CD (UK) Limited - Limited company accounts 22.3

REGISTERED NUMBER: 02905619 (England and Wales)

for

Page

Company Information  

1

Strategic Report  

2

Report of the Director  

4

Report of the Independent Auditors  

5

Statement of Comprehensive Income

8

Balance Sheet  

9

Statement of Changes in Equity  

11

Cash Flow Statement  

12

Notes to the Cash Flow Statement  

13

Notes to the Financial Statements

14

DIRECTOR:

G M Baker

REGISTERED OFFICE:

Baker House

Thistle Way

Gildersome Spur, Gildersome,

Leeds

West Yorkshire

LS27 7JZ

REGISTERED NUMBER:

02905619 (England and Wales)

AUDITORS:

Lindley Adams Limited Chartered Accountants

Statutory Auditor

28 Prescott Street

Halifax

West Yorkshire

HX1 2LG

The director presents his strategic report for the year ended 31 December 2021.

REVIEW OF BUSINESS

The Company continues to meet the demands of the commercial market and the domestic market for Solid Surface material in the UK and Ireland.  The company has the infrastructure in place to cope with the current level of sales and for future growth.

The Company has also continued the distribution of the Air Uno line of goods.

The COVID-19 pandemic continued to impact the business during 2021 and the company continued to take measures to mitigate the risks.  Office based employees returned to working from site in the safest conditions possible, with regularly reviewed COVID guidance.  The impact of COVID-19 was that turnover has not returned to the same levels as seen in 2019 but did increase slightly by 2% on 2020.

In October 2021, the business launched a new complementary, sustainable, solid surface product; PaperStone®. PaperStone® is primarily made with FSC certified recycled paper cardboard combined with a patented natural phenolic resin, PetroFree®.

The business has seen a slight increase in turnover in 2021 compared with 2020, with sales for 2021 of £20.153 million and an increase in gross profit to £5.911 million.  The maintenance of this level of turnover in the light of the difficult trading conditions brought about by the Covid 19 restrictions has continued to be from serving the existing customers and from broadening the nature of projects the company undertakes as well as broadening its customer base.  The company has continued to review and make improvements to both its operational infrastructure and human resources in 2021.

The director and leadership team monitor the key performance indicators of sales, profitability, overhead costs and working capital on a very regular basis, together with stock availability, customer service and operational key performance indicators.

PRINCIPAL RISKS AND UNCERTAINTIES

The principal risks and uncertainties facing the business are economic risks which will affect the economy in general, and construction in particular, together with any unforeseen supply interruptions.  COVID-19 has continued to show this to be the case in 2021.  The company monitors cash flow closely to ensure that it is not exposed to undue cash flow risks.  Political risks and environmental risks are considered by the directors on a regular basis.  The exposure of the company to foreign exchange rate fluctuations is monitored regularly and steps are taken to mitigate risks by strategic purchase of foreign currency.  Brexit has brought about additional challenges relating to both the import of goods from Europe and North America and the export of goods to Ireland which the company is managing by close control of the necessary protocols and procedures.

DEVELOPMENT AND PERFORMANCE OF THE BUSINESS

The company has continued to sell Solid Surface material and Air Uno products in the UK and Ireland.  Turnover has increased to £20.153 million in 2021 from £19.858 million in 2020.  Gross profit has increased to £5.911 million in 2021 from £5.870 million in 2020.

In 2019 the company introduced Next Day Delivery by dedicated liveried transport to customers in mainland UK, in order to enhance customer service.  This had an increased cost to the company but  reduced by a substantial amount the number of miles travelled by hauliers and had a positive environmental benefit.  During the 2020 lockdown period this service was not the highest priority for most customers and so deliveries returned to being a two-day service.  The next day service was reinstated in the second quarter of 2021.

The company actively encourages all staff to undertake a range of further training, which it supports, and to participate in quarterly company meetings and staff social events.

POSITION OF THE COMPANY'S BUSINESS AT THE YEAR END

At the end of 2021, the company's balance sheet showed capital and reserves of £7.078 million compared with £7.216 million at the end of 2020..

On 4th October 2021 Mrs C Baker transferred 2,426 C shares to Mr G M Baker.

The company monitors all elements of working capital, being stock, debtors, creditors and cash, carefully throughout the year.

ON BEHALF OF THE BOARD:

G M Baker - Director

28 September 2022

The director presents his report with the financial statements of the company for the year ended 31 December 2021.

DIVIDENDS

Interim dividends totalling £160,527.52 were paid during the year as follows:

Ordinary C £1 shares £14.0962 per share

DIRECTOR

G M Baker held office during the whole of the period from 1 January 2021 to the date of this report.

STATEMENT OF DIRECTOR'S RESPONSIBILITIES

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

AUDITORS

The auditors,  Lindley Adams Limited Chartered Accountants, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

G M Baker - Director

28 September 2022

Opinion

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 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 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 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 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 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 company and its environment obtained in the course of the audit, we have not identified material misstatements in the 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, 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 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 four, 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 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 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:

As part of our audit, we determined a level for materiality and assessed the risk of material misstatement in the financial statements.  Based on our understanding of the company and discussions with the management, we gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates. We identified the laws and regulations which we considered to have a direct effect on the financial statements and considered that the most significant are the Companies Act 2006, Financial Reporting Standards and UK tax legislation.

The engagement partner assessed that the engagement team had the appropriate competence and capabilities to identify or recognise non-compliance with the laws and regulations.

We enquired with management and those charged with governance as to any known instances of non-compliance or suspected non-compliance with laws and regulations including fraud.  We also designed specific appropriate audit procedures including:

- Agreeing financial statement disclosures to supporting documentation.

- Analytical procedures to identify any unusual or unexpected relationships.

- Testing appropriateness of journal entries.

- Review of accounting estimates for potential bias.

- Review of minutes of meetings of those charged with governance.

- Enquire with management as to actual and potential litigation and claims.

- Review of correspondence.

We are not aware of any actual or suspected non-compliance with laws and regulations, and we are not responsible for preventing or detecting non-compliance with all laws and regulations.  The primary responsibility for the prevention and detection of fraud rests with management and those charged with governance.

There are inherent limitations in audit procedures and there is an unavoidable risk that we may not have detected material misstatements within the financial statements, even though the audit is properly planned and performed in accordance with ISA's UK.  The further removed non-compliance with laws and regulations are from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.  The risk of not detecting a material misstatement due to fraud is higher than the risk due to error as fraud may involve a 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.

David Adams FCA (Senior Statutory Auditor)

for and on behalf of Lindley Adams Limited Chartered Accountants

Statutory Auditor

28 Prescott Street

Halifax

West Yorkshire

HX1 2LG

28 September 2022

TURNOVER

3

20,153,891

19,857,938

Cost of sales

(14,242,051

)

(13,946,286

)

GROSS PROFIT

5,911,840

5,911,652

Distribution costs

(1,472,847

)

(1,529,870

)

Administrative expenses

(4,572,104

)

(4,621,889

)

(133,111

)

(240,107

)

Other operating income

182,440

286,963

OPERATING PROFIT

5

49,329

46,856

Interest receivable and similar income

236

5,651

49,565

52,507

Amounts written off investments

7

-

(79,020

)

49,565

(26,513

)

Interest payable and similar expenses

8

(16,809

)

(17,264

)

PROFIT/(LOSS) BEFORE TAXATION

32,756

(43,777

)

Tax on profit/(loss)

9

(10,369

)

(10,724

)

PROFIT/(LOSS) FOR THE FINANCIAL YEAR

22,387

(54,501)

FIXED ASSETS

Intangible assets

12

32,196

53,526

Tangible assets

13

117,977

151,420

Investments

14

100

-

150,273

204,946

CURRENT ASSETS

Stocks

15

3,569,686

3,311,483

Debtors

16

6,689,604

6,004,033

Cash at bank and in hand

1,108,558

5,502,915

11,367,848

14,818,431

CREDITORS

Amounts falling due within one year

17

3,288,487

6,351,431

NET CURRENT ASSETS

8,079,361

8,467,000

TOTAL ASSETS LESS CURRENT

LIABILITIES

8,229,634

8,671,946

CREDITORS

Amounts falling due after more than one

year

18

(831,721

)

(1,168,550

)

PROVISIONS FOR LIABILITIES

22

(319,404

)

(286,746

)

NET ASSETS

7,078,509

7,216,650

CAPITAL AND RESERVES

Called up share capital

23

16,268

16,268

Share premium

24

389,707

389,707

Capital redemption reserve

24

76,377

76,377

Retained earnings

24

6,596,157

6,734,298

SHAREHOLDERS' FUNDS

7,078,509

7,216,650

The financial statements were approved by the director and authorised for issue on 28 September 2022 and were signed by:

G M Baker - Director

Called up

Capital

share

Retained

Share

redemption

Total

capital

earnings

premium

reserve

equity

£   

£   

£   

£   

£   

Balance at 1 January 2020

86,533

9,734,659

389,707

6,112

10,217,011

Prior year adjustment

-

(6,209

)

-

-

(6,209

)

As restated

86,533

9,728,450

389,707

6,112

10,210,802

Changes in equity

Purchase of own shares

(70,265

)

(2,884,380

)

-

70,265

(2,884,380

)

Dividends

-

(55,271

)

-

-

(55,271

)

Total comprehensive income

-

(82,400

)

-

-

(82,400

)

Balance at 31 December 2020

16,268

6,706,399

389,707

76,377

7,188,751

Prior year adjustment

-

27,899

-

-

27,899

As restated

16,268

6,734,298

389,707

76,377

7,216,650

Changes in equity

Dividends

-

(160,528

)

-

-

(160,528

)

Total comprehensive income

-

22,387

-

-

22,387

Balance at 31 December 2021

16,268

6,596,157

389,707

76,377

7,078,509

Cash flows from operating activities

Cash generated from operations

1

(2,926,230

)

2,845,038

Interest paid

(10,247

)

(9,810

)

Interest element of hire purchase payments

paid

(6,562

)

(7,454

)

Tax paid

(203

)

(58,216

)

Net cash from operating activities

(2,943,242

)

2,769,558

Cash flows from investing activities

Purchase of tangible fixed assets

(59,897

)

(3,524

)

Purchase of fixed asset investments

(100

)

-

Sale of tangible fixed assets

15,000

(888

)

Interest received

236

5,651

Net cash from investing activities

(44,761

)

1,239

Cash flows from financing activities

New loans in year

-

1,000,000

Loan repayments in year

(102,103

)

(38,062

)

Amounts repaid to other loan creditor

(1,053,846

)

-

HP capital repayments in year

(30,488

)

(31,790

)

Amount introduced by directors

-

2,273,696

Amount withdrawn by directors

(59,389

)

(18,414

)

Share buyback

-

(2,884,380

)