Delta-Simons Environmental Consultants L - Limited company accounts 20.1

REGISTERED NUMBER: 04786034 (England and Wales)

DELTA-SIMONS ENVIRONMENTAL CONSULTANTS

LIMITED

STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2020

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

5

Income Statement

7

Other Comprehensive Income

8

Statement of Financial Position

9

Statement of Changes in Equity

10

Statement of Cash Flows

11

Notes to the Statement of Cash Flows

12

Notes to the Financial Statements

14

DIRECTORS:

A J Ferguson

Dr R Griffiths

R C Higham

SECRETARY:

S Brown

REGISTERED OFFICE:

3 Henley Office Park

Doddington Road

Lincoln

LN6 3QR

REGISTERED NUMBER:

04786034 (England and Wales)

SENIOR STATUTORY AUDITOR:

Damon Brain BFP FCA FMAAT

AUDITORS:

Duncan & Toplis Limited, Statutory Auditor

4 Henley Way

Doddington Road

Lincoln

Lincolnshire

LN6 3QR

The directors present their strategic report for the year ended 30 June 2020.

REVIEW OF BUSINESS

The directors aim to present a balanced and comprehensive review of the business development, performance and position for the year ended 30 June 2020. The review is consistent with the size and complexity of the company and is written in the context of the risks and uncertainties faced.

The company has continued its strong recent growth, increasing revenue by 24.6% and both consolidating and further expanding existing markets in the UK, Europe and United States. Increased recruitment and connections with reliable overseas partners will allow for further increased activity levels in the coming years.

The Statement of Financial Position as at 30 June 2020 shows net assets have increased by £212k (2019: £45k). Gross margin has been marginally reduced due to more overseas work and higher labour costs however the results still show a healthy profit growth.

KEY PERFORMANCE INDICATORS

The directors use a range of performance measures to monitor and manage the business. A selection of key performance indicators are set out below:

2020

2019

Revenue growth

24.6%

31.5%

Gross margin

24.0%

24.7%

Net margin

2.3%

0.1%

Liquidity - current ratio

1.2

1.2

Debtor days

62

66

The above KPIs are calculated and reviewed on a regular basis by the directors and used to monitor and manage the company's performance.

FUTURE DEVELOPMENTS

The company remains consistently profitable and there are no planned changes to the principal activities of the company in the next financial year. The directors have ambitious growth plans for markets in the UK and abroad.

PRINCIPAL RISKS AND UNCERTAINTIES

The directors continually monitor the key risks facing the company together with assessing the controls used for managing these risks. A formal review and documentation of the principle risks facing the company is prepared and discussed with management at least annually.

With respect to the current COVID-19 pandemic, the directors have performed a full risk assessment within the business to ascertain the impact and have taken the appropriate measures and steps to comply with government guidelines and to ensure business continuity where possible.

Other principle risks and uncertainties facing the company are derived from the general economic uncertainty together with the ongoing competitor pressure. Foreign currency risk exposure is minimised as the company holds sufficient trading reserves and invoicing facilities in foreign currency denominated accounts.

ON BEHALF OF THE BOARD:

A J Ferguson - Director

15 November 2020

The directors present their report with the financial statements of the company for the year ended 30 June 2020.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of environmental consultancy services.

DIVIDENDS

No dividends will be distributed for the year ended 30 June 2020.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 July 2019 to the date of this report.

A J Ferguson

Dr R Griffiths

R C Higham

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 ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

ON BEHALF OF THE BOARD:

A J Ferguson - Director

15 November 2020

Opinion

We have audited the financial statements of Delta-Simons Environmental Consultants Limited (the 'company') for the year ended 30 June 2020 which comprise the Income Statement, Other Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity, Statement of Cash Flows and Notes to the Statement of Cash Flows, 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 30 June 2020 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 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 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.

Damon Brain BFP FCA FMAAT (Senior Statutory Auditor)

for and on behalf of Duncan & Toplis Limited, Statutory Auditor

4 Henley Way

Doddington Road

Lincoln

Lincolnshire

LN6 3QR

18 November 2020

REVENUE

3

13,134,785

10,542,418

Cost of sales

9,979,300

7,937,625

GROSS PROFIT

3,155,485

2,604,793

Administrative expenses

2,915,656

2,650,530

239,829

(45,737

)

Other operating income

4

69,541

51,619

309,370

5,882

Income from shares in group undertakings

-

3,886

Interest receivable and similar income

309

99

309

3,985

309,679

9,867

Interest payable and similar expenses

6

10,536

-

PROFIT BEFORE TAXATION

7

299,143

9,867

Tax on profit

8

47,368

(35,425

)

PROFIT FOR THE FINANCIAL YEAR

251,775

45,292

PROFIT FOR THE YEAR

251,775

45,292

OTHER COMPREHENSIVE INCOME

Purchase of own shares

(24,968

)

-

Income tax relating to other comprehensive income

-

-

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

(24,968

)

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

226,807

45,292

FIXED ASSETS

Intangible assets

9

-

-

Property, plant and equipment

10

447,012

494,478

Investments

11

4,396

4,396

451,408

498,874

CURRENT ASSETS

Debtors

12

3,445,841

3,211,496

Cash at bank and in hand

477,231

128,775

3,923,072

3,340,271

CREDITORS

Amounts falling due within one year

13

3,136,513

2,803,662

NET CURRENT ASSETS

786,559

536,609

TOTAL ASSETS LESS CURRENT LIABILITIES

1,237,967

1,035,483

CREDITORS

Amounts falling due after more than one year

14

(54,421

)

(89,383

)

PROVISIONS FOR LIABILITIES

18

(49,128

)

(38,457

)

NET ASSETS

1,134,418

907,643

CAPITAL AND RESERVES

Called up share capital

19

634

666

Share premium

20

562,936

562,936

Capital redemption reserve

20

430

398

Retained earnings

20

570,418

343,643

SHAREHOLDERS' FUNDS

1,134,418

907,643

The financial statements were approved by the Board of Directors and authorised for issue on 15 November 2020 and were signed on its behalf by:

A J Ferguson - Director

Called up

Capital

share

Retained

Share

redemption

Total

capital

earnings

premium

reserve

equity

£

£

£

£

£

Balance at 1 July 2018

666

298,351

562,936

398

862,351

Changes in equity

Total comprehensive income

-

45,292

-

-

45,292

Balance at 30 June 2019

666

343,643

562,936

398

907,643

Changes in equity

Issue of share capital

(32

)

-

-

-

(32

)

Total comprehensive income

-

226,775

-

32

226,807

Balance at 30 June 2020

634

570,418

562,936

430

1,134,418

Cash flows from operating activities

Cash generated from operations

1

1,210,686

(689,080

)

Interest element of hire purchase payments paid

(10,536

)

-

Tax paid

45,979

1,048

Net cash from operating activities

1,246,129

(688,032

)

Cash flows from investing activities

Purchase of tangible fixed assets

(92,927

)

(93,890

)

Interest received

309

99

Dividends received

-

3,886

Net cash from investing activities

(92,618

)

(89,905

)

Cash flows from financing activities

Capital repayments in year

(34,962

)

(53,244

)

Amount introduced by directors

2,000

1,650

Share buyback

(25,000

)

-

EMI scheme registration

10

-

Net cash from financing activities

(57,952

)

(51,594

)

Increase/(decrease) in cash and cash equivalents

1,095,559

(829,531

)

Cash and cash equivalents at beginning of year

2

(1,025,895

)

(196,364

)

Cash and cash equivalents at end of year

2

69,664

(1,025,895

)

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

2020

2019

£

£

Profit before taxation

299,143

9,867

Depreciation charges

140,393

101,934

EMI scheme registration

(10

)

-

Finance costs

10,536

-

Finance income

(309

)

(3,985

)

449,753

107,816

Increase in trade and other debtors

(282,324

)

(956,011

)

Increase in trade and other creditors

1,043,257

159,115

Cash generated from operations

1,210,686

(689,080

)

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 30 June 2020

30.6.20

1.7.19

£

£

Cash and cash equivalents

477,231

128,775

Bank overdrafts

(407,567

)

(1,154,670

)

69,664

(1,025,895

)

Year ended 30 June 2019

30.6.19

1.7.18

£

£

Cash and cash equivalents

128,775

180,411

Bank overdrafts

(1,154,670

)

(376,775

)

(1,025,895

)

(196,364

)

3.	ANALYSIS OF CHANGES IN NET DEBT

At 1.7.19

Cash flow

At 30.6.20

£

£

£

Net cash

Cash at bank and in hand

128,775

348,456

477,231

Bank overdrafts

(1,154,670

)

747,103

(407,567

)

(1,025,895

)

1,095,559

69,664

Debt

Finance leases

(142,627

)

34,962

(107,665

)

(142,627

)

34,962

(107,665

)

Total

(1,168,522

)

1,130,521

(38,001

)

1.	STATUTORY INFORMATION

Delta-Simons Environmental Consultants 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 presentation currency 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.

Revenue

Revenue comprises income recognised by the company in respect of goods and services supplied during the year, exclusive of Value Added Tax and trade discounts. Revenue is recognised as services are provided and contractual obligations have been fulfilled.

Revenue recognised on contracts

Profit on contracts is taken as the work is carried out if the final outcome can be assessed with reasonable certainty. The profit included is calculated on a prudent basis to reflect the proportion of the work carried out at the year end, by recording revenue and related costs as contract activity progresses. Revenue is calculated as that proportion of total contract value which costs incurred to date bear to total expected costs for that contract. Revenues derived from variations on contracts are recognised only when they have been accepted by the customer. Full provision is made for losses on all contracts in the year in which they are first foreseen.

Goodwill

Goodwill, being the amount paid in connection with the acquisition of a business in 2003, is being amortised evenly over its estimated useful life of fifteen years.

Property, plant and equipment

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

Plant and machinery

-

25% on cost and 10% on cost

Fixtures and fittings

-

25% on cost and 10% on cost

Motor vehicles

-

25% on cost

Computer equipment

-

25% on cost

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the statement of comprehensive income.

Government grants

Government grants are recognised when there is reasonable assurance that the grant will be received and conditions attached have been complied with. Grants are recognised as income over the period necessary to match them with the related costs, for which they are intended to compensate, on a systematic basis.

Financial instruments

The company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in non-puttable ordinary shares.

Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year. typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or financed at a · rate of interest that is not a market rate or in the case of an out-right short-term loan not at market rate, the financial asset or liability is measured, initially, at the present value of the future cash flow discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost.

Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the statement of comprehensive income.

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 statement of financial position date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position 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 statement of financial position 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.

Foreign exchange gains and losses resulting from the settlement of transact ions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the statement of comprehensive income except when deferred in other comprehensive income as qualifying cash flow hedges.

Hire purchase and leasing commitments

Rentals paid under operating leases are charged to the income statement 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 the income statement in the period to which they relate.

3.

REVENUE

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

An analysis of revenue by geographical market is given below:

2020

2019

£

£

United Kingdom

9,614,580

8,205,208

Germany

1,059,788

551,852

Netherlands

218,135

784,426

France

216,602

97,910

Other European

476,084

184,850

United States of America

1,441,183

668,205

Rest of the World

108,413

49,967

13,134,785

10,542,418

4.	OTHER OPERATING INCOME

2020

2019

£

£

Sundry receipts

10

51,619

Government grants

69,531

-

69,541

51,619

5.	EMPLOYEES AND DIRECTORS

2020

2019

£

£

Wages and salaries

5,113,962

4,364,294

Social security costs

537,501

451,578

Other pension costs

238,729

177,070

5,890,192

4,992,942

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

2020

2019

Direct fee earning staff

124

109

Administrative staff

17

17

Directors

2

2

143

128

2020

2019

£

£

Directors' remuneration

212,575

187,502

Directors' pension contributions to money purchase schemes

11,310

8,131

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 30 June 2020 is as follows:

2020

£

Emoluments etc

128,686

Pension contributions to money purchase schemes

6,000

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

2020

2019

£

£

Hire purchase interest

10,536

-

7.	PROFIT BEFORE TAXATION

The profit is stated after charging/(crediting):

2020

2019

£

£

Hire of plant and machinery

262,559

184,420

Depreciation - owned assets

140,393

130,019

Auditors' remuneration

10,000

8,500

Foreign exchange differences

33,023

(8,415

)

Hire of vehicles

136,811

99,437

Rent under operating lease

402,159

290,151