Company registration number 00137671 (England and Wales)
MILLERS OILS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
MILLERS OILS LIMITED
COMPANY INFORMATION
Directors
Andrew Charles Watson Miller
Janice Elizabeth Ward
Steven Cocking
Anthony Richard Lowe
Company number
00137671
Registered office
Hillside Oil Works
Rastrick Common
Brighouse
West Yorkshire
HD6 3DP
Auditor
BHP LLP
New Chartford House
Centurion Way
Cleckheaton
Bradford
West Yorkshire
BD19 3QB
Bankers
National Westminster Bank Plc
8 Market Place
Huddersfield
West Yorkshire
HD1 2AL
MILLERS OILS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Group statement of comprehensive income
8
Group balance sheet
9
Company balance sheet
10 - 11
Group statement of changes in equity
12 - 13
Company statement of changes in equity
14
Group statement of cash flows
15
Notes to the financial statements
16 - 36
MILLERS OILS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 1 -
The directors present the strategic report for the year ended 31 March 2023.
Fair review of the business
Like many businesses, Millers Oils has not been immune to the challenging economic conditions. Costs have risen in all areas of the business, particularly raw materials, energy, and transport. The high fuel cost had a significant impact on Fuel Additive Science Technologies Ltd’s (FAST) sales. Whilst disappointing, it was ahead of FAST’s marketplace which was reporting a much greater reduction in fuel sales for the same period. The immense cost pressure has resulted in a fall in Group Operating Profit, however the Directors are encouraged that the Company’s turnover has continued to grow to a record level, with year-on-year Group sales revenue increasing by 9%.
Principal risks and uncertainties
Due to the conflict in Ukraine and the aftershock of the COVID-19 pandemic, prices and availability of raw materials remains extremely volatile. In order to mitigate this volatility, world prices are continually monitored, alternative suppliers sought, and raw material inventory levels managed.
Key performance indicators
| | | |
| | | |
Turnover (decrease)/increase | | | |
| | | |
| | | |
Financial instruments
Objectives and policies
The group utilises appropriate financial instruments in order to conduct its business activities.
Price risk, credit risk, liquidity risk and cash flow risk
The business' principal financial instruments comprise bank balances, bank overdrafts, trade debtors, trade creditors, hire purchase and finance lease agreements. The main purpose of these instruments is to finance the business' operations.
In respect of bank balances, the liquidity risk is managed by maintaining a balance between the continuity of funding and flexibility through the use of invoice discounting at market rates of interest.
Trade debtors are managed in respect of credit and cash flow risk by policies concerning the credit offered to customers and the regular monitoring of amounts outstanding for both time and credit limits. The amounts presented in the balance sheet are net of allowances for doubtful debtors.
Trade creditors' liquidity risk is managed by ensuring sufficient funds are available to meet amounts due.
The business is a lessee in respect of finance leased assets. The liquidity risk in respect of these is managed by ensuring that there are sufficient funds to meet the payments.
MILLERS OILS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -
Steven Cocking
Director
12 June 2023
MILLERS OILS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 3 -
The directors present their annual report and financial statements for the year ended 31 March 2023.
Principal activities
The principal activity of the company and group continued to be that of the manufacture and supply of lubricants and fuel treatments.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Andrew Charles Watson Miller
Janice Elizabeth Ward
Steven Cocking
Anthony Richard Lowe
Results and dividends
The results for the year are set out on page 8.
Ordinary dividends were paid amounting to £243,687. The directors do not recommend payment of a further dividend.
Future developments
The Company will continue to identify and develop new markets, both in the UK and overseas. Product development will be a focus, ensuring the Company’s offering is continually improved and is able to meet the ever changing requirements of customers.
Auditor
In accordance with the company's articles, a resolution proposing that BHP LLP be reappointed as auditor of the group will be put at a General Meeting.
Statement of directors' responsibilities
The directors are responsible for preparing the Annual Report 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 group and company, and of the profit or loss of the group 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;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the ;
prepare the on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
MILLERS OILS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 4 -
The directors are responsible for the maintenance and integrity of the company website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.
On behalf of the board
Steven Cocking
Director
12 June 2023
MILLERS OILS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF MILLERS OILS LIMITED
- 5 -
Opinion
We have audited the financial statements of Millers Oils Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2023 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including 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 group's and the parent company's affairs as at 31 March 2023 and of the group's 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.
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 Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent 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
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. 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 course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. 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.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
MILLERS OILS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF MILLERS OILS LIMITED
- 6 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent company 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 directors' responsibilities statement, 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 is 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 parent 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 parent company or to cease operations, or have no realistic alternative but to do so.
Auditor's 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 an auditor's report 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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
We gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates and considered the risk of acts by the company that were contrary to applicable laws and regulations, including fraud. We designed audit procedures to respond to the risk, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
We focused on laws and regulations, relevant to the company, which could give rise to a material misstatement in the financial statements. Our tests included agreeing the financial statement disclosures to underlying supporting documentation, enquiries with management, and review of legal expenses. There are inherent limitations in the audit procedures described and, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it.
As part of our audit, we addressed the risk of management override of internal controls, including testing of journals and review of nominal ledger. We evaluated whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
MILLERS OILS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF MILLERS OILS LIMITED
- 7 -
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 an auditor's report 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.
Ann Brown (Senior Statutory Auditor)
For and on behalf of BHP LLP
12 June 2023
Chartered Accountants
Statutory Auditor
New Chartford House
Centurion Way
Cleckheaton
Bradford
West Yorkshire
BD19 3QB
MILLERS OILS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
- 8 -
2023
2022
Notes
£
£
Turnover
3
30,239,431
27,654,864
Cost of sales
(21,271,951)
(18,586,879)
Gross profit
8,967,480
9,067,985
Distribution costs
(1,102,897)
(1,037,357)
Administrative expenses
(5,867,596)
(5,473,554)
Other operating income
5,917
36,095
Operating profit
4
2,002,904
2,593,169
Interest receivable and similar income
8
635
43
Interest payable and similar expenses
9
(60,298)
(52,523)
Profit before taxation
1,943,241
2,540,689
Tax on profit
10
(371,340)
(560,111)
Profit for the financial year
1,571,901
1,980,578
Other comprehensive income
Revaluation of tangible fixed assets
65,000
Total comprehensive income for the year
1,571,901
2,045,578
Profit for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.
MILLERS OILS LIMITED
GROUP BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
12
957,299
1,157,204
Other intangible assets
12
20
Total intangible assets
957,299
1,157,224
Tangible assets
13
3,796,825
3,903,336
Investment properties
14
150,000
150,000
4,904,124
5,210,560
Current assets
Stocks
17
4,495,360
4,528,013
Debtors
18
5,062,485
4,932,139
Cash at bank and in hand
3,135,561
2,848,689
12,693,406
12,308,841
Creditors: amounts falling due within one year
19
(4,521,086)
(5,576,910)
Net current assets
8,172,320
6,731,931
Total assets less current liabilities
13,076,444
11,942,491
Creditors: amounts falling due after more than one year
20
(1,100,467)
(1,312,211)
Provisions for liabilities
Deferred tax liability
24
358,156
375,675
(358,156)
(375,675)
Net assets
11,617,821
10,254,605
Capital and reserves
Called up share capital
26
22,909
22,432
Revaluation reserve
65,000
65,000
Capital redemption reserve
3,820
3,820
Other reserves
(329,964)
(343,012)
Share option reserve
7,161
Profit and loss reserves
11,848,895
10,506,365
Total equity
11,617,821
10,254,605
The financial statements were approved by the board of directors and authorised for issue on 12 June 2023 and are signed on its behalf by:
12 June 2023
Steven Cocking
Director
MILLERS OILS LIMITED
COMPANY BALANCE SHEET
AS AT 31 MARCH 2023
31 March 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
12
Other intangible assets
12
Total intangible assets
Tangible assets
13
3,685,281
3,784,415
Investment properties
14
150,000
150,000
Investments
15
2,357,031
2,357,031
6,192,312
6,291,446
Current assets
Stocks
17
4,072,953
4,224,676
Debtors
18
4,590,284
4,466,209
Cash at bank and in hand
2,794,799
2,257,309
11,458,036
10,948,194
Creditors: amounts falling due within one year
19
(4,093,687)
(5,064,922)
Net current assets
7,364,349
5,883,272
Total assets less current liabilities
13,556,661
12,174,718
Creditors: amounts falling due after more than one year
20
(1,093,102)
(1,294,090)
Provisions for liabilities
Deferred tax liability
24
344,446
355,365
(344,446)
(355,365)
Net assets
12,119,113
10,525,263
Capital and reserves
Called up share capital
26
22,909
22,432
Revaluation reserve
65,000
65,000
Capital redemption reserve
3,820
3,820
Other reserves
(329,964)
(343,012)
Share option reserve
7,161
-
Profit and loss reserves
12,350,187
10,777,023
Total equity
12,119,113
10,525,263
As permitted by s408 Companies Act 2006, the truecompany has not presented its own profit and loss account and related notes. The company’s profit for the year was £1,802,535 (2022 - £2,035,169 profit).
MILLERS OILS LIMITED
COMPANY BALANCE SHEET (CONTINUED)
AS AT 31 MARCH 2023
31 March 2023
- 11 -
The financial statements were approved by the board of directors and authorised for issue on 12 June 2023 and are signed on its behalf by:
12 June 2023
Steven Cocking
Director
Company Registration No. 00137671
MILLERS OILS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 12 -
Share capital
Fair value reserve
Share option reserve
Capital redemption reserve
Other reserves
Profit and loss reserves
Total
Notes
£
£
£
£
£
£
£
Balance at 1 April 2021
21,954
-
-
3,820
(358,786)
8,721,014
8,388,002
Year ended 31 March 2022:
Profit for the year
-
-
-
-
-
1,980,578
1,980,578
Other comprehensive income:
Revaluation of tangible fixed assets
-
65,000
-
-
-
-
65,000
Total comprehensive income for the year
-
65,000
-
-
-
1,980,578
2,045,578
Issue of share capital
26
478
-
-
-
-
-
478
Dividends
11
-
-
-
-
-
(195,227)
(195,227)
Transfers
-
-
-
-
20,049
-
20,049
Payments for repurchase of shares
-
-
-
-
(4,275)
-
(4,275)
Balance at 31 March 2022
22,432
65,000
-
3,820
(343,012)
10,506,365
10,254,605
Year ended 31 March 2023:
Profit and total comprehensive income for the year
-
-
-
-
-
1,571,901
1,571,901
Issue of share capital
26
477
-
-
-
-
-
477
Dividends
11
-
-
-
-
-
(243,687)
(243,687)
Transfers
-
-
-
-
20,400
-
20,400
Options granted
25
-
-
21,477
-
-
-
21,477
Options exercised
25
-
-
(14,316)
-
-
14,316
-
Payments for repurchase of shares
-
-
-
-
(7,352)
-
(7,352)
Balance at 31 March 2023
22,909
65,000
7,161
3,820
(329,964)
11,848,895
11,617,821
MILLERS OILS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 13 -
Other reserves represents a reserve for own shares which is deducted from equity in respect of a payment of £300,000 to Millers Oils Limited Employee Benefit Trust for the purpose of acquiring 5,060 ordinary shares of £1 each in the company in accordance with an agreement dated 11 April 2014, a further payment due under the agreement of £100,000 and an additional payment of £2,000 to cover the cost of stamp duty. Millers Oils Limited Employee Benefit Trust is a trust constituted as an employee share scheme under section 1166 of the Companies Act 2006.
In the year ended 31 March 2022, 1,904 Ordinary shares of 10p each were issued to employees at £10.53 each based on the current estimated market value, resulting in proceeds to Millers Oils SIP of £20,049. Thereafter, 406 ordinary shares of 10p each were repurchased during the year from leavers and retiring employees at £10.53 per share, resulting in payments from Millers Oils SIP of £4,275. The proceeds of £20,049 have been added to equity and the payments of £4,275 have been deducted from equity via the reserve for own shares.
In the year ended 31 March 2023, 1,600 Ordinary shares of 10p each were issued to employees at £12.75 each based on the current estimated market value, resulting in proceeds to Millers Oils SIP of £20,400. Thereafter, 546 ordinary shares of 10p each were repurchased during the year from leavers and retiring employees at £12.75 per share, resulting in payments from Millers Oils SIP of £6,962. The proceeds of £20,400 have been added to equity and the payments of £6,962 have been deducted from equity via the reserve for own shares.
This treatment is in accordance with Financial Reporting Standard 102 and the guidance previously contained in UITF Abstract 38 Accounting for ESOP Trusts.
MILLERS OILS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 14 -
Share capital
Revaluation reserve
Capital redemption reserve
Other reserves
Share option reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
£
£
Balance at 1 April 2021
21,954
3,820
(358,786)
-
8,937,081
8,604,069
Year ended 31 March 2022:
Profit for the year
-
-
-
-
-
2,035,169
2,035,169
Other comprehensive income:
Revaluation of tangible fixed assets
-
65,000
-
-
-
-
65,000
Total comprehensive income for the year
-
65,000
-
-
-
2,035,169
2,100,169
Issue of share capital
26
478
-
-
-
-
-
478
Dividends
11
-
-
-
-
-
(195,227)
(195,227)
Transfers
-
-
-
20,049
-
-
20,049
Payments for repurchase of shares
-
-
-
(4,275)
-
-
(4,275)
Balance at 31 March 2022
22,432
65,000
3,820
(343,012)
-
10,777,023
10,525,263
Year ended 31 March 2023:
Profit and total comprehensive income for the year
-
-
-
-
-
1,802,535
1,802,535
Issue of share capital
26
477
-
-
-
-
-
477
Dividends
11
-
-
-
-
-
(243,687)
(243,687)
Transfers
-
-
-
20,400
-
-
20,400
Options granted
25
-
-
-
-
21,477
-
21,477
Options exercised
25
-
-
-
-
(14,316)
14,316
-
Payments for repurchase of shares
-
-
-
(7,352)
-
-
(7,352)
Balance at 31 March 2023
22,909
65,000
3,820
(329,964)
7,161
12,350,187
12,119,113
MILLERS OILS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 15 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
29
1,562,095
1,840,719
Interest paid
(60,298)
(52,523)
Income taxes paid
(471,390)
(523,155)
Net cash inflow from operating activities
1,030,407
1,265,041
Investing activities
Purchase of tangible fixed assets
(259,958)
(280,718)
Proceeds on disposal of tangible fixed assets
2,888
22,249
Interest received
635
43
Net cash used in investing activities
(256,435)
(258,426)
Financing activities
Proceeds from issue of shares
477
478
Sale of own shares
20,400
20,049
Purchase of own shares
(7,352)
(4,275)
Repayment of bank loans
(110,924)
(91,496)
Payment of finance leases obligations
(146,014)
(77,677)
Dividends paid to equity shareholders
(243,687)
(195,227)
Net cash used in financing activities
(487,100)
(348,148)
Net increase in cash and cash equivalents
286,872
658,467
Cash and cash equivalents at beginning of year
2,848,689
2,190,222
Cash and cash equivalents at end of year
3,135,561
2,848,689
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 16 -
1
Accounting policies
Company information
Millers Oils Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Hillside Oil Works, Rastrick Common, Brighouse, HD6 3DP.
The group consists of Millers Oils Limited and its subsidiaries.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
1.2
Basis of consolidation
In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 17 -
The consolidated group financial statements consist of the financial statements of the parent company Millers Oils Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.
All financial statements are made up to 31 March 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Millers Oils Limited owns 50% of the share capital of Millers Oils Azerbaijan LLC, a company incorporated during the year ended 31 March 2018. The company is deemed to be immaterial for the purposes of giving a true and fair view.
Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.
Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.
1.3
Going concern
At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.4
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
1.5
Research and development expenditure
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 18 -
1.6
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.
For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.
1.7
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Patents & licences
Straight line over 5 years
Development costs
Straight line over 3 years
Intellectual Property
20% straight line
Goodwill
Straight line over 10 years
1.8
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Freehold land and buildings
2% or 20% straight line
Plant and machinery
10% to 25% reducing balance and 20% to 33% straight line
Fixtures and fittings
25% straight line
Motor vehicles
20% or 25% reducing balance, and 10% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.
1.9
Investment properties
Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.
Where fair value cannot be achieved without undue cost or effort, investment property is accounted for as tangible fixed assets.
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 19 -
1.10
Fixed asset investments
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.
Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.
In the parent company financial statements, investments in associates are accounted for at cost less impairment.
Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
1.11
Impairment of fixed assets
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 20 -
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.12
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.13
Cash at bank and in hand
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.14
Financial instruments
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 21 -
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
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 group after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 22 -
1.15
Equity instruments
Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
1.16
Derivatives
Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.
A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.
1.17
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.18
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 23 -
1.19
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.20
Share-based payments
Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the equity instruments granted using a recent transaction in the group's shares. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to equity.
1.21
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
1.22
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
Government grants relating to turnover are recognised as income over the periods when the related costs are incurred. Grants relating to an asset are recognised in income systematically over the asset's expected useful life. If part of such a grant is deferred it is recognised as deferred income rather than being deducted from the asset's carrying amount.
Grants received in relation to the government Coronavirus Job Retention Scheme (Furlough) have been recognised within other operating income. The grant is account for on the accruals basis once the related payroll return has been submitted.
1.23
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 24 -
2
Judgements and key sources of estimation uncertainty
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Overhead absorption
As part of stock, Millers Oils treats raw materials (base oils) which transforms the materials into WIP/finished goods. As a result, it is necessary to consider the costs associated with this process which have been included within overheads. When calculating the absorption cost, management considers the proportion of overheads attributable to treating each category of stock, and compares this to the stock days to form an estimate of the overhead absorption included within stock at the year end.
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Sales
30,239,431
27,654,864
2023
2022
£
£
Other significant revenue
Interest income
635
43
Grants received
5,857
36,035
2023
2022
£
£
Turnover analysed by geographical market
Sales - UK
22,975,444
20,388,685
Sales - Rest of World
7,263,987
7,266,179
30,239,431
27,654,864
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 25 -
4
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange losses
2,659
4,107
Government grants
(5,857)
(36,035)
Depreciation of owned tangible fixed assets
311,671
293,655
Depreciation of tangible fixed assets held under finance leases
43,819
33,974
Loss/(profit) on disposal of tangible fixed assets
8,091
(876)
Amortisation of intangible assets
199,925
199,925
Operating lease charges
129,898
120,741
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
17,505
15,400
Audit of the financial statements of the company's subsidiaries
6,000
4,700
23,505
20,100
For other services
Taxation compliance services
2,530
2,335
Other taxation services
2,925
3,500
All other non-audit services
2,375
1,950
7,830
7,785
6
Employees
The average monthly number of persons (including directors) employed by the group and company during the year was:
Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Administration and support
33
31
12
11
Production
32
32
32
32
Research and development
6
6
6
6
Distribution
47
47
47
47
Total
118
116
97
96
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
6
Employees
(Continued)
- 26 -
Their aggregate remuneration comprised:
Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
4,388,289
4,263,110
3,598,639
3,435,478
Social security costs
406,274
359,030
316,568
265,322
Pension costs
193,752
175,908
155,053
141,167
4,988,315
4,798,048
4,070,260
3,841,967
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
580,907
490,922
Company pension contributions to defined contribution schemes
30,000
24,000
610,907
514,922
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2022 - 2).
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
264,655
224,309
Company pension contributions to defined contribution schemes
15,000
12,000
The group's key management personnel are all directors of Millers Oils Limited.
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
635
31
Other interest income
-
12
Total income
635
43
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 27 -
9
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
41,890
40,679
Interest on finance leases and hire purchase contracts
18,408
11,844
Total finance costs
60,298
52,523
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
417,773
434,557
Adjustments in respect of prior periods
(28,914)
(20,621)
Total current tax
388,859
413,936
Deferred tax
Origination and reversal of timing differences
(17,519)
146,175
Total tax charge
371,340
560,111
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Profit before taxation
1,943,241
2,540,689
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
369,216
482,731
Tax effect of expenses that are not deductible in determining taxable profit
92,686
116,787
Change in unrecognised deferred tax assets
1,283
(1,450)
Adjustments in respect of prior years
(28,914)
(20,621)
Effect of change in corporation tax rate
(4,204)
90,567
Permanent capital allowances in excess of depreciation
(11,227)
(32,155)
Other permanent differences
(47,500)
(76,000)
Other
252
Taxation charge
371,340
560,111
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 28 -
11
Dividends
2023
2022
£
£
Final paid
243,687
195,227
12
Intangible fixed assets
Group
Goodwill
Patents & licences
Development costs
Intellectual Property
Total
£
£
£
£
£
Cost
At 1 April 2022 and 31 March 2023
2,478,208
67,628
119,556
100
2,665,492
Amortisation and impairment
At 1 April 2022
1,321,004
67,628
119,556
80
1,508,268
Amortisation charged for the year
199,905
20
199,925
At 31 March 2023
1,520,909
67,628
119,556
100
1,708,193
Carrying amount
At 31 March 2023
957,299
957,299
At 31 March 2022
1,157,204
20
1,157,224
Company
Goodwill
Patents & licences
Development costs
Total
£
£
£
£
Cost
At 1 April 2022 and 31 March 2023
479,159
67,628
119,556
666,343
Amortisation and impairment
At 1 April 2022 and 31 March 2023
479,159
67,628
119,556
666,343
Carrying amount
At 31 March 2023
At 31 March 2022
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 29 -
13
Tangible fixed assets
Group
Freehold land and buildings
Plant and machinery
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 April 2022
3,515,393
5,229,561
94,449
520,736
9,360,139
Additions
137,665
12,473
109,820
259,958
Disposals
(7,500)
(15,079)
(34,851)
(57,430)
At 31 March 2023
3,507,893
5,352,147
106,922
595,705
9,562,667
Depreciation and impairment
At 1 April 2022
1,387,823
3,853,407
48,131
167,442
5,456,803
Depreciation charged in the year
69,097
198,630
21,056
66,707
355,490
Eliminated in respect of disposals
(12,456)
(33,995)
(46,451)
At 31 March 2023
1,456,920
4,039,581
69,187
200,154
5,765,842
Carrying amount
At 31 March 2023
2,050,973
1,312,566
37,735
395,551
3,796,825
At 31 March 2022
2,127,570
1,376,154
46,318
353,294
3,903,336
Company
Freehold land and buildings
Plant and machinery
Motor vehicles
Total
£
£
£
£
Cost
At 1 April 2022
3,515,393
5,108,063
445,156
9,068,612
Additions
131,575
75,830
207,405
Disposals
(7,500)
(15,079)
(10,468)
(33,047)
At 31 March 2023
3,507,893
5,224,559
510,518
9,242,970
Depreciation and impairment
At 1 April 2022
1,387,823
3,772,514
123,860
5,284,197
Depreciation charged in the year
69,097
179,636
46,827
295,560
Eliminated in respect of disposals
(12,456)
(9,612)
(22,068)
At 31 March 2023
1,456,920
3,939,694
161,075
5,557,689
Carrying amount
At 31 March 2023
2,050,973
1,284,865
349,443
3,685,281
At 31 March 2022
2,127,570
1,335,549
321,296
3,784,415
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
13
Tangible fixed assets
(Continued)
- 30 -
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
Group
Company
2023
2022
2023
2022
£
£
£
£
Plant and machinery
289,296
460,249
289,296
460,249
Freehold land and buildings with a carrying amount of £2,050,973 (2022 - £2,127,250) have been pledged to secure borrowings of the company. The company is not allowed to pledge these assets as security for other borrowings or to sell them to another entity.
14
Investment property
Group
Company
2023
2023
£
£
Fair value
At 1 April 2022 and 31 March 2023
150,000
150,000
Investment property is carried at the current market value, the last valuation incorporated within these financial statements was undertaken in May 2021 by an external valuer Peter David Properties Limited. The directors are satisfied that this valuation was appropriate as at 31 March 2023.
15
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
16
2,357,031
2,357,031
Movements in fixed asset investments
Company
Shares in group undertakings
£
Cost or valuation
At 1 April 2022 and 31 March 2023
2,357,031
Carrying amount
At 31 March 2023
2,357,031
At 31 March 2022
2,357,031
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 31 -
16
Subsidiaries
Details of the company's subsidiaries at 31 March 2023 are as follows:
Name of undertaking
Registered
Nature of business
Class of
% Held
office
shares held
Direct
Indirect
Fuel Additive Science Technologies Limited
Manufacturers of fuel additives
Ordinary
100.00
-
Millers Oils (Aberdeen) Limited
Dormant
Ordinary
100.00
-
Millers Oils Azerbaijan LLC
Azerbaijan
Dormant
Ordinary
50.00
-
The registered office of Millers Oils (Aberdeen) Limited is Caledonian Logistics Ltd Old Quarry Road, Cumbernauld, Glasgow, Scotland, G68 9NB.
The registered office of Fuel Additive Science Technologies Limited is Unit 29 Atcham Business Park, Upton Magna, Shrewsbury, Shropshire, SY4 4UG.
17
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Raw materials and consumables
1,722,192
2,041,522
1,722,192
2,041,522
Work in progress
623,514
516,461
623,514
516,461
Finished goods and goods for resale
2,149,654
1,970,030
1,727,247
1,666,693
4,495,360
4,528,013
4,072,953
4,224,676
18
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
4,583,401
4,516,589
4,168,734
4,103,622
Corporation tax recoverable
16,532
16,532
Amounts owed by group undertakings
-
-
33,937
22,994
Other debtors
13,918
-
11,520
Prepayments and accrued income
448,634
399,018
376,093
339,593
5,062,485
4,932,139
4,590,284
4,466,209
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 32 -
19
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans
21
71,701
101,701
71,701
101,701
Obligations under finance leases
22
74,949
90,143
64,193
79,726
Trade creditors
3,108,452
3,741,641
2,961,732
3,647,707
Corporation tax payable
188,091
270,622
132,230
150,065
Other taxation and social security
526,376
258,331
396,611
113,399
Other creditors
250,000
250,000
Accruals and deferred income
551,517
864,472
467,220
722,324
4,521,086
5,576,910
4,093,687
5,064,922
20
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
21
931,237
1,012,161
931,237
1,012,161
Obligations under finance leases
22
169,230
300,050
161,865
281,929
1,100,467
1,312,211
1,093,102
1,294,090
21
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
1,002,938
1,113,862
1,002,938
1,113,862
Payable within one year
71,701
101,701
71,701
101,701
Payable after one year
931,237
1,012,161
931,237
1,012,161
The bank borrowings are secured by a fixed and floating charge on book debts and a floating charge over all other assets.
The company's subsidiary undertaking, Fuel Additive Science Technologies Limited, has given an unlimited inter-company guarantee in respect of the bank borrowings of Millers Oils Limited.
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 33 -
22
Finance lease obligations
Group
Company
2023
2022
2023
2022
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
92,260
100,407
74,139
89,990
In two to five years
185,844
333,975
185,844
315,854
278,104
434,382
259,983
405,844
Less: future finance charges
(33,925)
(44,189)
(33,925)
(44,189)
244,179
390,193
226,058
361,655
Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 3 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
Obligations under finance leases and hire purchase agreements are secured on the assets to which they relate.
23
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
193,752
175,908
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 34 -
24
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
Liabilities
Liabilities
2023
2022
Group
£
£
Accelerated capital allowances
361,381
378,655
Short term timing differences
(3,225)
(2,980)
358,156
375,675
Liabilities
Liabilities
2023
2022
Company
£
£
Accelerated capital allowances
347,671
358,345
Short term timing differences
(3,225)
(2,980)
344,446
355,365
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 April 2022
375,675
355,365
Credit to profit or loss
(17,519)
(10,919)
Liability at 31 March 2023
358,156
344,446
Of the deferred tax liability set out above, £79,000 is expected to reverse within 12 months and relates to accelerated capital allowances that are expected to mature in the same period.
25
Share option reserve
EMI options were granted by the company to two key employees over a new issue of 28,636 A Ordinary shares. The fair value of the share options was based on their open market value at the time the shares were granted.
The employees will become unconditionally entitled to the share options when specific performance conditions are achieved,
The total expense recognised in the year to 31 March 2023 was £21,477.
The total options exercised at 31 March 2023 was 19,088; 9,548 of options remained outstanding at 31 March 2023, the fair value of which is included in the company's share option reserve.
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 35 -
26
Share capital
Group and company
2023
2022
Ordinary share capital
£
£
Issued and fully paid
210,000 Ordinary shares of 10p each
21,000
21,000
19,088 (2022: 14,316) A Ordinary shares of 10p each
1,909
1,432
22,909
22,432
4,772 Ordinary A shares of 10p each were issued by the company at par on the 18 July 2022.
27
Capital commitments
Amounts contracted for but not provided in the financial statements:
Group
Company
2023
2022
2023
2022
£
£
£
£
Acquisition of tangible fixed assets
108,763
104,721
108,763
104,721
28
Operating lease commitments
Lessee
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
107,321
218,106
47,766
96,932
Between two and five years
70,706
137,675
51,220
59,420
178,027
355,781
98,986
156,352
MILLERS OILS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 36 -
29
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
1,571,901
1,980,578
Adjustments for:
Taxation charged
371,340
560,111
Finance costs
60,298
52,523
Investment income
(635)
(43)
Loss/(gain) on disposal of tangible fixed assets
8,091
(876)
Amortisation and impairment of intangible assets
199,925
199,925
Depreciation and impairment of tangible fixed assets
355,490
327,629
Fair value of options granted
21,477
-
Movements in working capital:
Decrease/(increase) in stocks
32,653
(1,078,650)
Increase in debtors
(130,346)
(1,173,487)
(Decrease)/increase in creditors
(928,099)
973,009
Cash generated from operations
1,562,095
1,840,719
30
Analysis of changes in net funds - group
1 April 2022
Cash flows
31 March 2023
£
£
£
Cash at bank and in hand
2,848,689
286,872
3,135,561
Borrowings excluding overdrafts
(1,113,862)
110,924
(1,002,938)
Obligations under finance leases
(390,193)
146,014
(244,179)
1,344,634
543,810
1,888,444
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