Henbury Engineering Limited - Limited company accounts 20.1

REGISTERED NUMBER: 10633736 (England and Wales)

Group Strategic Report,

Report of the Directors and

Consolidated Financial Statements

for the Year Ended 31 March 2020

for

Henbury Engineering Limited

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Consolidated Profit and loss account

8

Consolidated Other Comprehensive Income

9

Consolidated Balance Sheet

10

Company Balance Sheet

11

Consolidated Statement of Changes in Equity

12

Company Statement of Changes in Equity

13

Consolidated Cash Flow Statement

14

Notes to the Consolidated Cash Flow Statement

15

Notes to the Consolidated Financial Statements

17

DIRECTORS:

P R Morgan

J Fowler

J Dudley-Toole

REGISTERED OFFICE:

Hall Lane Works

Elton

Sandbach

Cheshire

CW11 3TU

REGISTERED NUMBER:

10633736 (England and Wales)

AUDITORS:

Thompson Wright Limited

Chartered Accountants

and Statutory Auditors

Ebenezer House

Ryecroft

Newcastle under Lyme

Staffordshire

ST5 2BE

The directors present their strategic report of the company and the group for the year ended 31 March 2020.

REVIEW OF BUSINESS

The Directors have taken a long term view in the building of a successful business and invested heavily in new

equipment in the year to March 2020 in order to differentiate itself from its competitors whilst increasing both the

capacity and competitiveness of the business.

Over £2m was invested in the period and significant items acquired include an automated press (Trumpf TruBend

5230 and Bendmaster 150) and an additional automated laser (Trumpf TruLaser 5030 Fibre and TruStore 3030).

The installation and commissioning of these machines over the six month period from August 2019 to January 2020

caused significant disruption to the business, and is responsible for the year on year decline in both turnover and

profitability of the business. With in excess of 25% of the factory inaccessible or unavailable for production the

capacity was greatly reduced causing a decline in efficiency.

However, with Covid-19 having a negative impact on many manufacturing businesses, it is pleasing to note that

turnover in the period to the end of August 2020 remains in-line with, and net profits are in excess of, those achieved

in the previous 2 years.

The new equipment has been instrumental in winning some significant contracts with new customers supplying both

the public sector (manufacturing beds for the Nightingale hospitals) and in the private sector (manufacturing hand

sanitiser machines).

The business continues to invest at a similar level to prior years in Research and Development to further improve the

product and process offerings.

Due to performance issues in the period to year end March 2020, Newfield have also restructured the Senior

Management team, Ownership and Funding Structure. This Structure has aligned roles and responsibilities across the

business with the companies long term objectives and aspirations.

As in previous years, the directors monitor the performance of the company through monthly management accounts

and sales reports together with the monitoring of bank balances and ability to meet its future liabilities.

Key performance indicators are gross margin, stock turnover, debtors days and operating profit which can be

calculated from the financial statements..

As in previous years, the directors monitor the performance of the group through monthly management accounts and

sales reports together with the monitoring of bank balances and ability to meet its future liabilities.

Key performance indicators are gross margin, stock turnover, debtors days and operating profit which can be

calculated from the financial statements.

PRINCIPAL RISKS AND UNCERTAINTIES

The directors have identified the key risks faced by the group to be market risk, financial risk, credit risk and exchange

rate risk.

The directors are constantly monitoring both the quality and price of the products it acquires and the range of goods

it supplies, to minimise the market risk.

The group seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to

invest cash assets safely and profitably.

The group's policy throughout the year has been to maintain liquid funds at the bank and avoid incurring overdraft

interest whilst also funding the repayment of finance lease and loan obligations.

To achieve short term flexibility, the group operates an invoice discounting facility and hire purchase facilities, which

means that it is exposed to interest rate risk.

Where the group has had to undertake short term borrowings, the company's exposure to interest rate fluctuations

on its borrowings is managed by the use of fixed and floating facilities. It is the group's policy to minimise the amount

of borrowings at floating rates of interest.

The maturity of borrowings is set out in note 15 to the financial statements.

The principal credit risk arises from its trade debtors.

In order to manage credit risk, the directors set limits for its customers based on a combination of payment history

and third party credit references. Where available credit insurance is also taken out. Credit limits are reviewed by the

credit controller on a regular basis in conjunction with debt ageing and collection history.

During 2019/20, credit risk exposure was spread over a large number of customers.

ON BEHALF OF THE BOARD:

J Fowler - Director

30 September 2020

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

31 March 2020.

PRINCIPAL ACTIVITY

The principal activity of the group in the year under review was that of steel fabricators.

DIVIDENDS

No dividends will be distributed for the year ended 31 March 2020.

EVENTS SINCE THE END OF THE YEAR

Information relating to events since the end of the year is given in the notes to the financial statements.

DIRECTORS

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

report.

P R Morgan

J Fowler

J Dudley-Toole

DISCLOSURE IN THE STRATEGIC REPORT

Future developments and principal risks and uncertainties are disclosed in the strategic report.

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 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 group's

auditors are aware of that information.

AUDITORS

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

Meeting.

ON BEHALF OF THE BOARD:

J Fowler - Director

30 September 2020

Opinion

We have audited the financial statements of Henbury Engineering Limited (the 'parent company') and its subsidiaries

(the 'group') for the year ended 31 March 2020 which comprise the Consolidated Profit and loss account,

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 our 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 March 2020 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

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 group 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 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 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 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 we are 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, we have not identified material misstatements in the Group 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; 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

-	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 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.

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.

Jeremy Bostock BA BFP FCA (Senior Statutory Auditor)

for and on behalf of Thompson Wright Limited

Chartered Accountants

and Statutory Auditors

Ebenezer House

Ryecroft

Newcastle under Lyme

Staffordshire

ST5 2BE

30 September 2020

TURNOVER

7,961,812

9,638,603

Cost of sales

5,665,886

6,437,418

GROSS PROFIT

2,295,926

3,201,185

Administrative expenses

2,994,751

2,945,119

OPERATING (LOSS)/PROFIT

4

(698,825

)

256,066

Interest receivable and similar income

47

329

(698,778

)

256,395

Interest payable and similar expenses

5

331,332

405,376

LOSS BEFORE TAXATION

(1,030,110

)

(148,981

)

Tax on loss

6

(480,816

)

(541,313

)

(LOSS)/PROFIT FOR THE FINANCIAL YEAR

(549,294

)

392,332

(Loss)/profit attributable to:

Owners of the parent

(549,294

)

392,332

(LOSS)/PROFIT FOR THE YEAR

(549,294

)

392,332

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(549,294

)

392,332

Total comprehensive income attributable to:

Owners of the parent

(549,294

)

392,332

FIXED ASSETS

Intangible assets

8

(898,013

)

(940,067

)

Tangible assets

9

5,354,231

3,533,777

Investments

10

-

-

4,456,218

2,593,710

CURRENT ASSETS

Stocks

11

628,305

774,396

Debtors

12

2,711,201

2,928,889

Cash at bank and in hand

154,817

989,304

3,494,323

4,692,589

CREDITORS

Amounts falling due within one year

13

4,274,125

4,101,012

NET CURRENT (LIABILITIES)/ASSETS

(779,802

)

591,577

TOTAL ASSETS LESS CURRENT LIABILITIES

3,676,416

3,185,287

CREDITORS

Amounts falling due after more than one year

14

(3,433,557

)

(2,393,134

)

PROVISIONS FOR LIABILITIES

19

(155,288

)

(155,288

)

NET ASSETS

87,571

636,865

CAPITAL AND RESERVES

Called up share capital

20

150

150

Retained earnings

21

87,421

636,715

SHAREHOLDERS' FUNDS

87,571

636,865

The financial statements were approved by the Board of Directors and authorised for issue on 30 September 2020 and

were signed on its behalf by:

J Fowler - Director

FIXED ASSETS

Intangible assets

8

-

-

Tangible assets

9

-

-

Investments

10

4,750,000

4,750,000

4,750,000

4,750,000

CURRENT ASSETS

Debtors

12

70

70

CREDITORS

Amounts falling due within one year

13

4,749,920

4,749,920

NET CURRENT LIABILITIES

(4,749,850

)

(4,749,850

)

TOTAL ASSETS LESS CURRENT LIABILITIES

150

150

CAPITAL AND RESERVES

Called up share capital

20

150

150

SHAREHOLDERS' FUNDS

150

150

Company's profit for the financial year

-

-

The financial statements were approved by the Board of Directors and authorised for issue on 30 September 2020 and were signed on its behalf by:

J Fowler - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 April 2018

150

244,383

244,533

Changes in equity

Total comprehensive income

-

392,332

392,332

Balance at 31 March 2019

150

636,715

636,865

Changes in equity

Total comprehensive income

-

(549,294

)

(549,294

)

Balance at 31 March 2020

150

87,421

87,571

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 April 2018

150

-

150

Changes in equity

Balance at 31 March 2019

150

-

150

Changes in equity

Balance at 31 March 2020

150

-

150

Cash flows from operating activities

Cash generated from operations

1

471,256

104,767

Interest paid

(219,286

)

(258,453

)

Interest element of hire purchase payments paid

(112,046

)

(146,923

)

Tax paid

-

387,957

Net cash from operating activities

139,924

87,348

Cash flows from investing activities

Purchase of intangible fixed assets

-

(6,005

)

Purchase of tangible fixed assets

(40,597

)

(305,988

)

Sale of tangible fixed assets

-

6,525

Interest received

47

329

Net cash from investing activities

(40,550

)

(305,139

)

Cash flows from financing activities

New loans in year

-

1,600,000

Loan repayments in year

(185,753

)

(1,742,845

)

Invoice discounting facility

(630,799

)

1,318,205

Capital repayments in year

(117,309

)

(81,698

)

Net cash from financing activities

(933,861

)

1,093,662

(Decrease)/increase in cash and cash equivalents

(834,487

)

875,871

Cash and cash equivalents at beginning of year

2

989,304

113,433

Cash and cash equivalents at end of year

2

154,817

989,304

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

2020

2019

£

£

Loss before taxation

(1,030,110

)

(148,981

)

Depreciation charges

353,035

276,840

Profit on disposal of fixed assets

-

(6,525

)

Government grants

-

(24,474

)

Finance costs

331,332

405,376

Finance income

(47

)

(329

)

(345,790

)

501,907

Decrease/(increase) in stocks

146,091

(144,543

)

Decrease/(increase) in trade and other debtors

698,504

(621,298

)

(Decrease)/increase in trade and other creditors

(27,549

)

368,701

Cash generated from operations

471,256

104,767

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 March 2020

31.3.20

1.4.19

£

£

Cash and cash equivalents

154,817

989,304

Year ended 31 March 2019

31.3.19

1.4.18

£

£

Cash and cash equivalents

989,304

113,433

3.	ANALYSIS OF CHANGES IN NET DEBT

Other

non-cash

At 1.4.19

Cash flow

changes

At 31.3.20

£

£

£

£

Net cash

Cash at bank

and in hand

989,304

(834,487

)

154,817

989,304

(834,487

)

154,817

Debt

Finance leases

(1,041,844

)

117,309

-

(3,099,481

)

Debts falling due

within 1 year

(2,154,259

)

627,664

-

(1,526,595

)

Debts falling due

after 1 year

(1,589,691

)

188,888

-

(1,400,803

)

(4,785,794

)

933,861

-

(6,026,879

)

Total

(3,796,490

)

99,374

-

(5,872,062

)

1.	STATUTORY INFORMATION

Henbury Engineering 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 General 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.

After making enquiries, the directors have a reasonable expectation that the group has adequate resources to

continue in operational existence for the foreseeable future, being the 12 month period from the date of these

accounts being approved, given the impact of the Coronavirus upon the economy and therefore the financial

statements have been prepared on a going concern basis.

Basis of consolidation

The consolidated financial statements incorporate the financial statements of the company and all subsidiary

undertakings, together with the group's shares of the net assets and results of associated undertakings and

joint ventures. The financial statements of all group companies are adjusted, where necessary, to ensure the

use of consistent accounting policies. Acquisitions are accounted for under the acquisition method. The results

of companies acquired or disposed of are included in the group profit and loss account from or up to the date

that control passes respectively.

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.

Transactions between group entities which have been eliminated on consolidation are not disclosed within the

financial statements.

Significant judgements and estimates

The company makes significant judgements and estimates concerning the future. The resulting accounting

estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have

a significant risk of causing a material adjustment to the carrying value of assets and liabilities are detailed

below.

Impairment of debtors

Management makes an estimate of the recoverable value of trade and other debtors. When assessing

impairment of trade and other debtors, management considers factors including the progress and stage

reached of individual cases.

Stock provision

The company sells products which are subject to changing customer demands and product degradation. As a

result it is necessary to consider the recoverability of the cost of stocks and the associated provisioning

necessary. When calculating the stock provision, management considers the nature and condition of the stock

as well as reviewing sales and purchase history.