Spaldings Limited Company accounts

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COMPANY REGISTRATION NUMBER: 01558147

Spaldings Limited

Financial Statements

For the year ended

31 March 2023

Spaldings Limited

Financial Statements

Year ended 31 March 2023

Contents	Page

Strategic report	1

Directors' report	3

Independent auditor's report to the members	6

Statement of income and retained earnings	10

Statement of financial position	11

Statement of cash flows	12

Notes to the financial statements	13

Spaldings Limited

Strategic Report

Year ended 31 March 2023

The directors present their strategic report for the year ended 31 March 2023. The principal activity of the company during the period was the supply of parts and equipment to the land management sector, principally the agricultural and groundcare markets. Whilst these two markets have many similarities, the group is organised to service them separately to optimise efficiency. Spaldings Limited

was a subsidiary of Marubeni Agri Machinery Holdings until the 6 June 2022. On this date the business was acquired by Twinings BidCo Limited, a holding company whose principal shareholders are Inspirit Capital of 105 Piccadilly London W1J 7NJ and the executive directors.

Review of business

The directors consider the three most important key performance indicators to be turnover, gross margin and operating profit. Turnover for the year was £24.7m (2022 £23.7m). Market and climatic conditions were favourable throughout the year with farm incomes improving with high commodity prices, albeit marginally offset by high input costs. The summer headway led to hard land conditions resulting in high sales of wearing parts. Overall turnover increased by 4% against the corresponding year 2022. Gross profit was £9.7m (2022 £9.3m). Improving market conditions, coupled with supply side inflation led to price increases which were largely recovered through pricing management which resulted in an improvement in gross margin levels to 39.6% (2022 – 39.2%).

Principal risks and uncertainties

Competitive pressure in the United Kingdom is a continuing risk for the group, which could result in it losing its sales to its key competitors. Political uncertainty due to Brexit is also a factor with some of the major customers when considering purchases. The group manages this risk by providing high quality products to its customers and by actively maintaining strong relationships with key personnel. Many of the Group's purchases are made in Euros and it is therefore exposed to movements in the Euro to Pound Sterling exchange rate. The group mitigates this risk, where significant, by the use of forward contracts. With regard to the current situation with the COVID-19 pandemic, the war in Ukraine and the cost of living crisis in general the company does not consider that they have any impact on the company's operation.

This report was approved by the board of directors on 31 October 2023 and signed on behalf of the board by:

Mr P Bray

Director

Registered office:

25-35 Sadler Road

Lincoln

United Kingdom

LN6 3XJ

Spaldings Limited

Directors' Report

Year ended 31 March 2023

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

Directors

The directors who served the company during the year were as follows:

Mr P Bray	(Appointed 9 September 2022)
Mr A Farrant	(Appointed 6 June 2022)
Mr D Fox	(Appointed 9 September 2022)
Mr N J Whelan	(Appointed 9 September 2022)
Mr P S Youens	(Appointed 23 February 2023)
Mr H Kondo	(Resigned 6 June 2022)

Mr N Yamamoto	(Resigned 6 June 2022)
Mr T Ishida	(Resigned 6 June 2022)
Mr W Stamp	(Served from 6 June 2022 to 22 February 2023)

Dividends

The company has made £798k loss for the year (2022: £137k profit). No dividend was paid in the year to Spaldings Holdings Limited (2022: £0).

Future developments

The company intends to continue to supply and distribute patented and other products to the agricultural, ground care and industrial markets.

Financial risk management and exposure

a) Price risk

Price risk arises on goods purchased in Euros and USD and also gives exposure to foreign currency movement. The group mitigates this risk by the use of forward contracts.

The company is in a competitive market and therefore has a risk of losing sales to competitors. The company manages this risk by providing high quality products to its customers and by maintaining strong relationships.

b) Credit risk

The structure of the customer base of the company means that credit risk is not considered significant.

c) Liquidity and Cashflow risk

Liquidity and cashflow risk is mitigated by virtue of the company being part of a large group.

Directors' responsibilities statement

The directors are responsible for preparing the strategic report, 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and the profit or loss of the company for that period. In preparing these financial statements, the directors are required to: - select suitable accounting policies and then apply them consistently; - make judgments and accounting estimates that are reasonable and prudent; - prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. Auditor

Each of the persons who is a director at the date of approval of this report confirms that:

- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.

This report was approved by the board of directors on 31 October 2023 and signed on behalf of the board by:

Mr P Bray

Director

Registered office:

25-35 Sadler Road

Lincoln

United Kingdom

LN6 3XJ

Spaldings Limited

Independent Auditor's Report to the Members of Spaldings Limited

Year ended 31 March 2023

Opinion

We have audited the financial statements of Spaldings Limited (the 'company') for the year ended 31 March 2023 which comprise the statement of income and retained earnings, statement of financial position, statement of cash flows 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 FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion the financial statements: - give a true and fair view of the state of the company's affairs as at 31 March 2023 and of its loss for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; - have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

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

Conclusions relating to going concern

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

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

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

Other information

The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

- the information given in the strategic report and the 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.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion: - adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or - the financial statements are not in agreement with the accounting records and returns; or - certain disclosures of directors' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, 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. 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 assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by: - making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and - considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. To address the risk of fraud through management bias and override of controls, we: - performed analytical procedures to identify any unusual or unexpected relationships; - assessed whether judgements and assumptions made in determining the accounting estimates set out in Note 1 were indicative of potential bias; and - investigated the rationale behind significant or unusual transactions. In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to: - agreeing financial statement disclosures to underlying supporting documentation; There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to inquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any. Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion. As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also: - Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. - Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control. - Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. - Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern. - Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. 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.

Linda Lord BSc FCA BFP TEP

(Senior Statutory Auditor)

For and on behalf of

Streets Audit LLP

Chartered accountants & statutory auditor

Tower House

Lucy Tower Street

Lincoln

LN1 1XW

14 November 2023

Spaldings Limited

Statement of Income and Retained Earnings

Year ended 31 March 2023

		2023	2022
Note		£000	£000
Turnover	4	24,651	23,696

Cost of sales	14,875	14,412
	---------	---------
Gross profit	9,776	9,284

Distribution costs		1,394	1,265
Administrative expenses		8,985	7,761
Other operating income	5	3	–
		--------	--------
Operating (loss)/profit	6	( 600)	258

Other interest receivable and similar income	10	–	1
Interest payable and similar expenses	11	195	8
		--------	--------
(Loss)/profit before taxation		( 795)	251

Tax on (loss)/profit	12	3	114
		-----	-----
(Loss)/profit for the financial year and total comprehensive income		( 798)	137
		-----	-----

Retained earnings at the start of the year	14,496	14,359
	---------	---------
Retained earnings at the end of the year	13,698	14,496
	---------	---------

All the activities of the company are from continuing operations.

Spaldings Limited

Statement of Financial Position

31 March 2023

	2023	2022
Note	£000	£000

Fixed assets

Tangible assets	13	351	502

Current assets

Stocks	14	7,868	6,938
Debtors	15	16,169	10,964
Cash at bank and in hand		542	116
		---------	---------
		24,579	18,018

Creditors: amounts falling due within one year	16	10,232	3,082
		---------	---------
Net current assets		14,347	14,936
		---------	---------
Total assets less current liabilities		14,698	15,438

Provisions	–	( 58)
	---------	---------
Net assets	14,698	15,496
	---------	---------

Capital and reserves

Called up share capital	19	1,000	1,000
Profit and loss account		13,698	14,496
		---------	---------
Shareholders funds		14,698	15,496
		---------	---------

These financial statements were approved by the board of directors and authorised for issue on 31 October 2023 , and are signed on behalf of the board by:

Mr P Bray

Director

Company registration number: 01558147

Spaldings Limited

Statement of Cash Flows

Year ended 31 March 2023

	2023	2022
	£000	£000

Cash flows from operating activities

(Loss)/profit for the financial year	( 798)	137

Adjustments for:
Depreciation of tangible assets	208	232
Other interest receivable and similar income	–	( 1)
Interest payable and similar expenses	195	8
Tax on (loss)/profit	3	114
Accrued expenses	47	36

Changes in:
Stocks	( 930)	( 279)
Trade and other debtors	( 5,205)	348
Trade and other creditors	1,843	( 1,151)
	--------	--------
Cash generated from operations	( 4,637)	( 556)

Interest paid	( 195)	( 8)
Interest received	–	1
Tax received/(paid)	55	( 147)
	--------	-----
Net cash used in operating activities	( 4,777)	( 710)
	--------	-----

Cash flows from investing activities

Purchase of tangible assets	( 57)	( 92)
	--------	-----
Net cash used in investing activities	( 57)	( 92)
	--------	-----

Cash flows from financing activities

Proceeds from borrowings	4,010	–
Proceeds from loans from group undertakings	1,250	312
	--------	-----
Net cash from financing activities	5,260	312
	--------	-----

Net increase/(decrease) in cash and cash equivalents	426	( 490)
Cash and cash equivalents at beginning of year	116	606
	-----	-----
Cash and cash equivalents at end of year	542	116
	-----	-----

Spaldings Limited

Notes to the Financial Statements

Year ended 31 March 2023

1. General information

The company is a private company limited by shares, registered in England and Wales. The address of the registered office is 25-35 Sadler Road, Lincoln, LN6 3XJ, United Kingdom.

2. Statement of compliance

These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.

3. Accounting policies

Basis of preparation

The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.

The financial statements are prepared in sterling, which is the functional currency of the entity.

Transition to FRS 102

The entity transitioned from previous UK GAAP to FRS 102 as at 1 April 2021. Details of how FRS 102 has affected the reported financial position and financial performance is given in note 24.

Revenue recognition

Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax. Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably.

Income tax

The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.

Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.

Operating leases

Lease payments are recognised as an expense over the lease term on a straight-line basis. The aggregate benefit of lease incentives is recognised as a reduction to expense over the lease term, on a straight-line basis.

Tangible assets

Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in equity, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation, is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in equity in respect of that asset. Where a revaluation decrease exceeds the accumulated revaluation gains accumulated in equity in respect of that asset, the excess shall be recognised in profit or loss.

Depreciation

Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:

Plant and machinery	-	10-33% Straight line
Computer Software	-	10-33% Straight line

Impairment of fixed assets

A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets. For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the company are assigned to those units.

Stocks

Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition.

Finance leases and hire purchase contracts

Assets held under finance leases and hire purchase contracts are recognised in the statement of financial position as assets and liabilities at the lower of the fair value of the assets and the present value of the minimum lease payments, which is determined at the inception of the lease term. Any initial direct costs of the lease are added to the amount recognised as an asset. Lease payments are apportioned between the finance charges and reduction of the outstanding lease liability using the effective interest method. Finance charges are allocated to each period so as to produce a constant rate of interest on the remaining balance of the liability.

Financial instruments

A financial asset or a financial liability is recognised only when the entity becomes a party to the contractual provisions of the instrument. Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Debt instruments are subsequently measured at amortised cost. Other financial instruments, including derivatives, are initially recognised at fair value, unless payment for an asset is deferred beyond normal business terms or financed at a rate of interest that is not a market rate, in which case the asset is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

Defined contribution plans

Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund. When contributions are not expected to be settled wholly within 12 months of the end of the reporting date in which the employees render the related service, the liability is measured on a discounted present value basis. The unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

4. Turnover

Turnover arises from:

	2023	2022
	£000	£000
Sale of goods	24,651	23,696
	---------	---------

Turnover is attributable to the principal activity of the company. Turnover derived from the United Kingdom amounted to £23,260,679 and the remaining £1,390,623 of the turnover is attributable to overseas sales.

5. Other operating income

	2023	2022
	£000	£000
Other operating income	3	–
	-----	-----

6. Operating profit

Operating profit or loss is stated after charging/crediting:

	2023	2022
	£000	£000
Depreciation of tangible assets	207	233
Impairment of trade debtors	(31)	(40)
Operating lease rentals	434	406
Foreign exchange differences	5	8
	-----	-----

7. Auditor's remuneration

	2023	2022
	£000	£000
Fees payable for the audit of the financial statements	30	56
	-----	-----

Fees payable to the company's auditor and its associates for other services:

Audit-related assurance services	10	–
	-----	-----

8. Staff costs

The average number of persons employed by the company during the year, including the directors, amounted to:

	2023	2022
	No.	No.
Administrative staff	44	49
Number of sales staff	63	72
Number of stores staff	26	25
	-----	-----
	133	146
	-----	-----

The aggregate payroll costs incurred during the year, relating to the above, were:

	2023	2022
	£000	£000
Wages and salaries	5,536	4,797
Social security costs	573	482
Other pension costs	178	180
	--------	--------
	6,287	5,459
	--------	--------

Included in wages and salaries above are £564,000 of costs relating to the restructure following the acquisition of the share capital of Spalding Holdings Limited by Twinings BidCo Limited.

9. Directors' remuneration

The directors' aggregate remuneration in respect of qualifying services was:

	2023	2022
	£000	£000
Remuneration	525	–
Company contributions to defined contribution pension plans	44	–
	-----	-----
	569	–
	-----	-----

Remuneration of the highest paid director in respect of qualifying services:

	2023	2022
	£000	£000
Aggregate remuneration	95	–
Company contributions to defined contribution pension plans	12	–
	-----	-----
	107	–
	-----	-----

10. Other interest receivable and similar income

	2023	2022
	£000	£000
Interest on cash and cash equivalents	–	1
	-----	-----

11. Interest payable and similar expenses

	2023	2022
	£000	£000
Interest on obligations under finance leases and hire purchase contracts	6	8
Other interest payable and similar charges	189	–
	-----	-----
	195	8
	-----	-----

12. Tax on (loss)/profit

Major components of tax expense

	2023	2022
	£000	£000

Current tax:

UK current tax (income)/expense	( 55)	147

Deferred tax:

Origination and reversal of timing differences	58	–
Impact of change in tax rate	–	( 14)
Impact of changes in accounting policies and material errors	–	(19)
	-----	-----
Total deferred tax	58	( 33)
	-----	-----
Tax on (loss)/profit	3	114
	-----	-----

Reconciliation of tax expense

The tax assessed on the (loss)/profit on ordinary activities for the year is higher than (2022: higher than) the standard rate of corporation tax in the UK of 19 % (2022: 19 %).

	2023	2022
	£000	£000
(Loss)/profit on ordinary activities before taxation	( 795)	251
	-----	-----
(Loss)/profit on ordinary activities by rate of tax	( 151)	48
Adjustment to tax charge in respect of prior periods	( 55)	90
Effect of expenses not deductible for tax purposes	–	10
Effect of capital allowances and depreciation	209	( 34)
	-----	-----
Tax on (loss)/profit	3	114
	-----	-----

13. Tangible assets

	Plant and machinery	Computer Software	Total
	£000	£000	£000
Cost
At 1 April 2022	2,098	803	2,901
Additions	21	36	57
Disposals	( 32)	–	( 32)
	--------	-----	--------
At 31 March 2023	2,087	839	2,926
	--------	-----	--------
Depreciation
At 1 April 2022	1,719	680	2,399
Charge for the year	112	96	208
Disposals	( 32)	–	( 32)
	--------	-----	--------
At 31 March 2023	1,799	776	2,575
	--------	-----	--------
Carrying amount
At 31 March 2023	288	63	351
	--------	-----	--------
At 31 March 2022	379	123	502
	--------	-----	--------

14. Stocks

	2023	2022
	£000	£000
Finished goods and goods for resale	7,868	6,938
	--------	--------

15. Debtors

	2023	2022
	£000	£000
Trade debtors	4,109	3,637
Amounts owed by group undertakings	11,651	6,825
Prepayments and accrued income	206	324
Corporation tax repayable	203	178
	---------	---------
	16,169	10,964
	---------	---------

16. Creditors: amounts falling due within one year

	2023	2022
	£000	£000
Bank loans and overdrafts	4,010	–
Trade creditors	3,748	2,152
Amounts owed to group undertakings	1,562	312
Accruals and deferred income	290	243
Social security and other taxes	622	375
	---------	--------
	10,232	3,082
	---------	--------

Creditors of less than one year includes loan funding of £4,009,684 which is secured against the stock of the company.

17. Deferred tax

The deferred tax included in the statement of financial position is as follows:

	2023	2022
	£000	£000
Included in provisions	–	( 58)
	-----	-----

The deferred tax account consists of the tax effect of timing differences in respect of:

	2023	2022
	£000	£000
Accelerated capital allowances	–	( 58)
	-----	-----

18. Employee benefits

Defined contribution plans

The amount recognised in profit or loss as an expense in relation to defined contribution plans was £ 178,425 (2022: £ 179,686 ).

19. Called up share capital

Issued, called up and fully paid

	2023		2022
	No.	£	No.	£
Ordinary shares of £ 1 each	1,000,000	1,000,000	1,000,000	1,000,000
	--------------	--------------	--------------	--------------

20. Analysis of changes in net debt

	At 1 Apr 2022	Cash flows	At 31 Mar 2023
	£000	£000	£000
Cash at bank and in hand	116	426	542
Debt due within one year	(312)	(5,260)	(5,572)
	-----	--------	--------
	( 196)	( 4,834)	( 5,030)
	-----	--------	--------

21. Operating leases

The total future minimum lease payments under non-cancellable operating leases are as follows:

	2023	2022
	£000	£000
Not later than 1 year	387	407
Later than 1 year and not later than 5 years	275	473
	-----	-----
	662	880
	-----	-----

22. Related party transactions

The directors have taken advantage of the exemption in FRS 102 from disclosing related party transactions on the grounds that the company is a subsidiary undertaking where 100% of the voting rights are controlled within the group, and consolidated financial statements in which the subsidiary undertaking is included are publicly available.

23. Controlling party

The company is a 100% subsidiary of Spalding Holdings Limited, a company incorporated in England & Wales. The ultimate controlling Party is Twinings Topco Limited which owns 100% of the share capital of Twinings Bidco Limited and in turn Spalding Holdings Limited, Twinings Topco Limited is incorporated in England & Wales with a registered office of 105 Piccadilly, London, United Kingdom, W1J 7NJ and is controlled by P S Youens and A Farrant.

24. Transition to FRS 102

These are the first financial statements that comply with FRS 102. The company transitioned to FRS 102 on 1 April 2021.

No transitional adjustments were required in equity or profit or loss for the year.

Transitional adjustments were required in equity and profit or loss for the year. Adjustments have taken place in the year to remove classification of right of use assets and Lease Liabilities previously recognised under IFRS 16 Leases as part of FRS 101 accounting standards. The derecognition of such has increased the in year loss by £2,183 (2022: increased profit £3,325). Furthermore, retained earnings brought forward has increased by £24,000 (2022: retained earnings brought forward increased by £21,000).