Ridgway Holdings Limited - Limited company accounts 22.3

REGISTERED NUMBER: 13266188 (England and Wales)

GROUP STRATEGIC REPORT, REPORT OF THE DIRECTOR AND

CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD 15 MARCH 2021 TO 30 APRIL 2022

FOR

RIDGWAY HOLDINGS LIMITED

Page

Company Information

1

Group Strategic Report

2

Report of the Director

3

Report of the Independent Auditors

5

Consolidated Income Statement

9

Consolidated Other Comprehensive Income

10

Consolidated Balance Sheet

11

Company Balance Sheet

12

Consolidated Statement of Changes in Equity

13

Company Statement of Changes in Equity

14

Consolidated Cash Flow Statement

15

Notes to the Consolidated Cash Flow Statement

16

Notes to the Consolidated Financial Statements

17

DIRECTOR:

T R Jones

REGISTERED OFFICE:

Earthmover House

Ridgway Business Park

St Martins

Oswestry

Shropshire

SY11 3PZ

REGISTERED NUMBER:

13266188 (England and Wales)

AUDITORS:

D.R.E. & Co. (Audit) Limited

Kingsland House

39 Abbey Foregate

Shrewsbury

Shropshire

SY2 6BL

The director presents his strategic report of the company and the group for the period 15 March 2021 to 30 April 2022.

REVIEW OF BUSINESS

he principal activities of the group in the year under review were those of sale and hire of plant and machinery, property development and the provision of aviation services.

The group has maintained strong results during the year and it expects this to continue for the foreseeable future.

Key Performance Indicators

2022

Turnover

£23,247,336

Gross margin

28.42%

Operating profit

£5,038,920

Cash generation

£3,520,256

Environment

The group continues to monitor the impact of its business on the environment.

Employees

Details of the number of employees and related costs can be found in note 5 to the financial statements.

PRINCIPAL RISKS AND UNCERTAINTIES

The group operates in a competitive market which is a continuing risk and may result in sales being lost to competitors. The group manages this risk by providing excellent service in all its activities.

The directors have considered the impact on the business and reviewed the post year end trading results and are satisfied that the going concern basis remains appropriate.

ON BEHALF OF THE BOARD:

T R Jones - Director

15 November 2022

The director presents his report with the financial statements of the company and the group for the period 15 March 2021 to 30 April 2022.

INCORPORATION

The holding company was incorporated on 15 March 2021.

DIVIDENDS

The directors recommend an interim dividend of £321 per ordinary share.

The total distribution of dividends for the period ended 30 April 2022 will be £25,000

EVENTS SINCE THE END OF THE PERIOD

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

DIRECTOR

T R Jones held office during the whole of the period from 15 March 2021 to the date of this report.

The director, being eligible, offers himself for election at the forthcoming first Annual General Meeting.

POLITICAL DONATIONS AND EXPENDITURE

During the year, a subsidiary company, Ridgway Rentals Limited, made donations totalling £11,000 of which £360 was donated to the North Shropshire Conservative Association, a political party.

DISCLOSURE IN THE STRATEGIC REPORT

The company has chosen, in accordance with s414C(11) of the Companies Act, to set out in the company's strategic report information regarding the review of business and a description of the principal risks and uncertainties facing the company.

STATEMENT OF DIRECTOR'S RESPONSIBILITIES

The director is responsible for preparing the Group Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations.

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is 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 director is 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 him to ensure that the financial statements comply with the Companies Act 2006. He is 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 director is 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 he 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, D.R.E. & Co. (Audit) Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

T R Jones - Director

15 November 2022

Opinion

We have audited the financial statements of Ridgway Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the period ended 30 April 2022 which comprise the Consolidated Income Statement, 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 30 April 2022 and of the group's profit for the period 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 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 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 director with respect to going concern are described in the relevant sections of this report.

Other information

The director is responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Director, 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 Director 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 Director 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 Director.

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 director's remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit.

Responsibilities of director

As explained more fully in the Statement of Director's Responsibilities set out on page three, the director is 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 director determines 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 director is 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 director either intends to liquidate the group or the parent company or to cease operations, or has 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.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

- the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;

- we identified the laws and regulations applicable to the group and parent company through discussions with directors and other management, and from our commercial knowledge and experience of the renting and leasing of construction and civil engineering machinery and equipment sector;

- we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the group and parent company, including the Companies Act 2006, taxation legislation, Financial Conduct Authority, employment, environmental, health and safety legislation. We also consider regulations such as General Data Protection Regulations, Anti money laundering, Consumer Rights Act throughout the audit.

- we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management; and

- identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the group and parent company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

- making enquiries of management as to their knowledge of actual, suspected and alleged fraud; and

- reviewing the client's system notes and internal controls.

To address the risk of fraud through management bias and override of controls, we:

- performed analytical procedures to identify any unusual or unexpected relationships;

- tested journal entries to identify unusual transactions;

- review of the cashbook to identify any large or unusual transactions that appear to have no commercial basis.

- assessed whether judgements and assumptions made in determining the accounting estimates set out in note 3 were indicative of potential bias; and

- investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

- agreeing financial statement disclosures to underlying supporting documentation;

- enquiring of management as to actual and potential litigation and claims; and

- reviewing correspondence with HMRC.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or 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.

Francis Nock F.C.C.A (Senior Statutory Auditor)

for and on behalf of D.R.E. & Co. (Audit) Limited

Kingsland House

39 Abbey Foregate

Shrewsbury

Shropshire

SY2 6BL

15 November 2022

TURNOVER

4

23,247,336

Cost of sales

(16,639,939

)

GROSS PROFIT

6,607,397

Administrative expenses

(1,568,978

)

5,038,419

Other operating income

501

OPERATING PROFIT

6

5,038,920

Interest receivable and similar income

357

5,039,277

Interest payable and similar expenses

7

(1,111,960

)

PROFIT BEFORE TAXATION

3,927,317

Tax on profit

8

(637,400

)

PROFIT FOR THE FINANCIAL PERIOD

3,289,917

Profit attributable to:

Owners of the parent

1,676,307

Non-controlling interests

1,613,610

3,289,917

PROFIT FOR THE PERIOD

3,289,917

OTHER COMPREHENSIVE INCOME

-

TOTAL COMPREHENSIVE INCOME FOR THE PERIOD

3,289,917

Total comprehensive income attributable to:

Owners of the parent

1,676,307

Non-controlling interests

1,613,610

3,289,917

FIXED ASSETS

Intangible assets

11

-

Tangible assets

12

46,395,372

Investments

13

-

Investment property

14

-

46,395,372

CURRENT ASSETS

Stocks

15

70,965

Debtors

16

7,680,541

Cash at bank and in hand

3,520,256

11,271,762

CREDITORS

Amounts falling due within one year

17

19,613,065

NET CURRENT LIABILITIES

(8,341,303

)

TOTAL ASSETS LESS CURRENT LIABILITIES

38,054,069

CREDITORS

Amounts falling due after more than one year

18

(22,180,212

)

PROVISIONS FOR LIABILITIES

22

(4,600,917

)

NET ASSETS

11,272,940

CAPITAL AND RESERVES

Called up share capital

23

156

Retained earnings

24

6,185,114

SHAREHOLDERS' FUNDS

6,185,270

NON-CONTROLLING INTERESTS

25

5,087,670

TOTAL EQUITY

11,272,940

The financial statements were approved by the director and authorised for issue on 15 November 2022 and were signed by:

T R Jones - Director

FIXED ASSETS

Intangible assets

11

-

Tangible assets

12

-

Investments

13

55

Investment property

14

-

55

CURRENT ASSETS

Debtors

16

850,101

Cash at bank

42,841

892,942

CREDITORS

Amounts falling due within one year

17

3,000

NET CURRENT ASSETS

889,942

TOTAL ASSETS LESS CURRENT LIABILITIES

889,997

CAPITAL AND RESERVES

Called up share capital

23

156

Retained earnings

24

889,841

SHAREHOLDERS' FUNDS

889,997

Company's profit for the financial year

914,841

The financial statements were approved by the director and authorised for issue on 15 November 2022 and were signed by:

T R Jones - Director

Called up

share

Retained

Non-controlling

Total

capital

earnings

Total

interests

equity

£

£

£

£

£

Changes in equity

Issue of share capital

156

-

156

-

156

Dividends

-

(25,000

)

(25,000

)

(588,000

)

(613,000

)

Opening reserves on group

reconstruction

-

4,533,807

4,533,807

-

4,533,807

Total comprehensive income

-

1,676,307

1,676,307

1,613,610

3,289,917

156

6,185,114

6,185,270

1,025,610

7,210,880

Non-controlling interest on group reconstruction

-

-

-

4,062,060

4,062,060

Balance at 30 April 2022

156

6,185,114

6,185,270

5,087,670

11,272,940

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Changes in equity

Issue of share capital

156

-

156

Dividends

-

(25,000

)

(25,000

)

Total comprehensive income

-

914,841

914,841

Balance at 30 April 2022

156

889,841

889,997

Cash flows from operating activities

Cash generated from operations

1

11,169,834

Interest paid

(3,904

)

Interest element of hire purchase payments paid

(1,108,056

)

Net cash from operating activities

10,057,874

Cash flows from investing activities

Purchase of tangible fixed assets

(1,139,125

)

Sale of tangible fixed assets

7,271,958

Sale of investment property

420,000

Interest received

357

Net cash from investing activities

6,553,190

Cash flows from financing activities

Loan repayments in year

(23,980

)

Capital repayments in year

(13,568,606

)

Share issue

156

Dividends paid non controlling interest

(588,000

)

Cash transferred on group reconstruction

1,114,622

Equity dividends paid

(25,000

)

Net cash from financing activities

(13,090,808

)

Increase in cash and cash equivalents

3,520,256

Cash and cash equivalents at beginning of period

2

-

Cash and cash equivalents at end of period

2

3,520,256

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

£

Profit before taxation

3,927,317

Depreciation charges

5,937,980

Profit on disposal of fixed assets

(44,779

)

Finance costs

1,111,960

Finance income

(357

)

10,932,121

Increase in stocks

(54,682

)

Decrease in trade and other debtors

344,780

Decrease in trade and other creditors

(52,385

)

Cash generated from operations

11,169,834

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:

Period ended 30 April 2022

30.4.22

15.3.21

£

£

Cash and cash equivalents

3,520,256

-

3.	ANALYSIS OF CHANGES IN NET DEBT

Group

Other

reconstruct

non-cash

At 15.3.21

Cash flow

ion

changes

At 30.4.22

£

£

£

£

£

Net cash

Cash at bank

and in hand

-

2,405,634

1,114,622

3,520,256

-

2,405,634

1,114,622

3,520,256

Debt

Finance leases

-

13,568,606

(40,949,716

)

(11,963,934

)

(39,345,044

)

Debts falling due

within 1 year

-

(11

)

(23,625

)

-

(23,636

)

Debts falling due

after 1 year

-

23,991

(175,041

)

-

(151,050

)

-

13,592,586

(41,148,382

)

(11,963,934

)

(39,519,730

)

Total

-

15,998,220

(40,033,760

)

(11,963,934

)

(35,999,474

)

1.	STATUTORY INFORMATION

Ridgway Holdings Limited is a private company, limited by shares, incorporated and registered in England and Wales. The company's registered number and registered office address can be found on the General Information page.

2.	STATEMENT OF COMPLIANCE

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.

3.	ACCOUNTING POLICIES

Basis of preparing the financial statements

The financial statements have been prepared under the historical cost convention.

These financial statements are for the group as well as for the individual entity only.

The financial statements are presented in Sterling (£), rounded to the nearest £1.

Going concern

At the balance sheet date the group had net current liabilities of £8,341,303. As shown in note 17 of the financial statements £17,315,882 relates to hire purchase and finance lease liabilities which are used to finance the hire fleet shown in the balance sheet under tangible fixed assets. The directors have considered post year-end trading and believe that the going concern basis of preparation remains appropriate.

Basis of consolidation

The consolidated financial statements present the results of the parent company and those of its subsidiaries. All consolidated subsidiaries have coterminous financial year ends. Inter group transactions have been eliminated from the financial statements and subsidiary results have been restated, where applicable, to reflect comparable accounting policies. The financial statements therefore include:

Ridgway Holdings Limited - (Parent company)

Sandford Assets Limited- (51% subsidiary)

Ridgway Holdings International Limited - (100% subsidiary undertaking of Sandford Assets Limited)

Ridgway Rentals Limited - (100% subsidiary undertaking of Sandford Assets Limited)

Ridgway Properties Limited - (100% subsidiary undertaking of Sandford Assets Limited)

Ridgway Aviation Limited - (100% subsidiary undertaking of Sandford Assets Limited)

Sandford Assets (St Martins) Limited - (75% dormant subsidiary undertaking of Sandford Assets Limited)

Ridgway Leasing Limited - (100% dormant subsidiary undertaking of Ridgway Rentals Limited)

On 30 April 2021 a group reconstruction took place. Ridgway Holdings Limited acquired 51% of the Sandford Assets group via a share for share exchange.

Significant judgements and estimates

The group makes estimates and assumptions 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 amounts of assets and liabilities within the next financial year are addressed below.

The annual depreciation charge for tangible assets is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary to reflect current estimates, economic utilisation and the physical condition of the assets. See note 12 for the carrying amount of tangible fixed assets, and note 3 for the useful economic lives for each class of assets.

The company makes an estimate of the recoverable value of trade debtors. When assessing impairment of trade debtors, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience. See note 16 for the net carrying amount of debtors.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Turnover includes the proceeds of sale of hire fleet assets. The net book value of these assets is disclosed within cost of sales.

Goodwill

Goodwill, being the amount paid in connection with the acquisition of a business in 2012, is being amortised evenly over its estimated useful life of 5 years. Goodwill arising on the group reconstruction has been fully amortised to reserves.

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.

Tangible fixed assets

Tangible fixed assets are stated at historic cost less accumulated depreciation. Costs include original purchase price of the asset and the costs attributable to bringing the asset to its working condition for its intended use.

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

Freehold buildings

-

33% on cost, 25% on cost and 1% on cost

Freehold land

-

Not provided

Aircraft

-

5% on costs

Plant and machinery

-

25% of cost and 10% on cost

Hire fleet

-

10% on cost

Motor vehicles

-

25% on cost

Computer equipment

-

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

Government grants

Grants of a revenue nature are recognised in income over the period in which the group recognises the related costs, for which the grant is intended to compensate.

During the year, the group received government grants of £501 under the Coronavirus Job Retention Scheme (CJRS), which is recognised in income.

Investment property

Investment properties are included in the balance sheet at their fair value.

Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Taxation

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

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the 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 period 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 makes contributions to personal pension schemes for the benefit of directors and employees.

Contributions paid are charged to the profit and loss account in the period to which they relate.

Operating lease income

Rental income from operating leases are recognised on a straight line basis over the period of the leases.

Amounts receivable in respect of finance leases

Amounts receivable from third parties under finance leases are recorded in the balance sheet within debtors.