act 2006. Such a qualifying third party

indemnity provision remains in force as at the date of approving the director's report.

DISCLOSURE IN THE STRATEGIC REPORT

The business review disclosure has been included in the strategic report.

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

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.

AUDITORS

The auditors, d&t, are deemed to be reappointed under section 487(2) of the Companies Act 2006.

ON BEHALF OF THE BOARD:

P J Woolley - Director

23 July 2020

Opinion

We have audited the financial statements of PBShop.Co.UK Limited (the 'company') for the year ended

31 July 2019 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 July 2019 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.

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 five, 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.

Benjamin Herbert (Senior Statutory Auditor)

for and on behalf of d&t

Chartered Accountants & Statutory Auditors

Swatton Barn

Badbury

Swindon

Wiltshire

SN4 0EU

23 July 2020

TURNOVER

3

36,420,258

28,093,290

Cost of sales

35,034,010

27,712,952

GROSS PROFIT

1,386,248

380,338

Administrative expenses

668,946

458,159

717,302

(77,821

)

Other operating income

-

89,574

OPERATING PROFIT

5

717,302

11,753

Interest receivable and similar income

41

5

717,343

11,758

Interest payable and similar expenses

6

-

4

PROFIT BEFORE TAXATION

717,343

11,754

Tax on profit

7

82,468

-

PROFIT FOR THE FINANCIAL YEAR

634,875

11,754

PROFIT FOR THE YEAR

634,875

11,754

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

634,875

11,754

FIXED ASSETS

Intangible assets

9

152,063

161,296

Tangible assets

10

142,043

161,875

294,106

323,171

CURRENT ASSETS

Stocks

11

198,850

263,905

Debtors

12

1,969,803

1,280,904

Cash at bank and in hand

373,677

485,824

2,542,330

2,030,633

CREDITORS

Amounts falling due within one year

13

2,328,047

2,031,738

NET CURRENT ASSETS/(LIABILITIES)

214,283

(1,105

)

TOTAL ASSETS LESS CURRENT LIABILITIES

508,389

322,066

PROVISIONS FOR LIABILITIES

16

1,448

-

NET ASSETS

506,941

322,066

CAPITAL AND RESERVES

Called up share capital

17

1,000

1,000

Retained earnings

18

505,941

321,066

SHAREHOLDERS' FUNDS

506,941

322,066

The financial statements were approved by the Board of Directors and authorised for issue on 23 July 2020 and were signed on its behalf by:

P J Woolley - Director

A Gillett - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 August 2017

1,000

519,312

520,312

Changes in equity

Dividends

-

(210,000

)

(210,000

)

Total comprehensive income

-

11,754

11,754

Balance at 31 July 2018

1,000

321,066

322,066

Changes in equity

Dividends

-

(450,000

)

(450,000

)

Total comprehensive income

-

634,875

634,875

Balance at 31 July 2019

1,000

505,941

506,941

Cash flows from operating activities

Cash generated from operations

1

407,491

346,848

Interest paid

-

(4

)

Tax paid

4,287

330

Net cash from operating activities

411,778

347,174

Cash flows from investing activities

Purchase of intangible fixed assets

(35,546

)

(66,429

)

Purchase of tangible fixed assets

(40,503

)

(12,996

)

Sale of tangible fixed assets

2,083

400

Interest received

41

5

Net cash from investing activities

(73,925

)

(79,020

)

Cash flows from financing activities

Equity dividends paid

(450,000

)

(210,000

)

Net cash from financing activities

(450,000

)

(210,000

)

(Decrease)/increase in cash and cash equivalents

(112,147

)

58,154

Cash and cash equivalents at beginning of year

2

485,824

427,670

Cash and cash equivalents at end of year

2

373,677

485,824

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

2019

2018

£

£

Profit before taxation

717,343

11,754

Depreciation charges

105,115

79,891

(Profit)/loss on disposal of fixed assets

(2,083

)

924

Finance costs

-

4

Finance income

(41

)

(5

)

820,334

92,568

Decrease/(increase) in stocks

65,055

(82,765

)

(Increase)/decrease in trade and other debtors

(693,193

)

660,331

Increase/(decrease) in trade and other creditors

215,295

(323,286

)

Cash generated from operations

407,491

346,848

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 July 2019

31.7.19

1.8.18

£

£

Cash and cash equivalents

373,677

485,824

Year ended 31 July 2018

31.7.18

1.8.17

£

£

Cash and cash equivalents

485,824

427,670

1.	STATUTORY INFORMATION

PBShop.Co.UK 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. The trading address of the company is Unit 22, Horcott Industrial Estate, Fairford,

Gloucestershire, GL7 4BX.

The presentation of the financial statements is the Pound Sterling (£).

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.

RELATED PARTY EXEMPTION

The company has taken advantage of exemption, under the terms of Financial Reporting Standard

102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose

related party transactions with wholly owned subsidiaries within the group.

TURNOVER

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

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

Turnover is recognised when the company has received and despatched the relevant product to fulfil

a customers order, as all products sold by the company are ordered from third party suppliers to

specifically fulfil customers orders.

INTANGIBLE ASSETS

Intangible assets are initially measured at cost. After initial recognition, intangible assets are

measured at cost less any accumulated amortisation and any accumulated impairment losses.

Research and development are being amortised evenly over their estimated useful life of five years.

TANGIBLE FIXED ASSETS

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Improvements to property

-

10% straight line basis

Plant and machinery

-

15% on reducing balance

Fixtures and fittings

-

33% straight line basis

Motor vehicles

-

33% straight line basis

Computer equipment

-

33% straight line basis

STOCKS

Stocks are valued at the lower of cost and net realisable value, after making due allowance for

obsolete and slow moving items.

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

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at

the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of

exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at

the operating result.

HIRE PURCHASE AND LEASING COMMITMENTS

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.

3.

TURNOVER

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

4.	EMPLOYEES AND DIRECTORS

2019

2018

£

£

Wages and salaries

1,197,808

1,053,179

Social security costs

105,195

90,867

Other pension costs

19,407

18,011

1,322,410

1,162,057

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

2019

2018

Postage and packing

40

35

Customer services

6

5

IT

3

3

Admin

6

6

55

49

2019

2018

£

£

Directors' remuneration

212,500

144,033

Information regarding the highest paid director for the year ended 31 July 2019 is as follows:

2019

£

Emoluments etc

125,000

5.	OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2019

2018

£

£

Hire of plant and machinery

22,509

25,399

Depreciation - owned assets

60,335

46,953

(Profit)/loss on disposal of fixed assets

(2,083

)

924

Research and development amortisation

44,779

32,940

Auditors' remuneration

10,350

8,950

Auditors' remuneration for non audit work

3,090

1,715

Foreign exchange (gain)/loss

(19,627

)

(10,588

)

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

2019

2018

£

£

Other interest

-

4

7.

TAXATION

Analysis of the tax charge

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

2019

2018

£

£

Current tax:

UK corporation tax

81,020

-

Deferred tax

1,448

-

Tax on profit

82,468

-