REGISTERED NUMBER:
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LASER QUANTUM LIMITED |
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STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
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FINANCIAL STATEMENTS |
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FOR THE YEAR ENDED 31 DECEMBER 2020 |
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REGISTERED NUMBER:
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LASER QUANTUM LIMITED |
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STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
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FINANCIAL STATEMENTS |
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FOR THE YEAR ENDED 31 DECEMBER 2020 |
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LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
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CONTENTS OF THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
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Company Information | 1 |
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Strategic Report | 2 |
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Report of the Directors | 3 |
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Report of the Independent Auditors | 5 |
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Statement of Comprehensive Income | 9 |
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Statement of Financial Position | 10 |
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Statement of Changes in Equity | 11 |
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Notes to the Financial Statements | 12 |
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LASER QUANTUM LIMITED |
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COMPANY INFORMATION |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
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DIRECTORS: |
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SECRETARY: |
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REGISTERED OFFICE: |
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REGISTERED NUMBER: |
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AUDITORS: |
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Chartered Accountants and |
Statutory Auditors |
Clarke Nicklin House |
Brooks Drive |
Cheadle Royal Business Park |
Cheadle |
Cheshire |
SK8 3TD |
LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
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STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
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The directors present their strategic report for the year ended 31 December 2020. |
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REVIEW OF BUSINESS AND FUTURE DEVELOPMENTS |
2020 was an unprecedented year for Laser Quantum Limited with the Coronavirus pandemic having significant impact on staff, customers and their demand, as well as the supply chain. The business, with its manufacture of key enabling technology, focused on continuity of operation through the pandemic, whilst working within the required pandemic controls and supported by the wider Novanta Inc business. Overall, the business prioritised activities to manage the risks of 2020 whilst implementing business changes to ensure Laser Quantum Limited emerged as a strong business well-placed to benefit from future growth. |
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For the 12 months ending 31 December 2020, Laser Quantum Limited achieved a turnover of £20.9m compared to £28.5m in 2019, with a profit before tax reducing from 36.4% to 27.4% over the same period. The business utilised support from the Government's furlough scheme and had to perform a restructure programme which required a small number of employees to be released in Q4 2020. Performance in the first 6 months of 2021 has seen levels of turnover exceeding those enjoyed in 2019 and prior. |
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Medium-term business development continues to be the primary strategy with focus on both capability and capacity. Laser Quantum Limited strengthened its development and engineering functions with new product development activities looking to mature with new product introductions expected to reach the market in 2021 and through 2022. |
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With Novanta Inc being a progressive owner, integration into the Novanta Way and the Novanta Growth System structure has seen consistent alignment across the business with focus on increased capability and performance. This aligned with Laser Quantum Limited's agility and flexibility during a challenging year helped to maintain Gross Margins above 60% through 2020. |
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Laser Quantum Limited markets and sells its products globally, attainting an export level of 98% (2019: 95%). Whilst Brexit has had an impact on the business this was mainly administrative through 2020 and in the early months of 2021. The global supply chain continues to come under pressure as a result of increased demand on sectors as economic recovery from the pandemic continues. |
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Future developments: the leading business risks relate to the general global market condition and how the global marketplace reacts to the multiple impacts of the pandemic, as well as ensuring Laser Quantum Limited is well-placed to take advantage of any increase in demand as it continues to offer high specification, reliable and good-value products. |
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Since the year end, Laser Quantum Limited has completed the transition of the Laser Quantum GmbH (Germany) business to Stockport leading to the liquidation of that business. |
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PRINCIPAL RISKS AND UNCERTAINTIES |
The principal risks and uncertainties of the company relate to competition and the global supply chain. Further details are included in note 23 to the financial statements. |
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FINANCIAL RISK MANAGEMENT |
Information on financial risk management is scheduled in note 24 to the financial statements. |
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ON BEHALF OF THE BOARD: |
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LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
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REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
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The directors present their report with the financial statements of the company for the year ended 31 December 2020. |
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PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of the design, manufacture and sale of innovative, high-quality, laser products. |
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DIVIDENDS |
The total distribution of dividends for the year ended 31 December 2020 will be £3,500,000. |
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RESEARCH AND DEVELOPMENT |
The company continues to invest in research and development to further its product range, which amounted to £2.4m in 2020 (2019: £2.8m). The directors regard R&D investment as key for success in the medium to long term future. |
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EVENTS SINCE THE END OF THE YEAR |
Information relating to events since the end of the year is given in the notes to the financial statements. |
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DIRECTORS |
The directors shown below have held office during the whole of the period from 1 January 2020 to the date of this report. |
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STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations. |
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Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to: |
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- | 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. |
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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. |
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STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
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REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
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AUDITORS |
The auditors, Clarke Nicklin LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
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ON BEHALF OF THE BOARD: |
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REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
LASER QUANTUM LIMITED |
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Opinion |
We have audited the financial statements of Laser Quantum Limited (the 'company') for the year ended 31 December 2020 which comprise the Statement of Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
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In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 31 December 2020 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. |
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Basis for opinion |
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. |
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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. |
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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. |
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Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. |
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Other information |
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
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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. |
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In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If 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. |
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Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of the audit: |
- | the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
LASER QUANTUM LIMITED |
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Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors. |
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We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of directors' remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
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Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page three, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. |
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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. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
LASER QUANTUM LIMITED |
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Auditors' responsibilities for the audit of the financial statements |
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. |
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Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
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Procedures to identify risks: |
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enquiring of management concerning the company's procedures relating to: identifying, evaluating and
complying with laws and regulations and whether they were aware of any instances of noncompliance; detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; |
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discussing among the engagement team regarding how and where fraud might occur in the financial
statements and any potential indicators of fraud. As part of this discussion, we identified potential for fraud in the following areas: timing of recognition of sales and purchases and their related stock movements, posting of unusual journals; and |
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obtaining an understanding of the legal and regulatory frameworks that the company operates in,
focusing on those laws and regulations that had a direct effect on the financial statements or that had a fundamental effect on the operations of the company. The key laws and regulations we considered in this context included UK Companies Act, employment law, health and safety, pensions legislation and tax legislation. |
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The procedures to respond to risks identified included: |
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reviewing the financial statement disclosures and testing to supporting documentation to assess
compliance with relevant laws and regulations discussed above; |
- | enquiring of management, concerning actual and potential litigation and claims; |
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performing analytical procedures to identify any unusual or unexpected relationships that may indicate
risks of material misstatement due to fraud; |
- | reviewing correspondence with HMRC; |
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testing the timing and matching of income and expense transactions relating to stock movements
either side of the year end; and |
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in addressing the risk of fraud through management override of controls, testing the appropriateness of
journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business. |
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We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members, and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit. |
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A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
LASER QUANTUM LIMITED |
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Use of our report |
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed. |
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for and on behalf of
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Chartered Accountants and |
Statutory Auditors |
Clarke Nicklin House |
Brooks Drive |
Cheadle Royal Business Park |
Cheadle |
Cheshire |
SK8 3TD |
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LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
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STATEMENT OF COMPREHENSIVE INCOME |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
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2020 | 2019 |
Notes | £'000 | £'000 |
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TURNOVER | 3 |
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Cost of sales |
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GROSS PROFIT |
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Administrative expenses |
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5,071 | 10,567 |
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Other operating income |
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OPERATING PROFIT | 5 |
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Interest receivable and similar income |
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5,735 | 11,134 |
Amounts written off investments | 6 | - | 753 |
PROFIT BEFORE TAXATION |
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Tax on profit | 7 |
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PROFIT FOR THE FINANCIAL YEAR |
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OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR |
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LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
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STATEMENT OF FINANCIAL POSITION |
31 DECEMBER 2020 |
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2020 | 2019 |
Notes | £'000 | £'000 | £'000 | £'000 |
FIXED ASSETS |
Intangible assets | 9 |
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Tangible assets | 10 |
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Investments | 11 |
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CURRENT ASSETS |
Stocks | 12 |
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Debtors | 13 |
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Cash at bank |
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CREDITORS |
Amounts falling due within one year | 14 |
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NET CURRENT ASSETS |
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TOTAL ASSETS LESS CURRENT
LIABILITIES |
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PROVISIONS FOR LIABILITIES | 16 |
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NET ASSETS |
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CAPITAL AND RESERVES |
Called up share capital | 17 |
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Share premium | 18 |
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Capital redemption reserve | 18 |
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Retained earnings | 18 |
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SHAREHOLDERS' FUNDS |
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The financial statements were approved by the Board of Directors and authorised for issue on
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LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
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STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
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Called up | Capital |
share | Retained | Share | redemption | Total |
capital | earnings | premium | reserve | equity |
£'000 | £'000 | £'000 | £'000 | £'000 |
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Balance at 1 January 2019 |
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Changes in equity |
Dividends | - | ( |
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Total comprehensive income | - |
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- |
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Balance at 31 December 2019 |
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Changes in equity |
Dividends | - | ( |
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Total comprehensive income | - |
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Balance at 31 December 2020 |
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LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
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NOTES TO THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
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1. | STATUTORY INFORMATION |
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Laser Quantum Limited ("the Company") is a limited company incorporated in the United Kingdom. The address of its registered office and principal place of business is Emery Court, Vale Road, Stockport, Cheshire, SK4 3GL. |
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2. | ACCOUNTING POLICIES |
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Basis of preparing the financial statements |
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Financial Reporting Standard 102 - reduced disclosure exemptions |
The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland": |
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• | the requirements of Section 7 Statement of Cash Flows; |
• | the requirement of paragraph 3.17(d); |
• | the requirement of paragraph 33.7. |
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Preparation of consolidated financial statements |
The financial statements contain information about Laser Quantum Limited as an individual company and do not contain consolidated financial information as the parent of a group. The company is exempt under Section 401 of the Companies Act 2006 from the requirements to prepare consolidated financial statements as it and its subsidiary undertakings are included by full consolidation in the consolidated financial statements of its parent, Novanta Inc, 125 Middlesex Turnpike, Bedford, MA 01730, USA. |
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Going concern |
The financial statements have been prepared on a going concern basis as the directors believe that the company will be able to continue to meet its liabilities as they fall due for the foreseeable future. In drawing this conclusion, management have considered the following: |
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Laser Quantum Limited traded profitably through 2020 with H1 2021 seeing a 40% increase in revenues and at the date of signing, the company has significant cash balances. The directors expect the company to show growth in terms of both revenue and profit in 2021 against pre-pandemic levels. |
LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
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NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
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2. | ACCOUNTING POLICIES - continued |
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Significant judgements and estimates |
Preparation of the financial statements requires management to make significant judgements and estimates. The items in the financial statements where these judgements and estimates have been made include: |
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Amortisation and depreciation of assets |
The company amortises and depreciates its intangible and tangible assets over their estimated useful lives. The estimation of the useful lives of assets is based on historic performance as well as expectations about future use and therefore requires estimates and assumptions to be applied by the directors. The actual lives of these assets can vary depending on a variety of factors, including technological innovation, product life cycles and maintenance programmes. |
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Warranty provisions |
A warranty provision is made based on the directors' estimate of the future cost of rectifying problems on products sold by the company. |
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Dilapidations provision |
A dilapidations provision is made, based on the directors' estimate of the obligation to return a property to its original condition upon expiry of a lease. |
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Investments in and amounts due from group undertakings |
The company reviews the carrying value of its investments in group undertakings and the recoverability of intragroup debtors. In assessing whether there is any impairment, the directors make estimates and assumptions over the future performance of the respective group undertakings. |
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Turnover |
Turnover is measured at the fair value of the consideration received or receivable, net of discounts and value added tax. |
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The majority of the company's products are sold on an ex works basis and the revenue is recognised on dispatch. The remaining revenue is recognised when title to the goods is transferred to customers and is normally upon delivery of the product to the customer. |
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The company recognises turnover when (a) the significant risks and rewards of ownership have been transferred to the buyer, (b) the company retains no continuing involvement or control over the goods, (c) the amount of turnover can be measured reliably, (d) it is probable that future economic benefits will flow to the entity. |
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Intangible assets |
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. |
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Development costs are not yet being amortised as the underlying project is incomplete. |
LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
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NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
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2. | ACCOUNTING POLICIES - continued |
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Tangible fixed assets |
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Freehold property | - |
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Leasehold improvements | - |
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Plant and machinery | - |
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Fixtures and fittings | - |
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Computer equipment | - |
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Impairment of assets |
At each reporting date fixed assets are reviewed to determine whether there is any indication that those assets have suffered an impairment loss. If there is an indication of possible impairment, the recoverable amount of any affected asset is estimated and compared with its carrying amount. If estimated recoverable amount is lower, the carrying amount is reduced to its estimated recoverable amount, and an impairment loss is recognised immediately in the income statement. |
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If an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but not in excess of the amount that would have been determined had no impairment loss been recognised for the asset in the prior years. A reversal of an impairment loss is recognised immediately in the income statement. |
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Investments in subsidiaries |
Investment in subsidiary undertaking are recognised at cost less impairment. |
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Stocks |
Stocks are valued at the lower of cost and net realisable value, as follows: |
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Raw materials | - | purchase cost |
Work in progress and | - | cost of direct materials and labour |
Finished goods |
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cost of direct materials and labour, plus a reasonable proportion of
manufacturing overheads based on normal levels of activity. |
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Net realisable value is based on estimated normal selling price less further costs expected to be incurred to completion and disposal. Provision is made for obsolete, slow moving or defective items where appropriate. |
LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
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NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
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2. | ACCOUNTING POLICIES - continued |
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Financial instruments |
The company has chosen to adopt Sections 11 and 12 of FRS 102 in respect of financial instruments. The company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities, including amounts owed by and to group undertakings. |
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Financial assets |
Basic financial assets, including trade debtors, cash and bank balances and amounts owed by group undertakings, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at the market rate of interest. |
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Such assets are subsequently carried at amortised cost using the effective interest method. |
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At the end of each reporting period, financial assets measured at amortised cost are assessed for objective evidence of impairment. 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 the income statement. |
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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 the income statement. |
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Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party, or (c) control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions. |
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Financial liabilities |
Basic financial liabilities, including trade creditors and amounts owed to group undertakings, 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 receipts discounted at a market rate of interest. |
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Taxation |
Taxation expense for the period comprises current and deferred tax recognised in the reporting period. Tax is recognised in the income statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case tax is also recognised in other comprehensive income or directly in equity respectively. |
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Current or deferred taxation assets and liabilities are not discounted. |
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Current tax is the amount of income tax payable in respect of the taxable profit for the year or prior years. Tax is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the period end. |
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Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities. |
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LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
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NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
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2. | ACCOUNTING POLICIES - continued |
Deferred tax |
Deferred tax arises from timing differences that are differences between taxable profits reported in the tax return and total comprehensive income as stated in the financial statements. These timing differences arise from the inclusion of income and expenses in tax assessments in periods difference from those in which they are recognised in the financial statements. |
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Deferred tax is recognised on all timing differences at the reporting date except for certain exceptions. Unrelieved tax losses and other deferred tax assets are only recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
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Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the period end and that are expected to apply to the reversal of timing differences. |
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Research and development |
Expenditure on research and development is written off in the year in which it is incurred. |
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Foreign currencies |
The company's functional and presentation currency is Sterling (£). |
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Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions. |
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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 the income statement except when deferred in other comprehensive income as qualifying cash flow hedges. |
|
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension 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 when they are due. Amounts not paid are shown in accruals in the balance sheet. The assets of the plan are held separately from the company in independently administered funds. |
|
Provision for liabilities |
Provisions are recognised when the company has a present obligation (legal or constructive) as a result of a past event, it is probable that the company will be required to settle the 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 end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. |
|
The company recognises provisions for the expected costs of maintenance under warranties, which are charged against profits when products have been invoiced. |
|
Government grants |
Grant income receivable under the Coronavirus Job Retention Scheme ("CJRS") is recognised in the Income Statement on a straight line basis over the furlough period for each relevant employee. |
LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
|
|
3. | TURNOVER |
|
The turnover and profit before taxation are attributable to the one principal activity of the company. |
|
An analysis of turnover by geographical market is given below: |
|
2020 | 2019 |
£'000 | £'000 |
United Kingdom |
|
|
Overseas | 20,575 | 27,118 |
|
|
|
4. | EMPLOYEES AND DIRECTORS |
2020 | 2019 |
£'000 | £'000 |
Wages and salaries |
|
|
Social security costs |
|
|
Other pension costs |
|
|
|
|
|
The average number of employees during the year was as follows: |
2020 | 2019 |
|
Management | 3 | 4 |
Operations | 78 | 91 |
Research and development | 34 | 37 |
Administration | 19 | 22 |
|
|
|
2020 | 2019 |
£ | £ |
Directors' remuneration |
|
|
Directors' pension contributions to money purchase schemes |
|
|
|
The number of directors to whom retirement benefits were accruing was as follows: |
|
Money purchase schemes |
|
|
|
Information regarding the highest paid director is as follows: |
2020 | 2019 |
£ | £ |
Emoluments etc |
|
|
Pension contributions to money purchase schemes |
|
|
LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
|
|
5. | OPERATING PROFIT |
|
The operating profit is stated after charging/(crediting): |
|
2020 | 2019 |
£'000 | £'000 |
Depreciation - owned assets |
|
|
Auditors' remuneration: Audit services |
|
|
Taxation advisory services |
|
|
Research and development |
|
|
Operating lease rentals |
|
|
Foreign exchange |
|
|
Stock provision movement |
|
( |
) |
|
6. | AMOUNTS WRITTEN OFF INVESTMENTS |
2020 | 2019 |
£'000 | £'000 |
Impairment of investments | - | 753 |
|
7. | TAXATION |
|
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
2020 | 2019 |
£'000 | £'000 |
Current tax: |
UK corporation tax |
|
|
|
Deferred tax |
|
|
Tax on profit |
|
|
|
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
|
2020 | 2019 |
£'000 | £'000 |
Profit before tax |
|
|
Profit multiplied by the standard rate of corporation tax in the UK of
|
|
|
|
Effects of: |
Expenses not deductible for tax purposes |
|
|
Depreciation in excess of capital allowances |
|
|
Patent Box | (491 | ) | (796 | ) |
Total tax charge | 686 | 1,343 |
LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
|
|
8. | DIVIDENDS |
2020 | 2019 |
£'000 | £'000 |
Ordinary shares of £1 each |
Interim |
|
|
|
9. | INTANGIBLE FIXED ASSETS |
Development |
costs |
£'000 |
COST |
At 1 January 2020 |
and 31 December 2020 |
|
NET BOOK VALUE |
At 31 December 2020 |
|
At 31 December 2019 |
|
|
10. | TANGIBLE FIXED ASSETS |
Freehold | Leasehold | Plant and |
property | improvements | machinery |
£'000 | £'000 | £'000 |
COST |
At 1 January 2020 |
|
|
|
Additions |
|
|
|
At 31 December 2020 |
|
|
|
DEPRECIATION |
At 1 January 2020 |
|
|
|
Charge for year |
|
|
|
At 31 December 2020 |
|
|
|
NET BOOK VALUE |
At 31 December 2020 |
|
|
|
At 31 December 2019 |
|
|
|
LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
|
|
10. | TANGIBLE FIXED ASSETS - continued |
|
Fixtures |
and | Computer |
fittings | equipment | Totals |
£'000 | £'000 | £'000 |
COST |
At 1 January 2020 |
|
|
|
Additions |
|
|
|
At 31 December 2020 |
|
|
|
DEPRECIATION |
At 1 January 2020 |
|
|
|
Charge for year |
|
|
|
At 31 December 2020 |
|
|
|
NET BOOK VALUE |
At 31 December 2020 |
|
|
|
At 31 December 2019 |
|
|
|
|
Included in the cost of Freehold Property is land of £55,000 (2019: £55,000) which is not depreciated. |
|
11. | FIXED ASSET INVESTMENTS |
Shares in |
group |
undertakings |
£'000 |
COST |
At 1 January 2020 |
and 31 December 2020 |
|
NET BOOK VALUE |
At 31 December 2020 |
|
At 31 December 2019 |
|
|
Subsidiary |
Percentage
held |
Place of incorporation |
|
Laser Quantum GmbH | 100% | Germany |
|
LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
|
|
12. | STOCKS |
|
2020 | 2019 |
£'000 | £'000 |
Raw materials and consumables | 1,570 | 2,236 |
Demo stock | 184 | 244 |
Work in progress | 661 | 925 |
Finished goods and goods for resale | 83 | 348 |
2,498 | 3,753 |
|
The directors of the company believe there is no material difference between the balance sheet value and replacement cost of stock. For these purposes, replacement cost is based on latest invoice price at the balance sheet date. |
|
Stock is stated after provisions for impairment of £0.5m (2019: £0.4m). |
|
13. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2020 | 2019 |
£'000 | £'000 |
Trade debtors |
|
|
Amounts owed by group undertakings |
|
|
Other debtors |
|
|
VAT |
|
|
Deferred tax asset |
Decelerated capital allowances |
|
|
Prepayments and accrued income |
|
|
|
|
|
Trade debtors are stated after provisions for returns of £15,000 (2019: £15,000). |
|
14. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2020 | 2019 |
£'000 | £'000 |
Trade creditors |
|
|
Amounts owed to group undertakings |
|
|
Corporation tax |
|
|
Other creditors |
|
|
Accruals and deferred income |
|
|
|
|
|
15. | LEASING AGREEMENTS |
|
Minimum lease payments under non-cancellable operating leases fall due as follows: |
2020 | 2019 |
£'000 | £'000 |
Within one year |
|
|
Between one and five years |
|
|
|
|
LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
|
|
16. | PROVISIONS FOR LIABILITIES |
2020 | 2019 |
£'000 | £'000 |
Other provisions |
Warranty provision | 453 | 528 |
Dilapidations provision | 186 | 186 |
|
|
|
Deferred | Other |
tax | provisions |
£'000 | £'000 |
Balance at 1 January 2020 | ( |
) |
|
Charge to Statement of Comprehensive Income during year |
|
|
Balance at 31 December 2020 | ( |
) |
|
|
17. | CALLED UP SHARE CAPITAL |
|
|
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2020 | 2019 |
value: | £ | £ |
|
Ordinary | £1 | 572 | 572 |
|
Called up share capital - represents the nominal value of shares that have been issued. |
|
18. | RESERVES |
Capital |
Retained | Share | redemption |
earnings | premium | reserve | Totals |
£'000 | £'000 | £'000 | £'000 |
|
At 1 January 2020 |
|
|
|
10,459 |
Profit for the year |
|
|
Dividends | ( |
) | ( |
) |
At 31 December 2020 |
|
|
|
12,008 |
|
Retained earnings - includes all current and prior period retained profit and losses. |
|
Share premium - includes any premiums received on issues of share capital. Any transaction costs associated with the issuing of shares are deducted from share premium. |
|
Capital redemption reserve - represents the nominal value of shares repurchased by the company |
|
19. | PENSION COMMITMENTS |
|
Unpaid pension contributions at the year end amount to £Nil (2019: £1,000). |
LASER QUANTUM LIMITED (REGISTERED NUMBER: 02971383) |
|
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2020 |
|
|
20. | ULTIMATE PARENT COMPANY |
|
Novanta Inc (incorporated in Canada ) is regarded by the directors as being the company's ultimate parent company. |
|
The largest and smallest group in which the results of the company are consolidated is Novanta Inc. The consolidated financial statements of Novanta Inc can be found at www.sec.gov or by writing to Novanta Inc, 125 Middlesex Turnpike, Bedford, MA 01730, USA. |
|
21. | RELATED PARTY DISCLOSURES |
|
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 wholly owned subsidiaries within the group. |
|
22. | POST BALANCE SHEET EVENTS |
|
Since the year end the company's subsidiary Laser Quantum GmbH has been liquidated and operations have been transferred to the company. |
|
23. | PRINCIPAL RISKS AND UNCERTAINTIES |
|
The principal risks and uncertainties of the company relate to competition and the global supply chain. |
|
Competition |
The company manages competitive trading risk by continually investing in research and development to provide industry leading products to customers, and by maintaining relationships with those customers. |
|
Supply Chain |
The global supply chain is affected by lead time variation as demand continues to outstrip supply. The company has strong inventory management processes in place and an established and supportive supply chain. The challenges surrounding international trade and supply chain are expected to continue through 2021. |
|
24. | FINANCIAL MANAGEMENT RISK |
|
The company operations expose it to a variety of financial risks that include credit risk and foreign exchange risk. |
|
Credit risk |
Credit risk is managed by agreeing payment terms in advance. Appropriate credit control procedures are followed at all operations where credit risk is perceived. |
|
Foreign exchange rate risk |
The company's transactions are in sterling and other currencies, and therefore the company is exposed to the movement in foreign exchange rates. This is mitigated within the company by both buying and selling in various currencies. |