Registered number:
02781256
Finnlines UK Limited
Financial statements
Information for filing with the registrar
For the year ended
31 December 2022
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Finnlines UK Limited
Registered number:
02781256
Balance sheet
As at
31 December 2022
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Provisions for liabilities
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The
financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The Company has opted not to file the statement of income and retained earnings in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf by
:
The notes on page 4 form part of these financial statements.
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Finnlines UK Limited
Notes to the financial statements
For the year ended 31 December 2022
Finnlines UK Limited is a limited liability company incorporated and domiciled in England and Wales. The company's registered number is 02781256. The address of its registered office is Finhumber House, Queen Elizabeth Dock, Hedon Road, Hull, HU9 5PB.
The company's principal activity is the business of shipping and forwarding agents. Ancillary activities include the provision of haulage, terminal, warehousing and general forwarding services at ports on the East Coast of the United Kingdom.
2.
Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of
Financial Reporting Standard 102, the Financial Reporting Standard applicable in
the UK and the Republic of Ireland and the Companies Act 2006
.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies.
The financial statements are rounded to the nearest pound.
The following principal accounting policies have been applied:
The company's principal activities as shipping and forwarding agents are undertaken primarily to support the wider activities of the Finnlines plc group. The margins generated by these activities are not substantial and the nature of the company's business is such that there can be considerable variation in the timing of cash inflows. Rather than relying on bank or other external sources of finance, the company is supported by its parent undertaking Finnlines plc, which has provided loans as and when needed to the company to meet its financing needs.
Finnlines plc have confirmed that they will continue to provide sufficient financial support to the company in order that the company can continue its operations as a going concern for the foreseeable future. The group has considerable financial resources and as a consequence the directors believe that the company is well placed to manage its business risks successfully despite the current uncertain economic outlook.
Given the above, the directors have formed a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. For these reasons, they continue to adopt the going concern basis of accounting in preparing the annual financial statements.
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Finnlines UK Limited
Notes to the financial statements
For the year ended 31 December 2022
2.
Accounting policies (continued)
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is pound sterling.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the statement of income and retained earnings within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
∙
the amount of revenue can be measured reliably;
∙
it is probable that the Company will receive the consideration due under the contract;
∙
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
∙
the costs incurred and the costs to complete the contract can be measured reliably.
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Operating leases: the Company as lessee
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Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.
Interest income is recognised in profit or loss using the effective interest method.
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Finnlines UK Limited
Notes to the financial statements
For the year ended 31 December 2022
2.
Accounting policies (continued)
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the balance sheet. The assets of the plan are held separately from the Company in independently administered funds.
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Current and deferred taxation
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The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
∙
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
The estimated useful lives range as follows:
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Finnlines UK Limited
Notes to the financial statements
For the year ended 31 December 2022
2.
Accounting policies (continued)
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
The Company adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the Company. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
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Finnlines UK Limited
Notes to the financial statements
For the year ended 31 December 2022
2.
Accounting policies (continued)
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Financial instruments (continued)
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Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the statement of income and retained earnings.
For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Company would receive for the asset if it were to be sold at the balance sheet date.
Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is an 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.
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The average monthly number of employees, including directors, during the year was
12
(2021 -
11
)
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Charge for the year on owned assets
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Finnlines UK Limited
Notes to the financial statements
For the year ended 31 December 2022
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Charge for the year on owned assets
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Amounts owed by group undertakings
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Prepayments and accrued income
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Page 1
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Finnlines UK Limited
Notes to the financial statements
For the year ended 31 December 2022
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Accruals and deferred income
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Charged to profit or loss
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The provision for deferred taxation is made up as follows:
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Accelerated capital allowances
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Page 2
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Finnlines UK Limited
Notes to the financial statements
For the year ended 31 December 2022
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Allotted, called up and fully paid
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50,000
(2021 -
50,000
)
Ordinary "A"
shares of £
1.00
each
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50,000
(2021 -
50,000
)
Ordinary "B"
shares of £
1.00
each
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250,000
(2021 -
250,000
)
Preference
shares of £
1.00
each
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This represents the nominal value of shares that have been issued by the company.
The "A" and "B" ordinary shares rank pari passu, with holders of both classes of share having the right to vote at all general meetings of the company.
The preference shares do not carry any voting rights or rights to dividends and are not-interest bearing. They are redeemable at the option of the company at no fixed or determinable amount or within a specified time period. As a consequence preference shares are considered to be equity instruments in accordance with the requirements of FRS 102.
The company is a participating employer of the Merchant Navy Officer Pension Fund ("MNOPF"), an industry-wide defined benefit pension scheme that provides retirement for Merchant Navy Officers and their dependants.
The company is unable to ascertain its share of the overall deficit if the MNOPF and of the underlying assets and liabilities of the Fund on a consistent and reasonable basis. Thus the company accounts for any contributions to the scheme as if it were a defined contribution scheme, recognising normal contributions as they fall due for payment and deficit funding contributions on an accrual basis.
Actuarial valuations of the MNOPF are undertaken every three years, with the most recently completed valuation being as at 31 March 2021. The 2021 valuation showed that the fund had a surplus of assets relative to technical provisions of £58m, an improvement to the previously stated deficit of £73m as at 31 March 2018, equivalent to a funding level of 102%. This represented an improvement in the funding level, which was 98% at the date of the previous triennial valuation in 2018. The company can be required to make deficit funding contributions to the MNOPF following the completion of each triennial actuarial valuation, however given the fund is in a surplus position this is not going to be relevant.
The directors expect the company to continue to be a participating employer of the MNOPF for the foreseeable future. The MNOPF have confirmed that as the company has an employee enrolled in the scheme, it does not currently intend to serve a demand for payment in respect of any section 75 statutory debt.
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Related party transactions
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The company is exempt from disclosing related party transactions with other companies that are wholly owned within the group.
All other related party transactions during the current and prior periods, including key management personnel compensation, were made under normal market conditions.
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Page 3
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Finnlines UK Limited
Notes to the financial statements
For the year ended 31 December 2022
The company continues to be a wholly owned subsidiary undertaking of Finnlines Plc, a company incorporated in Finland. Copies of the group financial statements are available to download from the group website 'www.finnlines.com' or by post on request from the following address:
Finnlines plc
Corporate Communication
PO Box 197
FI - 00181
Helsinki
Finland
The ultimate parent undertaking of the company is Grimaldi Group SpA, a privately owned Italian company, by virtue of its 100% (2021 - 100%) interest in the share capital of Finnlines plc. Grimaldi Group SpA is controlled by members of the Grimaldi family.
The auditors' report on the financial statements for the year ended 31 December 2022 was unqualified.
The audit report was signed on
24 February 2023
by
Peter Manser FCA DChA
(senior statutory auditor) on behalf of
Kreston Reeves LLP
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Page 4
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