Drallim Industries Limited - Accounts to registrar (filleted) - small 23.2.5

REGISTERED NUMBER: 00606278 (England and Wales)

DRALLIM INDUSTRIES LIMITED

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30TH JUNE 2023

Page

Company Information

1

Balance Sheet

2

to

4

Notes to the Financial Statements

5

to

14

DIRECTORS:

R P Bedford

D R Mooney

J M Staplehurst

SECRETARY:

J M Staplehurst

REGISTERED OFFICE:

Millwood House

Drury Lane

Ponswood Industrial Estate

St Leonards on Sea

East Sussex

TN38 9BA

REGISTERED NUMBER:

00606278 (England and Wales)

ACCOUNTANTS:

Gibbons Mannington & Phipps LLP

Chartered Accountants

20 Eversley Road

Bexhill-on-Sea

East Sussex

TN40 1HE

BANKERS:

HSBC Bank Plc

4 Robertson Street

Hastings

East Sussex

TN34 1HW

SOLICITORS:

Thomson Snell and Passmore

3 Lonsdale Gardens

Tunbridge Wells

Kent

TN1 1NX

FIXED ASSETS

Tangible assets

4

4,572,950

4,638,555

Investments

5

4,067

4,067

4,577,017

4,642,622

CURRENT ASSETS

Stocks

6

1,331,158

1,303,234

Debtors

7

564,036

676,274

Cash in hand

1,256,310

1,565,613

3,151,504

3,545,121

CREDITORS

Amounts falling due within one year

8

575,816

579,353

NET CURRENT ASSETS

2,575,688

2,965,768

TOTAL ASSETS LESS CURRENT LIABILITIES

7,152,705

7,608,390

CREDITORS

Amounts falling due after more than one year

9

-

(230,730

)

PROVISIONS FOR LIABILITIES

12

-

(36,044

)

PENSION ASSET/(LIABILITY)

15

297,000

(119,070

)

NET ASSETS

7,449,705

7,222,546

CAPITAL AND RESERVES

Called up share capital

13

400,000

400,000

Share premium

41,794

41,794

Revaluation reserve

14

1,080,024

1,043,980

Retained earnings

5,927,887

5,736,772

SHAREHOLDERS' FUNDS

7,449,705

7,222,546

The company is entitled to exemption from audit under Section 477 of the Companies Act 2006 for the year ended 30th June 2023.

The members have not required the company to obtain an audit of its financial statements for the year ended 30th June 2023 in accordance with Section 476 of the Companies Act 2006.

The directors acknowledge their responsibilities for:

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

(b)

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

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

In accordance with Section 444 of the Companies Act 2006, the Income Statement has not been delivered.

The financial statements were approved by the Board of Directors and authorised for issue on 26th February 2024 and were signed on its behalf by:

D R Mooney - Director

J M Staplehurst - Director

1.	STATUTORY INFORMATION

Drallim Industries Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

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

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" including the provisions of Section 1A "Small Entities" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.

Preparation of consolidated financial statements

The financial statements contain information about Drallim Industries Limited as an individual company and do not contain consolidated financial information as the parent of a group. The subsidiary companies are dormant or non trading and any consolidation would not be material.

Related party exemption

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Turnover is recognised to the extent that the company has obtained the right to consideration through its performance under the contract. Where contracts are in progress at the year end, but have not been billed, revenue and profit is recognised to the extent that the company has obtained the right to consideration.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write down each asset over its estimated useful life taking into account the approximate residual value on disposal.

Freehold property

- 2.5% on cost or revaluation

Plant and machinery

- 10% on cost

Computer equipment, fixtures and fittings

- 20 - 50% on cost

Motor vehicles

- 25% on cost

No depreciation is provided on freehold land.

Investments in subsidiaries

Investments in subsidiary undertakings are recognised at cost.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Research and development

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

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Hire purchase and leasing commitments

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

Pension costs and other post-retirement benefits

The company operates a defined benefit pension scheme closed to new accruals at 30 June 2016. The current pension has moved into surplus on an actuarial basis as at 30 June 2023.

The current pension has moved into surplus on an actuarial basis as at 30th June 2023.

After the Trustees took appropriate financial advice, the return on investment of the scheme's assets has subsequently, in January 2024, been matched with the scheme's liabilities to hedge against future interest rate and inflation risk.

The company operates a defined contribution scheme. The contributions are charged to the profit and loss account and the assets of the scheme are held separately from those of the company in an independently administered fund.

Government grants

Grants are credited to deferred revenue. Grants towards capital expenditure are released to the profit and loss account over the expected useful life of the assets. Grants towards revenue expenditure are released to the profit and loss account as the related expenditure is incurred.

3.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was 34 (2022 - 34 ) .

4.	TANGIBLE FIXED ASSETS

Computer

equipment,

fixtures

Freehold

Plant and

and

Motor

property

machinery

fittings

vehicles

Totals

£

£

£

£

£

COST OR VALUATION

At 1st July 2022

4,350,000

340,816

154,695

61,320

4,906,831

Additions

-

67,595

20,414

25,019

113,028

Disposals

-

(9,500

)

-

(14,347

)

(23,847

)

At 30th June 2023

4,350,000

398,911

175,109

71,992

4,996,012

DEPRECIATION

At 1st July 2022

-

106,885

100,079

61,312

268,276

Charge for year

99,550

34,985

34,218

3,625

172,378

Eliminated on disposal

-

(3,246

)

-

(14,346

)

(17,592

)

At 30th June 2023

99,550

138,624

134,297

50,591

423,062

NET BOOK VALUE

At 30th June 2023

4,250,450

260,287

40,812

21,401

4,572,950

At 30th June 2022

4,350,000

233,931

54,616

8

4,638,555

Included in cost or valuation of land and buildings is freehold land of £ 368,000 (2022 - £ 368,000 ) which is not depreciated.

The freehold land and buildings was professionally revalued on 30th June 2022, by a RICS registered valuer.

Cost or valuation at 30th June 2023 is represented by:

Computer

equipment,

fixtures

Freehold

Plant and

and

Motor

property

machinery

fittings

vehicles

Totals

£

£

£

£

£

Revaluation surplus in 2022

1,029,492

-

-

-

1,029,492

Cost

3,320,508

398,911

175,109

71,992

3,966,520

4,350,000

398,911

175,109

71,992

4,996,012

5.	FIXED ASSET INVESTMENTS

Shares in

group

undertaki

£

COST

At 1st July 2022

and 30th June 2023

4,067

NET BOOK VALUE

At 30th June 2023

4,067

At 30th June 2022

4,067

Market value of listed investments at 30th June 2023 - £ 4,067 .

The company's investments at the Balance Sheet date in the share capital of companies include the following:

Drallim Controls Limited

Registered office: Inside of the United Kingdom

Nature of business: Dormant

%

Class of shares:

holding

Ordinary

100.00

2023

2022

£

£

Aggregate capital and reserves

1,000

1,000

Cargo Aids Limited

Registered office: Inside of the United Kingdom

Nature of business: Dormant

%

Class of shares:

holding

Ordinary

100.00

2023

2022

£

£

Aggregate capital and reserves

2,000

2,000

Drallim Telecommunications Limited

Registered office: Inside of the United Kingdom

Nature of business: Dormant

%

Class of shares:

holding

Ordinary

100.00

2023

2022

£

£

Aggregate capital and reserves

1,000

1,000

Drallim Industries Inc.

Registered office: Outside of the United Kingdom

Nature of business: Dormant

%

Class of shares:

holding

Ordinary

100.00

2023

2022

£

£

Aggregate capital and reserves

(12,325

)

(12,325

)

Drallim USA Inc

Registered office: Outside of the United Kingdom

Nature of business: Dormant

%

Class of shares:

holding

Ordinary

100.00

6.

STOCKS

2023

2022

£

£

Inventory parts

1,085,583

1,088,166

Work in progress

245,575

215,068

Total

1,331,158

1,303,234

7.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2023

2022

£

£

Trade debtors

313,338

417,168

Other debtors

1,040

59,870

Tax

116,787

64,311

Accrued income

49,115

47,633

Prepayments

83,756

87,292

564,036

676,274

8.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2023

2022

£

£

Trade creditors

118,076

225,205

Amounts owed to group undertakings

4,000

4,000

Social security and other taxes

51,054

45,321

VAT

117,296

10,448

Other creditors

268,303

278,191

Accrued expenses

17,087

16,188

575,816

579,353

9.

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

2023

2022

£

£

Other creditors

-

230,730

Provision is deleted for compensation on loss of office for the Executive Directors on termination at a future date to be determined.

10.	LEASING AGREEMENTS

Minimum lease payments under non-cancellable operating leases fall due as follows:

2023

2022

£

£

Within one year

16,743

11,122

Between one and five years

30,068

10,006

46,811

21,128

11.	SECURED DEBTS

On 1st March 2021, HSBC Bank plc were granted a charge over cash deposits totalling £170,500 held by the company and deposited with the bank on a 1 month revolving fixed rate deposit. The charge covers all present and future debts, money and liabilities owed to HSBC Bank plc including interest, fees, costs and expenses.

On 8th June 2023, HSBC Bank UK plc were granted a charge over a cash deposit totalling £196,000 held by the company and deposited with the bank on a 24 month fixed rate deposit maturing on 14th April 2025.

The charge covered a contract guarantee issued to a customer.

12.	PROVISIONS FOR LIABILITIES

2023

2022

£

£

Deferred tax

-

36,044

Deferred

tax

£

Balance at 1st July 2022

36,044

Charge/(credit) to other

(36,044

)

comprehensive income during

the year

Balance at 30th June 2023

-

13.	CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:

Number:

Class:

Nominal

2023

2022

value:

£

£

400,000

Ordinary

£1

400,000

400,000

14.

RESERVES

Revaluati

reserve

£

At 1st July 2022

1,043,980

Increase to property revaluation reserve

36,044

At 30th June 2023

1,080,024

15.	EMPLOYEE BENEFIT OBLIGATIONS

The Company sponsors Drallim Industries Limited Retirement Benefit Scheme, a funded defined benefit pension scheme in the UK. The scheme is set up on a tax relieved basis as a separate trust independent of the Company and is supervised by its Trustees. They are responsible for ensuring that the correct benefits are paid, that the scheme is appropriately funded and that scheme assets are appropriately invested.

The Company pays the cost as determined by the annual actuarial valuations. The Trustees are required to use prudent assumptions to value the liabilities and costs of the scheme whereas the accounting assumptions must be best estimates. The latest actuarial valuation dated 30 June 2022 showed a funding shortfall of £1,121,000. However, by 30 June 2023 the deficit had been recovered and the scheme is now in surplus.

The amounts recognised in the balance sheet are as follows:

Defined benefit

pension plans

2023

2022

£

£

Present value of funded obligations

(4,514,000

)

(4,894,000

)

Fair value of plan assets

4,811,000

4,747,000

297,000

(147,000

)

Present value of unfunded obligations

-

-

Surplus/(Deficit)

297,000

(147,000

)

Deferred tax asset

-

27,930

Net asset/(liability)

297,000

(119,070

)

The amounts recognised in profit or loss are as follows:

Defined benefit

pension plans

2023

2022

£

£

Current service cost

-

-

Net interest from net defined benefit asset/liability

2,000

33,000

Past service cost

-

-

2,000

33,000

Actual return on plan assets

122,000

(99,000

)

Actual return on plan assets is represented by the following amounts:

2023

2021

£

£

Income return

179,000

94,000

Capital return

(57,000

)

(193,000

)

122,000

(99,000

)

Changes in the present value of the defined benefit obligation are as follows:

Defined benefit

pension plans

2023

2022

£

£

Opening defined benefit obligation

4,894,000

7,198,000

Interest cost

181,000

127,000

Actuarial losses/(gains)

(299,000

)

(1,712,000

)

Benefits paid

(262,000

)

(719,000

)

4,514,000

4,894,000

Changes in the fair value of scheme assets are as follows:

Defined benefit

pension plans

2023

2022

£

£

Opening fair value of scheme assets (adjusted)

4,747,000

5,361,000

Contributions by employer

207,000

207,000

Assets expenses

(3,000

)

(3,000

)

Expected return

179,000

94,000

Actuarial gains/(losses)

(57,000

)

(193,000

)

Benefits paid

(262,000

)

(719,000

)

4,811,000

4,747,000

The amounts recognised in other comprehensive income are as follows:

Defined benefit

pension plans

2023

2022

£

£

Actuarial gains/(losses)

444,000

1,690,000

444,000

1,690,000

The major categories of scheme assets as a percentage of total scheme assets are as follows:

Defined benefit

pension plans

2023

2022

Diversified Growth Fund

100%

100%

100.00%

100.00%

Principal actuarial assumptions at the balance sheet date (expressed as weighted averages):

2023

2022

Liability discount rate

5.20%

3.80%

Inflation assumption - RPI

3.30%

3.15%

Inflation assumption - CPI

2.50%

2.35%

Revaluation of deferred pensions

2.50%

2.35%

Increases for pensions in payment

3.30%

3.15%

Proportion of employees commuting pension for cash

100%

100%

Forecast mortality rates are:

Male aged 65 at year end

86.4

86.9

Female aged 65 at year end

88.9

89.3

Male aged 45 at year end

87.6

88.2

Female aged 45 at year end

90.3

90.7

Sensitivity rates

The increase in the scheme deficit in the current financial year for each 0.1% change in the variable rate for the following assumptions amounted to:

2023

2022

Inflation rate increase

£43,000

£66,000

Discount rate decrease

£52,000

£63,000

The pension scheme surplus (2022 - deficit) after tax relief measured by the Scheme Actuary using current practice applying a discount rate of 5.20% based on the current return on 17 year high grade (AA rated) corporate bonds amounts to £297,000. The pension scheme's assets at the balance sheet date were invested in a Diversified Growth Fund with a benchmark return of 5% per annum over 1 month SONIA before charges of 0.68%.

Defined contribution scheme

The company operates a defined contribution pension scheme available to all staff and the contributions are charged to the profit and loss account.