Thameswey Energy Limited - Limited company accounts 18.2

REGISTERED NUMBER: 03772150 (England and Wales)

DIRECTORS' REPORT AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2018

FOR

THAMESWEY ENERGY LIMITED

Page

Company Information

1

Directors' Report

2

Statement of Directors' Responsibilities

3

Independent Auditor's Report

4

Income Statement

7

Other Comprehensive Income

8

Balance Sheet

9

Statement of Changes in Equity

10

Cash Flow Statement

11

Notes to the Financial Statements

12

DIRECTORS:

D J Spinks

W Prescott

Dr B M Maunders

P N Bryant

SECRETARY:

Clyde Secretaries Limited

REGISTERED OFFICE:

The St Botolph Building

138 Houndsditch

London

EC3A 7AR

REGISTERED NUMBER:

03772150 (England and Wales)

AUDITOR:

Hamlyns LLP

Statutory Auditor and

Chartered Accountants

Sundial House

High Street

Horsell

Woking

Surrey

GU21 4SU

BANKERS:

National Westminster Bank Plc

PO Box 358

1 High Street

Woking

Surrey

GU21 1ZS

SOLICITORS:

Clyde & Co LLP

The St Botolph Building

138 Hounsditch

London

EC3A 7AR

The directors present their report with the financial statements of the company for the year ended 31 December 2018.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of building, financing and operating combined heat and

power plant and photovoltaic plant for the production and supply of electricity, heat and chilled water.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2018 to the date of this report.

D J Spinks

W Prescott

Dr B M Maunders

P N Bryant

Other changes in directors holding office are as follows:

R J Kingsbury - resigned 8 May 2018

STATEMENT AS TO DISCLOSURE OF INFORMATION TO THE AUDITOR

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 auditor is 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 auditor is aware of that

information.

This report has been prepared in accordance with the provisions of Part 15 of the Companies Act 2006 relating to small

companies.

ON BEHALF OF THE BOARD:

Dr B M Maunders - Director

31 July 2019

The directors are responsible for preparing the Directors' 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;

-	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.

Opinion

We have audited the financial statements of Thameswey Energy Limited (the 'company') for the year ended 31 December 2018

which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash

Flow Statement 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).

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 loss 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.

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 Auditor 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.

Other information

The directors are responsible for the other information. The other information comprises the information in the Directors'

Report and the Statement of Directors' Responsibilities, but does not include 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 the audit:

-	the information given in the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Directors' Report has been prepared in accordance with applicable legal requirements.

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 Directors' Report.

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; or

-	the directors were not entitled to take advantage of the small companies' exemption from the requirement to prepare a Strategic Report or in preparing the Directors' Report.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities, 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.

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.

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 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 www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditor's Report.

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 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.

David Cooper (Senior Statutory Auditor)

for and on behalf of Hamlyns LLP

Statutory Auditor and

Chartered Accountants

Sundial House

High Street

Horsell

Woking

Surrey

GU21 4SU

31 July 2019

Note:

The maintenance and integrity of the Thameswey Energy Limited website is the responsibility of the directors; the work carried out by the auditor does not involve consideration of these matters and, accordingly, the auditor accepts no responsibility for any changes that may have occurred to the financial statements since they were initially presented on the website.

TURNOVER

4,440,833

3,845,753

Cost of sales

2,899,222

2,083,703

GROSS PROFIT

1,541,611

1,762,050

Administrative expenses

1,226,730

1,316,893

314,881

445,157

Other operating income

40,544

36,281

OPERATING PROFIT

6

355,425

481,438

Interest receivable and similar income

13,622

6,381

369,047

487,819

Interest payable and similar expenses

7

769,956

780,195

LOSS BEFORE TAXATION

(400,909

)

(292,376

)

Tax on loss

8

2,588

1,228

LOSS FOR THE FINANCIAL YEAR

(403,497

)

(293,604

)

LOSS FOR THE YEAR

(403,497

)

(293,604

)

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(403,497

)

(293,604

)

FIXED ASSETS

Tangible assets

9

12,730,155

13,049,351

Investments

10

1,110,000

1,110,000

13,840,155

14,159,351

CURRENT ASSETS

Stocks

11

35,926

37,182

Debtors

12

1,217,476

1,828,051

Cash at bank

910,585

1,092,563

2,163,987

2,957,796

CREDITORS

Amounts falling due within one year

13

2,008,964

1,201,274

NET CURRENT ASSETS

155,023

1,756,522

TOTAL ASSETS LESS CURRENT LIABILITIES

13,995,178

15,915,873

CREDITORS

Amounts falling due after more than one year

14

(12,681,387

)

(14,349,843

)

ACCRUALS AND DEFERRED INCOME

16

(834,475

)

(683,217

)

NET ASSETS

479,316

882,813

CAPITAL AND RESERVES

Called up share capital

17

5,050,450

5,050,450

Retained earnings

18

(4,571,134

)

(4,167,637

)

SHAREHOLDERS' FUNDS

479,316

882,813

The financial statements were approved by the Board of Directors on 31 July 2019 and were signed on its behalf by:

D J Spinks - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2017

5,050,450

(3,874,033

)

1,176,417

Changes in equity

Total comprehensive income

-

(293,604

)

(293,604

)

Balance at 31 December 2017

5,050,450

(4,167,637

)

882,813

Changes in equity

Total comprehensive income

-

(403,497

)

(403,497

)

Balance at 31 December 2018

5,050,450

(4,571,134

)

479,316

Cash flows from operating activities

Cash generated from operations

21

1,462,131

287,483

Interest paid

(769,956

)

(780,195

)

Net cash from operating activities

692,175

(492,712

)

Cash flows from investing activities

Purchase of tangible fixed assets

(572,685

)

(947,488

)

Interest received

13,622

6,381

Net cash from investing activities

(559,063

)

(941,107

)

Cash flows from financing activities

New loans in year

-

1,000,000

Loan repayments in year

(506,892

)

(477,671

)

Contribution from other bodies

191,802

-

Net cash from financing activities

(315,090

)

522,329

Decrease in cash and cash equivalents

(181,978

)

(911,490

)

Cash and cash equivalents at beginning of year

22

1,092,563

2,004,053

Cash and cash equivalents at end of year

22

910,585

1,092,563

1.	STATUTORY INFORMATION

Thameswey Energy Limited is a private company, limited by shares , registered in England and Wales. The company's

registered number and registered office address can be found on the Company Information page.

The presentation currency of the financial statements is the Pound Sterling (£).

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial

Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial

statements have been prepared under the historical cost convention.

Going concern

The going concern basis adopted for preparing the financial statements is contingent upon the continued financial

support of the company's ultimate parent undertaking.

The directors agree and recommend for approval by Woking Borough Council a business plan each year with financial

projections which demonstrate that the company can repay its loans and give a return on the investment. The plan is

then presented to the Council's Executive and the full Council for approval. Woking Borough Council members

adopted the business plan covering the period 2019 to 2022 with an estimated return to profit in 2025. The principal

investment return to Woking Borough Council will be achieved via loan margins.

Assurances have been obtained from the ultimate parent undertaking that continued financial support will be made

available, as required, to ensure that liabilities can be met as they fall due and that the company has adequate funds to

continue trading.

For these reasons the directors believe that it is appropriate to prepare the accounts on a going concern basis.

Preparation of consolidated financial statements

The financial statements contain information about Thameswey Energy Limited as an individual company and do not

contain consolidated financial information as the parent of a group. The company is exempt under Section 400 of the

Companies Act 2006 from the requirements to prepare consolidated financial statements as it and its subsidiary

undertaking are included by full consolidation in the consolidated financial statements of its parent, Thameswey

Limited, .

Turnover

Turnover includes the sales value of units of energy supplied to domestic and commercial customers. Energy supplied

includes sustainable electricity, gas, heating, cooling as well as surplus energy units supplied to the grid through the

Feed in Tariff.

Turnover relating to the sales value of units of energy is recognised at the time at which energy is supplied, this is based

on periodic meter readings and includes estimates of the value of units supplied to customers between the date of the

last meter reading and the year end.

Turnover also includes the sales value of service charges relating to the maintenance and supply of energy meters.

Turnover relating to the sales value of service charges is recognised at the point at which the service is performed.

All turnover is stated net of VATand discounts.

Tangible fixed assets

The company's tangible fixed assets are stated at cost and generally depreciated on a straight-line basis over the

estimated operational lives of the assets. Borrowing costs directly attributable to the acquisition, construction or

production of tangible fixed assets are added to the cost of those assets when incurred, until such time as the assets are

substantially ready for their intended use at which time capitalisation ceases. Reviews are undertaken annually of the

estimated remaining lives and residual values of property, plant and equipment.

The main depreciation periods used by the company are set out below:

Buildings - Straight line over 60 years

Plant and machinery - Straight line over 15 to 60 years

Assets under construction are not depreciated until ready for use.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow

moving items.

Cost is defined as the average cost of stock items, and includes all purchase, transport and handling costs in bringing

stock to its present location and condition.

Financial instruments

Financial instruments are accounted for according to the substance of the contractual arrangements as either financial

assets, financial liabilities or equity instruments, rather than their legal form.

The company only has basic financial instruments.

Financial assets are initially measured at transaction price and subsequently held at cost, less any impairment.

Financial liabilities are measured initially at transaction price and subsequently at amortised cost.

An equity instrument is any contract that evidences a residual interest in the net assets of the company.

Finance costs are charged to the profit and loss over the term of the debt using the effective interest rate method so that

the amount charged is at a constant rate on the carrying amount.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the

extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

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 balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet

date.

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.

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.

Grants

Grants relating to fixed assets are treated as deferred income and released to the profit and loss account over the

expected useful life of the asset concerned. Other grants are credited to the profit and loss account as the related

expenditure is incurred.

Investments

Fixed asset investments consists wholly of investments in subsidiaries.

Investments in subsidiaries are valued at cost less any provisions for any impairment.

Impairment reviews of fixed asset investments are carried out annually by the board.

3.	CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In preparing the accounts, the company is required to make estimates and assumptions that impact on the reported

amounts of revenues, expenses, assets and liabilities of the company. Actual results may differ from these estimates.

Estimates and judgements pertinent to the company are included below. This critical accounting judgement and key

source of estimation uncertainty should be read in conjunction with the full statement of Accounting Policies at Note 2.

Revenue

The nature of the energy industry in which the company operates is such that the company's revenue recognition is

subject to a degree of estimation. The assessment of energy sales to customers is based on meter readings, which are

carried out on a systematic basis throughout the year. Whereby a meter reading is not undertaken before the year end an

estimate of the value of units supplied to customers between the date of the last meter reading and the period end is

recorded in revenue.

Unbilled revenue is included within accrued income in the balance sheet. At 31 December 2018 this amounted to

£366,999 (2017: £167,685)

4.	EMPLOYEES AND DIRECTORS

There were no staff or employees directly employed by the company for the year ended 31 December 2018 or for the

year ended 31 December 2017. The independent directors are remunerated by parent undertakings for the current and

preceding financial years. Staff costs are reallocated from parent undertakings.

5.	DIRECTORS' EMOLUMENTS

2018

2017

£

£

Directors' remuneration

9,305

9,316

Directors remuneration relates to fees paid to the independent non-executive directors.

6.	OPERATING PROFIT

The operating profit is stated after charging:

2018

2017

£

£

Depreciation - owned assets

878,616

880,890

Loss on disposal of fixed assets

13,265

-

Auditors' remuneration

8,828

5,770

7.

INTEREST PAYABLE AND SIMILAR EXPENSES

2018

2017

£

£

Other interest

769,956

780,195

8.

TAXATION

Analysis of the tax charge

The tax charge on the loss for the year was as follows:

2018

2017

£

£

Current tax:

UK corporation tax

2,588

1,228

Tax on loss

2,588

1,228

Reconciliation of total tax charge 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:

2018

2017

£

£

Loss before tax

(400,909

)

(292,376

)

Loss multiplied by the standard rate of corporation tax in the UK of 19% (2017 - 19.250%)

(76,173

)

(56,282

)

Effects of:

Expenses not deductible for tax purposes

2,520

-

Income not taxable for tax purposes

(7,703

)

(6,984

)

Depreciation in excess of capital allowances

166,937

169,571

Utilisation of tax losses

(82,993

)

(105,077

)

Total tax charge

2,588

1,228

9.	TANGIBLE FIXED ASSETS

Assets

Plant and

under

Buildings

machinery

construction

Totals

£

£

£

£

COST

At 1 January 2018

505,192

19,997,654

780,666

21,283,512

Additions

-

276,427

296,258

572,685

Disposals

-

(61,115

)

-

(61,115

)

Transfer to ownership

-

31,262

(31,262

)

-

At 31 December 2018

505,192

20,244,228

1,045,662

21,795,082

DEPRECIATION

At 1 January 2018

154,690

8,079,471

-

8,234,161

Charge for year

8,339

870,277

-

878,616

Eliminated on disposal

-

(47,850

)

-

(47,850

)

At 31 December 2018

163,029

8,901,898

-

9,064,927

NET BOOK VALUE

At 31 December 2018

342,163

11,342,330

1,045,662

12,730,155

At 31 December 2017

350,502

11,918,183

780,666

13,049,351

10.	FIXED ASSET INVESTMENTS

Unlisted

investments

£

COST

At 1 January 2018

and 31 December 2018

1,110,000

NET BOOK VALUE

At 31 December 2018

1,110,000

At 31 December 2017

1,110,000

The company's investments at the Balance Sheet date in the share capital of companies include the following:

Thameswey Central Milton Keynes Limited

Registered office: The St Botolph Building, 138 Houndsditch, London EC3A 7AR

Nature of business: Supply of electricity, heat and chilled water.

%

Class of shares:

holding

Ordinary

100.00

2018

2017

£

£

Aggregate capital and reserves

(17,314,576

)

(15,598,328

)

Loss for the year

(1,716,248

)

(1,744,722

)

The investment in Thameswey Central Milton Keynes Limited is reviewed for impairment annually by the board.

The business has significant opportunities in the medium and long term which are summarised in its business plan,

which is prepared annually and reviewed by the ultimate controlling party.

It is therefore considered appropriate by the directors that the investment does not require impairment.

11.

STOCKS

2018

2017

£

£

Stocks

35,926

37,182

12.

DEBTORS

2018

2017

£

£

Amounts falling due within one year:

Trade debtors

588,111

492,124

Amounts owed by group undertakings

255,177

1,159,177

Prepayments and accrued income

372,036

176,750

1,215,324

1,828,051

Amounts falling due after more than one year:

Amounts owed by group undertakings

2,152

-

Aggregate amounts

1,217,476

1,828,051