HEATHROW_ENVIRONMENTAL_LI - Accounts

The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true

These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.

Heathrow Environmental Limited is a private company limited by shares incorporated in England and Wales. The registered office is 17 Pennine Parade, Pennine Drive, London, NW2 1NT.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, modified to include the revaluation of certain financial instruments at fair value. The principal accounting policies adopted are set out below.

In determining the appropriate basis of preparation of the financial statements, the directors are required to consider whether the company can continue in operational existence for the foreseeable future. In so doing, the directors have taken into account all available information for the future, which is at least, but not limited to, twelve months from the date of approval by the directors of the financial statements.true

The company has a history of trading profitably and has minimal debt, having paid off its finance leases during the year.

Whilst the Covid-19 pandemic has clearly had an impact on the results to date for the current 20/21 financial year, it has not, in the opinion of the directors, had a materially adverse effect on the fundamentals underlying the stability of the business. The directors believe that whilst the pandemic presents the company with a significant challenge, it is well placed due to the quality of its clients and the influence of overriding economic factors such as the Government's support for the construction sector. The effects that have been experienced to date regarding hiring delays by companies where sites have been closed down temporarily, are now easing, and trade is gradually improving.

The directors have also considered a number of factors and sensitivities including the potential impact of further Covid-19 lockdowns and Brexit and after reviewing the company’s forecasts and projections, have a reasonable expectation that the company has adequate resources to continue to trade as a going concern for the foreseeable future, and therefore they continue to adopt the going concern basis in preparing the company financial statements.

Turnover is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. Turnover is recognised at the fair value of the consideration received or receivable for the haulage and waste material disposal services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates. Income is recognised on the provision of the haulage and waste material disposal service.

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks.

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

The average monthly number of persons (including directors) employed by the company during the year was 2 (2019 - 2).

The company has outsourced its payroll and during the year all payroll costs were recharged from a related company.

Plant and machinery with a net carrying amount of £0 (2019: £142,611) have been pledged to secure finance lease borrowings of the company. The company is not allowed to pledge these assets as security for other borrowings or to sell them to another entity until the liability is settled. All liabilities were settled during the year.

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Included in other creditors falling due within one year, are obligations under finance leases amounting to £0 (2019: £37,093) which are secured - see Note 3.

The company has one class of ordinary shares which carry no right to fixed income.

As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:

The auditor's report was unqualified.

The company had provided guarantees in respect of unpaid hire purchase liabilities of several related companies as part of a cross-company guarantee in favour of the company's bankers. At 31 January 2020, the outstanding hire purchase liabilities in those related companies, which were not included in the company's balance sheet, amounted to £0 (2019: £698,929). All liabilities relating to this guarantee were settled during the year.

The operating leases represent rentals payable by the company for properties utilised in the business owned by the directors. The leases are typically negotiated over terms of a year but sometimes for a period less than a year.

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:

In these unprecedented and testing times brought about by Covid-19, the directors, office staff and site personnel have reacted well to the new environment by creating new methods of working at a safe distance enabling operations to continue. Covid-19 has brought added focus to the Health and Safety requirements of the business but the company believes it has put in place the processes and procedures that ensure the highest level of safety and wellbeing for all its staff, customers and suppliers ensuring that everyone who goes to work comes home safe and well.

Undoubtedly, the COVID 19 pandemic has not only impacted businesses operating in the construction sector, but also  businesses in general and its future impact still remains uncertain. However, the directors are of the opinion that they have the personnel, expertise and resources in place to react to prevailing market conditions given their strong client relationships, adaptable business model and continued capital investment.

It is the intention of the company to continue to focus on strengthening its financial performance in the industry by concentrating on servicing clients by providing a responsive and reliable service, ensuring that its asset register is continually reviewed and updated, where required, while at the same time monitoring both direct and indirect costs, in what will be a challenging year ahead. A trade deal with the EU has yet to be negotiated, but some of the uncertainty surrounding Brexit has been removed, and with interest rates low and Government confirming they will support the construction industry through the inevitable recession the directors are confident that the business will not be materially adversely affected.

On 9 March 2020, the company became a wholly-owned subsidiary of Heathrow Group Companies Limited. Heathrow Group Companies Limited is itself a wholly-owned subsidiary of Modebest and Heathrow Group Holdings Limited. The registered office address of both Heathrow Group Companies Limited and Modebest and Heathrow Group Holdings Limited, is 17 Pennine Parade, Pennine Drive, London NW2 1NT. The change of ownership of the company resulted in a Debenture in favour of the outgoing shareholders.

Up to 9 March 2020, the ultimate controlling parties were E Scanlon and A Dravins who owned equal shares in the issued share capital of the company.

Following the change of ownership in March 2020, there is no ultimate controlling party, as there is no majority shareholder in the Modebest and Heathrow Group Holdings Limited.