J.E.B. Technologies Limited - Limited company accounts 16.3

REGISTERED NUMBER: 01079733 (England and Wales)

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS FOR THE PERIOD 1 NOVEMBER 2015 TO 31 DECEMBER 2016

FOR

J.E.B. TECHNOLOGIES LIMITED

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Income Statement

8

Other Comprehensive Income

9

Statement of Financial Position

10

Statement of Changes in Equity

11

Notes to the Financial Statements

12

DIRECTORS:

M S Isaacson

P Mehta

REGISTERED OFFICE:

Hampstead Avenue

Mildenhall

Suffolk

IP28 7AS

REGISTERED NUMBER:

01079733 (England and Wales)

AUDITORS:

DNG Dove Naish

Chartered Accountants

and Statutory Auditor

Eagle House

28 Billing Road

Northampton

Northamptonshire

NN1 5AJ

The directors present their strategic report for the period 1 November 2015 to 31 December 2016.

The trading results for the year and the company's financial position at the end of the year are shown in the

attached financial statements.

REVIEW OF BUSINESS

The company has had a challenging period. The company is exposed to currency exchange risk and has

incurred significant currency exchange losses as a result of the strength of the US Dollar against the Pound.

Internal reorganisations have been undertaken in order to reduce overheads and improve profitability. Despite

these efforts the company has reported a loss for the period, largely as a result of the foreign currency losses

associated with US borrowings.

The company has recognised a £3.109m pension liability in the period relating to the JEB Engineering Design

Limited Retirement Benefits Scheme. The increased liability is the result of changes to the key assumptions

used by the actuary, most notably the discount rate.

The company continues to pursue a variety of new opportunities as well as deepen existing customer

relationships.

PRINCIPAL RISKS AND UNCERTAINTIES

The company's activities expose it to a number of financial risks including credit risk, liquidity risk and

currency risk. The company does not use derivative financial instruments for speculative purposes.

Credit risk

The company's principal financial assets are bank balances and trade debtors.

The company's credit risk is primarily attributable to its trade debtors. The amounts presented in the balance

sheet are net of allowances for doubtful debts. The credit risk on bank balances is limited because the

counterparties are banks with high credit-ratings assigned by international credit-rating agencies.

The company has some concentration of credit risk to a small number of major customers. However, a

number of these are national defence agencies and other government departments and so this risk is

considered to be limited.The company's exposure to commercial customers is managed on an account by

account basis to ensure these don't exceed agreed credit limits.

Liquidity risk

In order to maintain liquidity to ensure that sufficient funds are available for on-going operations and future

developments, the company uses a mixture of long-term and short-term debt finance and equity funding and

inter-company treasury management.

Currency risk

The company undertakes trading transactions in currencies other than sterling and has funding instruments

denominated in foreign currency. The foreign exchange risk is managed by holding cash resources in foreign

currency.

KEY PERFORMANCE INDICATORS

The company uses order intake, production levels, turnover and profit as key performance indicators to

monitor performance.

SIGNED BY ORDER OF THE DIRECTORS:

P Mehta - Director

27 September 2017

The directors present their report with the financial statements of the company for the period 1 November 2015 to 31 December 2016.

PRINCIPAL ACTIVITY

The principal activity of the company in the period under review was that of design, manufacture and supply

of precision tools and components.

DIVIDENDS

No dividends will be distributed for the period ended 31 December 2016.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 November 2015 to the date

of this report.

M S Isaacson

P Mehta

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors 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), including

Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of

Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied

that they give a true and fair view of the state of affairs of the company and of the profit or loss of the

company for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements 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.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the

Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps

that he ought to have taken as a director in order to make himself aware of any relevant audit information and

to establish that the company's auditors are aware of that information.

AUDITORS

The auditors, DNG Dove Naish, will be proposed for re-appointment at the forthcoming Annual General

Meeting.

SIGNED BY ORDER OF THE DIRECTORS:

P Mehta - Director

27 September 2017

We have audited the financial statements of J.E.B. Technologies Limited for the period ended

31 December 2016 on pages eight to twenty four. The financial reporting framework that has been applied in

their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally

Accepted Accounting Practice), including Financial Reporting Standard 102 'The Financial Reporting

Standard applicable in the UK and Republic of Ireland'.

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 a Report of the Auditors 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.

Respective responsibilities of directors and auditors

As explained more fully in the Statement of Directors' Responsibilities set out on page four, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board's Ethical Standards for Auditors.

Scope of the audit of the financial statements

An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient

to give reasonable assurance that the financial statements are free from material misstatement, whether

caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to

the company's circumstances and have been consistently applied and adequately disclosed; the

reasonableness of significant accounting estimates made by the directors; and the overall presentation of the

financial statements. In addition, we read all the financial and non-financial information in the Strategic Report

and the Report of the Directors to identify material inconsistencies with the audited financial statements and

to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the

knowledge acquired by us in the course of performing the audit. If we become aware of any apparent material

misstatements or inconsistencies we consider the implications for our report.

Opinion on financial statements

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 December 2016 and of its loss for the period then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Opinion on other matter prescribed by the Companies Act 2006

In our opinion the information given in the Strategic Report and the Report of the Directors for the financial

year for which the financial statements are prepared is consistent with the financial statements.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where 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.

Andrew Clifford (Senior Statutory Auditor)

for and on behalf of DNG Dove Naish

Chartered Accountants

and Statutory Auditor

Eagle House

28 Billing Road

Northampton

Northamptonshire

NN1 5AJ

28 September 2017

TURNOVER

3

2,521,934

2,624,585

Cost of sales

1,748,164

1,996,004

GROSS PROFIT

773,770

628,581

Administrative expenses

1,909,220

520,096

(1,135,450

)

108,485

Other operating income

56,176

65,248

OPERATING (LOSS)/PROFIT

5

(1,079,274

)

173,733

Group loan waiver

6

-

1,747,187

(1,079,274

)

1,920,920

Amounts written off investments

7

-

8,739

(1,079,274

)

1,912,181

Interest payable and similar expenses

8

96,816

197,442

Other finance costs

21

-

34,000

96,816

231,442

(LOSS)/PROFIT BEFORE TAXATION

(1,176,090

)

1,680,739

Tax on (loss)/profit

9

(71,157

)

(66,746

)

(LOSS)/PROFIT FOR THE FINANCIAL PERIOD

(1,104,933

)

1,747,485

(LOSS)/PROFIT FOR THE PERIOD

(1,104,933

)

1,747,485

OTHER COMPREHENSIVE (LOSS)/INCOME

Actuarial gain/(loss) on pension scheme

(3,290,000

)

1,027,000

Limit on recognition of assets

181,000

(173,000

)

Income tax relating to components of other comprehensive (loss)/income

-

-

OTHER COMPREHENSIVE (LOSS)/INCOME FOR THE PERIOD, NET OF INCOME TAX

(3,109,000

)

854,000

TOTAL COMPREHENSIVE (LOSS)/INCOME FOR THE PERIOD

(4,213,933

)

2,601,485

FIXED ASSETS

Tangible assets

10

3,436,375

3,520,656

CURRENT ASSETS

Stocks

11

279,540

386,880

Debtors

12

374,453

1,626,446

Cash at bank and in hand

589,327

810,375

1,243,320

2,823,701

CREDITORS

Amounts falling due within one year

13

6,784,067

7,249,302

NET CURRENT LIABILITIES

(5,540,747

)

(4,425,601

)

TOTAL ASSETS LESS CURRENT LIABILITIES

(2,104,372

)

(904,945

)

CREDITORS

Amounts falling due after more than one year

14

(13,016

)

(44,831

)

PROVISIONS FOR LIABILITIES

18

-

(62,679

)

PENSION LIABILITY

21

(3,109,000

)

-

NET LIABILITIES

(5,226,388

)

(1,012,455

)

CAPITAL AND RESERVES

Called up share capital

19

6,600

6,600

Revaluation reserve

20

379,567

379,567

Capital redemption reserve

20

3,400

3,400

Retained earnings

20

(5,615,955

)

(1,402,022

)

SHAREHOLDERS' FUNDS

(5,226,388

)

(1,012,455

)

The financial statements were approved by the Board of Directors on 27 September 2017 and were signed on its behalf by:

P Mehta - Director

Called up

Capital

share

Retained

Revaluation

redemption

Total

capital

earnings

reserve

reserve

equity

£

£

£

£

£

Balance at 1 November 2014

-

(4,003,507

)

379,567

3,400

(3,620,540

)

Changes in equity

Issue of share capital

6,600

-

-

-

6,600

Total comprehensive income

-

2,601,485

-

-

2,601,485

Balance at 31 October 2015

6,600

(1,402,022

)

379,567

3,400

(1,012,455

)

Changes in equity

Total comprehensive loss

-

(4,213,933

)

-

-

(4,213,933

)

Balance at 31 December 2016

6,600

(5,615,955

)

379,567

3,400

(5,226,388

)

1.	STATUTORY INFORMATION

J.E.B. Technologies 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" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.

Based on discussions with the company's lenders and forecast financial performance, the directors

have a reasonable expectation that the group has adequate resources to continue in operational

existence for the foreseeable future. Thus they continue to adopt the going concern basis of

accounting in preparing the annual financial statements.

The financial statements cover a 14 month period to 31 December 2016 and the comparatives are

therefore not entirely comparable. The financial year end has been changed to align with the parent

company.

This is the first year in which the financial statements have been prepared under FRS 102. Refer to the

notes for an explanation of the transition.

Financial reporting standard 102 - reduced disclosure exemptions

The company has taken advantage of the following disclosure exemptions in preparing these financial

statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and

Republic of Ireland":

•

the requirements of Section 7 Statement of Cash Flows;

•

the requirement of Section 33 Related Party Disclosures paragraph 33.7.

Significant judgements and estimates

The preparation of financial statements requires the use of certain critical accounting estimates. It also

requires management to exercise its judgement in the process of applying the company accounting

policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions

and estimates are significant to the financial statements are disclosed within the individual accounting

policies below.

Turnover

Turnover represents the value, excluding Value Added Tax, of goods and services supplied to

customers during the year. Income is recognised when significant risks and rewards of ownership of

the goods have been transferred to the buyer, which depending on the specific contract terms is either

on dispatch or delivery of goods. Turnover on customer development and construction projects is

recognised in accordance with agreed milestones being met.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off the cost less estimated residual value of each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Plant and machinery

-

20% on cost, 20% on reducing balance and 10% on cost

Fixtures and fittings

-

25% on reducing balance

Motor vehicles

-

25% on reducing balance

No depreciation is provided on a long term leasehold property where the lease is for a 999 year period,

as in the opinion of the directors, the residual value is such that any depreciation charge would be

immaterial.

Fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses.

Where parts of an item of property, plant and equipment have different useful lives, they are accounted

for as separate items of property, plant and equipment.

Depreciation methods, useful lives and residual values are reviewed at each balance sheet date. The

selection of these residual values and estimated lives requires the exercise of judgement. The

directors are required to assess whether there is an indication of impairment to the carrying value of

assets. In making that assessment, judgements are made in estimating value in use. The directors

consider that the individual carrying values of assets are supportable by their value in use.

Stocks

Stocks and work in progress are valued at the lower of cost and net realisable value, after making due

allowance for obsolete and slow moving items.

Cost includes all direct expenditure and an appropriate proportion of fixed and variable overheads.

Deferred tax

Deferred taxation is provided on the liability method to take account of timing differences between the

treatment of certain items for accounts purposes and their treatment for tax purposes. Tax deferred or

accelerated is accounted for in respect of all material timing differences.

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 statement of financial position 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

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet.

Those held under hire purchase contracts are depreciated over their estimated useful lives. Those

held under finance leases are depreciated over their estimated useful lives or the lease term,

whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The

capital element of the future payments is treated as a liability.

Pension costs and other post-retirement benefits

The company operates a defined benefit pension scheme in the United Kingdom. The scheme was

closed to new members and accruals from 31 October 2003. The assets of the scheme are held

separately from those of the company, being invested with insurance companies.

The pension scheme surplus or deficit is recognised in full on the group balance sheet. The deferred

tax relating to a defined benefit asset or liability is offset against the defined benefit asset or liability and

not included with other deferred tax assets or liabilities.

Financial instruments

Cash and cash equivalents in the balance sheet comprise cash at banks and in hand and short term

deposits with an original maturity date of three months or less.

Debtors and creditors with no stated interest rate and receivable or payable within one year are

recorded at transaction price. Any losses arising from impairment are recognised in the statement of

comprehensive income under administrative expenses.

Financial liabilities and equity instruments are classified according to the substance of the contractual

arrangements entered into. An equity instrument is any contract that evidences a residual interest in

the assets of the entity after deducting all of its financial liabilities.

Where the contractual obligations of financial instruments (including share capital) are equivalent to a

similar debt instrument, those financial instruments are classed as financial liabilities. Financial

liabilities are presented as such in the balance sheet. Finance costs and gains or losses relating to

financial liabilities are included in the profit and loss account. Finance costs are calculated so as to

produce a constant rate of return on the outstanding liability.

Where the contractual terms of share capital do not have any terms meeting the definition of a

financial liability then this is classed as an equity instrument. Dividends and distributions relating to

equity instruments are debited direct to equity.

3.

TURNOVER

The turnover and loss (2015 - profit) before taxation are attributable to the one principal activity of the

company.

An analysis of turnover by class of business is given below:

Period

1/11/15

to

Year Ended

31/12/16

31/10/15

£

£

Sale of goods

2,521,934

2,624,585

2,521,934

2,624,585

An analysis of turnover by geographical market is given below:

Period

1/11/15

to

Year Ended

31/12/16

31/10/15

£

£

United Kingdom

976,328

2,057,733

Europe

950,758

329,918

Rest of the World

594,848

236,934

2,521,934

2,624,585

4.	EMPLOYEES AND DIRECTORS

Period

1/11/15

to

Year Ended

31/12/16

31/10/15

£

£

Wages and salaries

1,462,040

1,849,489

Social security costs

140,159

173,519

Other pension costs

321,590

428,576

1,923,789

2,451,584

The average monthly number of employees during the period was as follows:

Period

1/11/15

to

Year Ended

31/12/16

31/10/15

Production staff

22

60

Administrative staff

9

12

31

72

Period

1/11/15

to

Year Ended

31/12/16

31/10/15

£

£

Directors' remuneration

111,208

267,345

Directors' pension contributions to money purchase schemes

23,413

105,082

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes

1

4

5.	OPERATING (LOSS)/PROFIT

The operating loss (2015 - operating profit) is stated after charging/(crediting):

Period

1/11/15

to

Year Ended

31/12/16

31/10/15

£

£

Depreciation - owned assets

65,232

76,028

Depreciation - assets on hire purchase contracts

15,409

22,011

Profit on disposal of fixed assets

(88,794

)

-

Auditors' remuneration

35,000

30,000

Foreign exchange differences

1,214,449

(17,067

)

6.	EXCEPTIONAL ITEMS

Period

1/11/15

to

Year Ended

31/12/16

31/10/15

£

£

Group loan waiver

-

1,747,187

7.	AMOUNTS WRITTEN OFF INVESTMENTS

Period

1/11/15

to

Year Ended

31/12/16

31/10/15

£

£

Amounts written off investment

-

8,739

8.

INTEREST PAYABLE AND SIMILAR EXPENSES

Period

1/11/15

to

Year Ended

31/12/16

31/10/15

£

£

Bank loan interest

87,067

110,657

Other interest payable

-

78,429

Hire purchase

9,749

8,356

96,816

197,442

9.

TAXATION

Analysis of the tax credit

The tax credit on the loss for the period was as follows:

Period

1/11/15

to

Year Ended

31/12/16

31/10/15

£

£

Current tax:

UK corporation tax

-

8,479

Over/under provision in prior

year

(8,478

)

(18,958

)

Total current tax

(8,478

)

(10,479

)

Deferred tax

(62,679

)

(56,267

)

Tax on (loss)/profit

(71,157

)

(66,746

)

Reconciliation of total tax credit included in profit and loss

The tax assessed for the period is higher than the standard rate of corporation tax in the UK. The

difference is explained below:

Period

1/11/15

to

Year Ended

31/12/16

31/10/15

£

£

(Loss)/profit before tax

(1,176,090

)

1,680,739

(Loss)/profit multiplied by the standard rate of corporation tax in the UK of 20% (2015 - 20%)

(235,218

)

336,148

Effects of:

Expenses not deductible for tax purposes

(285

)

21,768

Income not taxable for tax purposes

-

(349,437

)

Depreciation in excess of capital allowances

15,087

-

Adjustments to tax charge in respect of previous periods

(8,478

)

(18,958

)

Deferred tax movement

(62,679

)

(56,267

)

Loss created

220,416

-

Total tax credit

(71,157

)

(66,746

)

Tax effects relating to effects of other comprehensive income

1/11/15 to 31/12/16

Gross

Tax

Net

£

£

£

Actuarial gain/(loss) on pension scheme

(3,290,000

)

-

(3,290,000

)

Limit on recognition of assets

181,000

-

181,000

(3,109,000

)

-

(3,109,000

)