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SolarEdge Critical Power U.K. Limited
Registered number: 04229714
Annual Report
For the year ended 31 December 2020
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
REGISTERED NUMBER: 04229714
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2020
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The Company has opted not to file the statement of comprehensive income in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 2 to 13 form part of these financial statements.
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
REGISTERED NUMBER: 04229714
STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 DECEMBER 2020
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2020
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Comprehensive income for the year
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Total comprehensive income for the year
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Comprehensive income for the year
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Total comprehensive loss for the year
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The notes on pages 2 to 13 form part of these financial statements.
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- 1 -
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
SolarEdge Critical Power U.K. Limited (previously known as Gamatronic (UK) Limited) is a private company limited by shares, and is incorporated in England and Wales. The registered number of the Company is 04229714. The registered address of the Company is Tower Bridge House, St. Katharine's Way, London, E1W 1DD.
The Company's trading address is 15 Chester Road, Colmworth Business Park, Eaton Socon, St Neots PE19 8YT.
The principal activity of the Company is that of the sale of UPS equipment.
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The financial statements have been presented in Pounds Sterling as this is the currency of the primary economic environment in which the Company operates and is rounded to the nearest pound.
The following principal accounting policies have been applied:
The financial statements are prepared on a going concern basis. The Company remains assured of the financial support provided by the ultimate parent company. The directors have received confirmation that the ultimate parent company will continue to support the Company and provide it with adequate funds when necessary to enable it to meet its debts as they fall due in the foreseeable future. On this basis, the directors consider it appropriate to prepare the financial statements on a going concern basis.
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
2.Accounting policies (continued)
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentation currency is Pounds Sterling.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.
All other foreign exchange gains and losses are presented in the Statement of Comprehensive Income.
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the Company and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before turnover is recognised:
Sale of goods
Turnover from the sale of goods is recognised when all of the following conditions are satisfied:
∙the Company has transferred the significant risks and rewards of ownership to the buyer;
∙the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
∙the amount of turnover can be measured reliably;
∙it is probable that the Company will receive the consideration due under the transaction; and
∙the costs incurred or to be incurred in respect of the transaction can be measured reliably.
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Interest receivable and similar income
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Interest income is recognised in the Statement of Comprehensive Income using the effective interest method.
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
2.Accounting policies (continued)
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in the Statement of Comprehensive Income when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.
Where share options are awarded to employees, the fair value of the options at the date of grant is charged to the Statement of Comprehensive Income over the vesting period. Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected to vest at each Statement of Financial Position date so that, ultimately, the cumulative amount recognised over the vesting period is based on the number of options that eventually vest. Market vesting conditions are factored into the fair value of the options granted. The cumulative expense is not adjusted for failure to achieve a market vesting condition.
The fair value of the award also takes into account non-vesting conditions. These are either factors beyond the control of either party (such as a target based on an index) or factors which are within the control of one or other of the parties (such as the Company keeping the scheme open or the employee maintaining any contributions required by the scheme).
Where the terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured immediately before and after the modification, is also charged to the Statement of Comprehensive Income over the remaining vesting period.
Where equity instruments are granted to persons other than employees, profit or loss is charged with fair value of goods and services received.
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
2.Accounting policies (continued)
Tax is recognised in the Statement of Comprehensive Income except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the Statement of Financial Position date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
2.Accounting policies (continued)
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Tangible fixed assets (continued)
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Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using both the straight line and reducing balance method.
Depreciation is provided on the following basis:
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Freehold land and buildings
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The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Statement of Comprehensive Income.
Investments in subsidiaries are measured at cost less accumulated impairment.
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first outbasis. Work in progress and finished goods include labour and attributable overheads.
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 impairment loss is recognised immediately in the Statement of Comprehensive Income.
Short term debtors are measured at transaction price, less any impairment.
Short term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
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 creditors, loans from banks and other third parties and loans to related parties.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
2.Accounting policies (continued)
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Financial instruments (continued)
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are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of Comprehensive Income.
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
2.Accounting policies (continued)
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Financial instruments (continued)
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For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Company would receive for the asset if it were to be sold at the reporting date.
Financial assets and liabilities are offset and the net amount reported in the Statement of Financial Position when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
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The average monthly number of employees, including the directors, during the year was 8 (2019: 9).
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
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Current tax on profits for the year
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Taxation on (loss)/profit on ordinary activities
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Factors affecting tax charge for the year
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The tax assessed for the year is higher than (2019: higher than) the standard rate of corporation tax in the UK of 19% (2019:19%). The differences are explained below:
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Loss on ordinary activities before tax
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(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19.00% (2019: 19.00%)
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Expenses not deductible for tax purposes
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Adjustments to tax charge in respect of previous periods
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Adjust deferred tax to average rate of 19%
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Remeasurement of deferred tax for changes in tax rates
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Deferred tax not recognised
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Total tax charge for the year
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Factors that may affect future tax charges
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The UK Government announced in the 2021 budget that from 1 April 2023, the rate of corporation tax in the United Kingdom will increase from 19% to 25%. Companies with profits of £50,000 or less will continue to be taxed at 19%, which is a new small profits rate. Where taxable profits are between £50,000 and £250,000, the higher 25% rate will apply but with a marginal relief applying as profits increase.
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
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Freehold land and buildings
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Other investments relate to shares owned in Colmworth Business Park Management Company Limited.
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Accruals and deferred income
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Included within amounts owed to group undertakings is a loan from SolarEdge Technologies (UK) Limited of £842,835 (2019: £842,835) which accrues interest at a rate of 3.15% (2019: 3.15%) per annum.
Remaining amounts owed to group undertakings are unsecured, payable on demand and interest free.
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
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Allotted, called up and fully paid
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200 (2019: 200) Ordinary shares of £1 each
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The Company has one class of ordinary shares; each share carries one voting right per share but no right to fixed income.
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The Company’s ultimate parent company grants RSU to 7 employees in 2020 (2019: 0). The RSUs are exercisable at a price of $0 per share at staged intervals between the year-end date and 2020.
A summary of RSUs activity during the year ended 31 December 2020 is as follows:
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Weighted average exercise price (pence)
2020
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Weighted average exercise price
(pence)
2019
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Exercised during the year
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Outstanding at the end of the year
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The weighted-average grant-date fair value of share awards granted during 2020 and 2019 was £99.31 and £Nil, respectively. The total fair value of shares exercised during 2020 and 2019 was £2,374 and £Nil respectively.
An expense of £112,705 (2019: £Nil) was recognised in relation to restricted stock unit award transactions in 2020 and 2019 by Company.
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The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £7,160 (2019: £6,317). Contributions totalling £2,772 (2019: £75) were payable to the fund at the reporting date.
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04229714
31 December 2020
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SOLAREDGE CRITICAL POWER U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
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Commitments under operating leases
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At 31 December 2020 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Later than 1 year and not later than 5 years
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Related party transactions
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The Company is a wholly owned subsidiary of SolarEdge Technologies Inc., Limited and as such has taken advantage of the exemption permitted by Section 33 ‘Related Party disclosures’ not to provide disclosures of transactions entered into with other wholly owned members of the group. The Company and its subsidiary undertakings are included within the consolidated financial statements of SolarEdge Technologies Inc., which are publicly available and can be obtained from SolarEdge Technologies Inc., 47505 Seabridge Drive, Fermont, CA, 94538, United States of America.
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Post balance sheet events
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There have been no significant events affecting the Company since the year end.
The immediate parent undertaking is SolarEdge Technologies (UK) Ltd., a company incorporated in United Kingdom.
The ultimate parent undertaking is SolarEdge Technologies Inc., a company incorporated in the United States of America. This is the smallest and largest group into which the Company's financial statements are consolidated. Copies of these consolidated group financial statements may be obtained from the following address: SolarEdge Technologies Inc., 47505 Seabridge Drive, Fermont, CA, 94538, United States of America.
The auditors' report on the financial statements for the year ended 31 December 2020 was unqualified.
The audit report was signed on 28 February 2022 by Jon Marchant (Senior Statutory Auditor) on behalf of Mazars LLP.
- 13 -
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