IRIS Accounts Production v24.1.9.2 12939220 Board of Directors 31.12.23 1.1.23 31.12.23 31.12.23 The group's principal activity during the year continued to be that of fabrication and erection of steel framed buildings. true true true false true true false false false false false false false false false true false Ordinary 0 iso4217:GBPiso4217:USDiso4217:EURxbrli:sharesxbrli:pureutr:tonnesutr:kWh129392202022-12-31129392202023-12-31129392202023-01-012023-12-31129392202021-12-31129392202022-01-012022-12-31129392202022-12-3112939220ns15:EnglandWales2023-01-012023-12-3112939220ns14:PoundSterling2023-01-012023-12-3112939220ns10:Director12023-01-012023-12-3112939220ns10:Consolidated2023-12-3112939220ns10:ConsolidatedGroupCompanyAccounts2023-01-012023-12-3112939220ns10:PrivateLimitedCompanyLtd2023-01-012023-12-3112939220ns10:Consolidatedns10:FRS1022023-01-012023-12-3112939220ns10:Consolidatedns10:Audited2023-01-012023-12-3112939220ns10:SmallCompaniesRegimeForDirectorsReport2023-01-012023-12-3112939220ns10:SmallCompaniesRegimeForAccounts2023-01-012023-12-3112939220ns10:Consolidatedns10:LargeMedium-sizedCompaniesRegimeForDirectorsReport2023-01-012023-12-3112939220ns10:LargeMedium-sizedCompaniesRegimeForAccountsns10:Consolidated2023-01-012023-12-3112939220ns10:FullAccounts2023-01-012023-12-3112939220ns5:Subsidiary12023-01-012023-12-3112939220ns5:Subsidiary22023-01-012023-12-3112939220ns5:Subsidiary32023-01-012023-12-3112939220ns5:Subsidiary42023-01-012023-12-3112939220ns5:Subsidiary52023-01-012023-12-3112939220ns5:Subsidiary62023-01-012023-12-311293922012023-01-012023-12-3112939220ns10:OrdinaryShareClass12023-01-012023-12-3112939220ns10:Consolidated2023-01-012023-12-3112939220ns10:Director22023-01-012023-12-3112939220ns10:Director32023-01-012023-12-3112939220ns10:RegisteredOffice2023-01-012023-12-3112939220ns10:Consolidated2022-01-012022-12-3112939220ns5:CurrentFinancialInstruments2023-12-3112939220ns5:CurrentFinancialInstruments2022-12-3112939220ns5:Non-currentFinancialInstruments2023-12-3112939220ns5:Non-currentFinancialInstruments2022-12-3112939220ns5:ShareCapital2023-12-3112939220ns5:ShareCapital2022-12-3112939220ns5:SharePremium2023-12-3112939220ns5:SharePremium2022-12-3112939220ns5:ShareCapital2022-01-012022-12-3112939220ns5:SharePremium2022-01-012022-12-3112939220ns5:RetainedEarningsAccumulatedLosses2022-12-3112939220ns5:RetainedEarningsAccumulatedLosses2023-12-311293922012023-01-012023-12-3112939220ns5:NetGoodwill2023-01-012023-12-3112939220ns5:IntangibleAssetsOtherThanGoodwill2023-01-012023-12-3112939220ns5:PatentsTrademarksLicencesConcessionsSimilar2023-01-012023-12-3112939220ns5:OwnedOrFreeholdAssetsns5:LandBuildings2023-01-012023-12-3112939220ns5:PlantMachinery2023-01-012023-12-3112939220ns5:FurnitureFittings2023-01-012023-12-3112939220ns5:CostValuation2022-12-3112939220ns5:Subsidiary112023-01-012023-12-31129392203ns5:Subsidiary22023-01-012023-12-3112939220ns5:Subsidiary352023-01-012023-12-31129392207ns5:Subsidiary42023-01-012023-12-31129392209ns5:Subsidiary52023-01-012023-12-3112939220ns5:Subsidiary6112023-01-012023-12-3112939220ns5:CurrentFinancialInstrumentsns5:WithinOneYear2023-12-3112939220ns5:CurrentFinancialInstrumentsns5:WithinOneYear2022-12-3112939220ns10:OrdinaryShareClass12023-12-31
REGISTERED NUMBER: 12939220 (England and Wales)












Group Strategic Report, Report of the Directors and

Consolidated Financial Statements

for the Year Ended 31 December 2023

for

Embrace Steel Group Ltd

Embrace Steel Group Ltd (Registered number: 12939220)






Contents of the Consolidated Financial Statements
for the year ended 31 December 2023




Page

Company Information 1

Group Strategic Report 2

Report of the Directors 4

Report of the Independent Auditors 5

Consolidated Income Statement 8

Consolidated Other Comprehensive Income 9

Consolidated Balance Sheet 10

Company Balance Sheet 11

Consolidated Statement of Changes in Equity 12

Company Statement of Changes in Equity 13

Consolidated Cash Flow Statement 14

Notes to the Consolidated Cash Flow Statement 15

Notes to the Consolidated Financial Statements 16


Embrace Steel Group Ltd

Company Information
for the year ended 31 December 2023







DIRECTORS: C M Bartholomew
D Curnock
J T Sapak





REGISTERED OFFICE: 71 Shelton Street
London
WC2H 9JQ





REGISTERED NUMBER: 12939220 (England and Wales)





AUDITORS: Clayton & Brewill
Statutory Auditors and
Chartered Accountants
Cawley House
149-155 Canal Street
Nottingham
Nottinghamshire
NG1 7HR

Embrace Steel Group Ltd (Registered number: 12939220)

Group Strategic Report
for the year ended 31 December 2023

The directors present their strategic report of the company and the group for the year ended 31 December 2023.

REVIEW OF BUSINESS
Turnover for the group in the year totalled £26,238,894 in with a gross profit of £5,414,646. The group received other income of £158,363, administrative expenses and overheads totalled £4,289,300 with finance costs of £299,437 and asset depreciation charged totalled £423,855.

The group made a pre-tax profit for the year of £1,013,017 in 2023.

The net assets of the group on 31 December 2023 were £2,112,159 (2022 - £1,437,724), with net current assets of £718,182 (2022 - net current liabilities £1,610,827).

PRINCIPAL RISKS AND UNCERTAINTIES
The directors consider that the principal risk to the operations of the group to be exposures arising from working on substantial contracts and the fluctuations in the timing of cash flows relating to these contracts. Care is taken during the negotiation of contract payment terms to alleviate working capital pressures as much as possible and minimises the use of the available financing facilities.

A further risk is the exposure to fluctuations in steel prices, particularly given many of the contracts are on a fixed price basis. Where possible pre-agreed prices and terms are negotiated with the main steel suppliers for contracted work.

There is a credit risk arising from exposure to customers defaulting on trade debts. The risk is minimised through tight credit control procedures, only dealing with reputable clients and in the use of Credit Insurance facilities.

These risks have been continued through 2023 due to the impact of the continuing Ukraine conflict on the UK and world economies and additional pressures of similar nature.

The group's forecasts and projections, taking account of reasonable potential changes in trading performance, show that the group should be able to operate within its current facilities for the foreseeable future. The directors are not aware of any reason why the working capital position would change in the coming 12 months.


Embrace Steel Group Ltd (Registered number: 12939220)

Group Strategic Report
for the year ended 31 December 2023

BUSINESS ACQUISITION
The directors are delighted to announce the recent, post balance sheet date, acquisition of Shufflebottom Ltd, a move that signifies a strategic expansion of our capabilities and offerings within the structural steel fabrication industry. This acquisition represents a pivotal step forward in our growth strategy and reinforces our commitment to delivering unparalleled value to our clients and stakeholders.

Shufflebottom Ltd brings a wealth of expertise, specialized technologies, and a proven track record in structural steel fabrication that perfectly complements our existing group operations. By integrating their strengths with ours, we are poised to enhance our service offerings, broaden our market presence, and solidify our position in the industry.

This strategic alignment not only expands our portfolio but also enhances our ability to deliver comprehensive solutions to our clients. The synergies created through this acquisition will enable us to offer a more diverse range of products and services, catering to the evolving needs of our customers while maintaining the highest standards of quality and reliability.

Furthermore, the acquisition of Shufflebottom Ltd strengthens our production capabilities, enabling us to undertake larger and more complex projects with increased efficiency and precision. This enhanced capacity not only positions us for sustainable growth but also reinforces our reputation as a trusted partner for clients seeking innovative and reliable structural steel solutions.

As we move forward, we are committed to a seamless integration process that prioritizes collaboration, transparency, and shared success. By leveraging the collective expertise and resources of group entities, we are confident in our ability to maximize the benefits of this acquisition and drive long-term value for our stakeholders.

ON BEHALF OF THE BOARD:





C M Bartholomew - Director


20 August 2024

Embrace Steel Group Ltd (Registered number: 12939220)

Report of the Directors
for the year ended 31 December 2023

The directors present their report with the financial statements of the company and the group for the year ended 31 December 2023.

DIVIDENDS
The total distribution of dividends for the year ended 31 December 2023 will be £ 70,500 .

FUTURE DEVELOPMENTS
The group continues to work on improving profitability and efficiency within the company and the group.

DIRECTORS
The directors shown below have held office during the whole of the period from 1 January 2023 to the date of this report.

C M Bartholomew
D Curnock
J T Sapak

FINANCIAL INSTRUMENT RISK
The details of the financial instrument risks are provided in the Strategic Report.

STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Group 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 the group and of the profit or loss of the group 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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group 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 group'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 group's auditors are aware of that information.

AUDITORS
The auditors, Clayton & Brewill, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:





C M Bartholomew - Director


20 August 2024

Report of the Independent Auditors to the Members of
Embrace Steel Group Ltd

Opinion
We have audited the financial statements of Embrace Steel Group Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated 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 group's and of the parent company affairs as at 31 December 2023 and of the group's 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 group 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
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.

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 group's and the parent 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.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information
The directors are responsible for the other information. The other information comprises the information in the Group 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 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.

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 Group 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 Group Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Report of the Independent Auditors to the Members of
Embrace Steel Group Ltd


Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
- the parent company 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 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.

In preparing the financial statements, the directors are responsible for assessing the group's and the parent 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 group or the parent 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.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

- Enquiry of management and those charged with governance around actual and potential litigation and
claims;

- Reviewing financial statement disclosures and testing to supporting documentation to assess
compliance with applicable laws and regulations;

- Performing audit work over the risk of management override of controls, including testing of journal
entries and other adjustments for appropriateness, evaluating the business rationale of significant
transactions outside the normal course of business and reviewing accounting estimates for bias;

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.

Report of the Independent Auditors to the Members of
Embrace Steel Group Ltd


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.




Mr Douglas Perry FCA (Senior Statutory Auditor)
for and on behalf of Clayton & Brewill
Statutory Auditors and
Chartered Accountants
Cawley House
149-155 Canal Street
Nottingham
Nottinghamshire
NG1 7HR

28 August 2024

Embrace Steel Group Ltd (Registered number: 12939220)

Consolidated
Income Statement
for the year ended 31 December 2023

31/12/23 31/12/22
as restated
Notes £    £   

TURNOVER 4 26,238,894 7,555,173

Cost of sales 20,824,248 5,482,417
GROSS PROFIT 5,414,646 2,072,756

Administrative expenses 4,289,300 1,449,037
1,125,346 623,719

Other operating income 158,363 346,586
OPERATING PROFIT 6 1,283,709 970,305

Interest receivable and similar income 28,745 1,440
1,312,454 971,745

Interest payable and similar expenses 7 299,437 122,549
PROFIT BEFORE TAXATION 1,013,017 849,196

Tax on profit 8 268,082 156,304
PROFIT FOR THE FINANCIAL YEAR 744,935 692,892
Profit attributable to:
Owners of the parent 581,729 692,892
Non-controlling interests 163,206 -
744,935 692,892

Embrace Steel Group Ltd (Registered number: 12939220)

Consolidated
Other Comprehensive Income
for the year ended 31 December 2023

31/12/23 31/12/22
as restated
Notes £    £   

PROFIT FOR THE YEAR 744,935 692,892


OTHER COMPREHENSIVE INCOME
Property revaluation - 528,750
Income tax relating to other
comprehensive income

-

(103,917

)
OTHER COMPREHENSIVE INCOME
FOR THE YEAR, NET OF INCOME TAX

-

424,833
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR

744,935

1,117,725

Total comprehensive income attributable to:
Owners of the parent 744,935 1,117,725

Embrace Steel Group Ltd (Registered number: 12939220)

Consolidated Balance Sheet
31 December 2023

31/12/23 31/12/22
as restated
Notes £    £    £    £   
FIXED ASSETS
Intangible assets 12 1,662,322 1,702,517
Tangible assets 13 2,188,855 2,269,640
Investments 14 - -
Investment property 15 2,120,000 2,120,000
5,971,177 6,092,157

CURRENT ASSETS
Stocks 16 139,464 180,413
Debtors 17 6,430,387 2,621,948
Cash at bank 3,725,219 872,762
10,295,070 3,675,123
CREDITORS
Amounts falling due within one year 18 9,576,888 5,285,950
NET CURRENT ASSETS/(LIABILITIES) 718,182 (1,610,827 )
TOTAL ASSETS LESS CURRENT
LIABILITIES

6,689,359

4,481,330

CREDITORS
Amounts falling due after more than
one year

19

(4,134,283

)

(2,632,015

)

PROVISIONS FOR LIABILITIES 22 (442,917 ) (411,591 )
NET ASSETS 2,112,159 1,437,724

CAPITAL AND RESERVES
Called up share capital 23 8 8
Share premium 24 319,991 319,991
Revaluation reserve 24 433,383 424,833
Fair value reserve 24 178,423 178,423
Retained earnings 24 1,017,148 514,469
SHAREHOLDERS' FUNDS 1,948,953 1,437,724

NON-CONTROLLING INTERESTS 163,206 -
TOTAL EQUITY 2,112,159 1,437,724

The financial statements were approved by the Board of Directors and authorised for issue on 20 August 2024 and were signed on its behalf by:





C M Bartholomew - Director


Embrace Steel Group Ltd (Registered number: 12939220)

Company Balance Sheet
31 December 2023

31/12/23 31/12/22
as restated
Notes £    £    £    £   
FIXED ASSETS
Intangible assets 12 - -
Tangible assets 13 - -
Investments 14 1 1
Investment property 15 - -
1 1

CURRENT ASSETS
Debtors 17 1,687,237 1,340,493

CREDITORS
Amounts falling due within one year 18 346,744 -
NET CURRENT ASSETS 1,340,493 1,340,493
TOTAL ASSETS LESS CURRENT
LIABILITIES

1,340,494

1,340,494

CREDITORS
Amounts falling due after more than
one year

19

1,020,495

1,020,495
NET ASSETS 319,999 319,999

CAPITAL AND RESERVES
Called up share capital 23 8 8
Share premium 319,991 319,991
SHAREHOLDERS' FUNDS 319,999 319,999

Company's profit for the financial year - -

The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the Board of Directors and authorised for issue on 20 August 2024 and were signed on its behalf by:





C M Bartholomew - Director


Embrace Steel Group Ltd (Registered number: 12939220)

Consolidated Statement of Changes in Equity
for the year ended 31 December 2023

Called up
share Retained Share Revaluation
capital earnings premium reserve
£    £    £    £   

Changes in equity
Issue of share capital 8 - 319,991 -
Total comprehensive income - 514,469 - 424,833
Balance at 31 December 2022 8 514,469 319,991 424,833

Changes in equity
Dividends - (70,500 ) - -
Total comprehensive income - 573,179 - 8,550
8 1,017,148 319,991 433,383
Non-controlling interest arising
on business combination

-

-

-

-
Balance at 31 December 2023 8 1,017,148 319,991 433,383
Fair
value Non-controlling Total
reserve Total interests equity
£    £    £    £   

Changes in equity
Issue of share capital - 319,999 - 319,999
Total comprehensive income 178,423 1,117,725 - 1,117,725
Balance at 31 December 2022 178,423 1,437,724 - 1,437,724

Changes in equity
Dividends - (70,500 ) - (70,500 )
Total comprehensive income - 581,729 - 581,729
178,423 1,948,953 - 1,948,953
Non-controlling interest arising
on business combination

-

-

163,206

163,206
Balance at 31 December 2023 178,423 1,948,953 163,206 2,112,159

Embrace Steel Group Ltd (Registered number: 12939220)

Company Statement of Changes in Equity
for the year ended 31 December 2023

Called up
share Retained Share Total
capital earnings premium equity
£    £    £    £   

Changes in equity
Issue of share capital 8 - 319,991 319,999
Balance at 31 December 2022 8 - 319,991 319,999

Changes in equity
Balance at 31 December 2023 8 - 319,991 319,999

Embrace Steel Group Ltd (Registered number: 12939220)

Consolidated Cash Flow Statement
for the year ended 31 December 2023

31/12/23 31/12/22
as restated
Notes £    £   
Cash flows from operating activities
Cash generated from operations 1 (154,510 ) 1,854,966
Interest paid (292,454 ) (117,602 )
Interest element of hire purchase
payments paid

(6,983

)

(4,947

)
Tax paid (98,380 ) 10,000
Net cash from operating activities (552,327 ) 1,742,417

Cash flows from investing activities
Purchase of intangible fixed assets - (1,325,751 )
Purchase of tangible fixed assets (104,456 ) (203,741 )
Sale of tangible fixed assets - 5,000
Cash inflow on acquisition - 339,158
Interest received 28,745 1,440
Net cash from investing activities (75,711 ) (1,183,894 )

Cash flows from financing activities
New loans in year 3,741,860 1,500,000
Loan repayments in year (143,573 ) (1,286,330 )
Capital repayments in year (47,292 ) 100,569
Equity dividends paid (70,500 ) -
Net cash from financing activities 3,480,495 314,239

Increase in cash and cash equivalents 2,852,457 872,762
Cash and cash equivalents at
beginning of year

2

872,762

-

Cash and cash equivalents at end
of year

2

3,725,219

872,762

Embrace Steel Group Ltd (Registered number: 12939220)

Notes to the Consolidated Cash Flow Statement
for the year ended 31 December 2023

1. RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM
OPERATIONS
31/12/23 31/12/22
as restated
£    £   
Profit before taxation 1,013,017 849,196
Depreciation charges 452,655 171,949
Loss on disposal of fixed assets 43,647 54,976
Gain on revaluation of fixed assets - (295,000 )
Finance costs 299,437 122,549
Finance income (28,745 ) (1,440 )
1,780,011 902,230
Decrease in stocks 40,949 1,214,935
Increase in trade and other debtors (3,808,459 ) (524,225 )
Increase in trade and other creditors 1,832,989 262,026
Cash generated from operations (154,510 ) 1,854,966

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 31 December 2023
31/12/23 1/1/23
£    £   
Cash and cash equivalents 3,725,219 872,762
Year ended 31 December 2022
31/12/22 1/1/22
as restated
£    £   
Cash and cash equivalents 872,762 -


3. ANALYSIS OF CHANGES IN NET DEBT

At 1/1/23 Cash flow At 31/12/23
£    £    £   
Net cash
Cash at bank 872,762 2,852,457 3,725,219
872,762 2,852,457 3,725,219
Debt
Finance leases (100,569 ) 47,292 (53,277 )
Debts falling due within 1 year (134,440 ) (2,064,841 ) (2,199,281 )
Debts falling due after 1 year (1,292,931 ) (1,533,444 ) (2,826,375 )
(1,527,940 ) (3,550,993 ) (5,078,933 )
Total (655,178 ) (698,536 ) (1,353,714 )

Embrace Steel Group Ltd (Registered number: 12939220)

Notes to the Consolidated Financial Statements
for the year ended 31 December 2023

1. STATUTORY INFORMATION

Embrace Steel Group 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 General Information page.

2. STATEMENT OF COMPLIANCE

The consolidated financial statements have been prepared under the historical cost convention and in accordance with United Kingdom Accounting Standards including Financial Reporting Standard 102, "The Financial Reporting Standard applicable in the UK and Republic of Ireland" ("FRS102") and the requirements of the Companies Act 2006.

3. ACCOUNTING POLICIES

Basis of preparing the financial statements
The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.

Basis of consolidation
The consolidated financial statements consolidate the financial statements of the company and its subsidiary undertakings.

The consolidation of the financial statements has been accounted for using the merger accounting method. As required by FRS102.19.30 the results and cash flows of all of the combining entities have been brought into the consolidated financial statements.

The consolidated financial statements present the results and cash flows of the group for the year ended 31 December 2023. The unconsolidated results of the company, where presented, are for the year ended 31 December 2023 and the comparatives present the results for the year ended 31 December 2022.

Intra group transactions and profits are eliminated fully on consolidation.

The company has taken advantage of section 408 of the Companies Act 2006 and does not publish a separate profit and loss account. The company's post tax profit for the year was £nil (2022 £nil).

Embrace Steel Group Ltd (Registered number: 12939220)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 December 2023

3. ACCOUNTING POLICIES - continued

Critical accounting judgements and key sources of estimation uncertainty
In the application of the group'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, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are outlined below.

i) Carrying value of property, plant and equipment and investment property (note 11 and 12)

The carrying value of property, plant and equipment and investment property as at 31 December 2023 was £4,308,855. Additions in the year totalled £104,456 and the depreciation charge was £177,091. Estimated useful economic lives of property, plant and equipment are based on management's judgements and experience. When management identifies that actual useful lives differ materially from the estimates used to calculate depreciation, that charge is adjusted. Due to the significance of capital investment, variations between actual and estimated useful lives could impact operating results both positively and negatively. Asset values are reviewed annually and historically changes to remaining estimates of useful lives have not been material..

(ii) Amounts recoverable on long term contracts (Note 15)
The carrying value of amounts recoverable under long term contracts as at 31 December 2023 was £5,256,142. These are calculated by reference to the stage of completion of a contract. The stage of completion of a contract is measured by comparing the costs incurred for work performed to date to the total estimated contract costs. The nature of construction contracts is such that disputes can occur over the valuation and recoverability of contract income at a particular point in time, particularly where there have been variations made contracts as they progress. In calculating the amounts recoverable under long term contracts the management have used their judgement and experience in calculating and assessing the valuation and recoverability of contract amounts

Turnover
Turnover is measured at the fair value of the consideration received or receivable, net of discounts and value added taxes. Turnover includes revenue earned from the sale of goods and from the rendering of services.

Turnover from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have transferred to the buyer.

Turnover from the rendering of services is recognised by reference to the stage of completion of the contract. The stage of completion of a contract is measured by comparing the costs incurred for work performed to date to the total estimated contract costs. Amounts recoverable on contracts are included within debtors and represent turnover recognised in excess of payments on account. Payments on account in excess of amounts recognised as turnover are included within creditors.

Goodwill
Goodwill, being the amount paid in connection with the acquisition of a business in 2022, is being amortised evenly over its estimated useful life of ten years.

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.

Patents and licences are being amortised evenly over their estimated useful life of three years.

Embrace Steel Group Ltd (Registered number: 12939220)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 December 2023

3. ACCOUNTING POLICIES - continued

Tangible fixed assets
Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.
Freehold property - 2% of cost or valuation
Plant and machinery - 15% on reducing balance
Fixtures and fittings - 25% on reducing balance

Investment property
Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss.

Stocks
Stocks are measured at the lower of cost and estimated selling price less costs to complete and
sell. Cost is determined using the first in first out method. The carrying amount of stock sold is
recognised as an expense in the period in which the related revenue is recognised.

Taxation
Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated 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.

Foreign currencies
Transactions in foreign currencies are initially recognised at the rate of exchange ruling at the date
of the transaction.

At the end of each reporting period foreign currency monetary items are translated at the closing
rate of exchange. Non-monetary items that are measured at historical cost are translated at the
rate ruling at the date of the transaction. All differences are charged to profit or loss.

Pension costs and other post-retirement benefits
The group operates a defined contribution pension scheme. Contributions are charged to the
profit and loss account as they become payable in accordance with the rules of the scheme.

Embrace Steel Group Ltd (Registered number: 12939220)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 December 2023

3. ACCOUNTING POLICIES - continued

Construction contracts
Where the outcome of a construction contract can be estimated reliably, revenue and costs are
recognised by reference to the stage of completion of the contract activity at the balance sheet
date. This is normally measured by the proportion that contract costs incurred for work performed
to date bear to the estimated total contract costs, except where this would not be representative of
the stage of completion. Variations in contract work, claims and incentive payments are included
to the extent that the amount can be measured reliably and its receipt is considered probable.

Where the outcome of a construction contract cannot be estimated reliably, contract revenue is
recognised to the extent of contract costs incurred where it is probable they will be recoverable.
Contract costs are recognised as expenses in the period in which they are incurred. When costs
incurred in securing a contract are recognised as an expense in the period in which they are
incurred, they are not included in contract costs if the contract is obtained in a subsequent period.

When it is probable that total contract costs will exceed total contract revenue, the expected loss is
recognised as an expense immediately.

4. TURNOVER

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

An analysis of turnover by class of business is given below:

31/12/23 31/12/22
as restated
£    £   
Construction contracts 26,152,699 7,495,659
Sale of stock and material 86,195 59,514
26,238,894 7,555,173

5. EMPLOYEES AND DIRECTORS
31/12/23 31/12/22
as restated
£    £   
Wages and salaries 1,207,511 1,117,955
Social security costs 13,882 35,969
Other pension costs 15,108 33,722
1,236,501 1,187,646

The average number of employees during the year was as follows:
31/12/23 31/12/22
as restated

Administration 5 9
Manufacturing 23 36
28 45

The average number of employees by undertakings that were proportionately consolidated during the year was 28 (2022 - 45 ) .

Embrace Steel Group Ltd (Registered number: 12939220)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 December 2023

5. EMPLOYEES AND DIRECTORS - continued

31/12/23 31/12/22
as restated
£    £   
Directors' remuneration - -

6. OPERATING PROFIT

The operating profit is stated after charging:

31/12/23 31/12/22
as restated
£    £   
Depreciation - owned assets 177,091 158,026
Loss on disposal of fixed assets 43,647 54,976
Goodwill amortisation 158,924 95,790
Patents and licences amortisation 116,640 17,302
Auditors' remuneration 23,250 15,917
Foreign exchange differences - 125

7. INTEREST PAYABLE AND SIMILAR EXPENSES
31/12/23 31/12/22
as restated
£    £   
Bank interest 107,634 39,723
Bank loan interest 92,773 10,121
Loan interest 92,047 67,758
Hire purchase 6,983 4,947
299,437 122,549

8. TAXATION

Analysis of the tax charge
The tax charge on the profit for the year was as follows:
31/12/23 31/12/22
as restated
£    £   
Current tax:
UK corporation tax 236,756 76,549
Corporation tax prior year - (33,298 )
Total current tax 236,756 43,251

Deferred tax 31,326 113,053
Tax on profit 268,082 156,304

Embrace Steel Group Ltd (Registered number: 12939220)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 December 2023

8. TAXATION - continued

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:

31/12/23 31/12/22
as restated
£    £   
Profit before tax 1,013,017 849,196
Profit multiplied by the standard rate of corporation tax in the UK
of 25 % (2022 - 19 %)

253,254

161,347

Effects of:
Expenses not deductible for tax purposes 15,141 10,445
Income not taxable for tax purposes - (56,050 )
Depreciation in excess of capital allowances 34,300 11,853
Adjustments to tax charge in respect of previous periods - (70,143 )
Change in tax rate (14,962 ) -
Pre acquisition adjustment - (14,201 )
Utlisation of losses (50,977 ) -
Deferred tax movement 31,326 113,053
Total tax charge 268,082 156,304

Tax effects relating to effects of other comprehensive income

There were no tax effects for the year ended 31 December 2023.

31/12/22
Gross Tax Net
£    £    £   
Property revaluation 528,750 (103,917 ) 424,833

9. INDIVIDUAL INCOME STATEMENT

As permitted by Section 408 of the Companies Act 2006, the Income Statement of the parent company is not presented as part of these financial statements.


10. DIVIDENDS
31/12/23 31/12/22
as restated
£    £   
shares of each
Final 70,500 -

11. PRIOR YEAR ADJUSTMENT

The 2022 balance sheet has been restated to include loan note liabilities of £265,088 redeemable in 2027.

The 2022 balance sheet has been restated to included preference shares issued after date in relation to the acquisition of Hambleton Steel Group Limited. The preference shares hold a redeemable value of £1,020,495.

Embrace Steel Group Ltd (Registered number: 12939220)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 December 2023

12. INTANGIBLE FIXED ASSETS

Group
Patents
and
Goodwill licences Totals
£    £    £   
COST
At 1 January 2023 1,669,239 226,370 1,895,609
Additions - 270,864 270,864
Disposals - (41,220 ) (41,220 )
At 31 December 2023 1,669,239 456,014 2,125,253
AMORTISATION
At 1 January 2023 175,790 17,302 193,092
Amortisation for year 158,924 116,640 275,564
Eliminated on disposal - (5,725 ) (5,725 )
At 31 December 2023 334,714 128,217 462,931
NET BOOK VALUE
At 31 December 2023 1,334,525 327,797 1,662,322
At 31 December 2022 1,493,449 209,068 1,702,517

13. TANGIBLE FIXED ASSETS

Group
Fixtures
Freehold Plant and and
property machinery fittings Totals
£    £    £    £   
COST OR VALUATION
At 1 January 2023 1,991,962 956,363 133,618 3,081,943
Additions 33,391 16,331 54,734 104,456
Disposals (1,600 ) (17,661 ) (31,238 ) (50,499 )
At 31 December 2023 2,023,753 955,033 157,114 3,135,900
DEPRECIATION
At 1 January 2023 247,621 502,357 62,325 812,303
Charge for year 84,093 69,308 23,690 177,091
Eliminated on disposal (836 ) (13,801 ) (27,712 ) (42,349 )
At 31 December 2023 330,878 557,864 58,303 947,045
NET BOOK VALUE
At 31 December 2023 1,692,875 397,169 98,811 2,188,855
At 31 December 2022 1,744,341 454,006 71,293 2,269,640

Embrace Steel Group Ltd (Registered number: 12939220)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 December 2023

13. TANGIBLE FIXED ASSETS - continued

Group

Cost or valuation at 31 December 2023 is represented by:

Fixtures
Freehold Plant and and
property machinery fittings Totals
£    £    £    £   
Valuation in 2022 427,500 - - 427,500
Cost 1,596,253 955,033 157,114 2,708,400
2,023,753 955,033 157,114 3,135,900

If freehold property had not been revalued they would have been included at the following historical cost:

31/12/23 31/12/22
as restated
£    £   
Cost 1,564,462 1,564,462
Aggregate depreciation 348,871 348,871

Freehold property were valued on an open market basis on 5 January 2023 by Eddisons Chartered Surveyors .

14. FIXED ASSET INVESTMENTS

Company
Other
investments
£   
COST
At 1 January 2023
and 31 December 2023 1
NET BOOK VALUE
At 31 December 2023 1
At 31 December 2022 1

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

Subsidiaries

Hambleton Steel (South) Limited
Registered office: Gatherley Road, Brompton on Swale, Richmond, North Yorkshire, DL10 5SF
Nature of business: Construction
%
Class of shares: holding
Ordinary 100.00

Embrace Steel Group Ltd (Registered number: 12939220)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 December 2023

14. FIXED ASSET INVESTMENTS - continued

Hambleton Structures Limited
Registered office: Gatherley Road, Brompton on Swale, Richmond, North Yorkshire, DL10 5SF
Nature of business: Dormant
%
Class of shares: holding
Ordinary 100.00

Sublet Fabrications Limited
Registered office: Gatherley Road, Brompton on Swale, Richmond, North Yorkshire, DL10 5SF
Nature of business: Construction
%
Class of shares: holding
Ordinary 100.00

Hambleton Steel Limited
Registered office: Gatherley Road, Brompton on Swale, Richmond, North Yorkshire, DL10 5SF
Nature of business: Construction
%
Class of shares: holding
Ordinary 100.00

Hambleton Steel Group Limited
Registered office: Gatherley Road, Brompton on Swale, Richmond, North Yorkshire, DL10 5SF
Nature of business: Construction
%
Class of shares: holding
Ordinary 100.00

ESG Bidco01 Limited
Registered office: 71-75 Shelton Street, Covent Garden, London, United Kingdom, WC2H 9JQ
Nature of business: Holding company
%
Class of shares: holding
Ordinary 100.00

All subsidiaries have been included in the consolidation.


15. INVESTMENT PROPERTY

Group
Total
£   
FAIR VALUE
At 1 January 2023
and 31 December 2023 2,120,000
NET BOOK VALUE
At 31 December 2023 2,120,000
At 31 December 2022 2,120,000

The investment property was valued by Eddisons Real Estate Valuers on 5th January
2023 in accordance with RICS Valuation - Global Standards incorporating IVSC International
Valuation Standards.

Embrace Steel Group Ltd (Registered number: 12939220)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 December 2023

15. INVESTMENT PROPERTY - continued

Group

Fair value at 31 December 2023 is represented by:
£   
Valuation in 2022 295,000
Cost 1,825,000
2,120,000

If investment property had not been revalued it would have been included at the following historical cost:

31/12/23 31/12/22
as restated
£    £   
Cost 1,325,158 1,325,158

Investment property was valued on an open market basis on 5 January 2023 by Eddisons Chartered Surveyors .

16. STOCKS

Group
31/12/23 31/12/22
as restated
£    £   
Stocks 139,464 180,413

17. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group Company
31/12/23 31/12/22 31/12/23 31/12/22
as
restated
as
restated
£    £    £    £   
Trade debtors 35,735 479,350 - -
Amounts owed by group undertakings - 18 1,340,489 1,340,490
Amounts recoverable on contract 5,256,142 1,801,550 - -
Other debtors 866,389 126,450 346,745 -
Called up share capital not paid 3 3 3 3
Prepayments and accrued income 272,118 214,577 - -
6,430,387 2,621,948 1,687,237 1,340,493

Embrace Steel Group Ltd (Registered number: 12939220)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 December 2023

18. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group Company
31/12/23 31/12/22 31/12/23 31/12/22
as
restated
as
restated
£    £    £    £   
Bank loans and overdrafts (see note 20)
55,180

-

-

-
Other loans (see note 20) 2,144,101 134,440 - -
Hire purchase contracts (see note 21) 30,952 47,068 - -
Trade creditors 5,006,000 1,245,272 - -
Amounts owed to group undertakings 652,145 3,277,613 346,744 -
Tax 245,304 106,928 - -
Social security and other taxes 30,996 31,693 - -
VAT 7,963 7,963 - -
Other creditors 870,148 363,152 - -
Accruals and deferred income 534,099 62,360 - -
Accrued expenses - 9,461 - -
9,576,888 5,285,950 346,744 -

19. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE
YEAR

Group Company
31/12/23 31/12/22 31/12/23 31/12/22
as
restated
as
restated
£    £    £    £   
Bank loans (see note 20) 2,443,106 - - -
Other loans (see note 20) 383,269 1,292,931 - -
Hire purchase contracts (see note 21) 22,325 53,501 - -
Other creditors 1,285,583 1,285,583 1,020,495 1,020,495
4,134,283 2,632,015 1,020,495 1,020,495

Other creditors falling due after more than one year include preference shares valued at £1,020,495 that are redeemable after 31 December 2024.

Embrace Steel Group Ltd (Registered number: 12939220)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 December 2023

20. LOANS

An analysis of the maturity of loans is given below:

Group
31/12/23 31/12/22
as restated
£    £   
Amounts falling due within one year or on demand:
Bank loans 55,180 -
Other loans 2,144,101 134,440
2,199,281 134,440
Amounts falling due between one and two years:
Bank loans - 1-2 years 39,822 -
Other loans - 1-2 years 383,269 1,292,931
423,091 1,292,931
Amounts falling due between two and five years:
Bank loans - 2-5 years 138,568 -
Amounts falling due in more than five years:
Repayable by instalments
Bank loans more 5 yr by instal 2,264,716 -

21. LEASING AGREEMENTS

Minimum lease payments fall due as follows:

Group
Hire purchase contracts
31/12/23 31/12/22
as restated
£    £   
Net obligations repayable:
Within one year 30,952 47,068
Between one and five years 22,325 53,501
53,277 100,569

22. PROVISIONS FOR LIABILITIES

Group
31/12/23 31/12/22
as restated
£    £   
Deferred tax 442,917 411,591

Embrace Steel Group Ltd (Registered number: 12939220)

Notes to the Consolidated Financial Statements - continued
for the year ended 31 December 2023

22. PROVISIONS FOR LIABILITIES - continued

Group
Deferred
tax
£   
Balance at 1 January 2023 411,591
Provided during year 970
Change of tax rates 30,356
Balance at 31 December 2023 442,917

23. CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:
Number: Class: Nominal 31/12/23 31/12/22
value: as
restated
£    £   
7,500 Ordinary 0.001 8 8

24. RESERVES

Group
Fair
Retained Share Revaluation value
earnings premium reserve reserve Totals
£    £    £    £    £   

At 1 January 2023 514,469 319,991 424,833 178,423 1,437,716
Profit for the year 581,729 581,729
Dividends (70,500 ) (70,500 )
Reserves transfer (8,550 ) - 8,550 - -
At 31 December 2023 1,017,148 319,991 433,383 178,423 1,948,945


25. CONTINGENT LIABILITIES

2023 2022
£ £

Warranty bonds 2,000,000 750,000

Warranty bonds require the company to make payments to third parties in the event that the company does not perform what is expected of it under the terms of certain construction contracts.

26. ULTIMATE CONTROLLING PARTY

The company is controlled by its ultimate parent company, Catalyst Ventures Ltd, a
company incorporated in England and Wales (company number 06692629). This is by virtue of its
holding 60% of the issued share capital in the company.

The ultimate controlling party is J Hacker by virtue of his majority shareholding in the ultimate
parent company, Catalyst Ventures Ltd. A copy of the consolidated accounts can be obtained from
the registered office.