Andritz Hydro Hammerfest (UK) Limited - Accounts to registrar (filleted) - small 22.3

REGISTERED NUMBER: SC338485 (Scotland)

Financial Statements for the Year Ended 31 December 2021

for

Andritz Hydro Hammerfest (UK) Limited

Page

Company Information

1

Report of the Independent Auditors

2

Income Statement

6

Abridged Balance Sheet

7

Notes to the Financial Statements

8

DIRECTORS:

M Schoeberl

H Heber

M Schneeberger

F Mette

REGISTERED OFFICE:

Spaces, Tay House

300 Bath Street

2nd Floor, Office 45

Glasgow

G2 4JR

REGISTERED NUMBER:

SC338485 (Scotland)

AUDITORS:

Azets Audit Services Limited

Chartered Accountants

Statutory Auditor

Triune Court

Monks Cross Drive

York

YO32 9GZ

Although the company is only required to file a Balance Sheet, requires the accompanying Report of the Auditors to be a copy of our report to the members on the company's full Financial Statements and Report of the Directors. Readers are cautioned that the Income Statement and certain other primary statements and the Report of the Directors, referred to in the copy of our Report of the Auditors, are not required to be filed with the Registrar of Companies.

Opinion

We have audited the financial statements of Andritz Hydro Hammerfest (UK) Limited (the 'company') for the year ended 31 December 2021 which comprise the profit and loss account, the balance sheet 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's 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.

Material uncertainty related to going concern

We draw attention to note 2 to the financial statements which indicates that the company's ability to continue as a going concern is dependent on financial support from its ultimate parent company and the availability of this financial support is uncertain. These events and conditions along with other matters explained in note 2, constitute a material uncertainty that may cast doubt on the company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.

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.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

- the information given in the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

- the directors' report has been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the 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; or

- the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemption in preparing the directors' report and from the requirement to prepare a strategic report.

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, 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.

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 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.

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

We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience, through discussion with the directors and other management, and from inspection of the company's regulatory and legal correspondence. We discussed with the directors and other management the policies and procedures regarding compliance with laws and regulations. We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance during the audit.

The company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation (including related companies legislation), distributable profits legislation, pensions legislation, taxation legislation and further laws and regulations that could indirectly affect the financial statements, comprising employment, environmental and health and safety legislation. We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items. Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the directors and other management and inspection of regulatory and legal correspondence, if any. These procedures did not identify any potentially material actual or suspected non-compliance.

To identify risks of material misstatement due to fraud we considered the opportunities and incentives and pressures that may exist within the company to commit fraud. Our risk assessment procedures included: enquiry of directors to understand the high level policies and procedures in place to prevent and detect fraud, reading Board minutes and considering performance targets and incentive schemes in place for management. We communicated identified fraud risks throughout our team and remained alert to any indications of fraud during the audit.

As a result of these procedures we identified the greatest potential for fraud in the following areas:

- revenue recognition and in particular the risk that revenue is recorded in the wrong period; and

- subjective accounting estimates.

Both risks arise due to a potential desire to present stronger results and enable management to benefit from enhanced incentives. As required by auditing standards we also identified and addressed the risk of management override of controls.

We performed the following procedures to address the risks of fraud identified:

- identifying and testing high risk journal entries through vouching the entries to supporting documentation;

- assessing significant accounting estimates for bias; and

- testing the timing and recognition of income and, in particular, that it was appropriately recognised or deferred.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

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 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.

Martin Davey (Senior Statutory Auditor)

for and on behalf of Azets Audit Services Limited

Chartered Accountants

Statutory Auditor

Triune Court

Monks Cross Drive

York

YO32 9GZ

29 November 2022

TURNOVER

675,718

242,382

Cost of sales

(526,250

)

(155,297

)

GROSS PROFIT

149,468

87,085

Administrative expenses

(221,971

)

(171,585

)

(72,503

)

(84,500

)

Other operating income

10,527

252,331

OPERATING (LOSS)/PROFIT

(61,976

)

167,831

Interest payable and similar expenses

(114,470

)

(131,877

)

(LOSS)/PROFIT BEFORE TAXATION

(176,446

)

35,954

Tax on (loss)/profit

-

-

(LOSS)/PROFIT FOR THE FINANCIAL YEAR

(176,446

)

35,954

CURRENT ASSETS

Debtors

29,710

57,586

Cash at bank

269,178

293,076

298,888

350,662

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

(9,181,052

)

(9,056,380

)

NET CURRENT LIABILITIES

(8,882,164

)

(8,705,718

)

TOTAL ASSETS LESS CURRENT LIABILITIES

(8,882,164

)

(8,705,718

)

CAPITAL AND RESERVES

Called up share capital

23,877,819

23,877,819

Retained earnings

(32,759,983

)

(32,583,537

)

SHAREHOLDERS' FUNDS

(8,882,164

)

(8,705,718

)

The financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.

All the members have consented to the preparation of an abridged Balance Sheet for the year ended 31 December 2021 in accordance with Section 444(2A) of the Companies Act 2006.

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

M Schoeberl - Director

1.	STATUTORY INFORMATION

Andritz Hydro Hammerfest (UK) Limited is a private company, limited by shares , registered in Scotland. The company's registered number and registered office address can be found on the Company Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

The principal accounting policies are summarised below. They have all been applied consistently throughout the year and the preceding year.

Andritz Hydro Hammerfest (UK) Limited is a company incorporated in the United Kingdom under the Companies Act. The address of the registered office is given on page 1. The nature of the Company's operations and its principal activity are set out in the report of the Directors.

The financial statements have been prepared in accordance with Financial Reporting Standard 102 (Section 1A) "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 historic cost convention. The present currency is £ sterling because that is the currency of the primary economic environment that the company operates.

Critical accounting judgements and key sources of estimation uncertainty

In the application of the Company's accounting policies, which are described in this note, the directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources, The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates are underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affect only that period or in that period or in the period of the revision and future periods if the revision affects both current and future periods.

The Directors note that there are no longer any critical judgements in applying accounting policies

Going concern

The financial statements have been prepared on the going concern basis, notwithstanding, the loss for the year to 31 December 2021 of £176,446 (2020: -£35,954) and the net liabilities of £8,882,164 (2020: £8,705,718), which the directors believe to be appropriate for the following reasons.

As further explained in the Report of the Directors, the company's trade is solely focused on providing services for the benefit of its parent undertaking Andritz AG ("Andritz").The Directors have considered cash-flow for a period of at least 12 months from the approval of these financial statements considering reasonably possible downsides,including the impact of COVID-19.

These forecasts indicate that the company is dependant in all cases on funding from Andritz to meet its liabilities as they fall due for that period. This includes Andritz not seeking repayment of the current amounts currently due to it, which at 31 December 2021 amounted to £8,950,510 and providing additional financial support during that period. Andritz has indicated its intention to continue to make available such funds as are needed by the company, and that it does not intend to seek repayments of the amounts due at the balance sheet date, for the period covered by the forecasts.

The activities of the Company are not however, integral to the activities of Andritz and therefore the Directors consider that there is not a sufficiently clear economic rationale for Andritz to continue to support the company and as a result there is uncertainty that the support which Andritz has indicated is available would be provided as required.

Based on these indications the Directors believe that it remains appropriate to prepare the financial statements on a going concern basis. However, these circumstances represent material uncertainty that may cast significant doubt on the company's ability to continue as a going concern and, therefore, to continue realising its assets and discharging its liabilities in the normal course of business. The financial statements do not include any adjustments that would result from the basis of preparation being inappropriate.

Turnover

Turnover is stated net of VAT and trade discount. Turnover from the sale of goods is recognised when the goods are physically delivered to the customer. Turnover from the supply of services represents the value of services provided under contracts to the extent that there is a right to consideration is recorded at the value of the consideration due. Where a contract has only been partially completed at the balance sheet date turnover represents the fair value of the service provided to date based on the stage of completion of the contract activity at the balance sheet date. Where payments are received from customers in advance of services provided, the amounts are recorded as deferred income and included as part of creditors due within one year.

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.

Intangible assets - research and development

Expenditure on research and development is capitalised where the outcome of those projects is assessed as being reasonably certain as regards viability and technical feasibility. Such expenditure is capitalised and will be amortised only when commercial production begins. Provision is made for any impairment.

Tangible fixed assets

Tangible fixed assets are stated at cost less depreciation and any provision for impairment. Depreciation is provided at rates calculated to write off the cost or valuation less estimated residual value each asset over its expected useful life, as follows:

Computer equipment - 25%-33% straight line

Fixtures and fittings - 20% straight line

Financial instruments

Financial assets and financial liabilities are recognised when the company becomes a party to the contractual provisions of the instrument.

Financial liabilities and equity instruments are classified according to the substance of the contractual agreements entered into. An equity instrument is an contract that evidences a residual in the assets of the Company after deducting all of its liabilities.

Financial assets and liabilities

All financial assets and liabilities are initially measured at transaction price (including transaction costs), except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value (which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a financing transaction. If an arrangement constitutes a financing transaction, the financial asset or liability is measure at the present value of the asset.

Financial assets and liabilities are only offset in the statement of financial position when, and only when there exists a legally enforceable right to set off the recognised amounts and the company intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Financial assets are derecognised when and only when a) the contractual rights to the cash flow from the financial assets expire or are settled, b) the company transfers to another party substantially all of the risks and rewards of ownership of the financial asset, or c) the company, despite having retained some, but not all, significant risks and rewards of ownership, has transferred control of the asset to another party.

Taxation

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

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the 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 recognised int he profit and loss in the period in which they arise.

Leases

Assets held under finance leases, hire purchase contracts and other similar arrangements, which confer rights and obligations similar to those attached to owned assets, are capitalised as tangible fixed assets at their fair value of the leased asset (or, if lower, the present value of the minimum lease payments as determined at the inception of the lease) and are depreciated over the shorter of the lease terms and their useful lives. The capital elements of future lease obligations are recorded as liabilities, while the interest elements are charge to the profit and loss amount over the period fo the leases to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals under operating leases are charged on a straight-line basis over the term of the lease term, even if the payments are not made on such a basis. Benefits received and receivable as an incentive to sign an operating lease are similarly spread on a straight-line basis over the lease term.

Pension costs and other post-retirement benefits

The company operates a defined contribution scheme. The company recognises a cost equal to their contribution payable for the period in their profit or loss. For defined contribution schemes the amount charged to the profit and loss account in respect of pension costs and other retirement benefits is the contributions payable in the year. Differences between contributions payable in the year and contributions actually paid are shown as either prepayments or accruals in the balance sheet.

Related party exemption

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 (Section 1A) '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.

3.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was 5 (2020 - 7 ) .

4.	PRIOR YEAR ADJUSTMENT

Plant and Machinery has been restated in the prior year, due to a material error. The asset in question was disposed of in the year to 31 December 2020, however this was not reflected in the financial statements.

Therefore, the following entries were made in the financial statements to 31 December 2020:

Plant and Machinery Cost /Disposals - (£14,856,618)

Plant and Machinery Depreciation / Disposals - £14,856,618

As a result of the above adjustment, Plant and Machinery had a carrying net book value of nil at the year end 31 December 2020, and a carrying net book value of nil at the year end 31 December 2021.

5.	INTANGIBLE FIXED ASSETS

Totals

£

COST

At 1 January 2021

and 31 December 2021

16,276,001

AMORTISATION

At 1 January 2021

and 31 December 2021

16,276,001

NET BOOK VALUE

At 31 December 2021

-

At 31 December 2020

-

The expense on the plant and machinery used in the development of technology related to the manufacture of tidal powered turbines was capitalised in accordance with Accounting for Research and Development requirements of FRS102.

6.	TANGIBLE FIXED ASSETS

Totals

£

COST

At 1 January 2021

55,847

Disposals

(20,641

)

At 31 December 2021

35,206

DEPRECIATION

At 1 January 2021

55,847

Eliminated on disposal

(20,641

)

At 31 December 2021

35,206

NET BOOK VALUE

At 31 December 2021

-

At 31 December 2020

-

7.	ULTIMATE CONTROLLING PARTY

The immediate parent company is Andritz Hydro Hammerfest Strom AS, a company registered in Norway (registered office at c/o Hammerfest Energi AS, Rossmollgata 50, 9601 Hammerfest; registration number 979 152 256) and the smallest group in which the results of this company are consolidated. The consolidated financial statements are prepared in Norway. Andritz GmbH is the largest group in which the results of the company are consolidated. The Andritz GmbH consolidated financial statements are prepared in Austria and are available at http://www.andritz.com.