ACCOUNTS - Final Accounts
ACCOUNTS - Final Accounts
|
Registered number:
FOR THE YEAR ENDED 31 DECEMBER 2022
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
COMPANY INFORMATION
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
CONTENTS
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
The Company trades under the Reflex brand, the principal activity being the supply to commercial customers of a fleet of over 5,000 light commercial vehicles and passenger cars on a flexible basis from one week to up to four years, as well as the sale of used vehicles at the end of the vehicles' rental life.
During the first half of 2022, the Company benefitted from a continued strong demand for its products at strong levels of fleet utilisation, profitability, and cash generation. Vehicle sales performance by value per vehicle sold remained firm during 2022 in a market driven by comparatively low levels of new vehicle availability, the high cost of new vehicles and high demand for vehicles across the UK economy.
The Board expresses their appreciation to all employees for their commitment to and hard work in achieving these results and for their tireless efforts to target steadily increasing margins. Hire sales increased by £92,603 to £30,890,413 (up 0.3% on 2021) driven by good utilisation and a continuing programme of hire rate improvements. Total turnover increased by £2,413,378 to £51,867,080, up 4.9% on 2021 (2021: £49,453,702) reflecting the hire rate improvement, and strong fleet utilisation, together with a strong vehicle sales performance. Administrative expenses grew by 31.5% to £6,107,182 (2021 : £4,644,434) and Exceptional Items comprised the costs associated with the repurchase for cancellation of the shares held by the remaining minority shareholder. Cash flows generated from operating activities decreased by 7.3% to £32,085,710 (2021 : £34,616,061).
On 2 August 2022, the Company completed the repurchase for cancellation of the shares in the Company held by Mr. Anthony Trahar.
This transaction was financed by cash balances held by the Company. The share buyback programme has resulted in Oliver Waring and his associated family interests increasing their equity interest in Reflex to 98.3%. This has permitted the continuation of a focused strategy for profit and cash optimisation and further growth when required as adopted in 2021.
Page 1
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
2022 performance resulted in revenue growth and cash generation. The Reflex team continues to develop their processes and analytical skills in order to become a firmly data driven operation, making decisions that benefit customers and build core margins.
Additionally, the Company has installed a new software system during 2023 : Microsoft Dynamics 365. This standardised software system is designed to drive the Company’s data management and analysis capacity to industry-leading standards as the Company continues to build a fully digital operational and strategic capability. Whilst focusing on profitability, cash flows and the implementation of cutting edge technologies, the Company has also been recognised as a national leader in Environmental, Social and Governance (ESG), winning the Lloyds Bank British Business 2022 ESG Champion of the Year Award in November 2022. Following this significant achievement, the Company has gone on to secure its own ESG rating during 2023. The Company has been awarded a strong Low Risk score. The opportunity presented to the Company in 2023, and which will continue into 2024, is to drive improvements in its core operating margins and resulting cash flows. Organic growth potential is strong and is being carefully engaged by the Company given the high input cost of new vehicles. Additionally, the availability of growth by acquiring sector-exiting competitors’ fleets and attendant customers remains a good quality source of opportunity.
Page 2
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
The principal risks and uncertainties facing the Company are:
Economic environment The Company’s customers have a broad spread of sectors, within which the demand for the Light Commercial Vehicle flexible rental product is strong. The Company operates solely within the UK. Inflation of input costs, with particular emphasis on new vehicle prices, has been strong. The Company has responded by adopting a very cautious approach to the purchase of new vehicles to avoid unduly inflating the overall fleet book cost. Competitive risk The Company competes in a mature open market environment. Prospective customers select vehicle providers based upon a combination of factors including price, quality of service and reputation. The Company has mitigated these risks by constantly monitoring price and service in comparison to customer and industry feedback. As a result, customer retention remains strong. Asset holding risk The Company is at risk to fluctuations in the residual values of vehicles in the market. This risk is mitigated by the purchasing of vehicles with significant manufacturer and dealer discounts. Furthermore, useful economic lives are regularly reviewed. Asset utilisation is monitored daily to ensure that unnecessary vehicle holding costs are minimised and the number of vehicle purchases are under constant review. Funding risk Whilst the Company’s Balance Sheet is strong, currently driven by significant equity value in the vehicle fleet which can be realised at any time through accelerated fleet sales, continued funding is required to grow and replace the fleet and service customer demand. Funding by mainstream lenders at market competitive rates of interest has been and continues to be achieved.
Page 3
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
Section S172 (1) Statement
During the year, the directors have had regard to the matters set out in S172 (1) (a) to (f) of the Companies Act 2006 whilst performing their duties. Whilst making decisions the directors ensure that they have acted in good faith, in a way they believe would promote the success of the Company for the benefit of its members as a whole. Specifically, the directors have considered the following:- a. The likely consequences of any decision in the long term; b. The interests of the Company's employees; c. The need to foster the Company's business relationships with suppliers, customers and others; d. The impact of the Company's operations on the community and the environment; e. The desirability of the Company maintaining a reputation for high standards of business conduct; and f. The need to act fairly between members of the Company. S172 (1) (a) The likely consequences of any decision in the long term The directors understand the business and the environment in which it operates. This is key to understanding the likely consequences of any long term decisions. There is a clear plan for profit improvements and thereafter growth which ensures the Company will continue to provide quality vehicles, satisfying customer and shareholder needs, amongst other stakeholders. Continually improving environmental performance and operating methods are integral and fundamental parts of the business strategy. The Company will continue to invest in equipment, vehicles and I.T. and plans to continue to do so over the next 12 months to ensure that it can meet the demands from our customers. The replacement and additions to our vehicle fleet and a new software system have been committed to. 5172 (1) (b) The interests of the Company's employees The directors recognise that the employees are key to the business and its success. What makes the Company different is its approach to relationships, which extends past the expected customer focus, to all employees. Staff retention is a testament to this and the Company's culture. Employee welfare and wellbeing is of utmost importance. The directors ensure all employees work in a safe and healthy environment. The directors regularly engage with employees through internal communication methods. When making decisions, the directors consider which course of action best delivers the Company strategy in the long term, taking into consideration all stakeholders of the Company, including the employees. Further investments are continuing to enhance and improve the quality of the environment our staff work within, and Reflex’s ESG programme has been recognised by its peers as industry leading. S172 (1) (c) The need to foster the Company's business relationships with suppliers, customers and others The directors recognise that building relationships with suppliers and customers is key to the success of the business. The Company's objective is to become a key supply partner, delivering the same quality vehicles each time. The directors recognise that working with suppliers and customers is also key to ensuring the impact to the environment is minimised. S172 (1) (d) The impact of the Company's operations on the community and the environment The directors recognise the importance of minimising the impact of the Company's operations on the community and environment, and this is core to its business strategy. The Company and the directors wholly support, and where possible exceed, the requirements of current environmental legislation and codes of practice. It is the aim to minimise waste and water usage in buildings, vehicles and processes in order to conserve supplies and
Page 4
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
minimise consumption of natural resources. The Company and the directors actively promote recycling both internally and amongst customers and suppliers. Environmental policies are reviewed periodically in consultation with staff and customers.
S172 (1) (e) The desirability of the Company maintaining a reputation for high standards of business conduct The directors are committed to improving quality and reducing any environmental impact, as noted above. This ensures that the Company's reputation within the local community is maintained. It is the aim of Reflex Vehicle Hire Limited to achieve sustained profitable growth, by providing cost effective vehicles for hire and purchase, maintaining a high level of customer satisfaction which enhances the Company's reputation with its customers and suppliers. S172 (1) (f) The need to act fairly between members of the Company When making decisions, the directors consider which course of action best delivers the Company strategy in the long term, taking into consideration all stakeholders of the Company. Examples of this are noted above where the directors consider all stakeholders when deciding which strategic decisions to take. Environmental matters The Company will seek to minimise adverse impacts on the environment from its activities, whilst continuing to address health, safety and economic issues. The Company has complied with all applicable legislation and regulations. The Companies Act 2006 (Strategic Report and Directors' Report) Regulation 2018 requires Reflex Vehicle Hire Limited to disclose annual UK energy consumption and Greenhouse Gas emissions from SECR regulated sources. Consumption (kWh) and Greenhouse Gas emissions (KgCO2e) totals Scope 1 consumption and emissions relate to direct combustion of natural gas, and fuels utilised for transportation operations, such as company vehicle fleets, and grey fleet. Scope 2 consumption and emissions relate to indirect emissions relating to the consumption of purchased electricity in day-to-day business operations. Totals The total consumption (kWh) figures for energy supplies reportable by Reflex Vehicle Hire Limited are as follows: Grid-supplied electricity (Scope 2) - 176,567 kWh (2021: 190,833 kWh) Gas (Scope 1) - 262,414 kWh (2021: 401,555 kWh) Transportation (Scope 1) - 4,336,273 kWh (2021: 3,917,321 kWh) Total 4,777,276 kWh (2021: 4,509,709 kWh) The total emissions (kgCO2e) figures for energy supplies reportable by Reflex Vehicle Hire Limited are as follows: Grid-supplied electricity (Scope 2) - 41,165 kgCO2e (2021: 44,491 kgCO2e) Gas (Scope 1) - 48,245 kgCO2e (2021: 73,826 kgCO2e) Transportation (Scope 1) - 1,025,441 kgCO2e (2021: 926,092 kgCO2e) Total 1,114,851 kgCO2e (2021: 1,044,409 kgCO2e) Intensity Metric Intensity metrics based on turnover and full time employee have been calculated, results of this analysis is as follows:
Page 5
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
kgCO2e / £m – 21,636 kgCO2e (2021: 21,314)
kgCO2e / full time employee 7,432 (2021: 9,582) Energy Efficiency Improvements Reflex Vehicle Hire Limited are committed to year-on-year improvements in their operational energy efficiency. During this period, Reflex undertook the following energy efficiency activities listed during the assessment period.
Reporting methodology Scope 1 and 2 consumption and CO2e emission data has been calculated in line with the 2019 UK Government environmental reporting guidance. The following Emission Factor Databases consistent with the 2019 UK Government environmental reporting guidance have been used, utilising the current published kWh gross calorific value (CV) and kgCO2e relevant for reporting year January to December 2022.
Reflex Emissions Reductions Plan
Reflex is committed to imbed sustainability into everything we do. We will aim to minimise our environmental footprint through our internal operations, confronting business efficiencies supported by the use of technologies to ultimately be well prepared for our fleet to become fully electrified in line with government legislation. Our mission is to see Reflex as a net zero emissions enterprise.
Throughout 2022 Reflex has implemented numerous environmental initiatives and processes to assist in the reduction of our CO2 emissions, making Reflex become a more energy efficient site. This has been done by the following implementations:
∙Reflex has changed all of its lighting options changing from using halogen bulbs into placing LED light fittings in all office’s, Workshops and Yard.
∙A new central heating system was installed so that areas can be heated rather than the entire building making this more energy efficient not needing to heat up unnecessary areas of the site.
∙EV:IE (Electric Vehicle Information Exchange) strategy has been created to assist our customers on their journey to changing their fleet to EV vehicles.
∙14 Electric Charging stations have been installed to assist in the implementation of our EV:IE strategy and our own change of internal company vehicle to EV.
∙Workshop heating units have been changed to a more energy efficient unit to help reduce our energy output.
∙Mixed Recycling Program has been imbedded and numerous mixed recycling stations have been installed across the business.
∙A forecasting program has been started to monitor the usage of energy across the business looking at ways to reduce our energy output.
∙Reflex has committed itself to managing its environmental impact and has gained an ISO 14001 Environmental accreditation to assist with its environmental management.
Reflex is committed to reducing its emissions year-on-year, with this in mind Reflex has set out some key projects that will have a positive impact on our business and the local environment, these being:
∙Environmental Awareness for all employees - Reflex will be training all current staff making them aware of their environmental impact. All new starters to Reflex will also take the training on their first day.
∙Cycle to work scheme – Reflex will be implementing a new cycle to work scheme and encouraging staff where possible to leave their vehicles at home and think of more environmentally friendly ways to attend work.
∙New bike shed – With the above in mind Reflex will be upgrading its current facilities to incorporate a large bike shed onsite for all staff to use.
∙Car share scheme – Along with the cycle to work scheme, Reflex will be looking to start a car share scheme allowing for prioritised parking for members of staff that car share.
∙Installation of a new roof – Reflex currently has an aging asbestos roof that will need to be changed to allow
Page 6
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
for solar panels to be fitted.
∙Solar panel installation – Solar panels will be fitted to the roof which will reduce the electricity used by Reflex by around 50%.
∙ESG Rating – Reflex gained an official ESG rating. This will better highlight areas that can be improved to better reduce our emissions.
Our commitments now are for a better environment and world for years to come. The development of this policy ensures we have a celebrative responsibility which will drives us to act on ensuring we keep corporate sustainability in the forefront of our minds in our everyday interactions. We are committed to working with our customers, suppliers, employees, and the wider community to support the delivery of a meaningful enterprise and we see Reflex having a key role as a provider of complete fleet solutions to ensure our customers are well equipped to understand how the world will move in an electrified vehicle environment. Our organisation understands we must all do our part to impact the greater good of this planet, so this document will be integrated to our everyday working life ensuring our policy is continuously reviewed and improved as the business develops.
This report was approved by the board and signed on its behalf.
Page 7
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
The directors present their report and the financial statements for the year ended 31 December 2022.
The profit for the year, after taxation, amounted to £2,437,898 (2021 - £2,292,097).
The Directors paid a dividend of £500,000 during 2022 in respect of the 2022 financial year (2021: £970,000).
The directors who served during the year were:
The Company is focused on continuing to establish a broad base of customers in order to diversify its customer base. The Company's product, the supply of flexible rental solutions across a range of light commercial vehicles and passenger cars, offers customers the opportunity to release capital from their commercial fleets to fund their core businesses.
Our aim remains to work closely with our customers at all times, ensuring their vehicle supply is secure, well maintained and tailored to ensure maximum value for money.
Including net obligations under long-term hire purchase contracts due within one year of £18,178,313 (2021: £19,035,004), the financial statements show net current liabilities in the current year amounting to £20,675,507 (2021: net liabilities of £21,393,201).
Whilst the Company’s Hire Purchase debt due in one year is significant at £18,178,313, the debt is matched to individual specific vehicles, with the repayment profile closely matched to the available weekly market hire rate and the eventual resale value ultimately expected in the used vehicle market. Should a vehicle become underutilised for any reason, it is sold, and the proceeds are used to settle the attributable Hire Purchase balance. The Company made use of term loan facility and working capital facility provided by the Company’s bankers to provide part of the funding requirement to support the share repurchase for cancellation programme. Cash flows have remained robust during 2022 and are sufficient to meet the Company’s liabilities. The Company’s lenders continue to be supportive during 2022, providing the funding facilities required for the fleet management programme. The Company’s growth and fleet replacement plans can be adequately funded from existing lending facilities. The directors have prepared cash flow forecasts to 31 December 2026, giving consideration to the varying risks and opportunities presented to the Company. Based on the above, the directors believe that it remains appropriate to prepare the financial statements on a going concern basis.
Page 8
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
The Company attaches considerable importance to ensuring that all its employees are provided with information concerning them as employees. The Company's current size allows this to take place by direct discussion and face to face meetings. As the Company grows it will develop information and consultation processes to continue to meet its employee and communication goals.
How we engage with our employees is also covered in the Strategic Report on page 4.
How we engage with our customers and suppliers is covered in the Strategic Report on page 4.
The Company's greenhouse gas emissions and energy consumption for the year are covered in our Strategic Report on pages 5 and 6.
The business review, principal risks and uncertainties, key performance indicators and financial risk management objectives and policies are included in the Strategic Report.
On 12 May 2023 the Company purchased the entire issued share capital of Hireway Vehicle Rentals Limited, comprising approximately 900 vehicles rented to B2B customers, 2 rental sites in Scotland and the North West of England. Consideration of £6,122,478 was paid to acquire net assets of £6,751,280. This transaction was financed by a combination of cash balances held by the Company, a term loan facility and standard Hire Purchase facilities provided by the Company’s bankers.
In June 2023, the trade and assets of Hiveway Vehicle Rentals Limited was hived up to Reflex Vehicle Hire Limited. There have been no other significant post balance sheet events.
Page 9
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
Following a rebranding exercise on 15 May 2023 the trading name of the company's independent auditor changed from MHA MacIntyre Hudson to MHA. The auditors, MHA, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
The directors are responsible for preparing the Strategic Report, the Directors' Report 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 for the Company's financial statements and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙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 to 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.
This report was approved by the board and signed on its behalf.
Page 10
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF REFLEX VEHICLE HIRE LIMITED
We have audited the financial statements of Reflex Vehicle Hire Limited (the 'Company') for the year ended 31 December 2022, which comprise the Profit and Loss Account, the Balance Sheet, the Statement of Cash Flows, the Statement of Changes in Equity and the related notes, 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).
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 United Kingdom, including the Financial Reporting Council'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.
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.
Page 11
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF REFLEX VEHICLE HIRE LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' 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.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
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 Directors' Report.
Page 12
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF REFLEX VEHICLE HIRE LIMITED (CONTINUED)
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 Auditors' 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:
∙Enquiry of management and those charged with governance around actual, potential or suspected litigation, claims, non-compliance with applicable laws and regulations and fraud.
∙Enquiry of entity staff in tax and compliance functions and external advisors to identify any instances of non-compliance with laws and regulations.
∙Performing audit work over the risk of management override, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias.
∙Reviewing of financial statements disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.
∙Discussing with the engagement team in relation to how and where fraud might occur in the financial statements and any potential indicators of fraud.
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 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 Auditors' Report.
Page 13
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF REFLEX VEHICLE HIRE LIMITED (CONTINUED)
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 Auditors' 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.
for and on behalf of
Statutory Auditors
Leicester, United Kingdom MHA is the trading name of MacIntyre Hudson LLP, a limited liability partnership in England and Wales (registered number OC312313).
Page 14
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2022
Page 15
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
REGISTERED NUMBER: 07813062
BALANCE SHEET
AS AT 31 DECEMBER 2022
Page 16
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
REGISTERED NUMBER: 07813062
BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2022
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 22 to 39 form part of these financial statements.
Page 17
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
Page 18
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2022
Page 19
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
Page 20
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2022
Page 21
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Reflex Vehicle Hire Limited is a private company, limited by shares, incorporated in England & Wales, registered number 07813062. The registered office address is 22 Belton Road West, Loughborough, LE11 5TR.
Principal activity The principal activity of the company during the year continued to be that of the supply to commercial customers of a fleet of over 5,100 light commercial vehicles and passenger cars on a flexible basis from one week to up to four years, as well as the sale of used vehicles at the end of the vehicles' rental life.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).
The presentational and functional curreny of the company is British Pounds Sterling (£).
The following principal accounting policies have been applied:
Page 22
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Including net obligations under long-term hire purchase contarcts due within one year of £18,178,313 (2021: £19,035,004), the financial statements show net current liabilities in the current year amounting to £20,675,507 (2021: £21,393,201).
Whilst the Company's Hire Purchase debt due in one year is significant at £18,178,313, the debt is matched to individual specific vehicles, with the repayment profile matched to the available weekly market hire rate and the eventual resale value ultimately expected in the used vehicle market. Should a vehicle become underutilised for any reason, it is sold, and the proceeds are used to settle the attributable Hire Purchase balance. The directors have prepared forecasts for the period to 31 December 2026. These are based on current trading levels which show high utilisation rates and give consideration to the recent and ongoing impact of the current economic situation and the acquisition of Hireway Vehicle Rentals Limited post year end. The Company made use of term loan facility and working capital facility provided by the Company’s bankers to provide part of the funding requirement to support the share repurchase for cancellation programme. Cash flows have remained robust during 2022 and are sufficient to meet the Company’s liabilities. The Company’s lenders continue to be supportive during 2022, providing the funding facilities required for the fleet management programme. The Company’s growth and fleet replacement plans can be adequately funded from existing lending facilities. The directors have prepared cash flow forecasts to 31 December 2026, giving consideration to the varying risks and opportunities presented to the Company. The Directors consequently have a reasonable expectation that the company will continue in operation for the foreseeable future, being a period of not less than 12 months from the date of approval of these financial statements and accordingly, the Financial Statements are prepared on a going concern basis.
Turnover is measured at the fair value of the consideration received or receivable in respect of the hire of vehicles, sale of used vehicles and supply of related goods or services in the normal course of business, net of value added tax and discounts.
Turnover from vehicle hire is recognised evenly over the hire period. Turnover from sales of other related goods and services is recognised at the point at which the goods or services are provided. Turnover from sales of used vehicles is recognised at the point of sale, which is usually represented by the point at which the customer takes possession of the vehicle. Used vehicles are recognised as stock at the point of sale as they are held for hire up until this point.
Page 23
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Assets held under hire purchase contracts are capitalised in the Balance Sheet and are depreciated over their useful lives. The corresponding hire purchase obligation is capitalised in the Balance Sheet as a liability. The interest element of the rental obligation is charged to the Profit and Loss Account over the year of the lease and represents a constant proportion of the balance of capital repayments outstanding.
Rentals paid under operating leases are charged to income on a straight-line basis over the lease term.
All interest-bearing loans and borrowings which are basic financial instruments are initially recognised at the present value of cash payable to the bank (including interest). After initial recognition they are measured at amortised cost using the effective interest rate method, less impairment. The effective interest rate amortisation is included in finance revenue in the Profit and Loss Account.
Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to Profit and Loss Account at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Profit and Loss Account in the same period as the related expenditure.
Page 24
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Page 25
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Depreciation is provided on the following basis:
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.
The residual values and depreciation rates have been determined with the anticipation that the net book values at the point the vehicles are sold is in line with open market values for those vehicles.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Profit and Loss Account.
Page 26
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Provisions are charged as an expense to the Profit and Loss Account in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. When payments are eventually made, they are charged to the provision carried in the Balance Sheet.
Page 27
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
Useful economic life and residual valaue of tangible fixed assets Depreciation is charged on a straight-line basis to an estimated residual value using depreciation rates which reflect the useful economic life of between 3 and 5 years. These rates have been set to align net book value with estimated market value at the point at which vehicles are transferred to vehicle sales stock. Trade Debtors Trade debtors consist of amounts due from customers. An allowance for doubtful debts is maintained for estimated losses resulting from the inability of the Company's customers to make required payments. The allowance is based on the Company's regular assessment of the credit worthiness and financial conditions of its customers.
Page 28
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Page 29
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Page 30
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Page 31
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
11.Taxation (continued)
From 1 April 2023, the Corporation Tax main rate increased to 25% for profits over £250,000. A small profits rate has also been introduced for profits of £50,000 or less, charging Corporation Tax at 19%. Profits between £50,000 and £250,000 will be taxed at the main rate reduced by a marginal relief
Page 32
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Page 33
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
15.Debtors (continued)
Page 34
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Page 35
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Page 36
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Page 37
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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 £123,446 (2021: £116,739). Contributions totalling £51,140 (2021: £48,244) were payable to the fund at the balance sheet date.
At the year end one of the directors of the Company owed to the Company £419,057 included in other debtors. During the year advances to directors totalled £503,397 and repayments totalled £84,370.
The director had an interest free loan during the year that is repayable on demand.
Page 38
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
REFLEX VEHICLE HIRE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
In June 2023, the trade and assets of Hiveway Vehicle Rentals Limited was hived up to Reflex Vehicle Hire Limited.
84.9% of the issued Ordinary share capital of the Company is held by
Page 39
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||