Lundy Projects Ltd - Limited company accounts 18.2

REGISTERED NUMBER: 01249562 (England and Wales)

STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

AUDITED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 SEPTEMBER 2018

FOR

LUNDY PROJECTS LTD

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

to

4

Report of the Independent Auditors

5

to

6

Income Statement

7

Other Comprehensive Income

8

Balance Sheet

9

Statement of Changes in Equity

10

Cash Flow Statement

11

Notes to the Cash Flow Statement

12

Notes to the Financial Statements

13

to

24

DIRECTORS:

Mr M A Lundy

Mr P Lundy

Mr J R J Bertrand

Mr I P Anderson

Mr K K Patel

REGISTERED OFFICE:

195 Chestergate

Stockport

Cheshire

SK3 0BQ

REGISTERED NUMBER:

01249562 (England and Wales)

AUDITORS:

Allens Accountants Limited

Statutory Auditor and

Chartered Accountants

123 Wellington Road South

Stockport

Cheshire

SK1 3TH

The directors present their strategic report for the year ended 30 September 2018.

REVIEW OF BUSINESS

The results for the business and the financial position of the company are shown in the financial statements.

The company is principally engaged in the design, manufacturing and installation of signalling structures alongside

manufacturing of tubular piles, structures SPS, all associated with the National Electrification Programme. The

company's construction arm undertakes the site installation of all its signalling and electrification programmes operating

our own rail plant.

The company is also a key Manufacturing Framework provider to Network Rail for National Electrification schemes.

This year the company has continued its growth and strengthened its position in the rail sector, further investment into

manufacturing and delivery of electrification has increased turnover, client base and market share. Network Rails

commitment to invest into The National Electrification Programme and CP6 enhancements continues to provide

sustainable revenue.

Continued investment in in both staff and equipment is expected to increase our market penetration and provide

sustainable growth

Recent investment into 'robotic manufacturing' has seen the company expand its working profile to 24 hours per day, at

our new manufacturing site in Irlam, Manchester.

We will continue to invest in new technology that creates competitive advantage. We will further develop our

apprenticeship schemes encouraging today's youth to engage with tomorrows technology.

Safety is imbedded within the company and we further develop our Behavioural Safety Culture to win the Hearts and

Minds of all our staff and operatives to create a safe place to work and be their Employer of Choice.

ON BEHALF OF THE BOARD:

Mr J R J Bertrand - Director

12 June 2019

The directors present their report with the financial statements of the company for the year ended 30 September 2018.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of engineers and engineering designers.

DIVIDENDS

The total distribution of dividends for the year ended 30 September 2018 will be £nil.

RESEARCH AND DEVELOPMENT

The company invests in bringing new and innovative products to the market.

DIRECTORS

The directors who have held office during the period from 1 October 2017 to the date of this report are as follows:

Mr A Lundy - resigned 9 October 2017

Mr P Lundy - appointed 9 October 2017

Mr T Rapp - appointed 9 October 2017 - resigned 1 August 2018

Mr P Limacher - appointed 9 October 2017 - resigned 1 August 2018

Mr H Daepp - appointed 9 October 2017 - resigned 1 August 2018

Mr J R J Bertrand - appointed 1 August 2018

Mr I P Anderson - appointed 1 August 2018

Mr K K Patel - appointed 1 August 2018

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.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors

have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting

Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not

approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the

company and of the profit or loss of the company for that period. In preparing these financial statements, the directors

are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the

company's transactions and disclose with reasonable accuracy at any time the financial position of the company and

enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for

safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud

and other irregularities.

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.

AUDITORS

The auditors, Allens Accountants Limited, will be proposed for re-appointment at the forthcoming Annual General

Meeting.

ON BEHALF OF THE BOARD:

Mr J R J Bertrand - Director

12 June 2019

Opinion

We have audited the financial statements of Lundy Projects Ltd (the 'company') for the year ended 30 September 2018

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

Cash Flow Statement and Notes to the Cash Flow Statement, 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 30 September 2018 and of its profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

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.

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 Strategic

Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors

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 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.

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.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you

if, in our opinion:

-	adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of directors' remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page three, the directors are

responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and

for such internal control as the directors determine necessary to enable the preparation of financial statements that are

free from material misstatement, whether due to fraud or error.

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 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.

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.

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.

Philip Leah (Senior Statutory Auditor)

for and on behalf of Allens Accountants Limited

Statutory Auditor and

Chartered Accountants

123 Wellington Road South

Stockport

Cheshire

SK1 3TH

12 June 2019

TURNOVER

4

38,310,946

38,011,162

Cost of sales

28,979,184

28,715,689

GROSS PROFIT

9,331,762

9,295,473

Administrative expenses

2,821,022

4,135,104

OPERATING PROFIT

6

6,510,740

5,160,369

Interest receivable and similar income

16,382

20,815

6,527,122

5,181,184

Interest payable and similar expenses

7

50,410

92,889

PROFIT BEFORE TAXATION

6,476,712

5,088,295

Tax on profit

8

1,172,079

1,000,728

PROFIT FOR THE FINANCIAL YEAR

5,304,633

4,087,567

PROFIT FOR THE YEAR

5,304,633

4,087,567

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

5,304,633

4,087,567

FIXED ASSETS

Tangible assets

10

4,100,807

5,522,142

CURRENT ASSETS

Stocks

11

818,031

463,388

Debtors

12

5,520,808

7,375,697

Cash at bank and in hand

16,269,624

11,613,650

22,608,463

19,452,735

CREDITORS

Amounts falling due within one year

13

4,333,493

7,621,570

NET CURRENT ASSETS

18,274,970

11,831,165

TOTAL ASSETS LESS CURRENT LIABILITIES

22,375,777

17,353,307

CREDITORS

Amounts falling due after more than one year

14

(153,241

)

(416,572

)

PROVISIONS FOR LIABILITIES

19

(302,144

)

(320,976

)

NET ASSETS

21,920,392

16,615,759

CAPITAL AND RESERVES

Called up share capital

20

1,060

1,060

Retained earnings

21

21,919,332

16,614,699

SHAREHOLDERS' FUNDS

21,920,392

16,615,759

The financial statements were approved by the Board of Directors on 12 June 2019 and were signed on its behalf by:

Mr J R J Bertrand - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 October 2016

1,060

12,620,110

12,621,170

Changes in equity

Dividends

-

(92,978

)

(92,978

)

Total comprehensive income

-

4,087,567

4,087,567

Balance at 30 September 2017

1,060

16,614,699

16,615,759

Changes in equity

Total comprehensive income

-

5,304,633

5,304,633

Balance at 30 September 2018

1,060

21,919,332

21,920,392

Cash flows from operating activities

Cash generated from operations

1

5,844,726

9,420,876

Interest paid

(12,986

)

(37,426

)

Interest element of hire purchase payments paid

(37,421

)

(55,466

)

Tax paid

(1,125,524

)

(1,199,526

)

Net cash from operating activities

4,668,795

8,128,458

Cash flows from investing activities

Purchase of tangible fixed assets

(571,269

)

(1,342,390

)

Sale of tangible fixed assets

1,376,713

61,761

Interest received

16,382

20,815

Net cash from investing activities

821,826

(1,259,814

)

Cash flows from financing activities

Loan repayments in year

(541,308

)

(93,692

)

Capital repayments in year

(362,542

)

(557,189

)

Amount introduced by directors

69,203

-

Amount withdrawn by directors

-

(86,331

)

Equity dividends paid

-

(92,978

)

Net cash from financing activities

(834,647

)

(830,190

)

Increase in cash and cash equivalents

4,655,974

6,038,454

Cash and cash equivalents at beginning of year

2

11,613,650

5,575,196

Cash and cash equivalents at end of year

2

16,269,624

11,613,650

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

30/9/18

30/9/17

£

£

Profit before taxation

6,476,712

5,088,295

Depreciation charges

688,977

628,211

Profit on disposal of fixed assets

(32,561

)

(35,877

)

(Increase)/decrease in AROC's

512,317

4,384,467

Finance costs

50,410

92,889

Finance income

(16,382

)

(20,815

)

7,679,473

10,137,170

Increase in stocks

(354,643

)

(329,015

)

Decrease/(increase) in trade and other debtors

1,273,369

(211,708

)

Decrease in trade and other creditors

(2,753,473

)

(175,571

)

Cash generated from operations

5,844,726

9,420,876

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these

Balance Sheet amounts:

Year ended 30 September 2018

30/9/18

1/10/17

£

£

Cash and cash equivalents

16,269,624

11,613,650

Year ended 30 September 2017

30/9/17

1/10/16

£

£

Cash and cash equivalents

11,613,650

5,575,196

1.	COMPANY INFORMATION

Lundy Projects Limited is a company limited by share capital and is incorporated in England and Wales

(registered number 01249562) . The registered office address is 195 Chestergate, Stockport, Cheshire, SK3 0BQ.

The nature of the company's operations and its principal activity was that of engineers and engineering desgners.

2.	STATUTORY INFORMATION

Lundy Projects Ltd 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.

3.	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.

Significant judgements and estimates

Preparation of the financial statements requires management to make significant judgements, estimates and

assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the

amounts reported for revenues and expenses for the year. However, the nature of estimation means that actual

outcomes could differ from those 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 if revision only affects that period, or in the period

of the revision and future periods if the revision affects both current and future periods.

Turnover

Turnover is recognised to the extent that it is probable that the economic benefits will flow to the Company and

the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or

receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also

be met before turnover is recognised:

i) the Company has transferred the significant risks and rewards of ownership to the buyer;

ii) the Company retains neither continuing managerial involvement to the degree usually associated with

ownership nor effective control over the goods sold;

iii) the amount of turnover can be measured reliably;

iv) it is probable that the Company will receive the consideration due under the transaction and the costs incurred

or to be incurred in respect of the transaction can be measured reliably.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Freehold property

-

2% on cost

Plant & machinery

-

25% on reducing balance and 15% on reducing balance

Motor vehicles

-

25% on reducing balance

Computer equipment

-

25% on cost

Tangible fixed assets are measured at cost less accumulated depreciation and any accumulated impairment

losses.

At each reporting date fixed assets are reviewed to determine whether there is any indication that those assets

have suffered an impairment loss. If there is an indication of possible impairment, the recoverable amount of any

affected asset is estimated and compared with its carrying amount.If estimated recoverable amount is lower, the

carrying amount is reduced to its estimated recoverable amount, and an impairment loss is recognised

immediately in profit or loss.

If an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate

of its recoverable amount, but not in excess of the amount that would have been determined had no impairment

loss been recognised for the asset in prior years. A reversal of an impairment loss is recognised immediately in

profit or loss.

Stocks

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

moving items.

Debtors

Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured

initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective

interest rate method, less any impairment.

Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and on hand, demand deposits deposits with banks and other

short term highly liquid investments with original maturities of three months or less and bank overdrafts. In the

statement of financial position, bank overdrafts are shown within borrowings or current liabilities.

Financial instruments

Financial instruments are classified and accounted for according to the substance of the contractual arrangement,

as either financial assets, financial liabilities or equity instruments. An equity instrument is any contract that

evidences a residual interest in the assets of the Company after deducting all of its liabilities.

The company enters into basic financial instrument transactions that result in the recognition of financial assets

and liabilities like trade and other accounts receivable and payable, loans from banks and other third parties,

together with loans to and from related parties.

Debt instruments (other than those wholly repayable or receivable in one year), including loans and other

accounts receivable and payable, are initially measured at present value of future cash flows and subsequently at

amortised cost using the effective interest method. Debt instruments that are payable or receivable in one year,

typically trade payables or receivables, are measured, initially and subsequently, at the undiscounted amount of

cash or other consideration, expected to be paid or received.

Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for

objective evidence of impairment. If objective evidence if impairment is found, an impairment loss is recognised

in the statement of comprehensive income.

Creditors

Short term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are

measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using

the effective interest method.

Interest bearing borrowings

Interest bearing borrowing are recognised initially at fair value less attributable transaction costs. Subsequent to

initial recognition, interest bearing borrowings are stated at amortised cost with any difference between the

amount initially recognised and redemption value being recognised in the statement of comprehensive income

over the period of the borrowings, together with any interest and fees payable, using the effective interest

method.

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.

Taxation

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.

Research and development

Expenditure on research and development is written off in the year in which it is incurred.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the

balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at

the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Hire purchase and leasing commitments

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held

under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases

are depreciated over their estimated useful lives or the lease term, whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The capital element

of the future payments is treated as a liability.

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the

lease.

Where the company enters into a lease which entails taking substantially all the risks and rewards of ownership

of an asset, the lease is treated as a finance lease. The asset is recorded in the balance sheet as a tangible fixed

asset and is depreciated in accordance with the above depreciation policies. Future instalments under such leases,

net of finance charges, are included within creditors. Rentals payable are apportioned between the finance

element, which is charged to the profit and loss account on a straight line basis, and the capital element which

reduces the outstanding obligation for future instalments.

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.

Long term contracts

Long term contracts are assessed on a contract by contract basis and reflected in the profit and loss account by

recording turnover and related costs as contract activity progresses. Turnover is ascertained in a manner

appropriate to the stage of completion of the contract, and credit taken for profit earned to date when the

outcome of the contract can be ascertained with reasonable certainty. The amount by which turnover exceeds

payments on account is classified as ''amounts recoverable on contracts'' and included in debtors, to the extent

that payments on account exceed relevant turnover, the excess is included as a creditor. The amount of long term

contracts, at cost net of amounts transferred to cost of sales, less provision for foreseeable losses and payments

on account not matched with turnover, is included in stocks.

Dividends

Dividends and other distributions to the company's shareholders are recognised as a liability in the financial

statements in the period in which the dividends and other distributions are approved by the shareholders. These

amounts are recognised in the statement of changes in equity.

4.

TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the company.

An analysis of turnover by geographical market is given below:

30/9/18

30/9/17

£

£

United Kingdom

38,310,946

38,011,162

38,310,946

38,011,162

5.	EMPLOYEES AND DIRECTORS

30/9/18

30/9/17

£

£

Wages and salaries

2,175,329

3,535,927

Social security costs

31,448

13,618

Other pension costs

26,469

20,451

2,233,246

3,569,996

The average number of employees during the year was as follows:

30/9/18

30/9/17

Management and administration

14

14

Production

25

21

39

35

30/9/18

30/9/17

£

£

Directors' remuneration

244,231

116,840

Directors' pension contributions to money purchase schemes

1,097

1,155

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes

1

1

Information regarding the highest paid director for the year ended 30 September 2018 is as follows:

30/9/18

£

Emoluments etc

146,314

Pension contributions to money purchase schemes

400