ADM Pressings Limited - Period Ending 2021-12-31
ADM Pressings Limited - Period Ending 2021-12-31
Registration number:
ADM Pressings Limited
for the Year Ended 31 December 2021
ADM Pressings Limited
Contents
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Company Information |
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Strategic Report |
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Directors' Report |
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Statement of Directors' Responsibilities |
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Independent Auditor's Report |
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Income Statement |
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Statement of Financial Position |
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Statement of Changes in Equity |
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Notes to the Financial Statements |
ADM Pressings Limited
Company Information
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Directors |
D L Thornewell J L R Cicero |
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Company secretary |
Kate K Cross |
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Registered office |
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Auditor |
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ADM Pressings Limited
Strategic Report for the Year Ended 31 December 2021
The director presents his strategic report for the year ended 31 December 2020.
Principal activity
The principal activity of the company is the manufacture of metal pressings, welded assemblies and fabrications
Fair review of the business
From March 2020 the UK economy has been significantly impacted across all sectors by the initial outbreak and subsequent disruption of the global Covid-19 pandemic, resulting in significant macroeconomic uncertainty which has continued into 2021. ADM sales levels were significantly impacted in 2020 by the downturns generated by uncertainty in the market and the impact of nationwide lockdowns on both supplier and customer operations. Despite the continued impact of the Covid-19 pandemic into 2021, ADM has seen a strong recovery across the customer base with the result that sales levels have largely returned to pre-pandemic levels. The business continued to leverage the government backed Coronavirus Job Retention Scheme to protect the workforce into 2021.
Supply chain constraints, particularly the availability and cost of raw material steel and aluminium, have presented further challenges in 2021. Prompt action from the business to secure ongoing material supply in combination with an open and honest commercial strategy with the customer base has enabled ADM to largely mitigate the adverse impact of rising material costs. These actions, along with a strategic focus on cost management across the business, is responsible for a positive improvement in gross margin % from 2020, along with a return to profitable operations for the business as a whole.
During 2021 the business has continued to invest in developing processes and procedures to provide dependable support to increased activity with a focus on increasing automation within the production framework. The business has also continued to strengthen the senior management team with strategic appointments and continued investment in people despite the challenges posed by the Covid-19 pandemic.
As reported in the company’s profit and loss account, revenue for the year ended 31st December 2021 was £22.1m compared to £15.8m for the year ended 31st December 2020. Gross Profit for the year was £8.5m representing 38.3% of total revenues compared to £5.3m (33.6%) for the prior year.
ADM continues to be highly regarded in its chosen market for pressed and fabricated steel product, with the added capability of its fully operational electrophoretic and powder paint line facility increasing ADM’s appeal to customers, whilst increasing value add and margin in the business. Significant capital investment over 2021 aims to continue to add to the ADM value proposition to our customers.
Despite continued economic challenges into 2021, the business is in a far more robust position to meet customer requirements; underpinned by a stronger management team and committed workforce. Infrastructure and business controls are significantly improved and prudent compliance with regulatory bodies will continue to be maintained.
Although the ongoing macroeconomic challenges resulting from the global Covid-19 pandemic are likely to limit immediate growth potential, in the medium term the compelling capability of the business is expected to deliver further growth from servicing existing client needs as well as from prospective new clients. In the longer term, the business is suitably positioned both operationally and financially to continue to offer both existing and new clients a robust and sustainable supply chain solution.
ADM Pressings Limited
Strategic Report for the Year Ended 31 December 2021 (continued)
The company's key financial and other performance indicators during the year were as follows:
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Unit |
2021 |
2020 |
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Gross profit margin |
% |
38.33 |
33.59 |
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EBIT |
% |
5.18 |
(2.28) |
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Operating cash (as a % of EBIT) |
% |
89.91 |
55.06 |
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ROCCE |
% |
18.64 |
(6.83) |
Principal risks and uncertainties
Operational and compliance risks are consistently monitored, and relevant procedures implemented to mitigate risks as they arise and are identified. ADM management maintain a proactive approach to managing the business over this period of economic uncertainty as the Covid-19 pandemic continues to impact the macroeconomic climate, taking advantage of available business support schemes and working closely with both the customer and supply base to ensure minimal disruption to all stakeholders.
The recent unrest between Russia and Ukraine, combined with the ongoing effects of Covid-19, is impacting raw material availability and pricing structures in some areas of the supply chain in early 2022. ADM management have mitigated this risk as far as practicable through diversification of the supply chain and through implementation of purchasing agreements with key suppliers.
Rising raw material pricing in Q1 2022 has the potential to put pressure on margins, proactive commercial management with both the supply chain and customer base ensures this risk is mitigated as much as possible.
Credit risks are constantly monitored, and credit limits of both the customer and supply base are consistently under review to ensure they remain appropriate under changing market conditions.
Approved and authorised by the
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ADM Pressings Limited
Directors' Report for the Year Ended 31 December 2021
The directors present their report and the financial statements for the year ended 31 December 2021.
Directors of the company
The directors who held office during the year were as follows:
Financial instruments
Objectives and policies
The company finances its activities with a combination of bank loans, finance leases and hire purchase contracts, cash and short term deposits. Overdrafts are used to satisfy short term cash flow requirements. Other financial assets and liabilities, such as trade debtors and trade creditors, arise directly from the Company's operating activities.
Price risk, credit risk, liquidity risk and cash flow risk
Price risk
Price risk is the risk that changes in raw material prices have the potential to impact on the profitability of the company. The company does not consider that it is materially exposed to price risk.
Credit risk
Credit risk is the risk that one party of a financial instrument will cause a financial loss for the other party by failing to discharge its obligation. Company policies are aimed at minimising such losses and require customers to satisfy credit worthiness procedures prior to acceptance of contracts. The company also utilises insurance policies to protect against non-payment of debt. The company does not consider that it is materially exposed to credit risk.
Cash flow and liquidity risk
Cash flow and liquidity risk is the risk that a company's available cash will not be sufficient to meet its financial obligations. The company actively manages its cash flow position including collection of debts and timely payment of creditors. This, coupled with the strong cash position of the Company is deemed sufficient to minimise the Company's exposure to cash flow and liquidity risk.
Foreign exchange risk
Foreign exchange risk refers to the potential for loss from exposure to foreign exchange rate fluctuations. Company policies are aimed at minimising this risk. The company does not consider that it is materially exposed to foreign exchange risk.
Employment of disabled persons
The Company gives full consideration to applications for employment from disabled persons where the candidate's particular aptitudes and abilities are consistent with adequately meeting the requirements of the job. Opportunities are available to disabled employees for training, career development and promotion.
Where existing employees become disabled, it is the Company's policy to provide continuing employment wherever practicable in the same or an alternative position and to provide appropriate training to achieve this aim.
ADM Pressings Limited
Directors' Report for the Year Ended 31 December 2021 (continued)
Employee involvement
During the year, the policy of providing employees with information, including information relating to the economic and financial factors affecting the performance of the company, has continued through the newsletter in which employees are encouraged to present their suggestions and views on the Company's performance. Regular meetings are held between local management and employees to allow free flow of information and ideas.
Future developments
See disclosures within the Strategic Report regarding future developments of the Company.
Going concern
The financial statements have been prepared on a going concern basis.
The company meets its day to day working capital requirements through cash generated from operations.
There was no unmanageable impact of COVID-19 on the company’s main income streams, suppliers or employees and the company has seen a return to profit in 2021. At the time of signing the financial statements, the company had significant positive cash balances.
The company’s forecasts and projections for the next twelve months show that the company should be able to continue in operational existence for that period, taking into account reasonable possible changes in trading performance.
Based on the factors set out above the Directors believe that it remains appropriate to prepare the financial statements on a going concern basis.
Disclosure of information to the auditor
Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditors are unaware.
Reappointment of auditor
Azets Audit Services Limited, trading as Azets Audit Services, were appointed auditor to the company following their acquisition of the trade of Tait Walker LLP, trading as MHA Tait Walker, on 1 May 2022.
In accordance with section 485 of the Companies Act 2006, a resolution for the re-appointment of Azets Audit Services as auditors of the company is to be proposed at the forthcoming Annual General Meeting.
Approved and authorised by the
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ADM Pressings Limited
Statement of Directors' Responsibilities
The directors acknowledge their responsibilities for preparing the Annual Report 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:
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select suitable accounting policies and apply them consistently; |
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make judgements and accounting estimates that are reasonable and prudent; |
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state whether applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and |
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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.
ADM Pressings Limited
Independent Auditor's Report to the Members of ADM Pressings Limited
Opinion
We have audited the financial statements of ADM Pressings Limited (the 'company') for the year ended 31 December 2021, which comprise the Income Statement, Statement of Financial Position, Statement of Changes in Equity, and Notes to the Financial Statements, including 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 December 2021 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 auditor 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
In auditing the financial statements, we have concluded that the director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
The other information comprises the information included in the annual report other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information contained within the annual report. 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.
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 course of 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 this gives rise to a material misstatement in the financial statements themselves. 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.
ADM Pressings Limited
Independent Auditor's Report to the Members of ADM Pressings Limited (continued)
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
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the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
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the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements. |
Matters on which we are required to report by exception
In the light of our 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 and the Directors' Report.
We have nothing to report in respect of the following matters in relation to which 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 6], 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 is 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.
Auditor 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 an auditor’s report 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.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
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enquiries of management about any known or suspected instances of non-compliance with laws and regulations and fraud; |
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reading correspondence with regulators including the health and Safety Executive and quality certifications; |
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reviewing of board minutes; |
ADM Pressings Limited
Independent Auditor's Report to the Members of ADM Pressings Limited (continued)
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challenging assumptions and judgements made by management in their significant accounting estimates; |
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auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias; and |
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reviewing financial statement disclosures and testing to support documentation. |
Because of the field in which the client operates, we identified the following areas as those most likely to have a material impact on the financial statements: Health and Safety; employment law (including the Working Time Directive); and compliance with the UK Companies Act.
Owing to the inherent limitations of an audit, there is an unavoidable risk that some material misstatements in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK). For instance, the further removed non-compliance is from the events and transactions reflected in the financial statements, the less likely the auditor is to become aware of it or to recognise the non-compliance.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
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 an auditor’s report 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.
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For and on behalf of
Statutory Auditor
Chartered Accountants
Bulman House
Regent Centre
Newcastle upon Tyne
NE3 3LS
Azets Audit Services is a trading name of Azets Audit Services Limited
ADM Pressings Limited
Income Statement for the Year Ended 31 December 2021
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Note |
2021 |
2020 |
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Turnover |
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Cost of sales |
( |
( |
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Gross profit |
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Distribution costs |
( |
( |
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Administrative expenses |
( |
( |
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Other operating income |
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Operating profit/(loss) |
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( |
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Interest payable and similar expenses |
( |
( |
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Profit/(loss) before tax |
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( |
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Taxation |
( |
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Profit/(loss) for the financial year |
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( |
The above results were derived from continuing operations.
The company has no recognised gains or losses for the year other than the results above.
ADM Pressings Limited
(Registration number: 06775062)
Statement of Financial Position as at 31 December 2021
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Note |
2021 |
2020 |
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Fixed assets |
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Tangible assets |
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Current assets |
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Stocks |
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Debtors |
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Cash at bank and in hand |
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Creditors: Amounts falling due within one year |
( |
( |
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Net current assets/(liabilities) |
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( |
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Total assets less current liabilities |
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Creditors: Amounts falling due after more than one year |
( |
( |
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Provisions for liabilities |
( |
( |
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Net assets |
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Capital and reserves |
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Called up share capital |
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Profit and loss account |
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Total equity |
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Approved and authorised by the
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ADM Pressings Limited
Statement of Changes in Equity for the Year Ended 31 December 2021
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Share capital |
Profit and loss account |
Total |
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At 1 January 2020 |
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Loss for the year |
- |
( |
( |
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Total comprehensive income |
- |
( |
( |
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At 31 December 2020 |
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Share capital |
Profit and loss account |
Total |
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At 1 January 2021 |
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Profit for the year |
- |
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Total comprehensive income |
- |
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At 31 December 2021 |
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ADM Pressings Limited
Notes to the Financial Statements for the Year Ended 31 December 2021
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General information |
The company is a private company limited by share capital, incorporated in England & Wales.
The address of its registered office is
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Accounting policies |
Summary of significant accounting policies and key accounting estimates
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
Statement of compliance
These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.
Basis of preparation
These financial statements have been prepared using the historical cost convention.
These financial statements are prepared in sterling which is the functional currency of the entity.
Summary of disclosure exemptions
The entity satisfies the criteria of being a qualifying entity as defined in FRS 102. As such, advantage has been taken of the following disclosure exemptions available under paragraph 1.12 of FRS 102:
(a) Disclosures in respect of each class of share capital have not been presented.
(b) No cash flow statement has been presented for the company.
(c) Disclosures in respect of financial instruments have not been presented.
(d) No disclosure has been given for the aggregate remuneration of key management personnel.
The company has taken advantage of the exemption available under paragraph 33.1A of FRS 102 and does not disclose related party transactions with members of the same group that are wholly owned.
ADM Pressings Limited
Notes to the Financial Statements for the Year Ended 31 December 2021 (continued)
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Accounting policies (continued) |
Going concern
The financial statements have been prepared on a going concern basis.
The company meets its day to day working capital requirements through cash generated from operations.
There was no unmanageable impact of COVID-19 on the company’s main income streams, suppliers or employees and the company has seen a return to profit in 2021. At the time of signing the financial statements, the company had significant positive cash balances.
The company’s forecasts and projections for the next twelve months show that the company should be able to continue in operational existence for that period, taking into account reasonable possible changes in trading performance.
Based on the factors set out above the Directors believe that it remains appropriate to prepare the financial statements on a going concern basis.
Judgements
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. |
The judgements (apart from those involving estimations) that management has made in the process of applying the entity's accounting policies and that have the most significant effect on the amounts recognised in the financial statements are as follows; |
Assessing indicators of impairment - In assessing whether there have been indicators of impairment of assets, the directors have considered both external and internal sources of information such as market conditions, counterparty credit ratings and experience of recoverability. |
Assessing nature of lease - The Company has entered into commercial leases and as a lessee it obtains use of property, plant and equipment. The classification as operating or finance lease requires the Company to determine, based on an evaluation of the terms and conditions of the arrangements, whether it acquires the significant risks and rewards of ownership of these assets and accordingly whether the lease requires an asset and liability to be recognised in the balance sheet. |
Taxation - Management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and level of future taxable profits together with an assessment of the effect of future tax planning strategies. |
ADM Pressings Limited
Notes to the Financial Statements for the Year Ended 31 December 2021 (continued)
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Accounting policies (continued) |
Key sources of estimation uncertainty
Accounting estimates and assumptions are made concerning the future and, by their nature, will rarely equal the related actual outcome. The key assumptions and other sources of estimation uncertainty that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are as follows:
Useful economic lives of tangible assets - The annual depreciation charge is sensitive to changes in the estimated useful lives of the assets. The useful economic lives are re-assessed annually. They are amended when necessary to reflect current estimates, future investments and economic utilisation. The carrying amount is £3,339,774 (2020 - £3,584,487).
Stock provision - The company has made an assumption of writing down the value of stock on items in which they expect the cost to exceed the net realisable value before it is fully sold/utilised. This assumption has involved looking at the historic sales patterns and expected sales in future years. The carrying amount is £244,762 (2020 - £420,408).
Impairment of debtors - The company makes an estimate of the recoverable value of the trade and other debtors. When assessing impairment of trade and other debtor, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience. The carrying amount is £101,110 (2020 - £192,602).
Revenue recognition
Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the company’s activities. Turnover is shown net of value added tax, returns, rebates and discounts.
The company recognises revenue when:
The amount of revenue can be reliably measured;
it is probable that future economic benefits will flow to the entity;
and specific criteria have been met for each of the company's activities.
Government grants
Government grants are recognised using the accrual model.
Under the accrual model, government grants relating to revenue are recognised on a systematic basis over the periods in which the company recognises the related costs for which the grant is intended to compensate. Grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the entity with no future related costs are recognised in income in the period in which it becomes receivable.
The Coronavirus Job Retention Scheme (CJRS) results in cash payments from government to compensate employers for part of the wages, associated national insurance contributions (NICs) and employer pension contributions of employees who have been placed on furlough (i.e. placed on a temporary leave of absence from working for the employer). This is a government grant which should be accounted for as such in accordance with FRS 102 Section 24.
Tax
The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except that a charge attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates taxable income.
ADM Pressings Limited
Notes to the Financial Statements for the Year Ended 31 December 2021 (continued)
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Accounting policies (continued) |
Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the financial statements. Unrelieved tax losses and other deferred tax assets are recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference.
Tangible assets
Tangible assets are stated in the statement of financial position at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
Depreciation
Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:
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Asset class |
Depreciation method and rate |
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Leasehold improvements |
Over remaining life of the lease |
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Plant and machinery |
Over 3 to 10 years |
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Equipment |
33% straight line |
Trade debtors
Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.
Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables.
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.
The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. At each reporting date, stocks are assessed for impairment. If stocks are impaired, the carrying amount is reduced to its selling price less costs to complete and sell; the impairment loss is recognised immediately in profit or loss.
Trade creditors
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.
Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.
ADM Pressings Limited
Notes to the Financial Statements for the Year Ended 31 December 2021 (continued)
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Accounting policies (continued) |
Borrowings
Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the income statement over the period of the relevant borrowing.
Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.
Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.
Leases
Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee.
Assets held under finance leases are recognised at the lower of their fair value at inception of the lease and the present value of the minimum lease payments. These assets are depreciated on a straight-line basis over the shorter of the useful life of the asset and the lease term. The corresponding liability to the lessor is included in the statement of financial position as a finance lease obligation.
Lease payments are apportioned between finance costs in the income statement and reduction of the lease obligation so as to achieve a constant periodic rate of interest on the remaining balance of the liability.
Share capital
Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.
ADM Pressings Limited
Notes to the Financial Statements for the Year Ended 31 December 2021 (continued)
|
Revenue |
The analysis of the company's Turnover for the year from continuing operations is as follows:
|
2021 |
2020 |
|
|
Sale of goods |
|
|
The analysis of the company's Turnover for the year by market is as follows:
|
2021 |
2020 |
|
|
UK |
|
|
|
Other operating income |
The analysis of the company's other operating income for the year is as follows:
|
2021 |
2020 |
|
|
Government grants |
|
|
|
Rental income |
|
|
|
Other operating income |
|
|
|
Coronavirus job retention scheme |
277,243 |
1,313,961 |
|
|
|
|
Operating profit/(loss) |
Arrived at after charging/(crediting)
|
2021 |
2020 |
|
|
Depreciation expense |
|
|
|
Loss on disposal of property, plant and equipment |
|
- |
|
Interest payable and similar expenses |
|
2021 |
2020 |
|
|
Interest on obligations under finance leases and hire purchase contracts |
|
|
|
Interest expense on other finance liabilities |
|
|
|
|
|
ADM Pressings Limited
Notes to the Financial Statements for the Year Ended 31 December 2021 (continued)
|
Staff costs |
The aggregate payroll costs (including directors' remuneration) were as follows:
|
2021 |
2020 |
|
|
Wages and salaries |
|
|
|
Social security costs |
|
|
|
Pension costs, defined contribution scheme |
|
|
|
Redundancy costs |
- |
|
|
|
|
The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:
|
2021 |
2020 |
|
|
Production |
|
|
|
Administration and support |
|
|
|
Other departments |
|
|
|
|
|
|
Directors' remuneration |
The directors' remuneration for the year was as follows:
|
2021 |
2020 |
|
|
Remuneration |
|
|
|
Contributions paid to money purchase schemes |
|
|
|
157,148 |
65,928 |
The above details of directors' emoluments do not include the emoluments of Mr J L R Cicero, which are paid by the parent company and recharged to the company as part of a management charge. This management charge, which in 2021 amounted to £240,000 also includes a recharge of administration costs borne by the parent company on behalf of the company and it is not possible to identify separately the amount of Mr J L R Cicero's emoluments.
|
Auditor's remuneration |
|
2021 |
2020 |
|
|
Audit of the financial statements |
|
|
ADM Pressings Limited
Notes to the Financial Statements for the Year Ended 31 December 2021 (continued)
|
Taxation |
Tax charged/(credited) in the income statement
|
2021 |
2020 |
|
|
Current taxation |
||
|
UK corporation tax |
|
( |
|
UK corporation tax adjustment to prior periods |
|
- |
|
107,228 |
(73,570) |
|
|
Deferred taxation |
||
|
Arising from origination and reversal of timing differences |
|
( |
|
Arising from changes in tax rates and laws |
|
|
|
Arising from previously unrecognised tax loss, tax credit or temporary difference of prior periods |
(1,835) |
- |
|
Total deferred taxation |
|
( |
|
Tax expense/(receipt) in the income statement |
|
( |
The tax on profit before tax for the year is higher than the standard rate of corporation tax in the UK (2020 - higher than the standard rate of corporation tax in the UK) of
The differences are reconciled below:
|
2021 |
2020 |
|
|
Profit/(loss) before tax |
|
( |
|
Corporation tax at standard rate |
|
( |
|
Effect of revenues exempt from taxation |
( |
( |
|
Effect of expense not deductible in determining taxable profit (tax loss) |
|
|
|
Deferred tax expense relating to changes in tax rates or laws |
|
|
|
Increase in UK and foreign current tax from adjustment for prior periods |
|
- |
|
Tax increase from effect of capital allowances and depreciation |
|
|
|
Tax decrease arising from group relief |
- |
( |
|
Other tax effects for reconciliation between accounting profit and tax expense (income) |
( |
( |
|
Total tax charge/(credit) |
|
( |
In the Spring Budget 2021, the Government announced that from 1 April 2023 the corporation tax rate will increase from 19% to 25%. This new law was deemed substantively enacted on 24 May 2021 and the deferred tax balances at the year end have been calculated based on this rate.
ADM Pressings Limited
Notes to the Financial Statements for the Year Ended 31 December 2021 (continued)
|
10 |
Taxation (continued) |
Deferred tax
Deferred tax assets and liabilities
|
2021 |
Liability |
|
Fixed term timing differences |
|
|
Short term timing differences - trading |
( |
|
|
|
2020 |
Liability |
|
Fixed term timing differences |
|
|
Short term timing differences - trading |
( |
|
|
|
Tangible assets |
|
Long leasehold land and buildings |
Fixtures and fittings |
Plant and machinery |
Total |
|
|
Cost or valuation |
||||
|
At 1 January 2021 |
|
|
|
|
|
Additions |
|
|
|
|
|
Disposals |
- |
- |
( |
( |
|
At 31 December 2021 |
|
|
|
|
|
Depreciation |
||||
|
At 1 January 2021 |
|
|
|
|
|
Charge for the year |
|
|
|
|
|
At 31 December 2021 |
|
|
|
|
|
Carrying amount |
||||
|
At 31 December 2021 |
|
|
|
|
|
At 31 December 2020 |
|
|
|
|
Included within the net book value of land and buildings above is £693,134 (2020 - £675,276) in respect of long leasehold land and buildings.
ADM Pressings Limited
Notes to the Financial Statements for the Year Ended 31 December 2021 (continued)
|
11 |
Tangible assets (continued) |
Assets held under finance leases and hire purchase contracts
The net carrying amount of tangible assets includes the following amounts in respect of assets held under finance leases and hire purchase contracts:
|
2021 |
2020 |
|
|
Plant and machinery |
1,849,401 |
2,244,282 |
|
Stocks |
|
2021 |
2020 |
|
|
Raw materials and consumables |
|
|
|
Debtors |
|
Current |
Note |
2021 |
2020 |
|
Trade debtors |
|
|
|
|
Amounts owed by related parties |
|
|
|
|
Other debtors |
|
|
|
|
Prepayments |
|
|
|
|
Corporation tax asset |
- |
|
|
|
|
|
|
Creditors |
|
Note |
2021 |
2020 |
|
|
Due within one year |
|||
|
Loans and borrowings |
|
|
|
|
Trade creditors |
|
|
|
|
Amounts due to related parties |
|
|
|
|
Social security and other taxes |
|
|
|
|
Other creditors |
|
|
|
|
Accrued expenses |
|
|
|
|
Corporation tax liability |
29,360 |
- |
|
|
Deferred income - government grant |
|
|
|
|
|
|
||
|
Due after one year |
|||
|
Loans and borrowings |
|
|
|
|
Deferred income - government grant |
|
|
|
|
646,114 |
1,019,918 |
ADM Pressings Limited
Notes to the Financial Statements for the Year Ended 31 December 2021 (continued)
|
Loans and borrowings |
|
2021 |
2020 |
|
|
Current loans and borrowings |
||
|
Hire purchase and finance lease liabilities |
|
|
|
Other borrowings |
|
|
|
|
|
|
|
2021 |
2020 |
|
|
Non-current loans and borrowings |
||
|
Hire purchase and finance lease liabilities |
|
|
Finance lease liabilities and hire purchase obligations are secured against the underlying assets to which they relate.
Other borrowings comprise of invoice financing and are secured against the debtors to which the monies have been advanced.
|
Provisions for liabilities |
|
Deferred tax |
Total |
|
|
At 1 January 2021 |
|
|
|
Increase (decrease) in existing provisions |
|
|
|
At 31 December 2021 |
|
|
|
|
||
|
Pension and other schemes |
Defined contribution pension scheme
The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £
Contributions totalling £
|
Share capital |
Allotted, called up and fully paid shares
|
2021 |
2020 |
|||
|
No. |
£ |
No. |
£ |
|
|
|
|
60,000 |
|
60,000 |
ADM Pressings Limited
Notes to the Financial Statements for the Year Ended 31 December 2021 (continued)
|
Reserves |
Share capital
Share capital represents the issued share capital of the company.
Profit and loss account
Profit and loss account represents cumulative profits or losses, net of dividends paid and other adjustments.
|
Obligations under leases and hire purchase contracts |
Finance leases
The total of future minimum lease payments is as follows:
|
2021 |
2020 |
|
|
Not later than one year |
|
|
|
Later than one year and not later than five years |
|
|
|
|
|
Operating leases
The total of future minimum lease payments is as follows:
|
2021 |
2020 |
|
|
Not later than one year |
|
|
|
Later than one year and not later than five years |
|
|
|
Later than five years |
|
|
|
|
|
The amount of non-cancellable operating lease payments recognised as an expense during the year was £
|
Commitments |
Capital commitments
The total amount contracted for but not provided in the financial statements was £
ADM Pressings Limited
Notes to the Financial Statements for the Year Ended 31 December 2021 (continued)
|
Parent and ultimate parent undertaking |
The company's immediate parent is
The most senior parent entity producing publicly available financial statements is
The ultimate controlling party is