J M LOVERIDGE LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Company Registration No. 06072278 (England and Wales)
J M LOVERIDGE LIMITED
CONTENTS
Page
Balance sheet
1
Statement of changes in equity
2
Notes to the financial statements
3 - 8
J M LOVERIDGE LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2020
31 December 2020
- 1 -
2020
2019
Notes
£
£
£
£
Current assets
Stocks
647,946
119,461
Debtors
5
1,329,994
1,243,465
Cash at bank and in hand
15,240
19,763
1,993,180
1,382,689
Creditors: amounts falling due within one year
6
(1,467,860)
(895,382)
Net current assets
525,320
487,307
Capital and reserves
Called up share capital
7
1,000
1,000
Profit and loss reserves
524,320
486,307
Total equity
525,320
487,307
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.
true
The notes referenced above form part of these financial statements.
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies' regime
and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements were approved by the board of directors and authorised for issue on 30 September 2021 and are signed on its behalf by:
Mr P Didlick
Director
Company Registration No. 06072278
J M LOVERIDGE LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2020
- 2 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2019
1,000
249,207
250,207
Year ended 31 December 2019:
Profit and total comprehensive income for the year
-
237,100
237,100
Balance at 31 December 2019
1,000
486,307
487,307
Year ended 31 December 2020:
Profit and total comprehensive income for the year
-
38,013
38,013
Balance at 31 December 2020
1,000
524,320
525,320
J M LOVERIDGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
- 3 -
1
Accounting policies
Company information
J M Loveridge Limited is a
private
company
limited by shares
incorporated in England and Wales.
The registered office is
Ayrton House, 38 Commerce Way, Parliament Business Park, Liverpool, L8 7BA.
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 as applicable to companies subject to the small companies regime. The disclosure requirements of Section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
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 £
1
.
The financial statements have been prepared under the historical cost convention.
The principal accounting policies adopted are set out below and have been consistently applied.
1.2
Going concern
As part of assessing the potential impact of the ongoing COVID-19 virus situation management has prepared revised financial forecasts for both this company and the broader OBG group. These forecasts indicate that the company will continue to trade profitably, and generate cash, over the period considered by them in their assessment of the appropriateness of adopting the going concern basis in the preparation of these financial statements. The revised forecasts also demonstrate that existing group banking facilities will remain adequate and that all associated banking covenants will be satisfactorily met.
true
Management has also considered the impact of potential operational challenges posed by COVID-19, including but not restricted to, an assessment of the robustness of their supply chain and broader logistics arrangements. Management has concluded that any operational pressures caused directly by the COVID-19 situation are unlikely to have a material impact on the company. On this basis the directors consider it appropriate to prepare these financial statements on a going concern basis.
1.3
Turnover
Turnover represents amounts receivable for goods and services net of VAT and trade discounts.
Turnover
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
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.
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:
Plant and Machinery
20% straight line
Computer equipment
25% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and
is credited or charged to profit or loss
.
J M LOVERIDGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
1
Accounting policies
(Continued)
- 4 -
1.5
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.
1.6
Cash and cash equivalents
Cash and cash equivalents
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.
1.7
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.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest
method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Financial assets classified as receivable within one year are not amortised.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from
fellow group companies and preference shares that are classified as debt, are
initially recognised at transaction price unless the arrangement constitutes a
financing transaction, where the debt instrument is measured at the present value of
the future
paymen
ts discounted at a market rate of interest.
Financial liabilities classified as payable within one year are not amortised.
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.
1.8
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.
1.9
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
J M LOVERIDGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
1
Accounting policies
(Continued)
- 5 -
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.
Deferred tax
Deferred taxation is provided in full in respect of taxation deferred by timing differences between the treatment of certain items for taxation and accounting purposes. The deferred tax balance has not been discounted.
1.10
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.11
Retirement benefits
The company operates a defined contribution scheme for the benefit of its employees. Contributions payable are charged to the profit and loss account in the year they are payable.
1.12
Government grants
Government grants are recognised at the fair value of the asset receive
d
or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met
. Where a
grant does not specify performance conditions
it
is recognised in income when the proceeds are received or receivable
. A grant received before the recognition criteria are satisfied is recognised as a liability.
1.13
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation
in the period
are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
J M LOVERIDGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
- 6 -
3
Employees
The average monthly number of persons employed by the company during the year was:
2020
2019
Number
Number
Total
15
15
4
Tangible fixed assets
Plant and machinery etc
£
Cost
At 1 January 2020 and 31 December 2020
8,299
Depreciation and impairment
At 1 January 2020 and 31 December 2020
8,299
Carrying amount
At 31 December 2020
At 31 December 2019
5
Debtors
2020
2019
Amounts falling due within one year:
£
£
Trade debtors
378,266
497,364
Amounts owed by group undertakings
694,091
453,404
Other debtors
244,103
277,483
Prepayments and accrued income
12,934
14,563
1,329,394
1,242,814
Deferred tax asset
600
651
1,329,994
1,243,465
J M LOVERIDGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
- 7 -
6
Creditors: amounts falling due within one year
2020
2019
£
£
Bank loans and overdrafts
136,036
280,474
Trade creditors
21,038
20,947
Amounts owed to group undertakings
1,249,469
244,979
Corporation tax
7,064
56,960
Other taxation and social security
5,354
5,311
Other creditors
48,899
286,711
1,467,860
895,382
Bank loans and overdrafts includes £136,036 (2019: £280,474) which are subject to an invoice discounting facility secured on trade debtors.
Bank loans and overdrafts drawn down from HSBC Bank plc are secured via a debenture including First Fixed Charge over book and other debts, chattels, goodwill and uncalled capital, both present and future; and First Floating Charge over all assets and undertaking both present and future.
7
Called up share capital
2020
2019
2020
2019
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
1,000
1,000
1,000
1,000
8
Audit report information
As the income statement has been omitted from the filing copy of the financial statements
,
the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006
:
The auditor's report was unqualified.
The senior statutory auditor was Iain White BSc FCA and the auditor was DSG.
J M LOVERIDGE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2020
- 8 -
9
Financial commitments, guarantees and contingent liabilities
The company is party to a multilateral guarantee in respect of amounts owed to HSBC Bank plc by OBG Holding Limited and its subsidiaries listed below:
OBG Pharmaceuticals Limited
Pharmasol Limited
Ayrton Saunders Limited
Ayrton Saunders and Company Limited
RBH Repacking Services Limited (previously called Hubron Repacking Services Limited)
OBG Scientific Division Limited
Pharmaserve (North West) Development Company Limited
Hubron Speciality Limited
Hubron (International) Limited
Pharmaserve (North West) Limited
Ransom Naturals Limited
Richard Baker Harrison Limited
OBG Holding Limited
10
Operating lease commitments
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
2020
2019
£
£
88,333
108,333
11
Related party transactions
There were no transactions during the year with related parties other than with group companies. The company is exempt from disclosing transactions with group companies that are wholly owned within the same group.
12
Parent company
The company is a wholly owned subsidiary of OBG
Scientific Division Limited and its
ultimate parent company
is
OBG Holding Limited. The
ultimate p
arent company, which prepares consolidated financial statements, is registered in England and Wales at Ayrton House, 38 Commerce Way, Parliament Business Park, Liverpool, L8 7BA. The parent company also has the same registered office as the ultimate parent company.
The smallest and largest group into which the results of this entity are consolidated is that headed by OBG Holding Limited.
The ultimate controlling party is Mr G O'Brien.