Russell Leisure Limited - Limited company accounts 20.1

REGISTERED NUMBER: SC162280 (Scotland)

Report of the Directors and

Unaudited Financial Statements for the Year Ended 30 September 2020

for

Russell Leisure Limited

T/A

Russell Play

Page

Company Information

1

Report of the Directors

2

Income Statement

3

Statement of Financial Position

4

Statement of Changes in Equity

5

Notes to the Financial Statements

6

DIRECTORS:

Alasdair James Wellwood

Teresa Wellwood

George A Mackay

Christopher James Mackay Wellwood

SECRETARY:

David Rintoul

REGISTERED OFFICE:

14 Rutland Square

Edinburgh

EH1 2BD

REGISTERED NUMBER:

SC162280 (Scotland)

ACCOUNTANTS:

Gibson McKerrell Brown LLP

Chartered Accountants

14 Rutland Square

Edinburgh

Midlothian

EH1 2BD

BANKERS:

The Royal Bank of Scotland plc

Newbridge Branch

30 Old Liston Road

Newbridge

EH28 8SS

SOLICITORS:

Dickson Minto WS

16 Charlotte Square

Edinburgh

EH2 4DF

The directors present their report with the financial statements of the company for the year ended 30 September 2020.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of the design, selling and installation of playground and multisport equipment.

REVIEW OF BUSINESS

The Directors report that the Turnover for the period ended 30 September 2020 was

£ 2,034,331 and the loss after taxation was £267,275. Included in this loss was a provision for an (Exceptional) Stock Loss of £ 136,240, which had no cash impact as it related to old and obsolete product.

As in many business sectors, the Covid 19 crisis curtailed our activities for a number of months this past year, reducing our turnover and profitability. The company responded quickly to the pandemic taking a number of decisive actions including establishing primary initiatives to prioritise the health and safety of our employees and customers, closing our offices, implementing work from home processes and reducing overhead costs to optimise cash flow.

The Directors are confident that the actions taken and the continued strengthening of our market will return the business to profitability in the coming year.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 October 2019 to the date of this report.

Alasdair James Wellwood

Teresa Wellwood

George A Mackay

Christopher James Mackay Wellwood

This report has been prepared in accordance with the provisions of Part 15 of the Companies Act 2006 relating to small companies.

ON BEHALF OF THE BOARD:

David Rintoul - Secretary

1 September 2021

TURNOVER

3

2,034,331

2,586,818

Cost of sales

1,591,854

1,798,436

GROSS PROFIT

442,477

788,382

Administrative expenses

813,209

733,124

(370,732

)

55,258

Other operating income

111,019

-

OPERATING (LOSS)/PROFIT

5

(259,713

)

55,258

Interest payable and similar expenses

7,562

4,786

(LOSS)/PROFIT BEFORE TAXATION

(267,275

)

50,472

Tax on (loss)/profit

7

-

-

(LOSS)/PROFIT FOR THE FINANCIAL YEAR

(267,275

)

50,472

FIXED ASSETS

Tangible assets

8

55,379

97,044

CURRENT ASSETS

Stocks

234,149

344,031

Debtors

9

530,253

744,511

Cash in hand

1,009

1,217

765,411

1,089,759

CREDITORS

Amounts falling due within one year

10

717,041

795,734

NET CURRENT ASSETS

48,370

294,025

TOTAL ASSETS LESS CURRENT LIABILITIES

103,749

391,069

CREDITORS

Amounts falling due after more than one year

11

1,561

21,606

NET ASSETS

102,188

369,463

CAPITAL AND RESERVES

Called up share capital

14

460,000

460,000

Retained earnings

(357,812

)

(90,537

)

SHAREHOLDERS' FUNDS

102,188

369,463

The company is entitled to exemption from audit under Section 477 of the Companies Act 2006 for the year ended 30 September 2020.

The members have not required the company to obtain an audit of its financial statements for the year ended 30 September 2020 in accordance with Section 476 of the Companies Act 2006.

The directors acknowledge their responsibilities for:

(a)	ensuring that the company keeps accounting records which comply with Sections 386 and 387 of the Companies Act 2006 and

(b)

preparing financial statements which give a true and fair view of the state of affairs of the company as at the end of each financial year and of its profit or loss for each financial year in accordance with the requirements of Sections 394 and 395 and which otherwise comply with the requirements of the Companies Act 2006 relating to financial statements, so far as applicable to the company.

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

The financial statements were approved by the Board of Directors and authorised for issue on 1 September 2021 and were signed on its behalf by:

Alasdair James Wellwood - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2019

460,000

(141,009

)

318,991

Changes in equity

Total comprehensive income

-

50,472

50,472

Balance at 30 September 2019

460,000

(90,537

)

369,463

Changes in equity

Total comprehensive income

-

(267,275

)

(267,275

)

Balance at 30 September 2020

460,000

(357,812

)

102,188

1.	STATUTORY INFORMATION

Russell Leisure 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.

The presentation currency of the financial statements is the Pound Sterling (£).

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" including the provisions of Section 1A "Small Entities" 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, excluding discounts, rebates, value added tax and other sales taxes. Turnover is attributable to the company's principal activity of design, selling and installation of playground and multisport equipment.

Tangible fixed assets

Tangible fixed assets are initially measured at cost. Cost includes the original purchase price and costs directly attributable to bringing the asset to its present location and into its present condition. After initial recognition, the assets are measured at cost less any accumulated depreciation and any accumulated impairment losses. Freehold properties are subsequently measured at their revalued amount, being the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

Depreciation is provided by equal instalments 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.

Motor vehicles - over 4 years

Plant and machinery - at varying rates on cost between 16.67% and 50%.

Depreciation and impairment losses are charged to the Income Statement within administrative expenses.

The assets' residual values and useful lives are reviewed, and adjusted, if appropriate, at the end of each reporting period. The effect of any change is accounted for prospectively

Government grants

A grant that becomes receivable as compensation for expenses or losses already incurred or the purpose of giving immediate financial support to the entity with no future related costs shall be recognised in income in the period in which it becomes receivable.

Grants relating to revenue shall be recognised in income on a systematic basis over the period in which the entity recognises the related costs for which the grant is intended to compensate.

Stocks and work in progress

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis.

At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The loss is recognised immediately in the Income Statement.

Financial instruments

The company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and payables, loans from banks and other third parties.

At the end of each reporting period, financial assets that are measured at cost are assessed for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Income Statement. If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been had the impairment not previously been recognised. The impairment reversal is recognised in the Income Statement.

Financial assets are derecognised when (a) the contractual rights to the cash flows arising from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party, or (c) control of the asset has been transferred to another party.

Financial liabilities are measured at amortised cost less any accumulated impairment losses. Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.

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 statement of financial position date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position 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.

Research and development

Expenditure on research and development is written off in the year in which it is incurred.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the statement of financial position 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 thestatement of financial position as substantially all of the risks and rewards incidental to ownership have been transferred from the leasing company.

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 shorter.

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

Rentals under operating leases are charged to the Income Statement on a straight line basis over the period of the lease.

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.

3.

TURNOVER

The turnover and loss (2019 - profit) before taxation are attributable to the one principal activity of the company.

An analysis of turnover by geographical market is given below:

Period

1.1.19

Year Ended

to

30.9.20

30.9.19

United Kingdom

94.61%

97.05%

Australia

0.55%

1.97%

Germany

2.05%

0.00%

Holland

0.10%

0.38%

UAE

1.09%

0.00%

Sweden

0.55%

0.50%

Belgium

0.15%

0.10%

Denmark

0.16%

0.00%

Eire

0.00%

0.00%

France

0.74%

0.00%

100.00%

100.00%

4.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was 17 (2019 - 18 ) .

Period

1.1.19

Year Ended

to

30.9.20

30.9.19

£

£

Directors' remuneration

142,841

120,123

Directors' pension contributions to money purchase schemes

5,963

4,992

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

Money purchase schemes

3

3

5.	OPERATING (LOSS)/PROFIT

The operating loss (2019 - operating profit) is stated after charging/(crediting):

Period

1.1.19

Year Ended

to

30.9.20

30.9.19

£

£

Other operating leases

91,401

69,103

Depreciation - owned assets

38,893

25,738

Depreciation - assets on hire purchase contracts

16,201

13,335

Loss on disposal of fixed assets

1,666

-

Foreign exchange differences

(5,535

)

(1,175

)

Pension costs

27,551

24,234

6.	EXCEPTIONAL ITEMS

Included in cost of sales is an exceptional write off for obsolete stock of £136,240.

7.

TAXATION

Analysis of the tax charge

No liability to UK corporation tax arose for the year ended 30 September 2020 nor for the period ended 30 September 2019.

8.	TANGIBLE FIXED ASSETS

Plant and

machinery

etc

£

COST

At 1 October 2019

226,278

Additions

26,061

Disposals

(25,264

)

At 30 September 2020

227,075

DEPRECIATION

At 1 October 2019

129,234

Charge for year

55,094

Eliminated on disposal

(12,632

)

At 30 September 2020

171,696

NET BOOK VALUE

At 30 September 2020

55,379

At 30 September 2019

97,044

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

Plant and

machinery

etc

£

COST

At 1 October 2019

71,120

Disposals

(25,264

)

At 30 September 2020

45,856

DEPRECIATION

At 1 October 2019

28,912

Charge for year

16,201

Eliminated on disposal

(12,632

)

At 30 September 2020

32,481

NET BOOK VALUE

At 30 September 2020

13,375

At 30 September 2019

42,208

9.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

30.9.20

30.9.19

£

£

Trade debtors

487,304

691,074

Other debtors

42,949

53,437

530,253

744,511

10.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

30.9.20

30.9.19

£

£

Bank loans and overdrafts

266,720

54,491

Hire purchase contracts (see note 12)

9,364

15,467

Trade creditors

152,418

239,461

Social security and other taxes

162,347

179,379

Accruals and deferred income

126,192

306,936

717,041

795,734

11.

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

30.9.20

30.9.19

£

£

Hire purchase contracts (see note 12)

1,561

21,606

12.	LEASING AGREEMENTS

Obligation under hire purchase contracts

The future minimum obligations are as follows:

30.9.20

31.12.19

£

£

Not later than one year

10,335

17,220

Later than one year and not later than five years

1,723

24,105

Total gross payments

12,058

41,325

Less: finance charges

(1,133

)

(4,252

)

Carrying amount of liability

10,925

37,073

Obligation under non-cancellable operating leases

The future minimum obligations are as follows:

30.9.20

31.12.19

£

£

Within one year

108,745

88,840

Between one and five years

169,148

142,894

277,893

231,734

13.	SECURED DEBTS

The following secured debts are included within creditors:

30.9.20

30.9.19

£

£

Bank overdrafts

266,720

54,491

Hire purchase contracts

10,925

37,073

277,645

91,564

The Royal Bank of Scotland plc has a bond and floating charge over all the company assets.

14.	CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:

Number:

Class:

Nominal

30.9.20

30.9.19

value:

£

£

150,000

Ordinary A

£1

150,000

150,000

150,000

Ordinary B

£1

150,000

150,000

160,000

Preference

£1

160,000

160,000

460,000

460,000

The preference shares are redeemable at the discretion of the company as is the payment of any dividend thereon.