Caseware UK (AP4) 2024.0.164 2024.0.164 2023-12-312023-12-312023-01-01falseNo description of principal activityfalse6977truefalse 10785183 2023-01-01 2023-12-31 10785183 2022-01-01 2022-12-31 10785183 2023-12-31 10785183 2022-12-31 10785183 2022-01-01 10785183 1 2023-01-01 2023-12-31 10785183 1 2022-01-01 2022-12-31 10785183 d:CompanySecretary1 2023-01-01 2023-12-31 10785183 d:Director1 2023-01-01 2023-12-31 10785183 d:Director1 2023-12-31 10785183 d:Director2 2023-01-01 2023-12-31 10785183 d:Director3 2023-01-01 2023-12-31 10785183 d:Director4 2023-01-01 2023-12-31 10785183 d:RegisteredOffice 2023-01-01 2023-12-31 10785183 e:Buildings e:ShortLeaseholdAssets 2023-01-01 2023-12-31 10785183 e:Buildings e:ShortLeaseholdAssets 2023-12-31 10785183 e:Buildings e:ShortLeaseholdAssets 2022-12-31 10785183 e:LandBuildings 2023-12-31 10785183 e:LandBuildings 2022-12-31 10785183 e:ComputerEquipment 2023-01-01 2023-12-31 10785183 e:ComputerEquipment 2023-12-31 10785183 e:ComputerEquipment 2022-12-31 10785183 e:ComputerEquipment e:OwnedOrFreeholdAssets 2023-01-01 2023-12-31 10785183 e:OwnedOrFreeholdAssets 2023-01-01 2023-12-31 10785183 e:CurrentFinancialInstruments 2023-12-31 10785183 e:CurrentFinancialInstruments 2022-12-31 10785183 e:Non-currentFinancialInstruments 2023-12-31 10785183 e:Non-currentFinancialInstruments 2022-12-31 10785183 e:CurrentFinancialInstruments e:WithinOneYear 2023-12-31 10785183 e:CurrentFinancialInstruments e:WithinOneYear 2022-12-31 10785183 e:Non-currentFinancialInstruments e:AfterOneYear 2023-12-31 10785183 e:Non-currentFinancialInstruments e:AfterOneYear 2022-12-31 10785183 e:ReportableOperatingSegment1 2023-01-01 2023-12-31 10785183 e:ReportableOperatingSegment1 2022-01-01 2022-12-31 10785183 e:ReportableOperatingSegment2 2023-01-01 2023-12-31 10785183 e:ReportableOperatingSegment2 2022-01-01 2022-12-31 10785183 f:UnitedKingdom 2023-01-01 2023-12-31 10785183 f:UnitedKingdom 2022-01-01 2022-12-31 10785183 f:RestEuropeOutsideUK 2023-01-01 2023-12-31 10785183 f:RestEuropeOutsideUK 2022-01-01 2022-12-31 10785183 f:RestWorldOutsideUK 2023-01-01 2023-12-31 10785183 f:RestWorldOutsideUK 2022-01-01 2022-12-31 10785183 e:UKTax 2023-01-01 2023-12-31 10785183 e:UKTax 2022-01-01 2022-12-31 10785183 e:ShareCapital 2023-12-31 10785183 e:ShareCapital 2022-12-31 10785183 e:ShareCapital 2022-01-01 10785183 e:SharePremium 2023-01-01 2023-12-31 10785183 e:SharePremium 2023-12-31 10785183 e:SharePremium 1 2023-01-01 2023-12-31 10785183 e:SharePremium 2022-01-01 2022-12-31 10785183 e:SharePremium 2022-12-31 10785183 e:SharePremium 2022-01-01 10785183 e:SharePremium 1 2022-01-01 2022-12-31 10785183 e:OtherMiscellaneousReserve 2023-01-01 2023-12-31 10785183 e:OtherMiscellaneousReserve 2023-12-31 10785183 e:OtherMiscellaneousReserve 1 2023-01-01 2023-12-31 10785183 e:OtherMiscellaneousReserve 2022-01-01 2022-12-31 10785183 e:OtherMiscellaneousReserve 2022-12-31 10785183 e:OtherMiscellaneousReserve 2022-01-01 10785183 e:OtherMiscellaneousReserve 1 2022-01-01 2022-12-31 10785183 e:RetainedEarningsAccumulatedLosses 2023-01-01 2023-12-31 10785183 e:RetainedEarningsAccumulatedLosses 2023-12-31 10785183 e:RetainedEarningsAccumulatedLosses 1 2023-01-01 2023-12-31 10785183 e:RetainedEarningsAccumulatedLosses 2022-01-01 2022-12-31 10785183 e:RetainedEarningsAccumulatedLosses 2022-12-31 10785183 e:RetainedEarningsAccumulatedLosses 2022-01-01 10785183 e:RetainedEarningsAccumulatedLosses 1 2022-01-01 2022-12-31 10785183 e:FurtherSpecificTypeProvisionContingentLiability1ComponentTotalProvisionsContingentLiabilities 2023-01-01 2023-12-31 10785183 e:FurtherSpecificTypeProvisionContingentLiability1ComponentTotalProvisionsContingentLiabilities 2023-12-31 10785183 e:FurtherSpecificTypeProvisionContingentLiability1ComponentTotalProvisionsContingentLiabilities 2022-12-31 10785183 e:FurtherSpecificTypeProvisionContingentLiability2ComponentTotalProvisionsContingentLiabilities 2023-01-01 2023-12-31 10785183 e:FurtherSpecificTypeProvisionContingentLiability2ComponentTotalProvisionsContingentLiabilities 2023-12-31 10785183 e:FurtherSpecificTypeProvisionContingentLiability2ComponentTotalProvisionsContingentLiabilities 2022-12-31 10785183 d:OrdinaryShareClass1 2023-01-01 2023-12-31 10785183 d:OrdinaryShareClass1 2023-12-31 10785183 d:OrdinaryShareClass1 2022-12-31 10785183 d:FRS102 2023-01-01 2023-12-31 10785183 d:Audited 2023-01-01 2023-12-31 10785183 d:FullAccounts 2023-01-01 2023-12-31 10785183 d:PrivateLimitedCompanyLtd 2023-01-01 2023-12-31 10785183 e:Subsidiary1 2023-01-01 2023-12-31 10785183 e:Subsidiary1 1 2023-01-01 2023-12-31 10785183 e:Subsidiary2 2023-01-01 2023-12-31 10785183 e:Subsidiary2 1 2023-01-01 2023-12-31 10785183 e:Subsidiary3 2023-01-01 2023-12-31 10785183 e:Subsidiary3 1 2023-01-01 2023-12-31 10785183 e:Subsidiary4 2023-01-01 2023-12-31 10785183 e:Subsidiary4 1 2023-01-01 2023-12-31 10785183 e:Subsidiary5 2023-01-01 2023-12-31 10785183 e:Subsidiary5 1 2023-01-01 2023-12-31 10785183 e:Subsidiary6 2023-01-01 2023-12-31 10785183 e:Subsidiary6 1 2023-01-01 2023-12-31 10785183 e:Subsidiary7 2023-01-01 2023-12-31 10785183 e:Subsidiary7 1 2023-01-01 2023-12-31 10785183 e:Subsidiary8 2023-01-01 2023-12-31 10785183 e:Subsidiary8 1 2023-01-01 2023-12-31 10785183 e:WithinOneYear 2023-12-31 10785183 e:WithinOneYear 2022-12-31 10785183 e:BetweenOneFiveYears 2023-12-31 10785183 e:BetweenOneFiveYears 2022-12-31 10785183 2 2023-01-01 2023-12-31 10785183 6 2023-01-01 2023-12-31 10785183 7 2023-01-01 2023-12-31 10785183 e:ShareCapital 1 2023-01-01 2023-12-31 10785183 e:ShareCapital 1 2022-01-01 2022-12-31 10785183 e:AcceleratedTaxDepreciationDeferredTax 2023-12-31 10785183 e:AcceleratedTaxDepreciationDeferredTax 2022-12-31 10785183 e:TaxLossesCarry-forwardsDeferredTax 2023-12-31 10785183 e:TaxLossesCarry-forwardsDeferredTax 2022-12-31 10785183 g:USDollar 2023-01-01 2023-12-31 xbrli:shares iso4217:GBP xbrli:pure


Registered number: 10785183












IROBOT UK LTD.
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

 

IROBOT UK LTD

CONTENTS



Page
Company information
 
1
Strategic report
 
2 - 12
Directors' report
 
13
Directors' responsibilities statement
 
14
Independent auditor's report
 
15 - 18
Profit and loss account
 
19
Balance sheet
 
20
Statement of changes in equity
 
21
Notes to the financial statements
 
22 - 42


 

IROBOT UK LTD
 
COMPANY INFORMATION


Directors
G D Weinstein 
J J Blanc 
S K Wong 
T Drake 




Company secretary
G D Weinstein



Registered number
10785183



Registered office
Thomas House, 84 Eccleston Square
London

England

SW1V 1PX




Independent auditor
Blick Rothenberg Audit LLP
Chartered Accountants & Statutory Auditor

16 Great Queen Street

Covent Garden

London

WC2B 5AH




Page 1

 

IROBOT UK LTD
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Introduction
 
The directors present their Strategic Report for the period from 1 January 2023 to 31 December 2023. 

Business review
 
iRobot UK LTD (the "Company" or “Our”) is a wholly owned subsidiary of iRobot Corporation (together the "Group" or “iRobot”). iRobot is a leading global consumer robot company that designs and builds robots that empower people to do more. With over 30 years of artificial intelligence ("AI") and advanced robotics experience, we are focused on building thoughtful robots and developing intelligent home innovations that help make life better for millions of people around the world. iRobot's portfolio of home robots and smart home devices features proprietary technologies for the connected home and advanced concepts in cleaning, mapping and navigation, human-robot interaction and physical solutions. Leveraging this portfolio, we plan to add new capabilities and expand our offerings to help consumers make their homes easier to maintain, more efficient, more secure and healthier places to live.
Since iRobot’s founding in 1990, we have developed the expertise necessary to design, build, sell and support durable, high-performance and cost-effective robots through the close integration of software, electronics and hardware. Following the introduction of the Roomba robotic vacuum cleaner ("RVC") in 2002, we have sold over 50 million consumer robots worldwide to become a global, market-leading consumer robotics innovator with a strong presence in a number of major geographic regions worldwide. Our core technologies serve as reusable building blocks that we adapt and expand to create next-generation robotic platforms. We believe that this approach accelerates the time to market while also reducing the costs, time and other risks associated with product development. These capabilities are amplified by iRobot OS. The software intelligence of iRobot OS powers our portfolio of connected robotic floorcare products, enabling an expanding range of new features and thoughtful digital experiences that improve overall cleaning performance, personalization and control. By leveraging our considerable expertise and ongoing investment in AI, home understanding and machine vision technologies, iRobot OS provides consumers with greater control over where, when and how our robots work, simple integration with other smart home devices, thoughtful recommendations to further enhance the cleaning experience, and the ability to share and transfer home knowledge across multiple iRobot robots. We believe that the capabilities within iRobot OS will help support our long-term vision of building out a larger ecosystem that encompasses a broader range of robots. We believe that our significant expertise in robot design, engineering, and smart home technologies and targeted focus on understanding and addressing consumer needs, positions us well to expand our total addressable market and capitalize on the anticipated growth in a wider range of robots.
As previously disclosed, on August 4, 2022, we entered into an Agreement and Plan of Merger (the "Original Merger Agreement") with Amazon.com, Inc., a Delaware corporation ("Parent" or "Amazon"), and Martin Merger Sub, Inc., a Delaware corporation and an indirect wholly owned subsidiary of Amazon ("Merger Sub"), providing for, among other things, the merger of Merger Sub with and into iRobot, iRobot surviving the merger as a wholly owned subsidiary of Parent (the "Merger", and, together with the other transactions contemplated by the Merger Agreement (as defined below), the "Transactions"). On July 24, 2023, we, Amazon and Merger Sub entered into an amendment to the Original Merger Agreement (the "Amendment", and the Original Merger Agreement, as amended and supplemented by the Amendment, the "Merger Agreement"). The Amendment adjusted the merger consideration to reflect the incurrence of the Term Loan. On January 28, 2024, we and Amazon mutually agreed to terminate the Merger Agreement and entered into a mutual termination agreement effective as of such date (the "Termination Agreement"). The termination of the Merger Agreement was approved by our Board of Directors.
 
Page 2

 

IROBOT UK LTD

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023


Continuing from 2022, our revenue performance was impacted by lower orders from retailers and distributors largely resulting from a decline in consumer sentiment and resultant spending. The overall market conditions continued to be challenging and we saw increased competition in EMEA throughout 2023. In recent years, with increased competition in the floorcare segment, we have conceded some market share to the competitive entrants. In 2023, we focused on managing our cash and executing on our near-term robotic floorcare roadmaps, while working to obtain necessary regulatory approvals to complete the Transactions with Amazon. To achieve our goals for the year and set us up for success, we continued to implement a variety of measures to reduce spending, including workforce reductions. During the third quarter of 2022, we reduced our workforce and terminated approximately 100 employees, 7 of which were located in the UK. During the first quarter of fiscal 2023, we further reduced our workforce by approximately 85 employees, 2 of which were in the UK. During 2023, we also scaled back working media and other demand-generation activities, limited investment in non-robotic product categories and engaged in minimal new hiring. 
Our strategy has important near-term and long-term elements, each designed to drive sustainable, profitable growth. In the near-term, we are focused on stabilizing our company following the termination of the Merger with Amazon. Key to this stabilization effort is the near-term implementation of an operational restructuring plan to more closely align our cost structure with near-term revenue expectations and drive profitability, including through the following financial and strategic initiatives:

achieving gross margin improvements through the execution of agreements with joint design and contract manufacturing partners on more beneficial terms that provide significant reductions in cost of goods sold;
reducing research and development expense through increased offshoring of non-core engineering functions to lower-cost regions;
centralizing global marketing activities and consolidating agency expenditures to reduce sales and marketing expenses while seeking efficiencies in demand generation activities to drive sales more cost effectively;
evaluating and streamlining our global entity structure to eliminate unnecessary real estate expenditures, legal entity costs, and find efficiencies in operations; and
focusing our product roadmap on core value drivers within robotic floorcare.
 
These near-term changes are designed to return us to profitability and ensure the liquidity necessary to fund long-term strategic growth initiatives.
In the longer-term, we believe that a continued focus on innovation is necessary to maintain leadership in the robotic floorcare category. We typically deliver new, high-value functionality and features in our newest products. We also focus on cost-optimizing our innovations in ways that extend those capabilities across our portfolio. In addition to continuing to advance beautifully designed, high-performance hardware platforms, our investments in research and development also support ongoing advances in iRobot OS by leveraging our extensive AI, home understanding and machine vision capabilities. We believe that software intelligence will be increasingly critical for differentiating our floorcare robots and other home innovations. Customer demand for more 2-in-1 robotic cleaners continues to grow, and during 2023, we delivered several important new innovations centered around 2-in-1 robotic cleaners while also taking steps to protect our innovations, including: (i) we launched two upgrades to iRobot OS, delivering new features and digital experiences across our entire portfolio of WiFi-connected floor cleaning robots; and (ii) in September 2023, we introduced the Roomba Combo i5+, Roomba Combo j5+, Roomba j9+ and Roomba Combo j9+, our most powerful and intelligent robot.
In addition to our commitment to driving innovation in robotic floorcare, our strategy requires that we continue to invest in ensuring that our customers have the best possible experience with our products and that they use our products consistently. We believe that a highly satisfied iRobot customer is more likely to recommend our products to others and purchase more products and accessories directly from us over the course of their ownership. Accordingly, we plan to invest in features and functionality aimed at elevating the iRobot experience as well as in our customer care organization. We will continue to take steps to further enhance our customer care capabilities and will continue to focus on improving our customer satisfaction.
In the longer-term, we believe that our focus on innovation – including developing and protecting key robotic technologies and maintaining key talent in robotics – will allow the development over time of new products not only within robotic floorcare but also in other robotic categories.
Page 3

 

IROBOT UK LTD

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023


Principal risks and uncertainties
 
The management of the business and the execution of the Company's strategies are subject to several risks.
The principal risks and uncertainties are integrated with the principal risks of the Group and are not managed separately. Accordingly, the principal risks and uncertainties of the Group, which include those of the Company, are discussed on pages 11 to 26 of the Group's 2023 Annual Report, with updated risks noted in the Group's Q3 2024 Interim Report, which do not form part of this report. Additional risks noted in the Q3 2024 Interim Report are related to contract manufacturers, employee retention and cybersecurity.

Financial risk management

Currency
We face intense competition from other providers of robots, including diversified technology providers, as well as competition from providers offering alternative products, which could negatively impact our results of operations and cause our market share to decline. A number of companies have developed or are developing robots that will compete directly with our product offerings. Our competition includes established, well-known sellers of floor cleaning robots such as Ecovacs, SharkNinja, Samsung, Roborock, Dreame, as well as new market entrants. Many current and potential competitors are larger in size and more broadly diversified with substantially greater financial, marketing, research and manufacturing resources than we possess, and there can be no assurance that our current and future competitors will not be more successful than us. We also face competition from manufacturers of lower-cost devices, which has, and may continue to, further drive down the average selling price in the marketplace for floor cleaning products and impact demand for our products as macroeconomic conditions result in consumers shifting towards lower-cost alternatives. Moreover, while we believe many customers purchase our floor vacuuming robots as a supplement to, rather than a replacement for, their traditional vacuum cleaners, we also compete with providers of traditional vacuum cleaners.
The global market for robots is highly competitive, rapidly evolving and subject to changing technologies, including the utilization of evolving AI technologies, shifting customer needs and expectations and the likely increased introduction of new products. Our ability to remain competitive will depend to a great extent upon our ongoing performance in the areas of product development, operating efficiency and customer support.

Competition
We face intense competition from other providers of robots, including diversified technology providers, as well as competition from providers offering alternative products, which could negatively impact our results of operations and cause our market share to decline. A number of companies have developed or are developing robots that will compete directly with our product offerings. Our competition includes established, well-known sellers of floor cleaning robots such as Ecovacs, SharkNinja, Samsung, Roborock, as well as new market entrants. Many current and potential competitors are larger in size and more broadly diversified with substantially greater financial, marketing, research and manufacturing resources than we possess, and there can be no assurance that our current and future competitors will not be more successful than us. We also face competition from manufacturers of lower-cost devices, which has, and may continue to, further drive down the average selling price in the marketplace for floor cleaning products. Moreover, while we believe many customers purchase our floor vacuuming robots as a supplement to, rather than a replacement for, their traditional vacuum cleaners, we also compete with providers of traditional vacuum cleaners.
We expect that competition will continue to intensify as additional competitors enter the market and current competitors expand their product lines. Companies competing with us have, and may continue to, introduce products that are competitively priced, have increased performance or functionality, or incorporate technological advances that we have not yet developed or implemented. Increased competitive pressure has resulted and will continue to result in a loss of sales or market share or cause us to lower prices for our products, any of which would harm our business and operating results.
 
Page 4

 

IROBOT UK LTD

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023


Many of our competitors have demonstrated an ability to rapidly replicate new features and innovations that we have introduced into the market, and therefore are able to offer products with similar capabilities to ours at lower prices. Other competitors have demonstrated the ability to innovate more rapidly than we have, and those innovations – particularly in the development of 2-in-1 robot vacuum cleaners – have allowed competitors to offer products at premium price points as well as capture significant market share in certain geographic markets. In addition, some of our competitors aggressively discount their products and services in order to gain market share, which has resulted in pricing pressures, reduced profit margins and lost market share. In addition, new products often have lower volumes, lower selling prices or higher costs than products that have been sold for at least a year; any or all of those factors could negatively impact our gross margins and operating results.
 
The global market for robots is highly competitive, rapidly evolving and subject to changing technologies, shifting customer needs and expectations and the likely increased introduction of new products. Our ability to remain competitive will depend to a great extent upon our ongoing performance in the areas of product development, operating efficiency and customer support.

Consumer Demand
Reductions in consumer demand for our products have caused a decrease in revenue from sales of our products. If we are not successful in increasing consumer demand, or if macroeconomic conditions impacting consumer demand do not improve, we will continue to experience adverse impacts to our revenue and profitability.
To ensure an adequate inventory supply, we must forecast inventory needs and place orders sufficiently in advance with our suppliers and contract manufacturers, based on our estimates of future demand for specific product SKUs by region. Failure to accurately forecast our needs has resulted, and may continue to result, in manufacturing delays, increased costs, or excess inventory. Our ability to accurately forecast demand could be affected by many factors, including changes in consumer demand for our products, changes in demand for the products of our competitors, unanticipated changes in general market conditions, and the weakening of economic conditions or consumer confidence in future economic conditions. Our failure to accurately forecast consumer demand has resulted, and may continue to result, in excess inventory levels or a shortage of certain product models available for sale. Inventory levels in excess of consumer demand has resulted, and may continue to result, in increased promotional intensity to support the sale of excess inventory, which would cause and has caused our gross margins to suffer.
 
Financial key performance indicators
 
2023 Group Financial Performance Highlights
Our total Group revenue for fiscal 2023 was $ 890.6 million, declining 24.7% from revenue of $1,183.4 million in fiscal 2022. Continuing from 2022, our revenue performance was impacted by lower orders from retailers and distributors largely resulting from a decline in consumer sentiment and resultant spending. The overall market conditions continued to be challenging and we saw increased competition in EMEA, Japan and the U.S. throughout 2023. In 2023, we focused on managing our cash and executing on our near-term robotic floorcare roadmaps, while working to obtain necessary regulatory approvals to complete the Transactions with Amazon. To achieve our goals for the year and set us up for success, we continued to implement a variety of measures to reduce spending, including workforce reductions.  During 2023, we also scaled back working media and other demand-generation activities, limited investment in non-robotic floorcare product categories and engaged in minimal new hiring. These actions contributed to a total reduction of $130.2 million in operating expenses for fiscal 2023 as compared to the prior fiscal year. During 2023, we continued to carefully manage our inventory to a level that better aligns with current run rates and seasonality of the business. 

Page 5

 

IROBOT UK LTD

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

202iRobot UK Ltd Financial Performance Highlights
ole1029.png

In the 52 weeks ended 31 December 2023, the Company’s revenue increased by 3% from $ 237,671,396 in
2022 to $244,704,066 in 2023 and gross profit increased from $ 74,696,380 to $85,211,125. The Company’s revenue consisted primarily of intercompany transactions and distributor sales (both entirely done outside the UK), and DTC revenue from our website and marketplace channel in the EU and UK. 


ole120c.png

The Company’s inventory value decreased from $47,073,567 to $36,691,822 during the period. This reduction is a return to target inventory levels after an excess of inventory at the end of FY21. Days in inventory forward looking declined to 96 days compared to 123 days a year earlier.  

                                          ole1c57.png

Page 6

 

IROBOT UK LTD

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Environmental and social governance

Company Culture

The Company employed 62 people on December 31st, 2023 as compared to 70 employees a year earlier. Underpinning our culture is an ongoing commitment to ensuring that our employees, customers and suppliers are treated with dignity and respect. We strive to maintain a workplace that is free from violence, harassment, intimidation and other unsafe or disruptive conditions. Our policy is to provide a safe and healthy workplace and comply with applicable safety and health laws and regulations, as well as internal requirements. 
iRobot believes that the diversity of our talented workforce and their unique experiences, perspectives and viewpoints add value to our ability to meet the changing global requirements of our business. We continue to evolve our programs and practices to attract a variety of perspectives, ideas, skills, and cultural backgrounds to our global iRobot family. 
iRobot stands firmly against racial discrimination and social injustice. We are committed to developing a talented and diverse global workforce, creating workplaces that are inclusive and support the underrepresented communities within which we operate.

Data Privacy and Security
 
We are committed to safeguarding the privacy of customer-related information, including data collected by our connected products. We do not sell information about our customers to third parties. Our privacy policy allows customers to share data with third parties for the customer’s benefit, if they so choose. Additionally, Wi-Fi connected robot performance data is encrypted and sent to our Cloud, where it is stored securely, so it can be shown on the customer’s mobile device and help the customer or iRobot Customer Care diagnose potential performance issues. It is our practice to anonymize and aggregate performance data about our robots, which enables us to assess performance of our robots in the field, inform our product development roadmaps and help our support teams be more responsive.
We take the security of our products very seriously and do everything in our control to make sure the data we have in our system is used for one purpose: making your life easier with iRobot products. Our approach to security continues to be multi-layered around our robots, our Cloud and our apps. We adhere to industry-standard security best practices when developing our products, using technology-leading tools to assist our engineering and security teams during this process. We work closely with our suppliers and partners to ensure that our products and our suppliers’ and partners’ supporting systems (including physical infrastructure, Cloud and mobile apps) are properly configured and monitored with continuous security improvement processes in place. The Roomba j7 Series was the first robot vacuum to achieve the TUV SUD cyber security certification.
In January 2021, iRobot’s Roomba was the only robot vacuum cleaner to earn Consumer Reports’ Excellent rating for data security. But we do not rest on our laurels. We continuously research, develop and modify our processes to help us identify, react to, isolate and resolve security issues within our company and our products as quickly as possible. We also collaborate with independent security researchers who are encouraged to identify issues within our products.





Page 7

 

IROBOT UK LTD

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Environmental Considerations


iRobot’s London office building received the 2017 and 2019 Environmental Green Apple Gold Award for Environmental Best Practice because of recycling more than 70% of the waste produced on site. Recycling activities at this office include cardboard, batteries, plastics, paper, and cans. The building is also ISO 14-001 certified. In addition, the company uses the Nespresso recyclable coffee system and coffee pods and participates in the HP Planet Partners program for recyclable printer toner. The recently refurbished office is outfitted with dimmable lights and motion sensors/detectors, which helps improve overall energy efficiency and cost savings.
iRobot joined the Responsible Business Alliance in April 2020. The RBA is a coalition of the world’s leading electronics companies working together to improve efficiency and social, ethical, and environmental responsibility in the global supply chain. iRobot’s values are well-aligned with the vision and mission of the RBA to create sustainable value for workers, the environment and business through collaboration with our suppliers in ways that improve working and environmental condition. iRobot’s membership in the RBA is enabling us to engage efficiently with our contract manufacturing partners, direct suppliers and broader supply chain. Through this engagement, iRobot administers a supplier code of conduct, leverages tools and resources that drive supply chain sustainability performance and stays informed about key trends and emerging issues. iRobot has rolled out the Supplier Code of Conduct, aligned with the RBA, to all direct material suppliers (including contract manufacturers). 
iRobot’s products – from robot vacuums and mops to air purifiers – are shipped in recyclable, corrugated cardboard. Our product packaging is 93% paper-based (by weight) and recyclable.  While the recyclability of Roomba, Braava and the Automated Dirt Disposal and standard charging blocks vary, certain models have as much as 97% recyclability. In addition to supporting the recycling of up to 24,000 pounds of robots per week, we manage an active refurbishment program for products that have been returned by consumers to its retailers. In Europe, in accordance with EU rules for Waste from Electrical and Electronic Equipment (WEEE), consumers can take iRobot’s products to any electronics retailer to be collected for recycling purposes while products that are scrapped by iRobot in its European workshops will be properly disposed of in compliance with local regulations. 







Page 8

 

IROBOT UK LTD

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Streamlined energy and carbon reporting (SECR)

The Company’s energy use and greenhouse gas (GHG) emissions for the fiscal year ended December 31 are set out below.

ole5d10.png


Quantification and Reporting Methodology
The Company’s emissions are reported with reference to the latest Greenhous Gas Protocol Corporate Accounting and Reporting Standard (GHG Protocol). The 2023 UK Government GHG Conversion Factors for the Company Reporting published by the UK Department for Environment Food and Rural Affairs (DEFRA) are used to convert energy used in the Company’s operations to emissions of CO2e. Data sources include billing, invoices, and our property manager’s internal systems. As we have no logistics operations within the UK, and we have no company cars or transportation vehicles, we have concluded that we have no carbon emissions related to transport to report.
Intensity Metric
An intensity metric of tCO2e per square foot of building area has been applied for the annual total gross emissions. The square footage of the Company’s UK office space is 7,933 square feet.
Energy Efficiency Actions
As indicated above, the building recycles more than 70% of the waste produced on site. The building is also ISO 14-001 accredited and has undergone an audit from the governing body with a 100% rating.  We are working with our business partners to ensure our products and packaging are easy for consumers to recycle, and will continue to improve the recyclability of these as we evolve our design and manufacturing processes.

Page 9

 

IROBOT UK LTD

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Future developments

On January 28, 2024, the Group and Amazon mutually agreed to terminate the Merger Agreement and entered into the Termination Agreement effective as of such date. The termination of the Merger Agreement was approved by the Company's Board of Directors. In accordance with the terms of the Termination Agreement, Amazon made a cash payment to the Group in the previously agreed amount of $94.0 million on January 29, 2024. The Group then made a payment of $18.8 million for professional fees incurred in connection with the Transactions.
During the first quarter of fiscal 2024, we launched the Roomba Combo Essential robot which replaces Roomba 600 Series with an added mopping function, more suction power, longer battery life and intelligent iRobot OS automations. This robot makes the 2-in-1 cleaning experience more accessible to customers given the lower price point. These are the first products to benefit from our new contract manufacturing paradigm, taking advantage of their mature supply chains, expertise in design-for-manufacturing, and flexibility in component selection. 
In July 2024, we introduced the Roomba Combo 10 Max Robot + AutoWash dock, an advanced robot vacuum and mop which brings independent cleaning to a new level. The robot is engineered to powerfully vacuum and mop multiple floor types while the dock automatically refills and recharges the robot, washes and dries the mopping pad, empties debris, and self-cleans. It will be the first robot floor cleaner from iRobot to be compliant with the Matter smart home protocol and compatible with the Apple Home ecosystem. The launch represents an important milestone in our product innovation roadmap and is central to our strategy for Europe, where we aim to capitalize on growth opportunities at the high end of the market. Shipping of the Roomba Combo 10 Max Robot is scheduled to begin in August 2024. 


 
Page 10

 

IROBOT UK LTD

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Statement by the directors on performance of their statutory duties in accordance with S172 (1)
Companies Act 2006

Section 172 (1)(a) to (f) Companies Act 2006 requires the directors to act in the way they consider would be most likely to promote the success of the company for the benefit of its members, as a whole, with regard to the following matters:

a) The likely consequences of any decision in the long-term

The directors believe that they have acted in the way they consider, in good faith, to promote the long-term success of the company. The annual financial budgeting cycle is conducted in agreement with the Group’s guidelines, which requires the long-term impact of strategic decisions to be considered by both local and group management. In 2023, they focused on managing our cash and executing on our near-term robotic floorcare roadmaps, while working to obtain necessary regulatory approvals to complete the Transactions with Amazon. 
b) The interests of the company's employees

The directors consider our people to be our greatest asset and the interests of our employees are always considered. The directors take care over the well-being and environmental awareness of employees. Welfare programmes are optimised and implemented, aiming to protect workers' health and safety. Actions in the year under review included offering an Employee Assistance Plan, which includes counselling sessions and support on a variety of topics, including parenting, personal finances and eldercare

c) The need to foster the company's business relationships with suppliers, customers, and others
 
The directors ensure that the company’s Procurement team works closely with the different departments and third-party suppliers, operates under the Group’s policy, guidelines, and processes, within a controlled environment. The directors aim to work in partnership with suppliers to ensure that they reflect similar values and behaviours to those promoted by the Company. 
The Company puts the customer at the centre of everything we do. The directors ensure that all employees are very much focused on our relationship with the customers and consistently strive to provide quality products and excellent customer service. 

d) The impact of the company's operations on the community and environment
The Company has adopted a Human Rights Policy. Respect for human rights is an essential value for our Company and for the communities in which we operate. We are committed to ensuring that our employees and individuals in the communities affected by our activities are treated with dignity and respect. The Directors believe that following these principles helps our employees and our business thrive as we develop new and exciting technologies for the smart home.
The directors are mindful of environmental issues and have sought to minimise the impact of the company's activities on the environment. The Company leverages on the Group’s supply chain management to optimise and rationalise the environmental impact related to the materials used, whilst also implementing environmental initiatives in our UK offices such as outfitting the office with dimmable lights and motion sensors/detectors, which helps improve overall energy efficiency of the space.
Page 11

 

IROBOT UK LTD

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Statement by the directors on performance of their statutory duties in accordance with S172 (1)
Companies Act 2006 (continued)
e) The desirability of the company maintaining a reputation for high standards of business conduct

The Company follows the Code of Business Conduct and Ethics established by the Board of Directors of iRobot Corporation. This code was established to aid the Company’s directors, employees, and contractors in making ethical and legal decisions when conducting the Company’s business and performing their day-to-day duties. The Company expects its directors, employees, and contractors to exercise reasonable judgment when conducting the Company’s business. The Company encourages its directors, employees, and contractors to refer to this Code frequently to ensure that they are acting within both the letter and the spirit of this Code. Anti-bribery and data protection policies are in place which all employees are expected to read and understand, e learning is provided where appropriate.
 
f) The need to act fairly between members of the company 

The company is a wholly owned subsidiary of iRobot Corporation and the directors have regular and open dialogue with its representatives.   


This report was approved by the board and signed on its behalf.





S K Wong
Director

Date: 3 March 2025

Page 12

 

IROBOT UK LTD

DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

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

Results and dividends

The loss for the year, after taxation, amounted to $60,885,059 (2022 - profit $20,266,698).

The directors do not recommend a dividend.

Directors

The directors who served during the year were:

G D Weinstein (resigned 10 July 2024)
J J Blanc 
S K Wong 

Matters covered in the Strategic Report

As permitted by s414c(11) of the Companies Act 2006, the directors have elected to disclose information, required to be in the directors' report by Schedule 7 of the 'Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008', in the strategic report.

Disclosure of information to auditor

Each of the persons who are directors at the time when this directors' report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the company's auditor is unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the company's auditor is aware of that information.

This report was approved by the board and signed on its behalf.
 





S K Wong
Director

Date: 3 March 2025

Page 13

 

IROBOT UK LTD
 
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023

The directors are responsible for preparing the strategic report, 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 for the company's financial statements and then apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable UK 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 to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Page 14

 

IROBOT UK LTD

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF IROBOT UK LTD
 FOR THE YEAR ENDED 31 DECEMBER 2023

Opinion


We have audited the financial statements of iRobot UK Ltd (the 'company') for the year ended 31 December 2023, which comprise the profit and loss account, the balance sheet, the statement of changes in equity and the notes, including significant accounting policiesThe 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 2023 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's 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 United Kingdom, including the Financial Reporting Council'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 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 other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual reportOur 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. 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 course of 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.


Page 15

 

IROBOT UK LTD

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF IROBOT UK LTD (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Opinion 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 directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report 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 directors' report.


We have nothing to report in respect of the following matters in relation to which 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 directors' responsibilities statement set out on page 14, 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 is 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.


Page 16

 

IROBOT UK LTD

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF IROBOT UK LTD (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Auditor's 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.


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the supply chain and supply sector;
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation and anti-bribery and employment legislation;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

To address the risk of fraud through management bias and override of controls, we:

performed analytical procedures to identify any unusual or unexpected relationships;
tested a sample of journal entries to identify unusual transactions;
assessed whether judgements and assumptions made in determining accounting estimates were indicative of potential bias; and
investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

agreeing financial statement disclosures to underlying supporting documentation;
reading the minutes of meetings of those charged with governance;
enquiring of management as to actual and potential litigation and claims; and
confirming with management that all enquiries made into the company's tax affairs by HMRC and other countries where the company pays taxes have been addressed.
Page 17

 

IROBOT UK LTD

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF IROBOT UK LTD (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.


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 2006Our 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.





Mark Hart FCA CTA (senior statutory auditor)
  
for and on behalf of
Blick Rothenberg Audit LLP
 
Chartered Accountants
Statutory Auditor
  
16 Great Queen Street
Covent Garden
London
WC2B 5AH

 
Date: 
6 March 2025
Page 18

 

IROBOT UK LTD
 
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
$
$

  

Turnover
 4 
244,704,066
237,671,396

Cost of sales
  
(159,492,941)
(162,975,016)

Gross profit
  
85,211,125
74,696,380

Administrative expenses
  
(109,459,296)
(89,512,623)

Other operating income
 5 
57,559
118,237

Operating loss
 6 
(24,190,612)
(14,698,006)

Income from shares in group undertakings
 11 
41,095,623
33,986,673

Amounts written off investments
 12 
(76,046,783)
-

Interest receivable and similar income
 13 
411,832
263,704

Interest payable and similar expenses
 14 
(2,155,119)
(3,120,365)

(Loss)/profit before tax
  
(60,885,059)
16,432,006

Tax on (loss)/profit
 15 
-
3,834,692

(Loss)/profit for the financial year
  
(60,885,059)
20,266,698

There are no items of other comprehensive income for either the year or the prior year other than the profit or loss for the year. Accordingly, no statement of other comprehensive income has been presented.

Page 19


 
REGISTERED NUMBER:10785183
IROBOT UK LTD

BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
2022
Note
$
$

Fixed assets
  

Tangible assets
 16 
569,419
993,551

Investments
 17 
167,563,618
242,841,410

  
168,133,037
243,834,961

Current assets
  

Stocks
 18 
36,691,822
47,073,567

Debtors: amounts falling due after more than one year
 19 
-
5,499,084

Debtors: amounts falling due within one year
 19 
30,470,557
35,605,884

Cash at bank and in hand
  
13,205,158
17,650,314

  
80,367,537
105,828,849

Creditors: amounts falling due within one year
 20 
(85,577,668)
(102,110,729)

Net current (liabilities)/assets
  
 
 
(5,210,131)
 
 
3,718,120

Total assets less current liabilities
  
162,922,906
247,553,081

Creditors: amounts falling due after more than one year
 21 
(61,091,183)
(84,404,896)

Provisions for liabilities
  

Other provisions
 24 
(14,184,618)
(15,479,213)

  
 
 
(14,184,618)
 
 
(15,479,213)

Net assets
  
87,647,105
147,668,972


Capital and reserves
  

Called up share capital 
 25 
13,500,001
13,500,001

Share premium account
 26 
94,499,999
94,499,999

Other reserves
 26 
3,562,769
2,699,577

Profit and loss account
 26 
(23,915,664)
36,969,395

Total equity
  
87,647,105
147,668,972


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 3 March 2025.


S K Wong
Director

The notes on pages 22 to 42 form part of these financial statements.

Page 20

 

IROBOT UK LTD

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023


Called up share capital
Share premium account
Other reserves
Profit and loss account
Total equity

$
$
$
$
$


At 1 January 2022
13,500,001
94,499,999
2,053,053
16,655,387
126,708,440


Comprehensive income for the year

Profit for the year
-
-
-
20,266,698
20,266,698

Share based payment expense
-
-
693,834
-
693,834

Transfer to profit and loss account of share based payments on exercised options
-
-
(47,310)
47,310
-



At 1 January 2023
13,500,001
94,499,999
2,699,577
36,969,395
147,668,972


Comprehensive income for the year

Loss for the year
-
-
-
(60,885,059)
(60,885,059)

Share based payment expense
-
-
863,192
-
863,192


At 31 December 2023
13,500,001
94,499,999
3,562,769
(23,915,664)
87,647,105


The notes on pages 22 to 42 form part of these financial statements.

Page 21

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

iRobot UK Ltd purchases, markets, and distributes consumer robots to its group and distributors in Europe.
 
iRobot UK Ltd is a private company limited by shares incorporated and registered in England and Wales. The address of its registered office and principal place of business is Thomas House, 84 Eccleston Square, London, England, SW1V 1PX.
The financial statements are presented in US Dollars ($), which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest $.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the company's accounting policies (see note 3).

The company was, at the end of the year, a wholly-owned subsidiary of iRobot Corporation, a company incorporated in the USA, whose registered address is 8 Crosby Drive, Bedford, MA 01730. In accordance with the exemption given in Section 401 of the Companies Act 2006, the company is not required to produce, and has not published, consolidated accounts.
The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 102:
• Section 3 Financial Statement Presentation paragraph 3.17(d) (inclusion of statement of cash              flows);
• Section 7 Statement of Cash Flows (inclusion of statement of cash flows);
• Section 11 Financial Instruments paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv),        11.48(b) and 11.48(c) (disclosures relating to financial instruments);
• Section 26 Share based payments (disclosure of share based payments);
• Section 33 Related Party Disclosures paragraph 33.7 (disclosures of key management personnel       compensation).
The company is included in the consolidated financial statements of iRobot Corporation for the year ended 31 December 2022 and these financial statements may be obtained from investor.irobot.com

The following principal accounting policies have been applied:

 
2.2

Going concern

After making enquiries, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence and meet its liabilities as they fall due for the foreseeable future, being a period of at least twelve months from the date these financial statements were approved. In making that assessment the directors have considered the ongoing impact of the inflationary pressures. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.

Page 22

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
the company has transferred the significant risks and rewards of ownership to the buyer;
the company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of revenue can be measured reliably;
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.

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the company will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

Page 23

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.4

Foreign currency translation

Functional and presentation currency

The company's functional and presentational currency for both the current and prior year is US Dollars ($).

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the profit and loss account within administrative expenses.

 
2.5

Lease obligations

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

  
2.6

Research and development

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

 
2.7

Interest income

Interest income is recognised in profit or loss using the effective interest rate method.

 
2.8

Finance costs

Finance costs are charged to profit or 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. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

Page 24

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.9

Pensions

Defined contribution pension plan
The company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid the company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the balance sheet. The assets of the plan are held separately from the company in independently administered funds.

 
2.10

Holiday pay accrual

A liability is recognised to the extent of any unused holiday pay entitlement which is accrued at the balance sheet date and carried forward to future periods. This is measured at the undiscounted salary cost of the future holiday entitlement so accrued at the balance sheet date.

 
2.11

Share-based payments

Where share options are awarded to employees, the fair value of the options at the date of grant is charged to the profit and loss account over the vesting period. Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected to vest at each balance sheet date so that, ultimately, the cumulative amount recognised over the vesting period is based on the number of options that eventually vest. Market vesting conditions are factored into the fair value of the options granted. The cumulative expense is not adjusted for failure to achieve a market vesting condition.
The fair value of the award also takes into account non-vesting conditions. These are either factors beyond the control of either party (such as a target based on an index) or factors which are within the control of one or other of the parties (such as the company keeping the scheme open or the employee maintaining any contributions required by the scheme).
Where share options are awarded to employees, the fair value of the options at the date of grant is charged to the profit and loss account over the vesting period with a corresponding credit to the company's parent on whose shares the options are awarded.

Page 25

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.12

Current and deferred taxation

The tax expense for the period comprises current and deferred tax. Tax is recognised in the profit and loss account, except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

Current tax is the amount of income tax payable in respect of taxable profit for the year or prior years.
The current income tax charge is calculated on the basis of tax rates and laws that have been
enacted or substantively enacted by the balance sheet date in the countries where the company
operates and generates income.

Deferred tax arises from timing differences that are differences between taxable profits and total comprehensive income as stated in the financial statements. These timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in the financial statements.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
 
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent difference. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

 
2.13

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.

Page 26

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.13
Tangible fixed assets (continued)

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

The estimated useful lives range as follows:

Short-term leasehold property
-
10
years
Computer equipment
-
3
years

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.14

Investments

Investments in subsidiaries are measured at cost less accumulated impairment.

  
2.15

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Finished goods includes materials, inbound freight, import duties, and other handling fees and attributable overheads.
At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

  
2.16

Financial instruments

The company has elected to apply Sections 11 and 12 of FRS 102 in respect of financial instruments.
Financial assets and financial liabilities are recognised when the company becomes party to the contractual provisions of the instrument. 
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities. 
The company’s policies for its major classes of financial assets and financial liabilities are set out below. 
 
Page 27

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

Financial instruments (continued)
Financial assets
Basic financial assets, including trade and other debtors, cash and bank balances, and intercompany working capital balances, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate.
Such assets are subsequently carried at amortised cost using the effective interest rate method, less any impairment.
Financial liabilities
Basic financial liabilities, including trade and other creditors, and loans from fellow group companies, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Financing transactions are those in which payment is deferred beyond normal business terms or is financed at a rate of interest that is not a market rate.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Impairment of financial assets
Financial assets measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the profit and loss account. 
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between the asset's carrying amount and the best estimate of the amount the company would receive for the asset if it were to be sold at the reporting date. 
For financial assets measured at amortised cost, the impairment loss is measured as the difference between the asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If the financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. 
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
 
Page 28

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

Financial instruments (continued)
Derecognition of financial assets and financial liabilities
Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions. 
Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires. 
Offsetting of financial assets and financial liabilities
Financial assets and liabilities are offset, and the net amount reported in the balance sheet when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

 
2.17

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

 
2.18

Provisions for liabilities

Provisions are made where an event has taken place that gives the company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the balance sheet.

  
2.19

Share capital

Ordinary shares are classified as equity.

Page 29

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

3.


Judgements in applying accounting policies and key sources of estimation uncertainty

In the application of the company’s accounting policies, which are described in note 2, the following judgements and key estimates have been made by the directors:
Impairment of investments
In preparing these financial statements, the directors have exercised judgement in determining whether there are indicators of impairment of the investment in the company's investments in its subsidiary undertakings. Factors taken into consideration in reaching such a decision include the economic viability and expected future financial performance of the asset and where it is a component of a larger cash-generating unit, the viability and expected future performance of that unit.
Warranty Provision
The warranty provision is estimated on the future expectation of the costs the company will incur for defects in materials and workmanship which occur within two years of the end user sale. Warranty costs are estimated in the period the related revenue is recognised based on historical experience, expectations of future costs to repair or replace including freight and knowledge of specific product failures outside the historical experience. Actual results could differ from these estimates, which could cause increases or decreases to the warranty reserves in future periods.
Stock Provision
The carrying value of stock, at the lower of cost and net realisable value, is dependent on key judgements and estimates that are made by management.  The judgements relating to stock include an estimation of future expected average sales prices and disposal costs. These judgements also include consideration of specific factors and the developments in the market that have been identified throughout the year and subsequent to the year end. Actual outcomes could be different to the assumptions used in determining the estimates.


4.


Turnover

An analysis of turnover by class of business is as follows:


2023
2022
$
$

Sale of goods
242,878,736
236,297,537

Rendering of services
1,825,330
1,373,859

244,704,066
237,671,396


Analysis of turnover by country of destination:

2023
2022
$
$

United Kingdom
8,950,175
9,100,352

Rest of Europe
228,120,366
217,468,301

Rest of the world
7,633,525
11,102,743

244,704,066
237,671,396


Page 30

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

5.


Other operating income

2023
2022
$
$

Other operating income
57,559
118,237





6.


Operating loss

The operating profit is stated after charging/(crediting):

2023
2022
$
$

Depreciation of tangible fixed assets
497,916
402,882

Exchange differences
568,856
(7,277,247)

Other operating lease rentals
812,461
902,842

Defined contribution pension costs
269,899
325,927


7.


Auditor's remuneration

During the year, the company obtained the following services from the company's auditor and its associates:


2023
2022
$
$

Fees payable to the company's auditor and its associates for the audit of the company's financial statements
116,256
86,453

Fees payable to the company's auditor and its associates in respect of:

Taxation compliance services
10,383
4,930

Other services relating to taxation
103,334
71,273

Other non-audit services not included above
9,108
4,868

Page 31

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

8.


Employees

Staff costs, including directors' remuneration, were as follows:


2023
2022
$
$

Wages and salaries
5,364,223
9,127,290

Social security costs
912,403
1,163,492

Share option expense
863,192
693,834

Cost of defined contribution scheme
279,495
325,927

7,419,313
11,310,543


The average monthly number of employees, including the directors, during the year was as follows:


        2023
        2022
            No.
            No.







Directors
3
3



Sales and marketing
22
27



Engineering
12
9



Operations
8
11



Corporate administration
24
27

69
77


9.


Directors' remuneration

2023
2022
$
$

Directors' emoluments
331,484
312,361

Company contributions to defined contribution pension schemes
9,596
3,723

341,080
316,084


During the year retirement benefits were accruing to 1 director (2022 - 1) in respect of defined contribution pension schemes.

The highest paid director received remuneration of $366,199 (2022 - $312,361).

The value of the company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to $10,601 (2022 - $3,723).

During the year 1 director received shares under the long-term incentive schemes (2022 -1)

Page 32

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

10.

Key management personnel

2023
2022
        $
        $
Key management personnel's emoluments

2,355,905

3,781,886

Amounts receivable under long-term incentive schemes

752,416

585,804

Company contributions to defined contribution pension schemes

86,505

109,361


3,194,826

4,477,051



11.


Income from investments

2023
2022
$
$

Dividends received from group undertakings
41,095,623
33,986,673







12.


Amounts written off investments

2023
2022
$
$



Impairment of fixed asset investments
73,426,901
-

Impairment of group loan
2,619,882
-

76,046,783
-


13.


Interest receivable

2023
2022
$
$


Group loan interest receivable
-
142,559

Other interest receivable
411,832
121,145

411,832
263,704


14.


Interest payable and similar expenses

2023
2022
$
$


Group loan interest payable
2,155,119
3,120,365

Page 33

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

15.


Taxation


2023
2022
$
$

Corporation tax


Current tax on profits for the year
-
(2,823,416)


-
(2,823,416)


Total current tax
-
(2,823,416)

Deferred tax


Origination and reversal of timing differences
-
(1,011,276)

Total deferred tax
-
(1,011,276)


Taxation on profit/(loss) on ordinary activities
-
(3,834,692)

Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022 - lower than) the standard rate of corporation tax in the UK of 23.52% (2022 - 19%). The differences are explained below:

2023
2022
$
$


(Loss)/profit on ordinary activities before tax
(60,885,059)
16,432,006


(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of  23.52% (2022 - 19%)
(13,772,368)
3,122,081

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
18,515,843
157,501

Capital allowances for year in excess of depreciation
96,900
7,230

Short-term timing difference leading to a decrease in taxation
(707)
(160,817)

Non-taxable income
(10,101,021)
(6,457,468)

Tax deduction arising from exercise of employee options
-
(5,197)

Unrelieved tax losses carried forward
(993,144)
(148,349)

Other differences leading to a decrease in the tax charge
6,254,497
(349,673)

Total tax charge for the year
-
(3,834,692)

Page 34

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
15.Taxation (continued)


Factors that may affect future tax charges

In the Spring Budget 2021, the UK Government announced that from 1 April 2023 the corporation tax rate would increase to 25% for companies with profits of over £250,000. A small profits rate will also be introduced for companies with profits of £50,000 or less so that they will continue to pay corporation tax at 19%. From this date companies with profits between £50,000 and £250,000 will pay tax at the main rate reduced by a marginal relief providing a gradual increase in the effective corporation tax rate.


16.


Tangible fixed assets





Short-term leasehold property
Computer equipment
Total

$
$
$



Cost


At 1 January 2023
2,267,481
659,533
2,927,014


Additions
73,784
-
73,784



At 31 December 2023

2,341,265
659,533
3,000,798



Depreciation


At 1 January 2023
1,610,087
323,376
1,933,463


Charge for the year
376,191
121,725
497,916



At 31 December 2023

1,986,278
445,101
2,431,379



Net book value



At 31 December 2023
354,987
214,432
569,419



At 31 December 2022
657,394
336,157
993,551




The net book value of land and buildings may be further analysed as follows:


2023
2022
$
$

Short leasehold
354,987
657,394

354,987
657,394


Page 35

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

17.


Fixed asset investments





Investments in subsidiary companies

$



Cost


At 1 January 2023
242,841,410


Capital repayment
(1,850,891)



At 31 December 2023

240,990,519



Impairment


At 1 January 2023
-


Charge for the period
73,426,901



At 31 December 2023

73,426,901



Net book value



At 31 December 2023
167,563,618



At 31 December 2022
242,841,410

Page 36

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

Subsidiary undertakings


The following were subsidiary undertakings of the company:

Name

Registered office

Principal activity

Class of shares

Holding

iRobot France SAS
11 Avenue Albert Einstein, Villeurbanne, Lyon, France
Distributor
Ordinary
100%
iRobot Iberia SL
Edificio 3, Planta 2, Madrid, Spain
Distributor
Ordinary
100%
iRobot Germany GmbH
Am Sandtorpark 6, 20457 Hamburg, Germany
Distributor
Ordinary
100%
iRobot Belgium SPRL
Esplande 1, Bte 12, Buro & Design Centre, Brussels, Belgium
Distributor
Ordinary
100%
iRobot Netherlands B.V.
Zuiderzeelan 19a, Zwolle, Netherlands
Distributor
Ordinary
100%
iRobot Austria GmbH
Am Europlatz 2, Gebaude G, Vienna, Austria
Distributor
Ordinary
100%
iRobot Portugal Unipessoal LDA
Rua do Cais Das Naus, Lote, Lisbon, Portugal
Distributor
Ordinary
100%
Aeris Cleantec AG
Knonauerstrasse 54, 6330, Cham, Switzerland
Distributor
Ordinary
100%

The aggregate of the share capital and reserves as at 31 December 2023 and the profit or loss for the year ended on that date for the subsidiary undertakings were as follows:




Name
Aggregate of share capital and reserves
Profit/(loss)
$
$

iRobot France SAS
86,797,335
516,920

iRobot Iberia SL
19,690,428
558,410

iRobot Germany GmbH
2,865,575
400,928

iRobot Belgium SPRL
2,826,976
262,594

iRobot Netherlands B.V.
2,632,814
278,363

iRobot Austria GmbH
3,044,369
110,924

iRobot Portugal Unipessoal LDA
342,869
(21,410)

Aeris Cleantec AG
52,983,745
(8,557,536)

Page 37

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

18.


Stocks

2023
2022
$
$

Stock and work in progress
36,691,822
47,073,567


An impairment loss of $2,779,688 (2022: $683,401) was recognised in cost of sales against stock during the period due to slow-moving and obsolete stock.


19.


Debtors

2023
2022
$
$

Due after more than one year

Amounts owed by group undertakings
-
5,499,084


2023
2022
$
$

Due within one year

Trade debtors
10,733,125
7,869,846

Amounts owed by group undertakings
14,869,884
22,367,399

Other debtors
3,262,134
3,739,833

Prepayments and accrued income
253,819
347,648

Deferred taxation
1,351,595
1,281,158

30,470,557
35,605,884


Trade debtors are stated after a provision for bad debts of £1,422,111 (2022 - £nil).


20.


Creditors: Amounts falling due within one year

2023
2022
$
$

Trade creditors
29,957,183
23,845,444

Amounts owed to group undertakings
35,916,739
64,807,378

Other taxation and social security
1,844,414
1,518,171

Other creditors
106,504
190,793

Accruals and deferred income
17,752,828
11,748,943

85,577,668
102,110,729


Amounts owed to group undertakings related to unsecured group loans as detailed in note 21.

Page 38

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

21.


Creditors: Amounts falling due after more than one year

2023
2022
$
$

Amounts owed to group undertakings
60,179,084
83,586,811

Other creditors
281,557
266,154

Accruals and deferred income
630,542
551,931

61,091,183
84,404,896


Amounts owed to group undertakings related to unsecured group loans as detailed in note 21.


22.


Group loans

2023
2022
$
$



Within 1 year
-
51,781,901

Between 1 and 2 years
-
-

Between 2 and 5 years
60,179,084
-

Greater than 5 years
-
83,586,811

60,179,084
135,368,712

The loan balances due to group entities are unsecured. The balances due within 1 year accrue interest at ECB base rate plus 200 bps. The loan balance due between 2 and 5 years and more than 5 years in prior year accrues interest at 3% and is repayable on 30 September 2027.

Page 39

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

23.


Deferred taxation




2023


$






At beginning of year
1,281,158


Charged to profit or loss
70,437



At end of year
1,351,595

The deferred tax asset is made up as follows:

2023
2022
$
$


Accelerated capital allowances
1,351,595
51,800

Short term timing difference
-
1,229,358

1,351,595
1,281,158


24.


Provisions




Warranty provision
Dilapidation provision
Total

$
$
$





At 1 January 2023
15,230,581
248,632
15,479,213


Utilised in the year
(1,294,595)
-
(1,294,595)



At 31 December 2023
13,935,986
248,632
14,184,618

Warranty provision
The company provides for the two-year warranty against defects in materials and workmanship and the company will either repair the goods, provide replacement products at no charge to the customer or refund amounts to the customer for defective products. Warranty costs are estimated in the period the related revenue is recognised based on historical experience, expectations of future costs to repair or replace including freight and knowledge of specific product failures outside the historical experience. Actual results could differ from these estimates, which could cause increases or decreases to the warranty reserves in future periods.
Dilapidation provision
The company provides for the future anticipated reinstatement cost in connection with the short-term leasehold property which the company occupies. The estimate was established at the inception of the lease and is reviewed on an annual basis for any material variance in the estimate provided.

Page 40

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

25.


Share capital

2023
2022
$
$
Allotted, called up and fully paid



10,000,001 (2022 - 10,000,001) Ordinary shares of $1.35 each
13,500,001
13,500,001

There is a single class of ordinary shares. There are no restrictions on the distribution of dividends and the repayment of capital.



26.


Reserves

Share premium account

The share premium reserve includes any premiums received on issue of share capital. Any transaction costs associated with the issuing of shares are deducted from share premium.

Other reserves

Other reserves includes accrued expenditure on employee share options that have not been exercised. 

Profit and loss account

The profit and loss account includes all current and prior period retained profits and losses.


27.


Pension commitments

The company operates a defined contribution scheme for employees. The aggregate contributions for the year were $279,495 (2022: $325,927) of which $45,528 were outstanding at year end (2022: $48,534).


28.


Commitments under operating leases

At 31 December 2023 the company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
$
$


Not later than 1 year
3,595,293
4,509,688

Later than 1 year and not later than 5 years
75,957
686,424

3,671,250
5,196,112


29.


Related party transactions

The company has taken advantage of the exemption contained in FRS 102 section 33 "Related Party Disclosures" from disclosing transactions with entities which are a wholly owned part of the group.

Page 41

 

IROBOT UK LTD

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

30.


Controlling party

The smallest and largest group for which consolidated financial statements are drawn up and of which the company is member is that headed by iRobot Corporation the registered office of which is 8 Crosby Drive, Bedford, MA 01730, USA. Copies of these group financial statements are available to the public from its registered office or can be obtained from investor.irobot.com.
The ultimate parent company is iRobot Corporation.
In the opinion of the directors there is no ultimate controlling party.
On August 4, 2022, iRobot Corporation entered into an Agreement and Plan of Merger with Amazon.com, Inc., a Delaware corporation (“Parent” or “Amazon”) and Martin Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”), pursuant to which Merger Sub will merge with and into the company (the “Merger”), with iRobot Corporation surviving the Merger as a wholly owned subsidiary of Parent. If the Merger is consummated, iRobot Corporation's Common Stock will be delisted from the Nasdaq Stock Market LLC and deregistered under the Securities Exchange Act of 1934.
On July 24, 2023, the Group, Parent and Merger Sub entered into an Amendment to Agreement and Plan of Merger (the "Merger Agreement Amendment"), which amends the Merger Agreement (as amended and supplemented by the Merger Agreement Amendment, the "Amended Merger Agreement"), which provides, among other things, that each share of Common Stock, outstanding immediately prior to the Effective Time (subject to certain exceptions set forth in the Amended Merger Agreement) will, at the Effective Time, automatically be cancelled and converted into the right to receive $51.75 in cash, without interest and subject to applicable withholding taxes. Other than as expressly modified pursuant to the Merger Agreement Amendment, the Merger Agreement remains in full force and effect. The Group held a special meeting of stockholders on October 12, 2023 and the Group's stockholders voted to approve and adopt the Amended Merger Agreement.
On January 28, 2024, we and Amazon mutually agreed to terminate the Merger Agreement and entered into a mutual termination agreement effective as of such date (the "Termination Agreement"). The termination of the Merger Agreement was approved by our Board of Directors.

 
Page 42