REGISTERED NUMBER:
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Strategic Report, Report of the Directors and |
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Financial Statements for the Year Ended 31 December 2020 |
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George East (Housewares) Limited |
REGISTERED NUMBER:
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Strategic Report, Report of the Directors and |
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Financial Statements for the Year Ended 31 December 2020 |
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for |
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George East (Housewares) Limited |
George East (Housewares) Limited (Registered number: 03765504) |
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Contents of the Financial Statements |
for the Year Ended 31 December 2020 |
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Page |
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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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George East (Housewares) Limited |
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Company Information |
for the Year Ended 31 December 2020 |
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DIRECTORS: |
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REGISTERED OFFICE: |
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REGISTERED NUMBER: |
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AUDITORS: |
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Chartered Certified Accountants |
Statutory Auditors |
Meriden House |
6 Great Cornbow |
Halesowen |
West Midlands |
B63 3AB |
George East (Housewares) Limited (Registered number: 03765504) |
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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 |
Throughout 2020 we saw the effect of uncertainty of Brexit, the rapidly escalating cost of freight and the volatility of sterling against our two principal currencies; the US$ and €, which continues to put pressure on margins some of which will be recoupable through increased prices to the customer. |
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The UK grocery sector saw significant positive impact from Brexit being one of the core retail sectors that benefitted from the Covid 19 lockdowns and increased necessity to cook at home. |
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Our group has a stable of strong brands and 2020 saw both our Cleaning and Petcare divisions gain real traction in the UK market. The development and extension of group brands from our European portfolio remains a cornerstone of UK growth strategy. |
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The company is performing better than most competitors within our sector, showing sales growth with key customers across all areas including independents, national accounts and particularly online business. |
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The business continues with a positive balance sheet position, and liquidity, allowing the business to be able to meet its current obligations as they fall due. |
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PRINCIPAL RISKS AND UNCERTAINTIES |
Brexit |
Whilst the announcement of Brexit deal has reduced the uncertainty surrounding tariffs and import duties, it has increased delivery times and freight costs, at least in the short term. The business continues to monitor these areas to mitigate any potential risks and capitalise on any opportunity |
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Reliance on key customers |
Whilst the company engages with a wide range of customers, the company remains alert to the risk of reliance on key large customers and monitors this on an ongoing basis. |
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Foreign currency volatility |
As much of our product is imported, we are vulnerable to significant currency fluctuations, and the company uses forward exchange contracts to minimise the risk. |
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KEY PERFORMANCE INDICATORS |
The Directors consider the key performance indicators of the company to be: |
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(i) EBITDA for the financial year was £1,493,272 versus a prior year of £219,575, reflecting the growth in the business during the year. |
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(ii) A current ratio of 1.39 (2019: 1.31), being the ratio of current assets to current liabilities. Management consider this to be a positive indicator of the ability of the business to meet its short term obligations. |
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ON BEHALF OF THE BOARD: |
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George East (Housewares) Limited (Registered number: 03765504) |
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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 importation, marketing and sale of household, beauty and pet products. |
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DIVIDENDS |
There were no dividends paid or proposed during the year (2019: £Nil). |
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FUTURE DEVELOPMENTS |
The company continues to enhance its product range; with an increased focus on establishing select Nedac Sorbo Group brands in the UK market. |
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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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FINANCIAL INSTRUMENTS |
Objectives and policies |
The Company's operations expose it to a variety of financial risks that include credit risk, liquidity risk, cash flow risk and foreign exchange risk (as referred to above). Given the size of the Company, the directors have not delegated the responsibility of monitoring financial risk management to a sub-committee board. The policies set by the board of directors are implemented by the Company's finance department. |
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Liquidity and cash flow risk |
The Company manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring it has sufficient liquid resources to meet the operating needs of the business. The Company also has access to short-term inter-company financing when required. |
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The company is exposed to fair value interest rate risk on its fixed rate borrowings and cash flow interest rate risk on bank overdrafts and loans. |
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Credit risk |
Investments of cash surpluses and borrowings are made through banks and institutions which must fulfil credit rating criteria approved by the Board. All customers who wish to trade on credit terms are subject to credit verification procedures and we utilise credit insurance to minimise any risk. Trade debtors are reviewed on a regular basis and provision is made for doubtful debts when necessary. |
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Foreign exchange risk |
The Company is exposed to currency risk on purchases, sales and borrowings that are denominated in a currency other than the respective functional currency which is in pound sterling. The company's balance sheet is exposed to movement in GBP/US$ and GBP/EUR. The company uses forward exchange contracts on their main purchases in US$ to minimise the risk. |
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George East (Housewares) Limited (Registered number: 03765504) |
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Report of the Directors |
for the Year Ended 31 December 2020 |
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QUALIFYING THIRD-PARTY INDEMNITY PROVISION |
A qualifying third-party indemnity provision as defined in section 234 of the Companies Act 2006 was in force throughout the financial year and to the date of signing for the benefit of each of the directors in respect of liabilities incurred as a result of their office, to the extent permitted by law. In respect of those liabilities for which directors may not be indemnified, the company maintained a directors' and officers' liability insurance policy throughout the financial year and up to the date of signing the financial statements. |
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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. |
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ON BEHALF OF THE BOARD: |
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Report of the Independent Auditors to the Members of |
George East (Housewares) Limited |
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Opinion |
We have audited the financial statements of George East (Housewares) 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. |
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Report of the Independent Auditors to the Members of |
George East (Housewares) 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 four, 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. |
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Report of the Independent Auditors to the Members of |
George East (Housewares) 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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Based on our understanding of the company and the industry in which it operates, we identified principal risks of non-compliance with laws and regulations related to breaches of the Sale of Goods Act 1979 and employment laws, and we considered the extent to which non-compliance might have a material effect on the financial statements. Additionally, we considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006. |
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We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined the principal risks related to posting journal entries to manipulate financial performance, of management bias through judgements and assumptions in significant accounting estimates and significant one-off or unusual transactions. Audit procedures performed by the engagement team included: |
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- Discussions with management and those charged with governance including consideration of known or suspected instances of non-compliance with laws and regulations and fraud; |
- Evaluation and testing of the operating effectiveness of management's entity level controls designed to prevent and detect irregularities; |
- Performing testing on month-end adjustments; |
- Incorporating unpredictability into the nature, timing and/or extent of our testing; |
- Challenging assumptions and judgements made by management in their significant accounting estimates; |
- Identifying and testing journal entries, in particular any journal entries posted by infrequent users or senior management or posted with descriptions indicating a higher level of risk. |
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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. |
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Report of the Independent Auditors to the Members of |
George East (Housewares) 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 Certified Accountants |
Statutory Auditors |
Meriden House |
6 Great Cornbow |
Halesowen |
West Midlands |
B63 3AB |
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George East (Housewares) Limited (Registered number: 03765504) |
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Statement of Comprehensive Income |
for the Year Ended 31 December 2020 |
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2020 | 2019 |
Notes | £ | £ |
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REVENUE | 3 |
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Cost of sales |
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GROSS PROFIT |
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Distribution costs | ( |
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Administrative expenses | ( |
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1,187,583 | (49,726 | ) |
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Other operating income |
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1,303,276 | (17,856 | ) |
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Interest receivable and similar income |
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1,303,276 | (16,728 | ) |
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Interest payable and similar expenses | 6 | ( |
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PROFIT/(LOSS) BEFORE TAXATION | 7 |
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Tax on profit/(loss) | 8 | ( |
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PROFIT/(LOSS) FOR THE FINANCIAL
YEAR |
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OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR |
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George East (Housewares) Limited (Registered number: 03765504) |
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Statement of Financial Position |
31 December 2020 |
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2020 | 2019 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 9 |
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Property, plant and equipment | 10 |
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CURRENT ASSETS |
Inventories | 11 |
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Debtors | 12 |
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Cash at bank and in hand |
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CREDITORS |
Amounts falling due within one year | 13 |
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NET CURRENT ASSETS |
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TOTAL ASSETS LESS CURRENT
LIABILITIES |
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PROVISIONS FOR LIABILITIES | 17 |
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NET ASSETS |
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CAPITAL AND RESERVES |
Called up share capital | 18 |
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Share premium | 19 |
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Capital redemption reserve | 19 |
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Retained earnings | 19 |
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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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George East (Housewares) Limited (Registered number: 03765504) |
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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 |
£ | £ | £ | £ | £ |
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Balance at 1 January 2019 |
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Changes in equity |
Total comprehensive income | - | ( |
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Balance at 31 December 2019 |
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Changes in equity |
Total comprehensive income | - |
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Balance at 31 December 2020 |
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George East (Housewares) Limited (Registered number: 03765504) |
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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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George East (Housewares) Limited is a
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2. | ACCOUNTING POLICIES |
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Basis of preparing the financial statements |
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The financial statements are presented in pound sterling, which is the functional currency of the business, and rounded to the nearest £. |
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Going concern |
The company has received confirmation from Nedac Sorbo B.V, the company's parent company, that financial support will be provided for a period of twelve months from the date of approval of these financial statements such as to enable the company to meet its obligations as they fall due. |
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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 33.7. |
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Significant judgements and estimates |
The preparation of the financial statements in conformity with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise its own judgement in the process of applying the company's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed further below. |
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Critical accounting judgements and estimation uncertainty |
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. |
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Critical accounting estimates and assumptions |
The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial period are addressed below: |
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Useful economic lives of tangible assets |
The annual depreciation charge for tangible assets is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary to reflect current estimates, based on technological advancement, future investments, economic utilisation and the physical condition of the assets. |
George East (Housewares) Limited (Registered number: 03765504) |
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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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Turnover |
Revenue is measured at the fair value of consideration received or receivable and represents the amount receivable for goods supplied or services rendered, net of returns, discounts and rebates allowed by the company and value added taxes. |
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The company recognises revenue when (a) 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 revenue can be measured reliably; (d) it is probable that future economic benefits will flow to the entity and (e) when the specific criteria relating to each of the company's sales channels have been met as described below. |
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The company buys and sells a range of household, beauty and pet products in the wholesale market. Sales of goods are recognised on delivery to the wholesaler, when the wholesaler has full discretion over the channel and price to sell the product and there is no unfulfilled obligation that could affect the wholesaler's acceptance of the product. Delivery occurs when the goods have been shipped to the location specified by the wholesaler, the risks of obsolescence or loss have been transferred to the wholesaler, the wholesaler has accepted the products in accordance with the sales contract, the acceptance provisions have lapsed or the company has objective evidence that all criteria for acceptance has been satisfied. |
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Goods sold to wholesalers are often sold with volume rebates and also with the provision for the wholesale customer to return faulty goods. Sales are measured at the prices specified in the sale contract, net of estimated volume rebates and returns. Volume rebates are assessment based on anticipated annual purchases. Accumulated experience is used to estimate and provide for the discounts and returns. |
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Sales are normally made with a credit term of 60 days. The element of financing is deemed immaterial and is disregarded in the measurement of revenue. Provision is made for credit notes based on expected levels of returns which is based on the historical experience of returns. |
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Goodwill |
Goodwill arising on an acquisition of a business is carried out at cost less accumulated amortisation and impairment losses, if any. For the purposes of impairment testing, goodwill is allocated to each of the company's cash-generating units (or groups of cash-generating units) that is expected to benefit from synergies of the combination. |
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If there is an indication that there has been a significant change in amortisation rate or residual value of an asset, the amortisation of that asset is revised prospectively to reflect the new expectations. |
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If the net fair value of the identifiable assets and liabilities acquired exceeds the cost of a business combination, the excess of the fair value of non-monetary assets acquired is recognised in profit or loss in the periods in which non-monetary assets are recovered. Any excess exceeding the fair value of non-monetary assets acquired is recognised in profit or loss in the periods expected to be benefited. |
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Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over the useful economic life of the brands concerned by the director as follows. |
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Goodwill - 10% straight line |
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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. |
George East (Housewares) Limited (Registered number: 03765504) |
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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 |
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. |
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The Company adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when the cost is incurred, if the replacement part is expected to provide incremental future benefits to the Company. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred. |
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Depreciation is charged so as to allocate the cost of the assets less their residual value over their estimated useful lives. |
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Depreciation is provided on the following basis: |
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Freehold property | - | 0% - 2% | on cost |
Plant and machinery | - | 25% | on cost |
Fixtures and fittings | - | 16.7% | on cost |
Motor vehicles | - | 25% | on cost |
Computer equipment | - | 10% - 33% | on cost |
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The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date. |
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Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Income Statement. |
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During the previous financial year the company changed the rate of deprecation from 2% to 0% in relation to the land element held in freehold property in line with the group accounting policy. |
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Stocks |
Inventories are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items. |
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Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
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Current or deferred taxation assets and liabilities are not discounted. |
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Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date. |
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George East (Housewares) Limited (Registered number: 03765504) |
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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 is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date. |
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Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
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Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
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Foreign currencies |
Foreign currencies 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 at fair value are measured using the exchange rate when fair value was determined. |
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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 profit and loss account except where deferred in other comprehensive income as qualifying cash flow hedges. |
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Foreign exchange gains and losses that relate to borrowings are presented in the profit and loss account. |
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Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
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Annual bonus plan |
The company operates an annual bonus plan for employees. An expense is recognised in the profit and loss account when the company has a legal or constructive obligation to make payments under the plan as a result of past events and reliable estimate of the obligation can be made. |
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3. | REVENUE |
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The revenue and profit (2019 - loss) before taxation are attributable to the one principal activity of the company. |
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An analysis of revenue by geographical market is given below: |
|
2020 | 2019 |
£ | £ |
United Kingdom |
|
|
Europe |
|
|
Rest of the world | 409,447 | 439,472 |
|
|
George East (Housewares) Limited (Registered number: 03765504) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
4. | EMPLOYEES AND DIRECTORS |
2020 | 2019 |
£ | £ |
Wages and salaries |
|
|
Social security costs |
|
|
Other pension costs |
|
|
|
|
|
The average number of employees during the year was as follows: |
2020 | 2019 |
|
Distribution | 29 | 28 |
Administration and support | 31 | 31 |
Management | 1 | 1 |
Other | 4 | 2 |
|
|
|
2020 | 2019 |
£ | £ |
Directors' remuneration |
|
|
Directors' pension contributions to money purchase schemes |
|
|
|
Information regarding the highest paid director for the year ended 31 December 2020 is as follows: |
2020 |
£ |
Emoluments etc |
|
Pension contributions to money purchase schemes |
|
|
5. | EXCEPTIONAL ITEMS |
|
2020 | 2019 |
£ | £ |
Depreciation policy change | 127,630 |
Non recurring costs | (122,813 | ) |
- | 4,817 |
|
|
The exceptional items of £4,817 in the previous year are made up of non recurring costs of £122,813 that consist of a one-off cost in relation to establishing group projects, shareholding restructure and the launch of a new social media presence. There is a credit of £127,630 relating to an adjustment to the depreciation of land to bring the business in line with the group accounting policy, |
George East (Housewares) Limited (Registered number: 03765504) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
6. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2020 | 2019 |
£ | £ |
Bank interest |
|
|
Asset based finance interest |
|
|
(Gain) / loss on derivatives |
|
|
|
|
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7. | PROFIT/(LOSS) BEFORE TAXATION |
|
The profit (2019 - loss) is stated after charging/(crediting): |
|
2020 | 2019 |
£ | £ |
Depreciation - owned assets |
|
|
Profit on disposal of fixed assets | ( |
) |
|
Goodwill amortisation |
|
|
Auditors' remuneration |
|
|
Impairment of trade receivables |
|
|
Foreign exchange losses / (gains) | ( |
) | ( |
) |
|
8. | TAXATION |
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Analysis of the tax charge/(credit) |
The tax charge/(credit) on the profit for the year was as follows: |
2020 | 2019 |
£ | £ |
Current tax: |
UK corporation tax |
|
|
|
Deferred tax |
|
( |
) |
Tax on profit/(loss) |
|
( |
) |
George East (Housewares) Limited (Registered number: 03765504) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
8. | TAXATION - continued |
|
Reconciliation of total tax charge/(credit) included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
|
2020 | 2019 |
£ | £ |
Profit/(loss) before tax |
|
( |
) |
Profit/(loss) 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 |
|
|
Utilisation of tax losses | ( |
) |
|
Movement in deferred tax |
|
( |
) |
Total tax charge/(credit) | 220,984 | (72,681 | ) |
|
9. | INTANGIBLE FIXED ASSETS |
Goodwill |
£ |
COST |
At 1 January 2020 |
and 31 December 2020 |
|
AMORTISATION |
At 1 January 2020 |
|
Amortisation for year |
|
At 31 December 2020 |
|
NET BOOK VALUE |
At 31 December 2020 |
|
At 31 December 2019 |
|
|
Goodwill relates to the purchase of Manicare and O Elliotts divisions, which were acquired to expand sales of these products. The useful economic life remaining on goodwill is 3 years with a carrying value of £31,202 and £58,386 respectively. |
|
Amortisation expense for the current and prior year is included in administrative expenses. |
George East (Housewares) Limited (Registered number: 03765504) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
10. | PROPERTY, PLANT AND EQUIPMENT |
Fixtures |
Freehold | Plant and | and |
property | machinery | fittings |
£ | £ | £ |
COST |
At 1 January 2020 |
|
|
|
Additions |
|
|
|
Disposals |
|
|
|
At 31 December 2020 |
|
|
|
DEPRECIATION |
At 1 January 2020 |
|
|
|
Charge for year |
|
|
|
Eliminated on disposal |
|
|
|
At 31 December 2020 |
|
|
|
NET BOOK VALUE |
At 31 December 2020 |
|
|
|
At 31 December 2019 |
|
|
|
|
Motor | Computer |
vehicles | equipment | Totals |
£ | £ | £ |
COST |
At 1 January 2020 |
|
|
|
Additions |
|
|
|
Disposals | ( |
) |
|
( |
) |
At 31 December 2020 |
|
|
|
DEPRECIATION |
At 1 January 2020 |
|
|
|
Charge for year |
|
|
|
Eliminated on disposal | ( |
) |
|
( |
) |
At 31 December 2020 |
|
|
|
NET BOOK VALUE |
At 31 December 2020 |
|
|
|
At 31 December 2019 |
|
|
|
|
11. | INVENTORIES |
2020 | 2019 |
£ | £ |
Finished goods |
|
|
George East (Housewares) Limited (Registered number: 03765504) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
12. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2020 | 2019 |
£ | £ |
Trade debtors |
|
|
Amounts owed by group undertakings |
|
|
Other debtors |
|
|
Tax |
|
|
Deferred tax asset |
|
|
Prepayments |
|
|
|
|
|
Amounts owed by group undertakings do not bear interest and are repayable on demand. |
|
13. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2020 | 2019 |
£ | £ |
Trade creditors |
|
|
Corporation tax |
|
|
Social security and other taxes |
|
|
Forward exchange contracts | 207,698 | 94,959 |
Amounts due to invoice discounter | 2,114,195 | 2,116,570 |
Accruals and deferred income |
|
|
|
|
|
14. | LEASING AGREEMENTS |
|
Minimum lease payments under non-cancellable operating leases fall due as follows: |
2020 | 2019 |
£ | £ |
Within one year |
|
|
Between one and five years |
|
|
In more than five years |
|
|
|
|
|
The amount of non-cancellable operating lease payments recognised as an expense during the year was £272,884 (2019 : £262,636) |
|
15. | SECURED DEBTS |
|
On 12 June 2018 a charge over the freehold property was made in favour of Deutsche Bank AG was lodged with Companies House. |
|
A second fixed and floating charge dated 1 October 2019 in favour of ABN Amro Bank N.V. was registered with Companies House. |
George East (Housewares) Limited (Registered number: 03765504) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
16. | FINANCIAL INSTRUMENTS |
|
Financial (liabilities) / assets at fair value through profit and loss |
2020 | 2019 |
£ | £ |
Forward exchange contracts | (207,698 | ) | (94,959 | ) |
|
|
2020 | 2019 |
Note | £ | £ |
Financial assets that are debt instruments measured at amortised cost: |
Trade debtors | 12 | 4,703,549 | 2,779,649 |
Amounts owed by group undertakings | 12 | 2,224 | 721 |
Other debtors | 12 | 7,150 | 7,650 |
4,712,923 | 2,788,020 |
|
Financial liabilities measured at amortised cost: |
Trade creditors | 13 | 2,915,714 | 2,069,028 |
2,915,714 | 2,069,028 |
|
Derivative financial instruments |
The company enters into forward foreign currency contracts to mitigate the exchange rate risk for certain foreign currency payables. At 31 December 2020, the outstanding contracts all matured within 12 months (2019: 11 months) of the year end. The company is committed to buy US $6,200,000 (2019: $2,880,000) and pay a fixed sterling amount. |
|
The forward currency contracts are measured at fair value, which is determined using valuation techniques that utilise observable inputs. The key assumptions used in valuing the derivatives are the forward exchange rates for GBP:USD. |
|
The fair value is £207,698 liability - (2019 £94,959 liability) and the change in value included in profit or loss is £112,739 loss (2019; £204,141loss). |
|
17. | PROVISIONS FOR LIABILITIES |
2020 |
£ |
Deferred tax | 40,964 |
|
Deferred |
tax |
£ |
Balance at 1 January 2020 | ( |
) |
Movement | 153,113 |
Balance at 31 December 2020 |
|
George East (Housewares) Limited (Registered number: 03765504) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
17. | PROVISIONS FOR LIABILITIES - continued |
|
A deferred tax liability has arisen as a result of timing differences between depreciation and capital allowance claims on assets. |
|
18. | CALLED UP SHARE CAPITAL |
|
|
|
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2020 | 2019 |
value: | £ | £ |
|
Ordinary | 1 | 344,679 | 344,679 |
|
Ordinary B | 1 | 18,141 | 18,141 |
362,820 | 362,820 |
|
Rights, preferences and restrictions |
Ordinary shares and Ordinary B shares have the following rights, preferences and restrictions: |
The holders of Ordinary shares and Ordinary B shares are entitled to receive dividends as declared from time to time and are entitled to on vote per share at meetings of the company. All Ordinary shares and Ordinary B shares rank equally with regard to the company's residual assets. |
|
19. | RESERVES |
Capital |
Retained | Share | redemption |
earnings | premium | reserve | Totals |
£ | £ | £ | £ |
|
At 1 January 2020 |
|
|
|
3,279,740 |
Profit for the year |
|
|
At 31 December 2020 |
|
|
|
4,158,337 |
|
20. | PENSION COMMITMENTS |
|
The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £101,950 (2019: £93,723). |
|
21. | CONTINGENT LIABILITIES |
|
The company has given a guarantee of £75,000 (2019: £75,000) to HM Revenue & Customs. |
George East (Housewares) Limited (Registered number: 03765504) |
|
|
Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
|
22. | DIRECTORS' ADVANCES, CREDITS AND GUARANTEES |
|
The following advances and credits to a director subsisted during the years ended 31 December 2020 and 31 December 2019: |
|
2020 | 2019 |
£ | £ |
|
Balance outstanding at start of year |
|
|
Amounts advanced |
|
|
Amounts repaid |
|
( |
) |
Amounts written off | - | - |
Amounts waived | - | - |
Balance outstanding at end of year |
|
|
|
23. | 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. |
|
24. | POST BALANCE SHEET EVENTS |
|
On 5 January 2021 the UK Government announced a further national lockdown in order to stem the spread of the Covid-19 virus.The restrictions in place are due to be phased out with all restrictions lifted by 21 June 2021, subject to continued progress against the virus. |
The company has been able to continue operations during the period of lockdown and so the impact on the results of the company is not expected to be significant. |
|
25. | ULTIMATE CONTROLLING PARTY |
|
The company's immediate parent company is Nedac Sorbo B.V. incorporated in the Netherlands. |
|
The ultimate parent company is Nexus Newco B.V. incorporated in the Netherlands. |
|
The largest group to consolidate these financial statements is Nexus Newco B.V. The smallest group to consolidate these financial statements is Nedac Sorbo Mascot B.V. |
|
The financial statements of the group are available upon request from the Dutch Registrar on payment of the appropriate fee. |
|
The ultimate controlling party is not any individual party. |