Company registration number 00367479 (England and Wales)
F.G. Curtis Limited
Annual report and financial statements
For the year ended 31 May 2023
F.G. Curtis Limited
Company information
Directors
Mr M Stokes
Mr J D Agnew
Mr J J Brade
Mr S J Mallett
Mr G P Harford
Mr J W Williams
Company number
00367479
Registered office
Unit 8
Gatton Park Business Centre
Wells Place, Merstham
Redhill
Surrey
RH1 3DR
Auditor
DJH Mitten Clarke Audit Limited
The Glades
Festival Way
Festival Park
Stoke-on-Trent
Staffordshire
ST1 5SQ
F.G. Curtis Limited
Contents
Page
Strategic report
1 - 3
Directors' report
4 - 5
Independent auditor's report
6 - 9
Statement of comprehensive income
10
Statement of financial position
11
Statement of changes in equity
12
Notes to the financial statements
13 - 28
F.G. Curtis Limited
Strategic report
For the year ended 31 May 2023
- 1 -
The directors present the strategic report for the year ended 31 May 2023.
Review of the business
FG Curtis Limited (“Curtis”, “the Company”) saw Turnover grow to £26.8m (2022:14 months period £25.m) An Operating Profit of £3.4m was achieved (2022:14 months period £4.0m), however it should be noted that this year saw some specific recharges from it’s immediate holding company of £1.1m. Net assets at the year end were £12.7m (2022: £10.0m).
The directors are pleased with the performance of the Company, particularly in light of the challenges faced over the last twelve months which have seen global shortages in the supply chain, significant inflationary pressures and rising energy costs.
With the growth achieved over the last twelve months and to ensure that future growth plans can be achieved the Company undertook a significant investment commitment, which has resulted in doubling its potential operating capacity by obtaining a new unit which is located opposite the existing site. This new unit which only became into operation right at the end of the financial year, will provide greater operational efficiency and provides the ability to store stock on site.
Principal risks and uncertainties
The Company has exposure to currency variation and it looks to mitigate this through effective purchasing, monitoring the need to hedge where necessary and reviewing alternative sources of supply. Similarly, while there are sales into international markets, the ability to hedge exposure is closely monitored.
As the Company continues to grow, attracting and retaining experienced and high performing employees becomes ever more challenging, however, the Company looks to develop and progress employees in line with Company performance.
The impact of these unprecedented market conditions and inflationary pressures has resulted in the Company working closely with suppliers and customers to carefully ensure product is available and to continue to effectively service customer demand.
F.G. Curtis Limited
Strategic report (continued)
For the year ended 31 May 2023
- 2 -
Key performance indicators
The Company monitors performance daily and has in place key performance indicators that are designed to evaluate how the company performs. The key performance indicators that the Company uses are:
Actual Sales performance against prior year
2023 - £1,782k (7%) increase on 2022
2022 - £6,205k (41%) increase on 2021 (based on 2022 12 months prorated)
EBITDA
2023 - £3,738k
2022 - £4,383k
Decrease £645k (14.7%) for the year
EBITDA is calculated as Operating profit, adjusted for depreciation and profit/(loss) on disposal of
tangible fixed assets.
B-Corp Accreditation
The Board are pleased to disclose that in April 2023 it became the first UK carton manufacturer to gain B Corp accreditation. As a leading sustainable printed packaging manufacturer, committed to producing eco-friendly, high-quality packaging solutions whilst minimising our impact upon the environment, becoming a B Corp in April 2023 is a mark of approval of the way we have always worked. There should not be any work or manufacturing undertaken that is detrimental to the world we all live in and now it is even more important for like-minded companies to work together to achieve that end. From our inception, Curtis has been a pioneer in its commitment to this ethos. Proof of this is endorsed by our other credentials such as FSC Certification, ISO 14001, BPIF Zero Foil 2 Landfill and being the first company in the UK to achieve World Land Trust certified carbon balanced packaging accreditation. It's not just about being passionate though, it's about commitment to the community and environment. Initiatives like the Curtis Centre of Excellence, which encourages the next generation of packaging designers, and partnering with organizations like Bee1 to promote pollinator health and biodiversity through the planting of wildflowers. Becoming a B Corps is an endorsement of all that Curtis believes in, stands for and demonstrates its commitment to creating a better world for all.
Environment
There is recognition that the Company has a responsibility to the environment, customers, suppliers and employees. The Company, where possible ensures that it purchases material certified by the Programme for the Endorsement of Forest Certification (PEFC) or the Forest Stewardship Council (FSC). The Company’s commitment to protecting the environment is evidenced with it’s ISO 14001 accreditation and is Sedex certified as well as being the first company in the UK to offer World Land Trust certified carbon balancing packaging.
Other information and explanations
The unpresented market conditions that the Company has faced over these last twelve months, have highlighted how it has been able to effectively adapt to these challenges and ensure it continues to serve the needs of its customers and effectively grow the business.
The prospects for the future are encouraging and the Company is now well placed to build upon the financial performance achieved this year. With a committed workforce and a commitment to continue to invest further in both people and infrastructure, the future is approached with confidence.
F.G. Curtis Limited
Strategic report (continued)
For the year ended 31 May 2023
- 3 -
Mr M Stokes
Director
20 February 2024
F.G. Curtis Limited
Directors' report
For the year ended 31 May 2023
- 4 -
The directors present their annual report and financial statements for the year ended 31 May 2023.
Principal activities
The principal activity of the company continued to be the manufacture of printed cartons and display material.
Results and dividends
The results for the year are set out on page 10.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr M Stokes
Mr P B Curtis
(Resigned 27 October 2023)
Mr J D Agnew
Mr J J Brade
Mr S J Mallett
Mr G P Harford
Mr J W Williams
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 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.
Strategic report
The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of the review of the business and key performance indicators.
F.G. Curtis Limited
Directors' report (continued)
For the year ended 31 May 2023
- 5 -
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 company’s auditor 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 company’s auditor is aware of that information.
On behalf of the board
Mr M Stokes
Director
20 February 2024
F.G. Curtis Limited
Independent auditor's report
To the member of F.G. Curtis Limited
- 6 -
Opinion
We have audited the financial statements of F.G. Curtis Limited (the 'company') for the year ended 31 May 2023 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity 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 company's affairs as at 31 May 2023 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.
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 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 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.
F.G. Curtis Limited
Independent auditor's report (continued)
To the member of F.G. Curtis Limited
- 7 -
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.
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 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, 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 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 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.
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.
F.G. Curtis Limited
Independent auditor's report (continued)
To the member of F.G. Curtis Limited
- 8 -
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
we identified the laws and regulations applicable to the company through discussions with directors and other management;
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including legislation such as the Companies Act 2006, taxation legislation, data protection, FSC certification, ISO 14001, ISO 9001:2015, employment and health and safety legislation;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and reviewing legal and professional fee invoices; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
considering the internal controls in place to mitigate risks of fraud and non compliance with laws and regulations.
To address the risk of fraud through management bias and override of controls, we:
performed analytical procedures to identify any unusual or unexpected relationships;
tested journal entries to identify unusual transactions; and
assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
agreeing financial statement disclosures to underlying supporting documentation;
enquiring of management as to actual and potential litigation and claims;
reviewing any correspondence with HMRC; and
reviewing legal and professional fees incurred during the period to identify any potential indications of non-compliance with laws and regulations.
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
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.
F.G. Curtis Limited
Independent auditor's report (continued)
To the member of F.G. Curtis Limited
- 9 -
This report is made solely to the company's member 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 member those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.
Nicola Johnson
Senior Statutory Auditor
For and on behalf of DJH Mitten Clarke Audit Limited
22 February 2024
Accountants
Statutory Auditor
The Glades
Festival Way
Festival Park
Stoke-on-Trent
Staffordshire
ST1 5SQ
F.G. Curtis Limited
Statement of comprehensive income
For the year ended 31 May 2023
- 10 -
Year
Period
ended
ended
31 May
31 May
2023
2022
Notes
£
£
Turnover
3
26,812,377
25,030,178
Cost of sales
(18,528,893)
(17,124,378)
Gross profit
8,283,484
7,905,800
Distribution costs
(1,412,468)
(1,466,701)
Administrative expenses
(3,472,972)
(2,413,479)
Other operating income
14,091
Operating profit
4
3,398,044
4,039,711
Interest receivable and similar income
8
21,894
637
Interest payable and similar expenses
9
(29,283)
(29,780)
Profit before taxation
3,390,655
4,010,568
Tax on profit
10
(600,490)
(865,224)
Profit for the financial year
2,790,165
3,145,344
F.G. Curtis Limited
Statement of financial position
As at 31 May 2023
- 11 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
12
2,112,285
2,123,705
Investments
13
72,706
72,706
2,184,991
2,196,411
Current assets
Stocks
15
1,798,942
1,656,319
Debtors
16
10,572,103
9,571,641
Cash at bank and in hand
3,163,882
1,102,812
15,534,927
12,330,772
Creditors: amounts falling due within one year
17
(4,205,362)
(3,908,224)
Net current assets
11,329,565
8,422,548
Total assets less current liabilities
13,514,556
10,618,959
Creditors: amounts falling due after more than one year
18
(107,193)
(169,761)
Provisions for liabilities
Provisions
20
244,000
44,000
Deferred tax liability
21
415,000
447,000
(659,000)
(491,000)
Net assets
12,748,363
9,958,198
Capital and reserves
Called up share capital
23
62,500
62,500
Profit and loss reserves
24
12,685,863
9,895,698
Total equity
12,748,363
9,958,198
The financial statements were approved by the board of directors and authorised for issue on 20 February 2024 and are signed on its behalf by:
Mr M Stokes
Director
Company Registration No. 00367479
F.G. Curtis Limited
Statement of changes in equity
For the year ended 31 May 2023
- 12 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 April 2021
52,000
7,160,854
7,212,854
Period ended 31 May 2022:
Profit and total comprehensive income for the period
-
3,145,344
3,145,344
Bonus issue of shares
23
10,500
(10,500)
Dividends
11
-
(400,000)
(400,000)
Balance at 31 May 2022
62,500
9,895,698
9,958,198
Year ended 31 May 2023:
Profit and total comprehensive income for the year
-
2,790,165
2,790,165
Balance at 31 May 2023
62,500
12,685,863
12,748,363
F.G. Curtis Limited
Notes to the financial statements
For the year ended 31 May 2023
- 13 -
1
Accounting policies
Company information
F.G. Curtis Limited is a private company limited by shares incorporated in England and Wales. The registered office is Unit 8, Gatton Park Business Centre, Wells Place, Merstham, Redhill, Surrey, RH1 3DR.
1.1
Reporting period
The current period represents a 12 month period whereas the comparative represents a 14 month period. Therefore the comparative amounts are not entirely comparable.
1.2
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. The principal accounting policies adopted are set out below.
This 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:
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 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The company has taken advantage of the exemption under section 400 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.
F.G. Curtis Limited is a wholly owned subsidiary of Appleseed Bidco Limited and the results of F.G. Curtis Limited are included in the consolidated financial statements of Medication Packaging Holdco Limited which are available from Crewe Hall Enterprise Park, Crewe, Cheshire, CW1 6UL.
Related party exemption
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with other group entities where the relationship is one of being wholly owned.
1.3
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company 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.
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
1
Accounting policies
(Continued)
- 14 -
1.4
Turnover
The turnover shown in the profit or loss account represents amounts invoiced during the year, in respect of the manufacture of printed cartons and display material, exclusive of value added tax.
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 receipt 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
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:
Leasehold improvements
Over the period of the 15 year lease
Plant and equipment
10% straight line
Fixtures and fittings
20 to 33.33% straight line
Motor vehicles
25% 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 credited or charged to profit or loss.
1.6
Fixed asset investments
Interests in subsidiaries entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.7
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible 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.
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.
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
1
Accounting policies
(Continued)
- 15 -
1.8
Stocks
Stocks and work in progress 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.
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.
1.9
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand.
1.10
Financial instruments
Financial instruments are classified and accounted for, according to the substance of the contractual arrangement, as either financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial assets
Basic financial assets, which include debtors, loans from fellow group companies 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.
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.
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
1
Accounting policies
(Continued)
- 16 -
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 company 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 company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, 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
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 company’s contractual obligations expire or are discharged or cancelled.
1.11
Equity instruments
Equity instruments issued by the company 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 company.
1.12
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 income statement 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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
1
Accounting policies
(Continued)
- 17 -
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.
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 income statement, 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 when the company has 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.
1.13
Provisions
Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
1.14
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.
1.15
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.16
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 statement of financial position 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 leases asset are consumed.
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
1
Accounting policies
(Continued)
- 18 -
1.17
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.
1.18
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.
2
Judgements and key sources of estimation uncertainty
In the application of the company’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.
Critical judgements in applying the company's accounting polices
In the directors' opinion there are no critical judgements, apart from those involving estimations (dealt with separately below), that they have been made aware in applying company's accounting policies and that have had a significant effect on the amounts recognised in the financial statements.
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.
Valuation of stock and work-in-progress
In determining the valuation of both work-in-progress and finished goods, the company applies a standard cost per hour to both the actual labour time and actual machinery time on each job assignment. The estimated standard cost rates used are vary depending on the stage of the production process or the type of machine used. The hourly labour rate is estimated based on an average staff cost for that section of the production line. The hourly machine rate is based on management's estimate of costs applicable to each machine used.
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
- 19 -
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Sale of printed cartons and display materials
26,812,377
25,030,178
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
12,936,341
14,564,237
Overseas sales - EU
12,559,165
8,670,357
Overseas sales - Switzerland
653,095
773,264
Overseas sales - USA
371,579
228,139
Overseas sales - Asia
292,197
794,181
26,812,377
25,030,178
2023
2022
£
£
Other revenue
Interest income
21,894
637
Grants received
-
14,091
The Company received government grant income of £Nil (2022 - £14,091) under the Coronavirus Business Interruption Loan Scheme. There are no unfulfilled conditions or other contingencies attached to the grant income.
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
612
(19,838)
Government grants
-
(14,091)
Depreciation of owned tangible fixed assets
354,595
367,950
Profit on disposal of tangible fixed assets
(14,280)
(25,068)
Operating lease charges
308,965
329,103
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
- 20 -
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 company
32,000
18,000
For other services
All other non-audit services
6,250
4,000
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Production staff
86
62
Selling and distribution staff
4
6
Admin staff
16
30
Total
106
98
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
4,990,968
4,710,587
Social security costs
543,880
477,672
Pension costs
209,013
210,734
5,743,861
5,398,993
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
696,626
389,898
Company pension contributions to defined contribution schemes
119,178
111,362
815,804
501,260
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2022 - 3).
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
7
Directors' remuneration
(Continued)
- 21 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
249,366
127,241
Company pension contributions to defined contribution schemes
41,321
47,774
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
14,258
Other interest income
7,636
637
Total income
21,894
637
9
Interest payable and similar expenses
2023
2022
£
£
Interest on finance leases and hire purchase contracts
29,283
29,780
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
755,000
825,309
Adjustments in respect of prior periods
(122,510)
(62,178)
Total current tax
632,490
763,131
Deferred tax
Origination and reversal of timing differences
(32,000)
102,093
Total tax charge
600,490
865,224
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
10
Taxation
(Continued)
- 22 -
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
3,390,655
4,010,568
Expected tax charge based on the standard rate of corporation tax in the UK of 20.00% (2022: 19.00%)
678,131
762,008
Tax effect of expenses that are not deductible in determining taxable profit
14,878
37,021
Effect of change in corporation tax rate
2,754
99,342
Group relief
(280,440)
(31,407)
Depreciation on assets not qualifying for tax allowances
2,733
12,280
Under/(over) provided in prior years
(122,510)
(62,178)
Enhanced super deduction
(8,285)
(1,703)
Deferred tax not provided in prior period
(34,163)
33,075
Deferred tax (under)/over provided in current year
(10,507)
Over/(under) provided in current year
357,899
16,786
Taxation charge for the year
600,490
865,224
Factors that may affect future tax charges
With the availability of significant tax reliefs for capital expenditure the company anticipates being to be able to claim capital allowances in excess of depreciation in the short term. However, if capital expenditure slows down, this trend will reverse.
11
Dividends
2023
2022
£
£
Interim paid
400,000
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
- 23 -
12
Tangible fixed assets
Leasehold improvements
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 June 2022
525,261
3,719,678
74,296
134,091
4,453,326
Additions
137,652
168,637
42,607
348,896
Disposals
(60,000)
(1,179)
(61,179)
At 31 May 2023
662,913
3,828,315
115,724
134,091
4,741,043
Depreciation and impairment
At 1 June 2022
197,508
1,990,132
61,984
79,997
2,329,621
Depreciation charged in the year
49,618
257,726
22,362
24,889
354,595
Eliminated in respect of disposals
(55,000)
(458)
(55,458)
At 31 May 2023
247,126
2,192,858
83,888
104,886
2,628,758
Carrying amount
At 31 May 2023
415,787
1,635,457
31,836
29,205
2,112,285
At 31 May 2022
327,753
1,729,546
12,312
54,094
2,123,705
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2023
2022
£
£
Plant and equipment
277,000
517,233
Motor vehicles
18,111
27,989
295,111
545,222
13
Fixed asset investments
2023
2022
Notes
£
£
Investments in subsidiaries
14
72,706
72,706
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
- 24 -
14
Subsidiaries
Details of the company's subsidiaries at 31 May 2023 are as follows:
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
3D Creative Packaging Limited
Unit A3 Broomsleigh Business Park, Worsley Bridge, Worsley Bridge Road, London, SE26 5BN
Ordinary
100.00
15
Stocks
2023
2022
£
£
Raw materials and consumables
657,220
647,202
Work in progress
695,383
833,461
Finished goods and goods for resale
446,339
175,656
1,798,942
1,656,319
16
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
5,374,997
4,634,798
Amounts owed by group undertakings
4,702,369
4,365,202
Other debtors
260,201
416,689
Prepayments and accrued income
234,536
154,952
10,572,103
9,571,641
Amounts owed by group undertakings are unsecured, interest free, have no fixed date of repayment and are repayable on demand.
17
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Obligations under finance leases
19
64,367
140,862
Trade creditors
2,803,896
2,937,756
Amounts owed to group undertakings
45,568
Corporation tax
357,901
302,321
Other taxation and social security
223,565
103,430
Other creditors
29,404
30,700
Accruals and deferred income
680,661
393,155
4,205,362
3,908,224
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
17
Creditors: amounts falling due within one year
(Continued)
- 25 -
Obligations under finance leases of £64,367 (2022 - £140,862) are secured on the assets concerned. See "Finance lease obligations" for further information.
Amounts owed to group undertakings are unsecured, interest free, have no fixed date of repayment and are repayable on demand.
18
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Obligations under finance leases
19
107,193
169,761
Obligations under finance leases of £107,193 (2022 - £169,761) are secured on the assets concerned. See "Finance lease obligations" for further information.
19
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
64,367
140,862
In two to five years
107,193
169,761
171,560
310,623
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. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
20
Provisions for liabilities
2023
2022
£
£
Dilapidations provision
44,000
44,000
Other provisions
200,000
-
244,000
44,000
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
20
Provisions for liabilities
(Continued)
- 26 -
Movements on provisions:
Dilapidations provision
Other provisions
Total
£
£
£
At 1 June 2022
44,000
-
44,000
Additional provisions in the year
-
200,000
200,000
At 31 May 2023
44,000
200,000
244,000
Dilapidations provision
A dilapidations provision has been recognised in respect of works required to reinstate and make good a leased property. Expenditure is expected to be incurred in early 2024.
Other provisions
The company entered into an agreement with a customer to rectify some failed packaging manufactured during the year. A provision of £200,000 has been made for the expected costs to rectify the packaging and work is expected to be completed in early 2024.
21
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
415,000
447,000
2023
Movements in the year:
£
Liability at 1 June 2022
447,000
Credit to profit or loss
(32,000)
Liability at 31 May 2023
415,000
The deferred tax liability is not expected to reverse significantly in the short term due to the continuing investment in capital expenditure by the company.
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
- 27 -
22
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
209,013
210,734
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund. Contributions totalling £27,728 (2022 - £29,031) were payable to the fund at the reporting date and are included in creditors.
23
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary Shares of £1 each
62,500
62,500
62,500
62,500
The ordinary shares have no restrictions on the distribution of dividends and the repayment of capital.
24
Profit and loss reserves
Profit and loss reserves are made up of accumulated profits less accumulated losses and distributions up to the reporting date. This is a distributable reserve.
25
Financial commitments, guarantees and contingent liabilities
During the period, the company gave an unlimited guarantee, secured on all of the company's assets, as security for the borrowings of fellow group undertakings. At 31 May 2023 these borrowings amounted to £19,808,796 (2022 £17,414,330). As at the date of approval of these accounts, the directors do not anticipate that the guarantee will be called upon.
26
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
530,770
241,480
Between two and five years
1,555,536
703,280
2,086,306
944,760
F.G. Curtis Limited
Notes to the financial statements (continued)
For the year ended 31 May 2023
- 28 -
27
Related party transactions
Transactions with related parties
During the period to 2 December 2021, the company made purchases amounting to £178,000 from 3D Creative Packaging Limited, a company in which F. G. Curtis Limited owed 40% of the issued share capital. On 3 December 2021, the remaining 60% of share capital in 3D Creative Packaging Limited was acquired by F.G Curtis Limited.
28
Directors' transactions
Dividends totalling £0 (2022 - £333,020) were paid in the year in respect of shares held by the company's directors.
Description
% Rate
Opening balance
Amounts repaid
Closing balance
£
£
£
Directors loan
-
56,917
(56,917)
-
56,917
(56,917)
-
The advance is unsecured, repayable on demand and interest free.
29
Ultimate controlling party
The immediate parent undertaking is Appleseed Bidco Limited.
The ultimate parent undertaking and the smallest and largest group to consolidate these financial statements is Medication Packaging Holdco Limited. Copies of the Medication Packaging Holdco Limited consolidated financial statements can be obtained from Crewe Hall Enterprise Park, Crewe, Cheshire, CW1 6UL.
The ultimate controlling party is considered to be Harwood Private Equity V L.P.
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