Quin Global Holdings Ltd - Limited company accounts 20.1

REGISTERED NUMBER: SC598159 (Scotland)

Group Strategic Report, Report of the Directors and

Audited Consolidated Financial Statements for the Year Ended 31 December 2021

for

Quin Global Holdings Ltd

Page

Group Strategic Report

1

Report of the Directors

2

Report of the Independent Auditors

4

Consolidated Statement of Comprehensive Income

7

Consolidated Balance Sheet

8

Company Balance Sheet

9

Consolidated Statement of Changes in Equity

10

Company Statement of Changes in Equity

11

Consolidated Cash Flow Statement

12

Notes to the Consolidated Cash Flow Statement

13

Notes to the Consolidated Financial Statements

15

The directors present their strategic report of the company and the group for the year ended 31 December 2021.

REVIEW OF BUSINESS

The directors are reporting a disappointing year in terms of profitability. The business has been impacted by the coronavirus pandemic, global supply chain issues and rising costs of raw materials that have impacted on margins.

The group has generated £18,915,826 (2020: £20,894,506) of turnover, however has generated a loss of £352,644 (2020: £1,629,933 profit) before tax.

It is noted that the current year loss includes an exceptional cost of £508,548 in relation to a related party trade balance write off. This balance had been created as a result of trade with a related party company set up to take on the division of the business that in 2020 pivoted to manufactured sanitiser products during the global pandemic. Due to a significant slow down in that market the related party company became unsustainable, and the resulted trading balance was not deemed receivable and has therefore been written off.

At the period end the group had shareholders' funds of £1,890,266 (2020: £2,457,832) including distributable profits of £1,890,126 (2020: £2,457,692). The directors therefore believe the group's position to be satisfactory, especially as the group's current assets exceed its current liabilities by £222,692 (2020: £1,027,611).

During 2021 and continuing in 2022 significant work has been undertaken to ensure that the business can remain profitable and sustainable, and this has been evident during the current 2022 performance figures. The directors believe that there is a strong foundation to build the business further and improve on the current period's results.

PRINCIPAL RISKS AND UNCERTAINTIES

The directors have assessed the main risk facing the group as being material availability at reasonable costs along with logistic issues across Europe.

There is a risk of exposure to foreign exchange movements which could impact on the profit margins achieved by the group. The directors have taken advice on potential hedging strategies to mitigate this risk.

The company has limited exposure to customer defaults in these tough times as it insures its debts.

The company maintains committed to Quality, Health & Safety and this is at the forefront of all department's mindsets. It continues to hold ISO 14001, ISO 9001 and ISO 45001 certifications as part of its quality and safety processes.

ON BEHALF OF THE BOARD:

Mr A C Fowler - Director

28 September 2022

The directors present their report with the financial statements of the company and the group for the year ended 31 December 2021.

PRINCIPAL ACTIVITY

The principal activity of the group in the year under review was that of the provision of innovative bonding systems and specialised tools, excluding value added tax.

DIVIDENDS

The total distribution of dividends for the year ended 31 December 2021 will be £278,308.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2021 to the date of this report.

Mr A C Fowler

Mr L Fowler

Mr C Fowler

Mrs B Fowler

Mrs L Fowler

Mrs C Fowler

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

AUDITORS

Drummond Laurie CA are deemed to be reappointed under section 487(2) of the Companies Act 2006.

ON BEHALF OF THE BOARD:

Mr A C Fowler - Director

28 September 2022

Opinion

We have audited the financial statements of Quin Global Holdings Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2021 which comprise the Consolidated Statement of 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 December 2021 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

In auditing the financial statements, we have concluded that the directors' 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 group's and the parent 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 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 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.

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 two, 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.

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.

Based on our understanding of the group, we identified that the principal risks of non-compliance with laws and regulations related to fraudulent manipulation of the financial statements, including the risk of override of controls, to reduce profits and tax liabilities. We determined that the most likely method of manipulation would be the posting of inappropriate journal entries. Audit procedures performed by the audit engagement team consisted of a review of large and unusual journal entries, challenging assumptions and judgements made by management in significant accounting estimates, discussions with management related to known or suspected instances of non-compliance with laws and regulations, review of Board minutes where available, and an evaluation of management controls designed to prevent and detect irregularities.

There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations or through collusion.

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.

David Wheeler (Senior Statutory Auditor)

for and on behalf of Drummond Laurie CA

Statutory Auditor

Unit 5

Gateway Business Park

Beancross Road

Grangemouth

FK3 8WX

30 September 2022

TURNOVER

3

18,915,826

20,894,506

Cost of sales

(13,781,865

)

(14,694,345

)

GROSS PROFIT

5,133,961

6,200,161

Administrative expenses

(5,086,534

)

(4,697,518

)

47,427

1,502,643

Other operating income

156,001

182,252

OPERATING PROFIT

5

203,428

1,684,895

Related trade debt written off

6

(508,548

)

-

(305,120

)

1,684,895

Interest payable and similar expenses

7

(47,524

)

(54,962

)

(LOSS)/PROFIT BEFORE TAXATION

(352,644

)

1,629,933

Tax on (loss)/profit

8

63,386

(236,137

)

(LOSS)/PROFIT FOR THE FINANCIAL YEAR

(289,258

)

1,393,796

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(289,258

)

1,393,796

(Loss)/profit attributable to:

Owners of the parent

(289,258

)

1,393,796

Total comprehensive income attributable to:

Owners of the parent

(289,258

)

1,393,796

FIXED ASSETS

Intangible assets

11

267,600

304,200

Tangible assets

12

2,473,105

2,406,095

Investments

13

-

-

Investment property

14

-

-

2,740,705

2,710,295

CURRENT ASSETS

Stocks

15

2,133,575

1,705,315

Debtors

16

2,432,379

2,693,006

Cash at bank

158,134

771,749

4,724,088

5,170,070

CREDITORS

Amounts falling due within one year

17

(4,501,396

)

(4,142,459

)

NET CURRENT ASSETS

222,692

1,027,611

TOTAL ASSETS LESS CURRENT LIABILITIES

2,963,397

3,737,906

CREDITORS

Amounts falling due after more than one year

18

(997,580

)

(1,164,726

)

PROVISIONS FOR LIABILITIES

22

(75,551

)

(115,348

)

NET ASSETS

1,890,266

2,457,832

CAPITAL AND RESERVES

Called up share capital

23

140

140

Retained earnings

24

1,890,126

2,457,692

SHAREHOLDERS' FUNDS

1,890,266

2,457,832

The financial statements were approved by the Board of Directors and authorised for issue on 28 September 2022 and were signed on its behalf by:

Mr A C Fowler - Director

FIXED ASSETS

Intangible assets

11

-

-

Tangible assets

12

-

-

Investments

13

220

220

Investment property

14

1,408,303

1,408,303

1,408,523

1,408,523

CURRENT ASSETS

Debtors

16

-

432

CREDITORS

Amounts falling due within one year

17

(425,460

)

(366,559

)

NET CURRENT LIABILITIES

(425,460

)

(366,127

)

TOTAL ASSETS LESS CURRENT LIABILITIES

983,063

1,042,396

CREDITORS

Amounts falling due after more than one year

18

(740,133

)

(831,215

)

NET ASSETS

242,930

211,181

CAPITAL AND RESERVES

Called up share capital

23

140

140

Retained earnings

24

242,790

211,041

SHAREHOLDERS' FUNDS

242,930

211,181

Company's profit for the financial year

310,057

428,261

The financial statements were approved by the Board of Directors and authorised for issue on 28 September 2022 and were signed on its behalf by:

Mr A C Fowler - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2020

120

1,455,399

1,455,519

Changes in equity

Issue of share capital

20

-

20

Dividends

-

(391,503

)

(391,503

)

Total comprehensive income

-

1,393,796

1,393,796

Balance at 31 December 2020

140

2,457,692

2,457,832

Changes in equity

Dividends

-

(278,308

)

(278,308

)

Total comprehensive income

-

(289,258

)

(289,258

)

Balance at 31 December 2021

140

1,890,126

1,890,266

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2020

120

174,282

174,402

Changes in equity

Issue of share capital

20

-

20

Dividends

-

(391,502

)

(391,502

)

Total comprehensive income

-

428,261

428,261

Balance at 31 December 2020

140

211,041

211,181

Changes in equity

Dividends

-

(278,308

)

(278,308

)

Total comprehensive income

-

310,057

310,057

Balance at 31 December 2021

140

242,790

242,930

Cash flows from operating activities

Cash generated from operations

1

96,168

1,564,303

Interest paid

(39,110

)

(43,502

)

Interest element of hire purchase payments paid

(8,414

)

(11,460

)

Tax paid

(176,958

)

-

Net cash from operating activities

(128,314

)

1,509,341

Cash flows from investing activities

Purchase of tangible fixed assets

(274,717

)

(433,636

)

Sale of tangible fixed assets

7,500

126,296

Net cash from investing activities

(267,217

)

(307,340

)

Cash flows from financing activities

New loans in year

-

380,411

Loan repayments in year

(317,741

)

(114,109

)

Capital repayments in year

(127,476

)

(127,021

)

Amount introduced by directors

-

63,549

Amount withdrawn by directors

(66,213

)

-

Equity dividends paid

(278,308

)

(391,503

)

Net cash from financing activities

(789,738

)

(188,673

)

(Decrease)/increase in cash and cash equivalents

(1,185,269

)

1,013,328

Cash and cash equivalents at beginning of year

2

771,749

(241,579

)

Cash and cash equivalents at end of year

2

(413,520

)

771,749

1.	RECONCILIATION OF (LOSS)/PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

31.12.21

31.12.20

£

£

(Loss)/profit before taxation

(352,644

)

1,629,933

Depreciation charges

371,163

382,691

Loss on disposal of fixed assets

521

21,208

Finance costs

47,524

54,962

66,564

2,088,794

Increase in stocks

(428,260

)

(455,916

)

Decrease/(increase) in trade and other debtors

262,742

(758,874

)

Increase in trade and other creditors

195,122

690,299

Cash generated from operations

96,168

1,564,303

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 December 2021

31.12.21

1.1.21

£

£

Cash and cash equivalents

158,134

771,749

Bank overdrafts

(571,654

)

-

(413,520

)

771,749

Year ended 31 December 2020

31.12.20

1.1.20

£

£

Cash and cash equivalents

771,749

290,738

Bank overdrafts

-

(532,317

)

771,749

(241,579

)

3.	ANALYSIS OF CHANGES IN NET DEBT

Other

non-cash

At 1.1.21

Cash flow

changes

At 31.12.21

£

£

£

£

Net cash

Cash at bank

771,749

(613,615

)

158,134

Bank overdrafts

-

(571,654

)

(571,654

)

771,749

(1,185,269

)

(413,520

)

Debt

Finance leases

(226,738

)

127,476

(134,875

)

(234,137

)

Debts falling due

within 1 year

(316,750

)

171,104

-

(145,646

)

Debts falling due

after 1 year

(1,025,659

)

146,638

-

(879,021

)

(1,569,147

)

445,218

(134,875

)

(1,258,804

)

Total

(797,398

)

(740,051

)

(134,875

)

(1,672,324

)

1.	STATUTORY INFORMATION

Quin Global Holdings Ltd is a private company, limited by shares, domiciled in Scotland, registration number SC598159. The registered office is Unit 1 Ruthvenfield Avenue, Inveralmond Industrial Estate, Perth PH1 3WB.

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.

Basis of consolidation

The consolidated accounts are prepared in accordance with the group’s accounting principles and include the accounts of the parent company and all subsidiaries. Subsidiaries are consolidated from the date the group exercises control or influence over the company. Divested companies are included in the consolidated accounts until the date the group ceases to control or exercise influence over them. In preparing the consolidated financial statements any intra-group transactions have been eliminated. Foreign subsidiaries are translated using the current rate for the assets and liabilities and the average rate for turnover and expenses.

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.

Turnover

Turnover represents net invoiced sales of goods and services in respect of the provision of innovative bonding systems and specialised tools, excluding value added tax. Sales are recognised at the point at which the goods are delivered or the service is complete.

Goodwill

Goodwill, being the amount paid in connection with the acquisition of businesses in 2018 and 2019, is being amortised evenly over its useful estimated life of ten years.

Intangible assets

Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Patents and licences are being amortised evenly over their estimated useful life of ten years.

Tangible fixed assets and depreciation

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Freehold property

-

2% on cost

Long leasehold

-

20% on cost, 16.67% on cost and 10% on cost

Plant and machinery

-

33% on cost, 25% on reducing balance and 20% on cost

Fixtures and fittings

-

33% on cost and 20% on cost

Motor vehicles

-

25% on reducing balance

Tangible fixed assets are stated at cost less depreciation. Cost represent purchase price together with any incidental costs of acquisition.

The directors have considered the residual value of all tangible fixed assets to be immaterial and therefore all tangible fixed assets are depreciated to nil value.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items. Cost is represented by purchase price.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Hire purchase and leasing commitments

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the future payments is treated as a liability.

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

Pension costs and other post-retirement benefits

The group operates a defined contribution pension scheme. Contributions payable to the group's pension scheme are charged to profit or loss in the period to which they relate.

Provisions

Provisions are recognised when the company has a legal or constructive obligation as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation, and the amount has been reliably estimated. Provisions are not recognised for future operating losses. Provisions are discounted where the time value of money is material.

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.

3.

TURNOVER

The turnover and loss (2020 - profit) before taxation are attributable to the one principal activity of the group.

An analysis of turnover by geographical market is given below:

31.12.21

31.12.20

£

£

United Kingdom

9,486,635

13,779,110

Europe

8,697,282

6,764,929

Rest of world

731,909

350,467

18,915,826

20,894,506

4.	EMPLOYEES AND DIRECTORS

31.12.21

31.12.20

£

£

Wages and salaries

2,837,241

2,599,655

Social security costs

258,526

258,999

Other pension costs

140,314

181,968

3,236,081

3,040,622

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

31.12.21

31.12.20

Employees

60

59

The average number of employees by undertakings that were proportionately consolidated during the year was 54 (2020 - 53 ) .

31.12.21

31.12.20

£

£

Directors' remuneration

26,481

28,406

Directors' pension contributions to money purchase schemes

-

70,000

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes

-

6