Messenger Construction Limited - Limited company accounts 18.2

REGISTERED NUMBER: 07608158 (England and Wales)

Messenger Construction Limited

Strategic Report, Report of the Directors and

Financial Statements For The Year Ended 31st March 2018

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

4

to

5

Income Statement

6

Other Comprehensive Income

7

Balance Sheet

8

Statement of Changes in Equity

9

Notes to the Financial Statements

10

to

16

DIRECTORS:

P A Gibbons

K J Kosmaczewski

Mrs J F MacDonald

M C Cipriani

I A Milne

B F Morrell

Mrs H M Gibbons

Mrs H E Kosmaczewska

SECRETARY:

P A Gibbons

REGISTERED OFFICE:

310 Wellingborough Road

Northampton

Northamptonshire

NN1 4EP

BUSINESS ADDRESS:

Collyweston Heritage Centre

Main Road

Collyweston

Stamford

Lincolnshire

PE9 3PQ

REGISTERED NUMBER:

07608158 (England and Wales)

AUDITORS:

Cheney & Co

Statutory Auditor

310 Wellingborough Road

Northampton

NN1 4EP

The directors present their strategic report for the year ended 31st March 2018.

During the year the company has continued to grow and expand as the reputation for high quality and reliable work

attracts more new customers to the already large client base.

REVIEW OF BUSINESS

This year has been a rewarding year, seeing the group move into its purpose built offices and developing the business

with the addition of additional support services and growth in reputation, being asked to travel far and wide for the

services provided

During the year the company turnover dropped slightly on the previous year, which was a result of factors beyond the

control of the directors, such as delayed starts and most noticeably the impact that the cold wintry weather caused when

the "Beast from East" affected large parts of the country. The directors are pleased with the number of prestigious

projects completed in the year especially the completion of the Opera House at Nevill Holt, a Grade 1 listed building.

The directors are looking forward to the new year with a record level of secured work, being £26m for the forth coming

periods.

The success with some projects in the year as a result of the complete Design & Build approach has given the directors

a vision to offer this bespoke service to customers to aid a total package service to customers.

PRINCIPAL RISKS AND UNCERTAINTIES

The directors are not aware of any specific fundamental risks and uncertainties with regards to the current trading

activities, they are aware of the ongoing talks with regards to Brexit and the higher demand for skilled work and bespoke

services within the industry.

KEY PERFORMANCE INDICATORS

The directors would wish to disclose the following Key Performance Indicators

2018

2017

2016

2015

£ 000's

£ 000's

£ 000's

£ 000's

Turnover

19,261

21,290

15,088

10,131

Turnover variance on previous year

(9.52%

)

41.11%

48.93%

91.63%

Gross profit %

12.15%

12.12%

10.78%

16.59%

Liquidity ratio

128.83%

116.68%

111.45%

118.18%

Debtor days

71

58

40

40

Net profit %

1.96%

3.44%

3.1%

3.97%

Gearing

15.24%

10.15%

.6.13%

.-%

ON BEHALF OF THE BOARD:

P A Gibbons - Director

21st September 2018

The directors present their report with the financial statements of the company for the year ended 31st March 2018.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of property construction.

DIVIDENDS

The total distribution of dividends for the year ended 31st March 2018 will be £ 210,000 .

DIRECTORS

The directors shown below have held office during the whole of the period from 1st April 2017 to the date of this report.

P A Gibbons

K J Kosmaczewski

Mrs J F MacDonald

M C Cipriani

Other changes in directors holding office are as follows:

I A Milne - appointed 17th November 2017

B F Morrell - appointed 17th November 2017

Mrs H M Gibbons - appointed 26th February 2018

Mrs H E Kosmaczewska - appointed 26th February 2018

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). 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 or she ought to

have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that

the company's auditors are aware of that information.

AUDITORS

The auditors, Cheney & Co, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

P A Gibbons - Director

21st September 2018

Opinion

We have audited the financial statements of Messenger Construction Limited (the 'company') for the year ended

31st March 2018 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of

Changes in Equity and 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).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31st March 2018 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.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the

Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those

matters we are required to state to them in 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.

Paul Sparks ACA FCCA (Senior Statutory Auditor)

for and on behalf of Cheney & Co

Statutory Auditor

310 Wellingborough Road

Northampton

NN1 4EP

21st September 2018

TURNOVER

19,260,768

21,329,882

Cost of sales

(16,921,158

)

(18,749,509

)

GROSS PROFIT

2,339,610

2,580,373

Administrative expenses

(1,957,354

)

(1,832,261

)

OPERATING PROFIT

5

382,256

748,112

Interest receivable and similar income

33,577

620

415,833

748,732

Interest payable and similar expenses

6

(37,647

)

(15,592

)

PROFIT BEFORE TAXATION

378,186

733,140

Tax on profit

7

(75,230

)

(70,288

)

PROFIT FOR THE FINANCIAL YEAR

302,956

662,852

PROFIT FOR THE YEAR

302,956

662,852

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

302,956

662,852

FIXED ASSETS

Tangible assets

9

255,003

224,050

CURRENT ASSETS

Stocks

10

14,680

15,000

Debtors

11

5,026,068

5,822,703

Cash at bank and in hand

328

432

5,041,076

5,838,135

CREDITORS

Amounts falling due within one year

12

3,943,748

5,003,708

NET CURRENT ASSETS

1,097,328

834,427

TOTAL ASSETS LESS CURRENT LIABILITIES

1,352,331

1,058,477

CREDITORS

Amounts falling due after more than one year

13

(341,185

)

(136,687

)

PROVISIONS FOR LIABILITIES

17

(10,000

)

(13,600

)

NET ASSETS

1,001,146

908,190

CAPITAL AND RESERVES

Called up share capital

18

150

150

Retained earnings

19

1,000,996

908,040

SHAREHOLDERS' FUNDS

1,001,146

908,190

The financial statements were approved by the Board of Directors on 21st September 2018 and were signed on its behalf by:

P A Gibbons - Director

K J Kosmaczewski - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1st April 2016

150

420,188

420,338

Changes in equity

Dividends

-

(175,000

)

(175,000

)

Total comprehensive income

-

662,852

662,852

Balance at 31st March 2017

150

908,040

908,190

Changes in equity

Dividends

-

(210,000

)

(210,000

)

Total comprehensive income

-

302,956

302,956

Balance at 31st March 2018

150

1,000,996

1,001,146

1.	STATUTORY INFORMATION

Messenger Construction 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 (£).

The principal activity of the company in the year under review was that of property construction.

2.	STATEMENT OF COMPLIANCE

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.

3.	ACCOUNTING POLICIES

Basis of preparing the financial statements

The financial statements have been prepared under the historical cost convention.

The significant accounting policies applied in the preparation of these financial statements are set out

below.These policies have been consistently applied to all years presented unless otherwise stated.

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.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates,

value added tax and other sales taxes.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off 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

-

25% on cost

Fixtures and fittings

-

25% on cost

Motor vehicles

-

25% on cost and at varying rates on 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.

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.

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.

4.	EMPLOYEES AND DIRECTORS

2018

2017

£

£

Wages and salaries

2,069,669

1,783,650

Social security costs

136,638

83,948

Other pension costs

53,574

43,665

2,259,881

1,911,263

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

2018

2017

Head office

26

25

Site

33

27

59

52

2018

2017

£

£

Directors' remuneration

208,399

138,516

Directors' pension contributions to money purchase schemes

16,820

24,372

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

Money purchase schemes

6

4

Information regarding the highest paid director for the year ended 31st March 2018 is as follows:

2018

£

Emoluments etc

70,500

Pension contributions to money purchase schemes

391

5.	OPERATING PROFIT

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

2018

2017

£

£

Hire of plant and machinery

358,652

411,984

Other operating leases

46,533

38,327

Depreciation - owned assets

40,422

39,158

Depreciation - assets on finance leases

45,380

31,590

Auditors' remuneration

6,000

6,000

Foreign exchange differences

(5

)

(9

)

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

2018

2017

£

£

Bank interest

23,878

8,375

Leasing

13,769

7,217

37,647

15,592

7.

TAXATION

Analysis of the tax charge

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

2018

2017

£

£

Current tax:

UK corporation tax

38,962

67,288

Payment for utilization of

group losses

39,868

-

Total current tax

78,830

67,288

Deferred tax

(3,600

)

3,000

Tax on profit

75,230

70,288

Reconciliation of total tax charge included in profit and loss

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

explained below:

2018

2017

£

£

Profit before tax

378,186

733,140

Profit multiplied by the standard rate of corporation tax in the UK of 19% (2017 - 20%)

71,855

146,628

Effects of:

Expenses not deductible for tax purposes

(2,284

)

5,796

Capital allowances in excess of depreciation

-

(3,748

)

Depreciation in excess of capital allowances

12,203

-

Research and Development tax credits

-

(29,228

)

Deferred tax movement

(3,600

)

(1,202

)

Adjustment to costs on long term contracts

-

(47,958

)

Over provision in previous year

(505

)

-

Group relief

(42,307

)

-

Payment for utilization of group losses

39,868

-

Total tax charge

75,230

70,288

8.

DIVIDENDS

2018

2017

£

£

Interim

210,000

175,000

9.	TANGIBLE FIXED ASSETS

Fixtures

Plant and

and

Motor

machinery

fittings

vehicles

Totals

£

£

£

£

COST

At 1st April 2017

91,909

64,591

240,409

396,909

Additions

5,000

16,573

95,182

116,755

At 31st March 2018

96,909

81,164

335,591

513,664

DEPRECIATION

At 1st April 2017

38,896

56,215

77,748

172,859

Charge for year

17,323

15,095

53,384

85,802

At 31st March 2018

56,219

71,310

131,132

258,661

NET BOOK VALUE

At 31st March 2018

40,690

9,854

204,459

255,003

At 31st March 2017

53,013

8,376

162,661

224,050

The net book value of tangible fixed assets includes £ 202,217 (2017 - £ 152,415 ) in respect of assets held

under finance leases.

10.

STOCKS

2018

2017

£

£

Stocks

14,680

15,000

11.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2018

2017

£

£

Trade debtors

3,742,738

5,000,197

Amounts owed by group undertakings

912,889

490,390

Other debtors

236,578

244,778

VAT

127,766

52,535

Prepayments and accrued income

6,097

34,803

5,026,068

5,822,703

12.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2018

2017

£

£

Bank loans and overdrafts (see note 14)

166,675

214,235

Other loans (see note 14)

225,000

229,167

Finance leases (see note 15)

80,212

35,454

Trade creditors

1,750,949

2,385,898

Tax

39,437

67,288

Social security and other taxes

180,326

228,978

Other creditors

561,349

548,905

Accrued expenses

939,800

1,293,783

3,943,748

5,003,708