BURT BOULTON & HAYWOOD LIMITED
Company Registration No. 03540326 (England and Wales)
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2018
BURT BOULTON & HAYWOOD LIMITED
COMPANY INFORMATION
Directors
Mr A P Mononen
Mr J Monni
Mr O Hulleberg
Mr T Luukkainen
Secretary
Mr O Hulleberg
Company number
03540326
Registered office
Alexandra Docks
Newport
Gwent
NP20 2WA
Auditor
Dyke Yaxley Limited
1 Brassey Road
Old Potts Way
Shrewsbury
Shropshire
SY3 7FA
BURT BOULTON & HAYWOOD LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 5
Profit and loss account
6
Statement of comprehensive income
7
Balance sheet
8
Statement of changes in equity
9
Statement of cash flows
10
Notes to the financial statements
11 - 24
BURT BOULTON & HAYWOOD LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2018
- 1 -
The directors present the strategic report for the year ended 31 December 2018.
Fair review of the business
The company has experienced a good performance in the year. This has principally been driven by good demand in the utility sector.
The company had net current assets of £2,458,173 at 31 December 2018 which is down slightly on the previous year net current assets balance of £2,532,779.
We anticipate that volumes across business streams will change in 2019 to some extent. Demand for power transmission poles will slightly decrease, but the demand for telecommunication poles and treated timber products will stay strong.
The company is owned 100% by Scanpole BBH Ltd, which is a part of the Iivari Mononen Group.
Burt Boulton & Haywood Limited will distribute dividends of £100,000.
Principal risks and uncertainties
The management of the business and the execution of the company's strategy are subject to a number of risks. The key business risks and uncertainties affecting the company are considered to relate to competition and future legislation relating to the Biocidal Products (preservatives) Regulations.
Competition
The company operates in a competitive market, and to reduce this risk the company works with its customers and suppliers to ensure that the company's products meet their needs in order to retain their custom. If necessary the company then adjusts its strategy to better meet the customer's needs.
Future legislation relating to Biocidal Products (preservatives)
The company utilises certain wood preservative products which may be subject to future legislation changes - such legislation includes the Biocidal Products Regulation (BPR). Under the BPR wood preservatives are authorised for a period of 5 to 10 years. One of the preservatives used by the company is classed as 'products for substitution', namely creosote. The company is mitigating this risk by researching alternative wood preservatives that meet BPR criteria as well as researching alternative materials that would be acceptable to the utility sector.
Key performance indicators
Management have identified Key Performance Indicators (KPI's) that are used to drive business performance and to set targets for departments and employees throughout the business that will deliver the desired strategic goals.
The performance indicators used by management to assess performance of the company are turnover and profit on ordinary activities before taxation. The company has recognised turnover of £11,222,476 (2017 £13,382,208) with a profit before tax of £268,274 compared to a loss in 2017 of £53,560.
Mr A P Mononen
Director
15 March 2019
BURT BOULTON & HAYWOOD LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2018
- 2 -
The directors present their annual report and financial statements for the year ended 31 December 2018.
Principal activities
The principal activity of the company continued to be that of the manufacture of telegraph and transmission poles and related timber preservation.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr A P Mononen
Mr J Monni
Mr O Hulleberg
Mr T Luukkainen
Results and dividends
The results for the year are set out on page 6.
Ordinary dividends were paid amounting to
£500,000. A final dividend has been proposed of £100,000 in respect of these accounts.
No preference dividends were paid.
Auditor
Dyke Yaxley Limited were appointed auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
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 A P Mononen
Director
15 March 2019
BURT BOULTON & HAYWOOD LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2018
- 3 -
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;
-
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
-
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.
BURT BOULTON & HAYWOOD LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BURT BOULTON & HAYWOOD LIMITED
- 4 -
Opinion
We have audited the financial statements of Burt Boulton & Haywood Limited (the 'company') for the year ended 31 December 2018 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows 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 FRS 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 December 2018 and of its profit for the year then ended;
-
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-
have been prepared in accordance with the requirements of the Companies Act 2006.
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
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
-
the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
-
the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue
.
The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.
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 there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit
:
-
the information given in the strategic report and the directors' r
eport 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.
BURT BOULTON & HAYWOOD LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BURT BOULTON & HAYWOOD LIMITED
- 5 -
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 identifie
d
material misstatements in the strategic report and the directors'
r
eport
.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
-
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
-
the financial statements are not in agreement with the accounting records and returns; or
-
certain disclosures of directors' remuneration specified by law are not made; or
-
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors'
r
esponsibilities
s
tatement, 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.
A further description of our responsibilities for the audit of the financial statements is located on the
Financial Reporting Council’s website at: http://www.frc.org.uk/auditorsresponsibilities
.
This description forms part of our auditor’s 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 an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
Andrew Young (Senior Statutory Auditor)
for and on behalf of Dyke Yaxley Limited
1 April 2019
Chartered Accountants
Statutory Auditor
1 Brassey Road
Old Potts Way
Shrewsbury
Shropshire
SY3 7FA
BURT BOULTON & HAYWOOD LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2018
- 6 -
2018
2017
Notes
£
£
Turnover
3
11,222,476
13,382,208
Cost of sales
(9,610,918)
(12,032,739)
Gross profit
1,611,558
1,349,469
Distribution costs
(18,683)
(209,096)
Administrative expenses
(1,324,902)
(1,191,287)
Operating profit/(loss)
4
267,973
(50,914)
Interest payable and similar expenses
6
301
(2,646)
Profit/(loss) before taxation
268,274
(53,560)
Tax on profit/(loss)
7
(126,093)
(85,007)
Profit/(loss) for the financial year
142,181
(138,567)
The Profit And Loss Account has been prepared on the basis that all operations are continuing operations.
BURT BOULTON & HAYWOOD LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2018
- 7 -
2018
2017
£
£
Profit/(loss) for the year
142,181
(138,567)
Other comprehensive income
-
-
Total comprehensive income for the year
142,181
(138,567)
BURT BOULTON & HAYWOOD LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2018
31 December 2018
- 8 -
2018
2017
Notes
£
£
£
£
Fixed assets
Intangible assets
9
-
2
Tangible assets
10
513,249
713,556
513,249
713,558
Current assets
Stocks
11
3,544,084
2,653,602
Debtors
12
350,631
1,787,169
Cash at bank and in hand
239,879
94,796
4,134,594
4,535,567
Creditors: amounts falling due within one year
13
(1,676,421)
(2,002,788)
Net current assets
2,458,173
2,532,779
Total assets less current liabilities
2,971,422
3,246,337
Provisions for liabilities
15
(192,975)
(110,071)
Net assets
2,778,447
3,136,266
Capital and reserves
Called up share capital
17
500,002
500,002
Profit and loss reserves
18
2,278,445
2,636,264
Total equity
2,778,447
3,136,266
The financial statements were approved by the board of directors and authorised for issue on 15 March 2019 and are signed on its behalf by:
Mr A P Mononen
Director
Company Registration No. 03540326
BURT BOULTON & HAYWOOD LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2018
- 9 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 January 2017
500,002
3,574,831
4,074,833
Year ended 31 December 2017:
Loss and total comprehensive income for the year
-
(138,567)
(138,567)
Dividends
8
-
(800,000)
(800,000)
Balance at 31 December 2017
500,002
2,636,264
3,136,266
Year ended 31 December 2018:
Profit and total comprehensive income for the year
-
142,181
142,181
Dividends
8
-
(500,000)
(500,000)
Balance at 31 December 2018
500,002
2,278,445
2,778,447
BURT BOULTON & HAYWOOD LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2018
- 10 -
2018
2017
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
22
609,865
1,410,752
Interest paid
301
(2,646)
Income taxes refunded/(paid)
48,200
(60,398)
Net cash inflow from operating activities
658,366
1,347,708
Investing activities
Purchase of tangible fixed assets
(9,610)
(354,780)
Proceeds on disposal of tangible fixed assets
-
11,137
Net cash used in investing activities
(9,610)
(343,643)
Financing activities
Payment of finance leases obligations
-
(17,803)
Dividends paid
(500,000)
(800,000)
Net cash used in financing activities
(500,000)
(817,803)
Net increase in cash and cash equivalents
148,756
186,262
Cash and cash equivalents at beginning of year
91,123
(95,139)
Cash and cash equivalents at end of year
239,879
91,123
Relating to:
Cash at bank and in hand
239,879
94,796
Bank overdrafts included in creditors payable within one year
-
(3,673)
BURT BOULTON & HAYWOOD LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2018
- 11 -
1
Accounting policies
Company information
Burt Boulton & Haywood Limited is a
private
company
limited by shares
incorporated in England and Wales.
The registered office is
Alexandra Docks, Newport, Gwent, NP20 2WA.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in
sterling
, which is the functional currency of the company.
Monetary a
mounts
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.
1.2
Going concern
A
t the time of approving the financial statements
,
t
he directors have a reasonable expectation that the
company
has adequate resources to continue in operational existence for the foreseeable future. Thus
t
he directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business
, and
is shown net of VAT and other sales related taxes
.
The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer
(usually on dispatch of the goods)
, the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
1.4
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date
where
it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the
fair
value of the asset can be measured reliably.
Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Patents
Nil
The patents were fully written down this year.
1.5
Tangible fixed assets
Tangible fixed assets
are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
BURT BOULTON & HAYWOOD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
1
Accounting policies
(Continued)
- 12 -
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Land and buildings Leasehold
10% straight line basis
Plant and machinery
25% straight line basis
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
Impairment of fixed assets
At each reporting
period
end date, the
company
reviews the carrying amounts of its tangible
and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
1.7
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
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.
1.8
Cash at bank and in hand
Cash at bank and in hand
are basic financial assets
and
include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.9
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset
, with
the net amounts presented in the financial statements
,
when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
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.
BURT BOULTON & HAYWOOD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
1
Accounting policies
(Continued)
- 13 -
Trade debtors
, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as 'loans and receivables'. Loans and receivables are measured at amortised cost using the effective interest method, less any impairment.
Interest is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial.
The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating the interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the debt instrument to the net carrying amount on initial recognition.
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.
The impairment loss is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.
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 though 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.
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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations
expire or are discharged or cancelled.
1.10
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.
1.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The
company’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
BURT BOULTON & HAYWOOD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
1
Accounting policies
(Continued)
- 14 -
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.
1.12
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 i
s
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.
1.13
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.
1.14
Leases
Rentals payable under operating leases,
including
any lease incentives received, are charged to income 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 lease asset are consumed.
1.15
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 are included in the profit and loss account for the period.
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.
BURT BOULTON & HAYWOOD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
- 15 -
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2018
2017
£
£
Turnover analysed by class of business
Pole sales
11,222,476
13,382,208
2018
2017
£
£
Turnover analysed by geographical market
UK
11,222,476
13,382,208
4
Operating profit/(loss)
2018
2017
Operating profit/(loss) for the year is stated after charging/(crediting):
£
£
Exchange losses
177,481
169,374
Fees payable to the company's auditor for the audit of the company's financial statements
14,095
11,813
Depreciation of owned tangible fixed assets
209,917
241,021
Profit on disposal of tangible fixed assets
-
(4,750)
Amortisation of intangible assets
2
-
Cost of stocks recognised as an expense
8,863,189
11,253,368
Operating lease charges
18,446
6,870
Exchange differences recognised in profit or loss during the year, except for those arising on financial instruments measured at fair value through profit or loss, amounted to £177,481 (2017 - £169,374).
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2018
2017
Number
Number
Production
17
20
Management and administration
9
9
26
29
BURT BOULTON & HAYWOOD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
5
Employees
(Continued)
- 16 -
Their aggregate remuneration comprised:
2018
2017
£
£
Wages and salaries
1,028,279
855,734
Redundancy payments made or committed
16,947
30,243
Redundancy payments in the year include £
16,947
(201
7
: £
30,243
)
6
Interest payable and similar expenses
2018
2017
£
£
Interest on bank overdrafts and loans
-
1,856
Interest on finance leases and hire purchase contracts
-
790
Other interest
(301)
-
(301)
2,646
7
Taxation
2018
2017
£
£
Current tax
UK corporation tax on profits for the current period
91,389
(5,776)
Adjustments in respect of prior periods
1,800
90,783
Total current tax
93,189
85,007
Deferred tax
Origination and reversal of timing differences
32,904
-
Total tax charge
126,093
85,007
BURT BOULTON & HAYWOOD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
(Continued)
- 17 -
The actual charge for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:
2018
2017
£
£
Profit/(loss) before taxation
268,274
(53,560)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 19.00% (2017: 20.00%)
50,972
(10,712)
Tax effect of expenses that are not deductible in determining taxable profit
13,147
(10,654)
Adjustments in respect of prior years
-
85,007
Permanent capital allowances in excess of depreciation
29,070
21,366
Deferred tax adjustments in respect of prior years
32,904
-
Taxation charge for the year
126,093
85,007
8
Dividends
2018
2017
£
£
Final paid
500,000
800,000
The proposed final dividend for the year ended 31 December 2018 is:
2018
2017
Per share
Total
Total
£
£
£
Ordinary shares
0.20
100,000
500,000
BURT BOULTON & HAYWOOD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
- 18 -
9
Intangible fixed assets
Patents
£
Cost
At 1 January 2018 and 31 December 2018
2
Amortisation and impairment
At 1 January 2018
-
Amortisation charged for the year
2
At 31 December 2018
2
Carrying amount
At 31 December 2018
-
At 31 December 2017
2
10
Tangible fixed assets
Land and buildings Leasehold
Plant and machinery
Total
£
£
£
Cost
At 1 January 2018
377,000
3,377,365
3,754,365
Additions
-
9,610
9,610
At 31 December 2018
377,000
3,386,975
3,763,975
Depreciation and impairment
At 1 January 2018
275,254
2,765,555
3,040,809
Depreciation charged in the year
21,129
188,788
209,917
At 31 December 2018
296,383
2,954,343
3,250,726
Carrying amount
At 31 December 2018
80,617
432,632
513,249
At 31 December 2017
101,746
611,810
713,556
11
Stocks
2018
2017
£
£
Raw materials and consumables
3,360,057
2,616,419
Finished goods and goods for resale
184,027
37,183
3,544,084
2,653,602
BURT BOULTON & HAYWOOD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
- 19 -
12
Debtors
2018
2017
Amounts falling due within one year:
£
£
Trade debtors
271,740
261,255
Corporation tax recoverable
-
50,000
Amounts owed by group undertakings
-
1,331,690
Prepayments and accrued income
78,891
144,224
350,631
1,787,169
13
Creditors: amounts falling due within one year
2018
2017
Notes
£
£
Bank loans and overdrafts
14
-
3,673
Trade creditors
462,919
894,439
Amounts owed to group undertakings
549,517
24,082
Corporation tax
91,389
-
Other taxation and social security
429,529
591,736
Other creditors
12,705
8,022
Accruals and deferred income
130,362
480,836
1,676,421
2,002,788
14
Loans and overdrafts
2018
2017
£
£
Bank overdrafts
-
3,673
Payable within one year
-
3,673
The bank overdraft is unsecured.
15
Provisions for liabilities
2018
2017
Notes
£
£
160,071
110,071
Deferred tax liabilities
16
32,904
-
192,975
110,071
BURT BOULTON & HAYWOOD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
15
Provisions for liabilities
(Continued)
- 20 -
Movements on provisions apart from retirement benefits and deferred tax liabilities:
£
At 1 January 2018
110,071
Additional provisions in the year
50,000
At 31 December 2018
160,071
16
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2018
2017
Balances:
£
£
ACAs
32,904
-
2018
Movements in the year:
£
Liability at 1 January 2018
-
Charge to profit or loss
32,904
Liability at 31 December 2018
32,904
17
Share capital
2018
2017
£
£
Ordinary share capital
Issued and fully paid
2 Ordinary shares of £1 each
2
2
2
2
Preference share capital
Issued and fully paid
500,000 Preference shares of £1 each
500,000
500,000
500,000
500,000
BURT BOULTON & HAYWOOD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
17
Share capital
(Continued)
- 21 -
18
Profit and loss reserves
2018
2017
£
£
At the beginning of the year
2,636,264
3,574,831
Profit/(loss) for the year
142,181
(138,567)
Dividends declared and paid in the year
(500,000)
(800,000)
At the end of the year
2,278,445
2,636,264
BURT BOULTON & HAYWOOD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
- 22 -
19
Related party transactions
Transactions with related parties
During the year the company entered into the following transactions with related parties:
Sale of goods
Purchase of goods
2018
2017
2018
2017
£
£
£
£
Entities with control, joint control or significant influence over the company
8,485,696
9,061,847
3,953,073
4,653,304
8,485,696
9,061,847
3,953,073
4,653,304
Services provided
Services purchased
2018
2017
2018
2017
£
£
£
£
Entities with control, joint control or significant influence over the company
396,493
926,744
234,506
237,736
396,493
926,744
234,506
237,736
The following amounts were outstanding at the reporting end date:
Amounts owed to related parties
2018
2017
£
£
Entities with control, joint control or significant influence over the company
549,517
24,082
549,517
24,082
The following amounts were outstanding at the reporting end date:
Amounts owed by related parties
Amounts owed by related parties
2018
2017
Balance
Net
Balance
Net
£
£
£
£
Entities with control, joint control or significant influence over the company
-
-
1,331,690
1,331,690
-
-
1,331,690
1,331,690
BURT BOULTON & HAYWOOD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
19
Related party transactions
(Continued)
- 23 -
No guarantees have been given or received.
20
Operating lease commitments
Lessee
Operating lease payments represent rentals payable by the company for certain of its properties and for some vehicles. Leases are negotiated for an average term of 10 years and rentals are fixed for this period with an option to extend for a further 10 years at the prevailing market rate.
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:
2018
2017
£
£
Within one year
21,053
4,685
Between two and five years
1,069,939
11,210
In over five years
-
1,491,413
1,090,992
1,507,308
21
Controlling party
The ultimate parent company is Iivari Mononen Oy a company incorporated and trading in Finland.
The ultimate parent company Iivari Mononen Oy prepares accounts for the group. The registered office of the company is Rantakatu 25c, 80100 Joensuu, Finland.
BURT BOULTON & HAYWOOD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2018
- 24 -
22
Cash generated from operations
2018
2017
£
£
Profit/(loss) for the year after tax
142,181
(138,567)
Adjustments for:
Taxation charged
126,093
85,007
Finance costs
(301)
2,646
Gain on disposal of tangible fixed assets
-
(4,750)
Amortisation and impairment of intangible assets
2
-
Depreciation and impairment of tangible fixed assets
209,917
241,021
Increase/(decrease) in provisions
50,000
(55,075)
Movements in working capital:
(Increase) in stocks
(890,482)
(293,405)
Decrease in debtors
1,386,538
739,344
(Decrease)/increase in creditors
(414,083)
834,531
Cash generated from operations
609,865
1,410,752
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