A.R. Wholesale Limited - Limited company accounts 20.1

REGISTERED NUMBER: 12923295 (England and Wales)

Strategic Report, Report of the Directors and

Financial Statements

for the Period

2 October 2020 to 31 December 2021

for

A.R. Wholesale Limited

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

5

Statement of Comprehensive Income

9

Balance Sheet

10

Statement of Changes in Equity

11

Cash Flow Statement

12

Notes to the Cash Flow Statement

13

Notes to the Financial Statements

14

DIRECTORS:

M D M Jones

Miss H Thompson

REGISTERED OFFICE:

1 Mount Pleasant Way Stokesley Business

Stokesley

Middlesbrough

Cleveland

TS9 5NZ

REGISTERED NUMBER:

12923295 (England and Wales)

AUDITORS:

Anderson Barrowcliff LLP

Statutory Auditors

Chartered Accountants

3 Kingfisher Court

Bowesfield Park

Stockton on Tees

TS18 3EX

The directors present their strategic report for the period 2 October 2020 to 31 December 2021.

REVIEW OF BUSINESS

The company incorporated on 2 October 2020 and commenced trade on the 1 January 2021. The trading divisions known as Wholesale and Hoggarths (container storage rental) were transferred from its parent company Armstrong Richardson & Co Limited to A.R. Wholesale Limited on the trade commencement date. On the 1 June 2021 A.R. Wholesale Limited left the group to join a newly incorporated group, Blue Barn Group Limited. The directors believe the newly restructured group will improve efficiencies.

The company continues to seek growth and to capitalise on economies of scale. The results for the period show turnover amounting to £29,534,026, gross profit margin of 19.2% and overall pre-tax profit of £830,370. These results are considered satisfactory by the directors.

PRINCIPAL RISKS AND UNCERTAINTIES

The company continues to diversify its operations and is not solely dependent upon the UK agriculture industry. As a result the directors feel that there is no single customer or supplier, the loss of which would seriously affect the business.

KEY PERFORMANCE INDICATORS

Given the straightforward nature of the business, the Company's directors are of the opinion that analysis using KPIs is not necessary for an understanding of the development, performance or position of the entity, and that all relevant financial information has been disclosed within the financial statements.

ON BEHALF OF THE BOARD:

M D M Jones - Director

30 March 2022

The directors present their report with the financial statements of the company for the period 2 October 2020 to 31 December 2021.

COMMENCEMENT OF TRADING

The company started trading on 1 January 2021.

PRINCIPAL ACTIVITIES

The principal activities of the company in the period under review were those of pet and equine wholesaler and rental of containers.

DIVIDENDS

No dividends will be distributed for the period ended 31 December 2021.

FUTURE DEVELOPMENTS

The company expects to continue to improve efficiency and achieve economies of scale.

DIRECTORS

The directors who have held office during the period from 2 October 2020 to the date of this report are as follows:

M D M Jones - appointed 2 October 2020

Miss H Thompson - appointed 16 October 2020

Both the directors who are eligible offer themselves for election at the forthcoming first Annual General Meeting.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the 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 of the profit or loss of the company 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 transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

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 company'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 company's auditors are aware of that information.

AUDITORS

The auditors, Anderson Barrowcliff LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

M D M Jones - Director

30 March 2022

Opinion

We have audited the financial statements of A.R. Wholesale Limited (the 'company') for the period ended 31 December 2021 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the 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 company's affairs as at 31 December 2021 and of its 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 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 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 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 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 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 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 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 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, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of directors' remuneration specified by law are not made; or

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

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page three, 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 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 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. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.

Based on our understanding of the industry, we have considered applicable laws and regulations which may be fundamental to the company's ability to operate or to avoid a material penalty, and we considered the extent to which non-compliance might have a material effect on the financial statements. We considered management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to the posting of inappropriate manual journal entries to manipulate financial performance, management bias in significant accounting estimates and any significant one-off or unusual transactions.

We discussed among the audit engagement team the opportunities and incentives that may exist within the organisation for fraud and how and where fraud might occur in the financial statements.

Audit procedures performed by the engagement team included:

-

Enquiry of management and those charged with governance around actual and potential litigation and claims.

-

Enquiry of entity staff to identify any instances of non-compliance with laws and regulations.

-

Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.

-

Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business.

-

Revenue recognition; agreeing a sample of revenue transactions to gain assurance over the occurrence and accuracy of revenue and also to ensure revenue has been recognised in the correct period.

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. The 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 is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

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.

Helen Wilson FCA (Senior Statutory Auditor)

for and on behalf of Anderson Barrowcliff LLP

Statutory Auditors

Chartered Accountants

3 Kingfisher Court

Bowesfield Park

Stockton on Tees

TS18 3EX

31 March 2022

TURNOVER

3

29,534,026

Cost of sales

23,851,435

GROSS PROFIT

5,682,591

Distribution costs

1,306,047

Administrative expenses

3,519,235

4,825,282

857,309

Other operating income

22,024

OPERATING PROFIT

879,333

Interest receivable and similar income

1

879,334

Interest payable and similar expenses

5

48,964

PROFIT BEFORE TAXATION

6

830,370

Tax on profit

7

144,750

PROFIT FOR THE FINANCIAL PERIOD

685,620

OTHER COMPREHENSIVE INCOME

-

TOTAL COMPREHENSIVE INCOME FOR THE PERIOD

685,620

FIXED ASSETS

Tangible assets

8

786,139

CURRENT ASSETS

Stocks

9

1,225,134

Debtors

10

2,293,752

Cash at bank and in hand

1,259,537

4,778,423

CREDITORS

Amounts falling due within one year

11

4,729,394

NET CURRENT ASSETS

49,029

TOTAL ASSETS LESS CURRENT LIABILITIES

835,168

CREDITORS

Amounts falling due after more than one year

12

(111,618

)

PROVISIONS FOR LIABILITIES

15

(37,750

)

NET ASSETS

685,800

CAPITAL AND RESERVES

Called up share capital

16

180

Retained earnings

17

685,620

SHAREHOLDERS' FUNDS

685,800

The financial statements were approved by the Board of Directors and authorised for issue on 30 March 2022 and were signed on its behalf by:

M D M Jones - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Changes in equity

Issue of share capital

180

-

180

Total comprehensive income

-

685,620

685,620

Balance at 31 December 2021

180

685,620

685,800

Cash flows from operating activities

Cash generated from operations

1

2,390,599

Interest paid

(22,597

)

Interest element of hire purchase payments paid

(26,367

)

Net cash from operating activities

2,341,635

Cash flows from investing activities

Purchase of tangible fixed assets

(1,209,675

)

Sale of tangible fixed assets

46,531

Interest received

1

Net cash from investing activities

(1,163,143

)

Cash flows from financing activities

New loans in year

1,775,481

Loan repayments in year

(1,775,481

)

New HP loans in year

592,396

Capital repayments in year

(280,389

)

Share issue

180

Related party financing

(232,491

)

Government Grant

1,349

Net cash from financing activities

81,045

Increase in cash and cash equivalents

1,259,537

Cash and cash equivalents at beginning of period

2

-

Cash and cash equivalents at end of period

2

1,259,537

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

£

Profit before taxation

830,370

Depreciation charges

422,467

Profit on disposal of fixed assets

(45,462

)

Government grants

(1,349

)

Finance costs

48,964

Finance income

(1

)

1,254,989

Increase in stocks

(1,225,134

)

Increase in trade and other debtors

(1,801,798

)

Increase in trade and other creditors

4,162,542

Cash generated from operations

2,390,599

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 31 December 2021

31.12.21

2.10.20

£

£

Cash and cash equivalents

1,259,537

-

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 2.10.20

Cash flow

At 31.12.21

£

£

£

Net cash

Cash at bank and in hand

-

1,259,537

1,259,537

-

1,259,537

1,259,537

Debt

Finance leases

-

(312,007

)

(312,007

)

-

(312,007

)

(312,007

)

Total

-

947,530

947,530

1.	STATUTORY INFORMATION

A.R. Wholesale Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

The nature of the Company's operations and principal activities are set out in the Report of the Directors on page 3.

The financial statements are prepared in Sterling which is the functional currency of the company rounded to the nearest £.

The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been applied to the period presented unless otherwise stated.

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.

Turnover

Turnover is measured at the fair value of the consideration received or receivable net of VAT and trade discounts. The policies adopted for the recognition of turnover are as follows:

Sale of goods

Turnover from the sale of goods is recognised when significant risks and rewards of ownership of the goods have transferred to the buyer, the amount of turnover can be measured reliably, it is probable that the economic benefits associated with the transaction can be measured reliably. This is usually on the dispatch of the goods.

Sale of services

When the outcome of a transaction can be estimated reliably, turnover from hire of containers is recognised in the period the hire of container related.

Tangible fixed assets

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.

Plant and machinery

-

33% on cost and 20% on cost

Containers

-

20% on cost

Motor vehicles

-

20% on cost

Government grants

The company received government grants in respect of the Coronavirus Job Retention Scheme. These grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the company will comply with conditions attached to them. The grants were recognised using the accrual model.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing stock to its present location and condition. Cost is calculated using the first in, first out formula. Provision is made for damaged, obsolete and slow-moving stock where appropriate.

Taxation

Taxation for the period comprises current and deferred tax. Tax is recognised in the 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 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.

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.

Pension costs and other post-retirement benefits

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

Debtors and creditors receivable/payable within one year

Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss in administrative expenses.

Judgements and key sources of estimation uncertainty

In the application of the Company's accounting policies, 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 and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period of the revision, if the revision affects only that period, or in the period of revision and future periods if the revision affects both current and future periods.

3.

TURNOVER

The turnover and profit before taxation are attributable to the principal activities of the company.

An analysis of turnover by class of business is given below:

£

Sales of goods

29,257,510

Sales of services

276,516

29,534,026

4.	EMPLOYEES AND DIRECTORS

£

Wages and salaries

1,845,343

Social security costs

145,241

Other pension costs

53,473

2,044,057

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

Directors

1

Sales and administration

77

78

£

Directors' remuneration

43,400

Directors' pension contributions to money purchase schemes

2,602

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

Money purchase schemes

1

5.

INTEREST PAYABLE AND SIMILAR EXPENSES

£

Bank loan interest

22,597

Hire purchase

26,367

48,964

6.	PROFIT BEFORE TAXATION

The profit is stated after charging/(crediting):

£

Depreciation - owned assets

134,985

Depreciation - assets on hire purchase contracts

287,482

Profit on disposal of fixed assets

(45,462

)

Auditors remuneration

15,013

7.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the period was as follows:

£

Current tax:

UK corporation tax

137,000

Deferred taxation

7,750

Tax on profit

144,750

UK corporation tax has been charged at 19% .

Reconciliation of total tax charge included in profit and loss

The tax assessed for the period is lower than the standard rate of corporation tax in the UK. The difference is explained below:

£

Profit before tax

830,370

Profit multiplied by the standard rate of corporation tax in the UK of 19%

157,770

Effects of:

Overprovision of current year tax charge

898

Capital allowances super-deduction

(13,918

)

Total tax charge

144,750

There is no expiry date on timing differences, unused tax losses or tax credits.

8.	TANGIBLE FIXED ASSETS

Plant and

Motor

machinery

Containers

vehicles

Totals

£

£

£

£

COST

Additions

297,780

221,002

690,893

1,209,675

Disposals

-

-

(2,137

)

(2,137

)

At 31 December 2021

297,780

221,002

688,756

1,207,538

DEPRECIATION

Charge for period

90,211

40,110

292,146

422,467

Eliminated on disposal

-

-

(1,068

)

(1,068

)

At 31 December 2021

90,211

40,110

291,078

421,399

NET BOOK VALUE

At 31 December 2021

207,569

180,892

397,678

786,139

Fixed assets, included in the above, which are held under hire purchase contracts are as follows:

Plant and

Motor

machinery

vehicles

Totals

£

£

£

COST

Additions

10,928

600,358

611,286

Disposals

-

(2,136

)

(2,136

)

Transfer to ownership

(10,928

)

(57,125

)

(68,053

)

At 31 December 2021

-

541,097

541,097

DEPRECIATION

Charge for period

10,928

276,554

287,482

Eliminated on disposal

-

(1,068

)

(1,068

)

Transfer to ownership

(10,928

)

(51,431

)

(62,359

)

At 31 December 2021

-

224,055

224,055

NET BOOK VALUE

At 31 December 2021

-

317,042

317,042

9.

STOCKS

£

Goods for resale

1,225,134

10.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

£

Trade debtors

1,612,493

Amounts owed by participating interests

491,954

Other debtors

95,192

VAT

49,303

Prepayments

44,810

2,293,752

11.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

£

Hire purchase contracts (see note 13)

200,389

Trade creditors

3,901,284

Amounts owed to group undertakings

194,580

Amounts owed to participating interests

34,883

Taxation

137,000

Social security and other taxes

74,271

Other creditors

39,943

Accrued expenses

147,044

4,729,394

12.

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

£

Hire purchase contracts (see note 13)

111,618

13.	LEASING AGREEMENTS

Minimum lease payments under hire purchase fall due as follows:

£

Net obligations repayable:

Within one year

200,389

Between one and five years

111,618

312,007

14.	SECURED DEBTS

The following secured debts are included within creditors:

£

Hire purchase contracts

312,007

The company has a bank overdraft facility which is secured by a debenture charge over the fixed and floating assets of the Company.

The hire purchase contracts are secured over the assets to which they relate.

15.	PROVISIONS FOR LIABILITIES

£

Deferred taxation

37,750

Deferred

tax

£

Provided during period

30,000

Charge to Statement of Comprehensive Income during period

7,750

Balance at 31 December 2021

37,750

16.	CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:

Number:

Class:

Nominal

value:

£

180

Ordinary

£1

180

180 Ordinary shares of £1 each were allotted and fully paid for cash at par during the period.