Delkia Limited - Period Ending 2023-12-31
Delkia Limited - Period Ending 2023-12-31
Company Registration number:
Delkia Limited
Financial Statements
for the
Year Ended 31 December 2023
Delkia Limited
Contents
Pages
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Directors' report |
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Balance sheet |
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Notes to the financial statements |
Delkia Limited
Directors' report for the Year Ended 31 December 2023
The directors present their report and the financial statements for the year ended 31 December 2023.
Directors of the company
The directors who held office during the year were as follows:
Principal activity
The principal activity of the company is systems integration - providing technological and engineering solutions for safety-related and mission-critical systems.
BUSINESS REVIEW
The closing accounting period resulted in record sales for the Company amounting to ~£7.3m, with a net profit of ~£173k (~2.4%) following significant internal investment for future growth.
The Company continues to develop and invest into systems engineering and integration capability with technology services and products for high-integrity and mission-critical systems. The divisions in which the Company operates are highly regulated, covering clean energy (inc. nuclear), aerospace and maritime (both civil and defence).
Clean Energy
The division continues to grow steadily and this has resulted in major contract wins and frameworks for Delkia during the year. Delays have been seen in contract negotiations during Q4 2023, which has resulted in major contracts being placed in Q1 2024 (successfully won) across both the civil and nuclear defence markets. AMR and SMR development is of strong interest to the Company, as part of its clean energy portfolio whilst supporting existing new nuclear build strategies.
The nuclear decommissioning sector remains strong. It is expected that Delkia will successfully achieve ~£6m of new order intake in 2024. This is supported by recently awarded 16-year frameworks with anticipated revenue of £5m per annum.
Maritime
The maritime market has benefitted from significant growth across the civil and, in particular, defence sectors, and Delkia has been well positioned to meet that demand. In 2023, Delkia’s Maritime division delivered complex, high-integrity control and indication systems (from concept, through development, qualification, and build), along with integrated logistics support, vehicle control and platform management systems (surface and subsurface).
Our accompanying R&D programmes continue to mature autonomous air, surface and subsurface platforms, while expanding into artificial intelligence and machine learning. Building on this success, Delkia is now supporting Royal Navy through government procurement frameworks, poised to deliver well over £400m of services over the forthcoming decade. Delkia’s Maritime division expects to contribute circa £8m to group revenue during 2024.
Delkia Limited
Directors' report for the Year Ended 31 December 2023 (continued)
Aerospace
Developments in the general aerospace sector has seen significant increases in product development, specialist materials research and integration support, which will lead to Delkia’s Aerospace division receiving its first £1m+ contract in Q1 2024. Delkia has built up significant UK leading expertise in certification, airworthiness and flight control systems technologies. Delkia’s Aerospace division is projected to make a circa. ~£3m contribution to group revenue in 2024.
Research and Development (R&D)
As part of the Corporate Strategy, Delkia is committed to investing a percentage of revenue to grow its Research & Development capability, with the aim of developing technologies that support all divisions within the company. Delkia is planning to exhibit its first experimental air vehicle at the Farnborough Air show later in 2024. It continues to work closely with academia and industry partners across the UK.
An advisory Board has been appointed for oversight, governance and audit and has been in place since August 2023. The appointees have a balanced approach of expertise in the relevant sectors and financial governance. This Board has approved the Company Charter and the new Corporate Strategy for future growth. The Board is now working with the operations and full-time executive team to ensure a future organisational design is stable and sustainable for medium and long-term growth.
PRINCIPAL RISK AND UNCERTAINTIES
The business takes a risk-based approach and continues to assess its operations from a commercial, legal, and political perspective from the UK and overseas.
Brexit risks have been reviewed and these are not perceived as a major risk to the Company.
Global chip shortages are impacting lead times which is causing delays across major projects. Delkia has mitigated this by appointing a procurement and supply chain team with a clear strategy, distilling sustainability and resilience throughout its suppliers.
Delkia aims to maintain the highest standards of data integrity and security and our Company acknowledges the evolving landscape of cyber risks that impact businesses globally. While we continuously adapt our strategies to counter these risks, detailed descriptions of our specific mitigation measures are withheld to ensure the effectiveness of our security protocols.
FUTURE DIRECTION
The Company secured ~£10.2m of new orders throughout 2023, supporting a longer-term and sustainable growth projection. It continues to focus on its excellent operational delivery and is starting to secure larger packages of work, in all of its divisions across clean energy, aerospace, maritime and defence sectors. Forecast revenue for 2024 is ~£14m, which will transition the business from a small entity, with regards to Companies House reporting. The Board is comfortable with the sustained growth, and independent auditing is being planned for post 2023 accounts should this be required.
Delkia Limited
Directors' report for the Year Ended 31 December 2023 (continued)
Delkia continues to focus on its forward strategy as one of the UK’s leading engineering and technology partners for safety-related and mission-critical systems. International trade focus has already begun, securing contracts in France, Sweden, and the US. The Company continues its successful progression towards its growth target of ~£20m by 2026.
Small companies provision statement
This report has been prepared in accordance with the special provisions relating to companies subject to the small companies regime within Part 15 of the Companies Act 2006.
Approved and authorised by the
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Delkia Limited
Balance Sheet as at 31 December 2023
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2023 |
2022 |
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Fixed assets |
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Intangible assets |
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Tangible assets |
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Current assets |
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Stocks |
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Debtors |
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Cash at bank and in hand |
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Creditors: Amounts falling due within one year |
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Net current assets |
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Total assets less current liabilities |
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Creditors: Amounts falling due after more than one year |
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Provisions for liabilities |
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Net assets |
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Capital and reserves |
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Called up share capital |
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Other reserves |
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Retained earnings |
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Shareholders' funds |
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Delkia Limited
Balance Sheet as at 31 December 2023 (continued)
For the financial year ending 31 December 2023 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
Directors' responsibilities:
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The directors acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and the preparation of accounts. |
These financial statements have been prepared in accordance with the special provisions relating to companies subject to the small companies regime within Part 15 of the Companies Act 2006.
These financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime. As permitted by section 444 (5A) of the Companies Act 2006, the directors have not delivered to the registrar a copy of the Profit and Loss Account.
Company registration number: 07339803
Approved and authorised by the
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Delkia Limited
Notes to the financial statements for the Year Ended 31 December 2023
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GENERAL INFORMATION |
The company is a private company limited by share capital, incorporated in England and Wales.
The address of its registered office is:
These financial statements were authorised for issue by the
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ACCOUNTING POLICIES |
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
These financial statements have been prepared in accordance with Financial Reporting Standard 102 Section 1A smaller entities - 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland' and the Companies Act 2006 (as applicable to companies subject to the small companies' regime).
Basis of preparation
These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.
The financial statements are prepared in sterling, which is the functional currency of the entity. Monetary amounts in these financial statements are rounded to the nearest £.
Going concern
The financial statements have been prepared on a going concern basis.
Delkia Limited
Notes to the financial statements for the Year Ended 31 December 2023 (continued)
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ACCOUNTING POLICIES (continued) |
Judgements and key sources of estimation uncertainty
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Actual results may differ from these estimates. |
Revenue recognition
Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the company’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts.
The company recognises revenue when:
The amount of revenue can be reliably measured;
it is probable that future economic benefits will flow to the entity;
and specific criteria have been met for each of the company's activities.
Government grants
Grants for the purpose of giving immediate financial support with no future related costs to be incurred are recognised in the profit and loss account when the grant proceeds become receivable.
Other grants relating to revenue are recognised in the profit and loss account on a systematic basis over the periods in which the related costs are recognised for which the grant is intended to compensate.
Grants receivable in the period were £36,215 (2022: £nil) and were received from the Cumbria Local Enterprise Partnership.
Tax
The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.
The current corporation tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates taxable income.
Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the financial statements.
Unrelieved tax losses and other deferred tax assets are recognised when 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 and that are expected to apply to the reversal of the timing difference.
Delkia Limited
Notes to the financial statements for the Year Ended 31 December 2023 (continued)
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ACCOUNTING POLICIES (continued) |
Tangible assets
Tangible assets (excluding plant and equipment which is stated at valuation) are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
Depreciation
Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:
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Asset class |
Depreciation method and rate |
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Plant and machinery |
15% reducing balance |
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Office equipment |
25% reducing balance |
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Fixtures and fittings |
25% reducing balance |
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Property improvements |
15% reducing balance |
Intangible assets
Separately acquired trademarks, patents and licences are shown at historical cost.
Trademarks, patents and licences (including software) and customer-related intangible assets acquired in a business combination are recognised at fair value at the acquisition date.
Trademarks, patents and licences and customer-related intangible assets have a finite useful life and are carried at cost less accumulated amortisation and any accumulated impairment losses.
Intellectual Property rights are carried at cost less accumulated amortisation and any accumulated impairment losses.
Amortisation
Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:
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Asset class |
Amortisation method and rate |
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Trademarks, patents and licences |
5 year straight line |
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Intellectual property |
shorter of the economic life and the period the right is legally enforceable |
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.
Delkia Limited
Notes to the financial statements for the Year Ended 31 December 2023 (continued)
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ACCOUNTING POLICIES (continued) |
Trade debtors
Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.
Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables.
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.
The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. At each reporting date, stocks are assessed for impairment. If stocks are impaired, the carrying amount is reduced to its selling price less costs to complete and sell; the impairment loss is recognised immediately in profit or loss.
Trade creditors
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.
Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method where due after more than one year.
Borrowings
Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the profit and loss account over the period of the relevant borrowing.
Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.
Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.
Delkia Limited
Notes to the financial statements for the Year Ended 31 December 2023 (continued)
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ACCOUNTING POLICIES (continued) |
Leases
Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.
Share capital
Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.
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STAFF NUMBERS |
The average number of persons employed by the company (including directors) during the year, was
In addition to the above persons employed, the company also utilised an average of 37 consultants (2022 - 22) during the period.
Delkia Limited
Notes to the financial statements for the Year Ended 31 December 2023 (continued)
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INTANGIBLE ASSETS |
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Trademarks, |
Intellectual |
Total |
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Cost or valuation |
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At 1 January 2023 |
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At 31 December 2023 |
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Amortisation |
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At 1 January 2023 |
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Amortisation charge |
- |
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At 31 December 2023 |
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Carrying amount |
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At 31 December 2023 |
- |
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At 31 December 2022 |
- |
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Delkia Limited
Notes to the financial statements for the Year Ended 31 December 2023 (continued)
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TANGIBLE ASSETS |
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Property improvements |
Fixtures and |
Plant and equipment |
Total |
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Cost or valuation |
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At 1 January 2023 |
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Additions |
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At 31 December 2023 |
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Depreciation |
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At 1 January 2023 |
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Charge for the year |
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At 31 December 2023 |
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Carrying amount |
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At 31 December 2023 |
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At 31 December 2022 |
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Revaluation
The fair value of the company's plant and machinery was revalued on 31 October 2017. An independent valuer was not involved.
Had this class of asset been measured on a historical cost basis, the carrying amount would have been £31,998 (2022 - £37,645).
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STOCKS |
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2023 |
2022 |
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Stocks |
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DEBTORS |
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Current |
2023 |
2022 |
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Trade debtors |
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Prepayments |
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Other debtors |
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Delkia Limited
Notes to the financial statements for the Year Ended 31 December 2023 (continued)
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CREDITORS |
Creditors: amounts falling due within one year
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Note |
2023 |
2022 |
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Due within one year |
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Loans and borrowings |
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Trade creditors |
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Taxation and social security |
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Accruals and deferred income |
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Other creditors |
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Creditors: amounts falling due after more than one year
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Note |
2023 |
2022 |
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Due after one year |
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Loans and borrowings |
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RESERVES |
A reconciliation of the opening and closing non-distributable reserve for the current year is as follows:
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Non-distributable
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Brought forward |
10,200 |
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Other movement |
(2,191) |
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Carried forward |
8,009 |
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Delkia Limited
Notes to the financial statements for the Year Ended 31 December 2023 (continued)
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LOANS AND BORROWINGS |
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2023 |
2022 |
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Non-current loans and borrowings |
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Bank borrowings |
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2023 |
2022 |
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Current loans and borrowings |
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Bank borrowings |
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FINANCIAL COMMITMENTS, GUARANTEES AND CONTINGENCIES |
Amounts not provided for in the balance sheet
The total amount of financial commitments not included in the balance sheet in the balance sheet is £540,464 (2022 - £750,767), £540,464 (2022 - £736,065) of these commitments relate to property leases.