Princebuild Holdings Limited
Strategic Report for the Year Ended 30 September 2020
The directors present their strategic report for the year ended 30 September 2020.
Fair review of the business
The company acts as the parent of Princebuild Limited, and the consolidated group accounts include the results and assets of both companies.
The company’s income comprises dividends, management charges and rent received from its subsidiary, and interest received on its bank deposit account.The principal activities of the group are those of building contractors and property maintenance specialists, and trading is carried out through Princebuild Limited. The group accounts reflect pre-tax profits of £4,637,084 (2019: £3,555,659) and balance sheet reserves of £16.8 million (2019: £14.9 million).
The business review of the directors contained in the financial statements of Princebuild Limited is as follows:
We aim to present a fair review of the development and performance of our business during the year and its position at the year end. Our review is consistent with the size and non complex nature of our business, and is written in the context of the risks and uncertainties we face.
In spite of trading through unprecedented circumstances during the second half of the year arising from the COVID-19 pandemic, the company’s results reflect another very strong year. As with many businesses, the effects of COVID-19 have directly impacted on the company’s trading patterns in various ways. While certain projects, including some NHS and care home contracts, inevitably had to be postponed, the company has secured additional work in assisting businesses in making their workplaces COVID-19 secure, refurbishing premises of businesses temporarily unable to trade as a result of pandemic restrictions, and installing bespoke isolation units.
Turnover has fallen slightly by 5% to £55.2 million compared with £58.1 million in 2019, with a continued high number of large projects being completed. However, the gross profit margin reflects an increase of 3% since the previous year, resulting in operating profits of £4.1 million compared with £3.2 million in 2019.
Overheads have been well controlled, with a modest increase in costs of 5.8%. This has been due in part to gross wages costs being partly mitigated by government grant income received under the Coronavirus Job Retention Scheme.
The balance sheet continues to present a very solid position, with net assets increasing from £9.5 miliion to £11.1 million, and balances at the bank totalling £9.3 million.
The directors would like to thank all employees for their commitment and hard work over the last 12 months.
Principal risks and uncertainties
The business environment in which the company operates continues to be very challenging and competitive pricing across the industry continues to put pressure on margins.
However, the company’s reputation for delivering high quality service and meeting tight deadlines where necessary has provided a crucial edge over competitors.
Operationally, losses may be incurred as a result of inaccurate quoting, project delays, project mismanagement or other unforeseen circumstances. Ensuring that contracts are completed on time and in line with budgeted costs remains a key focus.
The longer term impacts of both Brexit and the COVID-19 pandemic remain unknown, and consequently future trading remains uncertain for all businesses. Restrictions on customers’ capital expenditure budgets may lead to further project deferrals.
Although trading conditions in the current climate remain challenging, the directors continue to investigate opportunities to grow the business and extend the range of services offered.
The London branch continues to perform well and expansion is continuing at the Northampton site.
Section 172 statement
This section of the financial statements includes the Directors considerations and activities in discharging their duties under s172(1) of the Companies Act 2006, in promoting the success of the Company for the benefit of members as a whole.
Along with the information provided in the Strategic Report, the reports include considerations of the likely consequences of the decisions of the Directors in the longer term and how the Directors have taken wider stakeholders needs into account.
Engagement with suppliers, customers and other relationships
Delivering our strategy requires strong mutually beneficial relationships with suppliers, customers and other operational partners. Princebuild seeks the promotion and application of certain general principles in such relationships. The ability to promote these principles effectively is an important factor in the decision to enter into or remain in such relationships.
The business continuously assesses the priorities related to customers and those with whom we do business, and the Directors engage with the businesses on these topics, for example, within the context of working safely on site and in line with social distancing guidelines as enforced by COVID-19.
Moreover, the Directors receive information updates on a variety of topics that indicate and inform how these stakeholders have been engaged and are performing with and on behalf of the Company.
Approved by the Board on 17 February 2021 and signed on its behalf by:
S S Pudney