Medical Imaging Partnership Limited - Period Ending 2023-03-31

Medical Imaging Partnership Limited

Contents

Medical Imaging Partnership Limited

Company Information

Medical Imaging Partnership Limited

Directors' Report for the Year Ended 31 March 2023

The directors present their report and the financial statements for the year ended 31 March 2023.

Directors of the company

The directors who held office during the year were as follows:

A G Lennox (ceased 12 December 2022)

P O Randell

S E Bird (appointed 1 January 2023)

Financial instruments

Objectives and policies

The board constantly monitors the company's trading results and revise projections as appropriate to ensure that the company can meet its future obligations as they fall due.

Price risk, credit risk, liquidity risk and cash flow risk

The company is exposed to the usual credit and cash flow risks associated with selling on credit and manages this through credit control procedures. The company's bank loans and loan stock are subject to price and liquidity risk as disclosed in note 17 to the financial statements.

In accordance with the Financial Reporting Council's 'Going Concern and Liquidity Risk: Guidance for Directors of UK Companies 2009', the directors of all companies are now required to provide disclosures regarding the adoption of the going concern basis of accounting.

The company has sufficient resources available and the directors have prepared forecasts for the next 12 months that indicate that this will continue to be the case and that these cash flows will be sufficient for the company to meet its financing commitments as they fall due. The directors therefore have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future and have continued to adopt the going concern basis in preparing the financial statements.

Disclosure of information to the auditors

Reappointment of auditors

Hazlewoods LLP have expressed their willingness to continue in office.

Approved by the Board on 22 December 2023 and signed on its behalf by:

P O Randell
Director

Medical Imaging Partnership Limited

Strategic Report for the Year Ended 31 March 2023

The directors present their strategic report for the year ended 31 March 2023.

Principal activity

The principal activity of the company is that of the provision of imaging services.

Fair review of the business

The results for the period, which are set out in the consolidated profit and loss account, show turnover of £13,978,077 (2022 - £10,474,463) and an operating loss of £515,501 (2022 - £680,909). At 31 March 2023, the company had total assets less current liabilities of £4,590,519 (2022 - £5,165,204). The directors consider the performance for the period and the financial position at the period end to be satisfactory.

The company uses a number of financial key performance indicators (KPIs), the principal KPIs are:
- Turnover and loss before tax as noted on page 8;
- Diagnostic activity and fee income;
- % NHS/Private patient income;
- Equipment capacity and utilisation;
- Staffing cost per modality.

Principal risks and uncertainties

One of the core business principles of developing strong collaborative working with NHS partners continues to deliver positive results. Longer term contracts, delivered through the CDC programme, aligned with a willingness to operate flexibly, delivers improved asset utilisation and increased revenues and this remains an objective. However inflationary pressure on staffing and utility costs set against fixed NHS tariff pricing remains a challenge to control margin erosion and the ability therefore to remain even more commercially focussed in this sector is paramount. NHS waiting times for imaging remains high, though high patient demand does not always translate quickly to increased patient throughput, either at existing NHS partner sites or to any new tender acquisition opportunity.

Future developments

The company will continue to develop and expand within the wider NHS diagnostic imaging arena and despite the known challenges, there is nevertheless a likelihood of increasing opportunity. The NHS CDC programme will be redefined for the 2024/25 financial year and so the business is preparing expansive plans for growth in this sector. Expansion is planned for new UK wide geographies, alongside maximising the already well established NHS partnership and collaboration activity delivered within Sussex.

The self pay diagnostic market opportunity remains strong and demand is likely to increase. Accordingly the company will now also offer further imaging modalities, in more locations, in order to maximise opportunity from this patient driven growth agenda. A strategic plan to open further high quality specialist diagnostic imaging and wellness centres is also being developed and the company will be looking positively at expansion within the wider private pay and insured market.

Both of the sectors within which the company operates will be subject to development and growth and the company is well placed to capitalise on its reputation for high quality service provision.

 

Approved by the Board on 22 December 2023 and signed on its behalf by:

P O Randell
Director

Medical Imaging Partnership Limited

Statement of Directors' Responsibilities

Medical Imaging Partnership Limited

Independent Auditor's Report to the Members of Medical Imaging Partnership Limited

Opinion

We have audited the financial statements of Medical Imaging Partnership Limited (the 'company') for the year ended 31 March 2023, which comprise the Profit and Loss Account, Balance Sheet, Statement of Changes in Equity, and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the original financial statements were authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

We have nothing to report in this regard.

Medical Imaging Partnership Limited

Independent Auditor's Report to the Members of Medical Imaging Partnership Limited

Opinion on other matter prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

Matters on which we are required to report by exception

In the light of our 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 and the Directors' Report.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page 4, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s 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.

Extent to which the audit was capable of detecting irregularities, including fraud

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:

We considered the nature of the group’s industry and its control environment and reviewed the groups’s documentation of their policies and procedures relating to fraud and compliance with laws and regulations. We also enquired of management about their own identification and assessment of the risks of irregularities.

We obtained an understanding of the legal and regulatory framework that the group operates in and identified the key laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements, including the UK Companies Act and tax legislation, and, those that do not have a direct effect on the financial statements but compliance with which may be fundamental to the group’s ability to operate or to avoid a material penalty.

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

Medical Imaging Partnership Limited

Independent Auditor's Report to the Members of Medical Imaging Partnership Limited

In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. In addressing the risk of fraud through management override of controls, we tested the appropriateness of journal entries and other adjustments; assessed whether the judgments made in accounting estimates are indicative of a potential bias; and evaluated the business rationale of any significant transactions that are unusual or outside the normal course of business.

In addition to the above, our procedures to respond to the risks identified included the following:

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

A further description of our responsibilities is available on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s 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.

Martin Howard (Senior Statutory Auditor)
For and on behalf of Hazlewoods LLP, Statutory Auditor

Windsor House
Bayshill Road
Cheltenham
GL50 3AT

22 December 2023

Medical Imaging Partnership Limited

Profit and Loss Account for the Year Ended 31 March 2023

The above results were derived from continuing operations.

The company has no other comprehensive income for the year.

Medical Imaging Partnership Limited

(Registration number: 06713311)
Balance Sheet as at 31 March 2023

Approved and authorised by the Board on 22 December 2023 and signed on its behalf by:
 

P O Randell
Director

Medical Imaging Partnership Limited

Statement of Changes in Equity for the Year Ended 31 March 2023

Medical Imaging Partnership Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office is:
The Pavilions Unit 7
Brighton Road
Pease Pottage
Crawley
RH11 9BJ

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

Basis of preparation

Going concern

The directors have reviewed the company's projections for the future and have reasonable expectation that the company will have adequate resources to continue in operational existence for the foreseeable future. The company's ability to continue as a going concern is reliant on the support of its creditors and in the opinion of the directors this support will continue for the foreseeable future. The company therefore continues to adopt the going concern basis in preparing its financial statements.

Judgements and estimation uncertainty

Revenue recognition

Tax

Medical Imaging Partnership Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

Tangible assets

Depreciation

Intangible assets

Amortisation

Investments

Cash and cash equivalents

Trade debtors

Medical Imaging Partnership Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

Trade creditors

Borrowings

Leases

Share capital

Defined contribution pension obligation

Medical Imaging Partnership Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

Financial instruments

Classification
Financial instruments are classified and accounted for according to the substance of the contractual arrangement, as financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities. Where shares are issued, any component that creates a financial liability of the company is presented as a liability on the balance sheet. The corresponding dividends relating to the liability component are charged as interest expenses in the profit and loss account.

 Recognition and measurement
All financial assets and liabilities are initially measured at transaction price (including transaction costs), except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value (which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a financing transaction. If an arrangement constitutes a financing transaction, the financial asset or financial liability is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

 Impairment
Assets, other than those measured at fair value, are assessed for indicators of impairment at each balance sheet date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss as described below. A non financial asset is impaired where there is objective evidence that, as a result of one or more events that occurred after initial recognition, the estimated recoverable value of the asset has been reduced. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use.

The recoverable amount of goodwill is derived from measurement of the present value of the future cash flows of the cash-generating units ('CGUs') of which the goodwill is a part. Any impairment loss in respect of a CGU is allocated first to the goodwill attached to that CGU, and then to other assets within that CGU on a pro-rata basis. Where indicators exist for a decrease in impairment loss, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised. Where a reversal of impairment occurs in respect of a CGU, the reversal is applied first to the assets (other than goodwill) of the CGU on a pro-rata basis and then to any goodwill allocated to that CGU.

For financial assets carried at amortised cost, the amount of an impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate. For financial assets carried at cost less impairment, the impairment loss is the difference between the asset’s carrying amount and the best estimate of the amount that would be received for the asset if it were to be sold at the reporting date.

Where indicators exist for a decrease in impairment loss, and the decrease can be related objectively to an event occurring after the impairment was recognised, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired financial asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised.

Medical Imaging Partnership Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

The total turnover of the company has been derived from its principal activity wholly undertaken in the United Kingdom.

Arrived at after charging/(crediting)

Exceptional income in the year comprises the realisation of deferred income relating to contract revenue from the 2017 financial year. Following confirmation in 2021 that all accounts had been reconciled, the directors felt, at that time, that it was prudent not to recognise the revenue at that time. However, now that six years has passed since the receipt of these funds and taking into consideration the confirmations received in 2021, the directors are of the opinion that this revenue can now be recognised. As this revenue does not relate to the 2023 financial year, the directors consider this income to be exceptional in nature and have disclosed it as such.

Exceptional expenses in the current year comprise a number of various costs, most notably CQC and quality standards related costs, stepped recruitment costs due to the marked increase in capacity during the year, redundancy costs, rentals costs due to damaged scanners, new market project costs, non-recurring bonuses and other small non-recurring costs.

Exceptional expenses in the prior year comprised rebranding costs, impairment of loan to related party, non-recurring consultancy fees and market research costs, directors' bonuses, redundancy costs and recruitment costs.

Medical Imaging Partnership Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

The aggregate payroll costs (including directors' remuneration) were as follows:

The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:

The directors' remuneration for the year was as follows:

During the year the number of directors who were receiving benefits and share incentives was as follows:

In respect of the highest paid director:

Medical Imaging Partnership Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

Tax charged/(credited) in the profit and loss account

The tax on profit before tax for the year is higher than the standard rate of corporation tax in the UK (2022 - higher than the standard rate of corporation tax in the UK) of 19% (2022 - 19%).

The differences are reconciled below:

Deferred tax

Deferred tax assets and liabilities

Effective 6 April 2023, the corporation tax rate increases from 19% to 25%.

Medical Imaging Partnership Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

Medical Imaging Partnership Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

Details of non-current trade and other debtors

£2,182,969 (2022 - £2,246,067) of deferred tax assets is classified as non-current. This is on the basis that while a portion of the asset will be realised annually, in the opinion of the directors, the majority of the balance will be realised in periods beyond one year from the balance sheet date and any portion realised within one year would not materially impact on the financial statements.

Medical Imaging Partnership Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

Other borrowings above represent loan notes of £1,789,238 (2022 - £1,670,592) and loans from the company's parent undertaking of £7,103,355 (2022 - £5,616,556).

The loan notes were issued by Apposite Healthcare Fund II LLP, the company's ultimate controlling party. At 31 March 2023, the amount shown above represents capital of £1,181,786 (2022 - £1,181,786) and accrued interest of £607,452 (2022 - £488,806). Compound interest accrues on the loan notes at a rate of 9% per annum, and are repayable in six-monthly instalments which began on 31 May 2019 and ending on 30 November 2021. At the balance sheet date no repayments have been made and the directors continue to liaise with the ultimate controlling party in respect to further waivers of the repayment terms.

The loans from parent undertaking represents principal loan amounts of £5,295,000 (2022 - £4,795,000) along with accrued interest of £1,808,355 (2022 - £821,556). These loans are all unsecured and bear interest at rates between 8% and 25% and are repayable on either the second or fourth anniversary on the respective loan being taken out.

Finance lease liabilities are secured on the assets to which they relate.

Defined contribution pension scheme

The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £101,702 (2022 - £203,071).

Contributions totalling £675 (2022 - £20,409) were payable to the scheme at the end of the year and are included in creditors.

Medical Imaging Partnership Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

Shares classified as equity

Allotted, called up and fully paid shares

Finance leases

The total of future minimum lease payments is as follows:

Operating leases

The total of future minimum lease payments is as follows:

The amount of non-cancellable operating lease payments recognised as an expense during the year was £998,845 (2022 - £862,082).

The company's immediate and ultimate parent is Imaging Holdings Company Limited (formerly Apposite Imaging Holdings Company Limited), incorporated in England and Wales.

 The most senior parent entity producing publicly available financial statements is Imaging Holdings Company Limited. These financial statements are available upon request from Companies House.

 The ultimate controlling party is Apposite Capital LLP by virtue of their ultimate majority shareholding.