Dale Hardware Limited - Limited company accounts 18.2

REGISTERED NUMBER: 03254785 (England and Wales)

DALE HARDWARE LIMITED

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2017

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

5

Income Statement

7

Other Comprehensive Income

8

Balance Sheet

9

Statement of Changes in Equity

10

Cash Flow Statement

11

Notes to the Cash Flow Statement

12

Notes to the Financial Statements

13

DIRECTORS:

Mr C D Browning

Mr N Vann

SECRETARY:

Mr N Martin

REGISTERED OFFICE:

Portobello

School Street

Willenall

West Midlands

WV13 3PW

REGISTERED NUMBER:

03254785 (England and Wales)

SENIOR STATUTORY AUDITOR:

Richard Harrison F.C.A.

AUDITORS:

Harrison & Co Accountants Limited

Chartered Accountants

& Statutory Auditors

531 Denby Dale Road West

Calder Grove

Wakefield

West Yorkshire

WF4 3ND

BANKERS:

The Royal Bank of Scotland

Leeds Park Row Branch

27 Park Row

Leeds

West Yorkshire

LS1 5QB

The directors present their strategic report for the year ended 31 December 2017.

The results for the year and the financial position at the year end were considered satisfactory by the directors, who expect steady

development in the foreseeable future.

Sales increased over the previous year by £ 2,500,247 (2016 £ 2,134,834), whilst gross profit has increased by

£ 500,684 (2016 increased by £ 904,773). Administrative expenses have increased by £ 496,711 (2016 increased by £ 537,408).

The directors continually take steps to identify, manage and mitigate business risk in various ways. The company has the ability to

respond quickly to any situation in a competitive market. It maintains strong relationships with its key employees, customers,

suppliers and other partners. Risks associated with the company’s IT systems are assessed, including continuity and recovery plans.

Policies and procedures exist to ensure that credit risk arising on trade debtors is manageable.

Compared to 2016 we have maintained a strong sales performance.

Key performance indicators include: -

Sales in 2017 £ 13,504,196 compared to 2016 sales of £ 11,003,949.

Gross profit in 2017 of £ 4,113,649 compared to 2016 gross profit of £ 3,612,965.

Profit after taxation was £ 1,319,557 compared to 2016 profit after taxation of £ 1,223,834.

ON BEHALF OF THE BOARD:

Mr C D Browning - Director

30 May 2018

The directors present their report with the financial statements of the company for the year ended 31 December 2017.

DIVIDENDS

No dividends will be distributed for the year ended 31 December 2017.

DIRECTORS

The directors during the year under review were:

Mr C Gorse

Mr D J Monaghan

Mr J P Houten

Mr C A Tobin

John Monaghan (Holdings) Limited

The beneficial interests of the directors holding office on 31 December 2017 in the issued share capital of the company were as

follows:

31.12.17

1.1.17

Ordinary £1 shares

Mr C Gorse

-

-

Mr D J Monaghan

-

-

Mr J P Houten

-

-

Mr C A Tobin

-

-

John Monaghan (Holdings) Limited

-

-

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.

ON BEHALF OF THE BOARD:

Mr C D Browning - Director

30 May 2018

Opinion

We have audited the financial statements of Dale Hardware Limited (the 'company') for the year ended 31 December 2017 which

comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow

Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting

policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom

Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and

Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

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.

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 December 2017 and of its profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	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 Auditors' 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

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:

-	the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

-

the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and

the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and 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, 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.

Opinion 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 Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors 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 Report of the Directors.

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.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page three, 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 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.

Auditors' 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 a Report of the Auditors 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.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's

website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Richard Harrison F.C.A. (Senior Statutory Auditor)

for and on behalf of Harrison & Co Accountants Limited

Chartered Accountants

& Statutory Auditors

531 Denby Dale Road West

Calder Grove

Wakefield

West Yorkshire

WF4 3ND

4 June 2018

TURNOVER

13,504,196

11,003,949

Cost of sales

9,390,547

7,390,984

GROSS PROFIT

4,113,649

3,612,965

Administrative expenses

3,157,603

2,660,892

956,046

952,073

Other operating income

380,852

290,855

OPERATING PROFIT

4

1,336,898

1,242,928

Interest payable and similar expenses

5

17,341

19,094

PROFIT BEFORE TAXATION

1,319,557

1,223,834

Tax on profit

6

220,681

214,955

PROFIT FOR THE FINANCIAL YEAR

1,098,876

1,008,879

PROFIT FOR THE YEAR

1,098,876

1,008,879

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,098,876

1,008,879

FIXED ASSETS

Tangible assets

8

408,195

322,259

CURRENT ASSETS

Stocks

9

4,003,044

3,987,716

Debtors

10

2,556,618

1,838,205

Cash at bank and in hand

4,596

3,267

6,564,258

5,829,188

CREDITORS

Amounts falling due within one year

11

2,375,367

2,667,218

NET CURRENT ASSETS

4,188,891

3,161,970

TOTAL ASSETS LESS CURRENT LIABILITIES

4,597,086

3,484,229

PROVISIONS FOR LIABILITIES

15

74,471

60,490

NET ASSETS

4,522,615

3,423,739

CAPITAL AND RESERVES

Called up share capital

16

1,000

1,000

Retained earnings

17

4,521,615

3,422,739

SHAREHOLDERS' FUNDS

4,522,615

3,423,739

The financial statements were approved by the Board of Directors on 30 May 2018 and were signed on its behalf by:

Mr C D Browning - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2016

1,000

2,657,375

2,658,375

Changes in equity

Dividends

-

(243,515

)

(243,515

)

Total comprehensive income

-

1,008,879

1,008,879

Balance at 31 December 2016

1,000

3,422,739

3,423,739

Changes in equity

Total comprehensive income

-

1,098,876

1,098,876

Balance at 31 December 2017

1,000

4,521,615

4,522,615

Cash flows from operating activities

Cash generated from operations

1

1,118,541

93,530

Interest paid

(17,341

)

(19,094

)

Tax paid

(199,330

)

(232,503

)

Net cash from operating activities

901,870

(158,067

)

Cash flows from investing activities

Purchase of tangible fixed assets

(196,955

)

(180,375

)

Net cash from investing activities

(196,955

)

(180,375

)

Cash flows from financing activities

Amount withdrawn by directors

(5,000

)

-

Equity dividends paid

-

(243,515

)

Net cash from financing activities

(5,000

)

(243,515

)

Increase/(decrease) in cash and cash equivalents

699,915

(581,957

)

Cash and cash equivalents at beginning of year

2

(1,014,592

)

(432,635

)

Cash and cash equivalents at end of year

2

(314,677

)

(1,014,592

)

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2017

2016

£

£

Profit before taxation

1,319,557

1,223,834

Depreciation charges

111,019

68,655

Amounts due to/from group companies

(70,579

)

237,825

Finance costs

17,341

19,094

1,377,338

1,549,408

Increase in stocks

(15,328

)

(1,284,902

)

Increase in trade and other debtors

(711,349

)

(152,973

)

Increase/(decrease) in trade and other creditors

467,880

(18,003

)

Cash generated from operations

1,118,541

93,530

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance

Sheet amounts:

Year ended 31 December 2017

31.12.17

1.1.17

£

£

Cash and cash equivalents

4,596

3,267

Bank overdrafts

(319,273

)

(1,017,859

)

(314,677

)

(1,014,592

)

Year ended 31 December 2016

31.12.16

1.1.16

£

£

Cash and cash equivalents

3,267

32,624

Bank overdrafts

(1,017,859

)

(465,259

)

(1,014,592

)

(432,635

)

1.	STATUTORY INFORMATION

Dale Hardware 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.

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.

Turnover

Turnover comprises the value of sales (net of value added tax, similar taxes and trade discounts) of goods and services

provided in the normal course of business. Turnover is recognised when the goods are despatched, which is the same day

on which the goods are delivered and hence is the point at which the risks and rewards of ownership pass to the buyer.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Warehouse equipment

-

15% on reducing balance

Office equipment

-

25% Straight line and 15% on reducing balance

Stocks

Stocks are valued at the lower of cost and net realisable value. Cost is ascertained by the user of the weighted average

method of cost calculation. Net realisable value is based on an estimated selling price, less further costs to be incurred to

completion and disposal. Provision is also made for obsolete, slow-moving and defective items, where appropriate.

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.

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 contribution pension scheme. Contributions payable to the company's pension scheme are

charged to profit or loss in the period to which they relate.

3.	EMPLOYEES AND DIRECTORS

2017

2016

£

£

Wages and salaries

1,905,548

1,609,776

Other pension costs

49,513

42,849

1,955,061

1,652,625

The average number of employees during the year was as follows:

2017

2016

Warehouse and administration

62

61

2017

2016

£

£

Directors' remuneration

448,408

395,079

Information regarding the highest paid director is as follows:

2017

2016

£

£

Emoluments etc

158,754

171,665

4.	OPERATING PROFIT

The operating profit is stated after charging:

2017

2016

£

£

Hire of plant and machinery

28,906

25,291

Depreciation - owned assets

111,019

26,037

Auditors' remuneration

11,000

9,000

5.

INTEREST PAYABLE AND SIMILAR EXPENSES

2017

2016

£

£

Bank interest

17,341

19,094

6.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2017

2016

£

£

Current tax:

UK corporation tax

233,104

221,552

Under provision in prior years

(26,404

)

(29,811

)

Total current tax

206,700

191,741

Deferred tax

13,981

23,214

Tax on profit

220,681

214,955

UK corporation tax was charged at 20%) in 2016.

Reconciliation of total tax charge included in profit and loss

The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained

below:

2017

2016

£

£

Profit before tax

1,319,557

1,223,834

Profit multiplied by the standard rate of corporation tax in the UK of 19.250% (2016 - 20%)

254,015

244,767

Effects of:

Expenses not deductible for tax purposes

2,532

-

Capital allowances in excess of depreciation

(9,462

)

-

Adjustments to tax charge in respect of previous periods

(26,404

)

(29,812

)

Total tax charge

220,681

214,955

7.

DIVIDENDS

2017

2016

£

£

Ordinary shares of £1 each

Final

-

243,515

8.	TANGIBLE FIXED ASSETS

Warehouse

Office

equipment

equipment

Totals

£

£

£

COST

At 1 January 2017

626,326

192,847

819,173

Additions

162,237

34,718

196,955

At 31 December 2017

788,563

227,565

1,016,128

DEPRECIATION

At 1 January 2017

355,987

140,927

496,914

Charge for year

94,688

16,331

111,019

At 31 December 2017

450,675

157,258

607,933

NET BOOK VALUE

At 31 December 2017

337,888

70,307

408,195

At 31 December 2016

270,339

51,920

322,259

9.

STOCKS

2017

2016

£

£

Stocks

4,003,044

3,987,716

10.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2017

2016

£

£

Trade debtors

2,420,842

1,768,475

Amounts owed by group undertakings

2,647

583

Directors' current accounts

5,000

-

Prepayments

128,129

69,147

2,556,618

1,838,205

11.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2017

2016

£

£

Bank loans and overdrafts (see note 12)

319,273

1,017,859

Trade creditors

590,085

340,471

Amounts owed to group undertakings

375,000

443,515

Corporation tax

122,328

114,958

Social security and other taxes

458,817

290,350

Accrued expenses

509,864

460,065

2,375,367

2,667,218