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REGISTERED NUMBER: 01830061 (England and Wales)















GROUP STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2023

FOR

ADVANCED INSTRUMENTS HOLDINGS LTD

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

CONTENTS OF THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023










Page

Group Strategic Report 1

Report of the Directors 3

Report of the Independent Auditors 4

Consolidated Statement of Comprehensive Income 7

Consolidated Balance Sheet 8

Company Balance Sheet 9

Consolidated Statement of Changes in Equity 10

Company Statement of Changes in Equity 11

Consolidated Cash Flow Statement 12

Notes to the Consolidated Financial Statements 13


ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023


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

REVIEW OF BUSINESS
The group has continued to manufacture and distribute its instruments to customers in the clinical and bio pharma end markets.

The group's performance for the year ended 31 December 2023 showed total revenues of £19.1m, a decrease of 13.8% on the previous year.

The decrease in sales was driven by a reduction in the Solentim portfolio revenues in China and other key markets, partly offset by expanded sales and distribution of the Osmometer portfolio. Demand for capital equipment in the bio pharma end market began to slow down in 2022 following very robust buying in 2021. These soft markets for capital equipment in bio pharma persisted into 2023.

The group generated losses before interest, taxation, depreciation and amortisation (negative "EBITDA") of £1.1m (2022: £3.2m of positive EBITDA).

In the view of the directors, the group's key accomplishments, against the high-level strategic objectives for its parent group, have been:

- To continue to serve our customers in the important UK clinical and biopharma markets with timely delivery of high-quality products.
- To prepare the group for increased customer engagement in the UK and Europe. Beginning in July 2022, AI expanded its distribution of the Osmometer portfolio of products of Advanced Instruments LLC (US), the sole shareholder of Advanced Instruments Holdings Ltd, to certain European countries/customers in the clinical and biopharma end markets.
- The company continued to invest in innovation and research and development, and added important capabilities to the Solentim portfolio of products.

The group recorded a non-cash impairment charge of £62.9m in 2023 to reduce the carrying value of goodwill to its fair value. The impairment was driven by a downturn in sales of the Solentim portfolio globally, and especially in the China market. While we expect sales of the Solentim portfolio of product to improve in the future, the adjustment ensures that the financial statements accurately represent the carrying value of the goodwill at its present fair value.

PRINCIPAL RISKS AND UNCERTAINTIES
Geopolitical events and security of supply
With the increasing prevalence of supply chain disruptions across the industry, the group has sought to mitigate supply chain risk by increasing both inventory levels and committed purchase orders.

Product and market risk
The group is in a very competitive market. It must continue to innovate its products to maintain a leadership position with customers in the cell line development and Osmolality markets.

Regulatory risks
Due to the nature of the industry in which we operate, the group is exposed to traditional regulatory risks (associated with the ongoing compliance of its business operations and products). Internal quality and regulatory issues are a core commitment of the Board, so suitable skills and experience are brought to bear to ensure that associated risks are managed.

Economic risks
Financial risks, which are primarily associated with the collectability of accounts receivable, and recoverability of inventory acquired to support key customers. These risks are appropriately managed through detailed oversight of our expert finance team.


ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

ANALYSIS OF KEY FINANCIAL PERFORMANCE INDICATORS

Performance measure 2022 2022 Movement % Commentary

Revenue £m 19.1 22.1 -14 The decrease in revenue was
driven by a reduction in sales of the
Solentim portfolio instruments,
partly offset by increased
Osmometer revenues.

Gross profit £m 8.4 11.9 -29 Gross profit decreased due to the
reduction in Solentim portfolio
revenues. Additionally, inventory
provisions were recorded to
address excess and obsolescence
risk.

Gross margin % 44 54 -19 A combination of lower instrument
revenues and increasing purchase
costs resulting in a reduced gross
margin.

Operating loss £m 78.5 10.4 -651 The reduction in gross profit and
the increase in group operating
expenses, drove the reduction in
operating profits, to report a loss for
the year to December 2023. The
current year includes £62.9m of
goodwill written off, following the
group impairment review.

EBITDA £m (1.1 ) 3.2 134 The reduction in operating profit
drove the reduction in EBITDA.

AREAS DEEMED TO BE OF KEY STRATEGIC IMPORTANCE
Long-range plans
We have a long-range plan for the business that includes continued investment in research and development staff to continuously innovate our products (to meet the needs of our customer base) and to expand our distribution capabilities across Europe.

Employees
To achieve our long range plans we need to attract and retain a talented workforce. We want to provide a challenging and stimulating workplace to both retain, develop and attract new team members.

Business relationships
We are committed to maintain strong relationships with our customers and suppliers. For our customers we seek to understand their unique needs, and to continuously innovate and bring those customers products and services to improve their workflows. Similarly, to serve those customers we need strong relationships with our suppliers to ensure that they are in a position to continue to meet our needs.

Community and environment
We are committed to supporting our community and reducing our CO2 emissions through various means.

FINANCIAL INSTRUMENTS
The group has an unsecured loan from a fellow subsidiary of £100m with interest charged at 6%. The loan is repayable in 2030. In addition, the group has an unsecured, interest-free loan from the same subsidiary of £13m. This is repayable on demand but the directors do not expect this to be demanded in the medium-term. The directors consider the exposure to credit, liquidity and cash flow risk to be limited.

ON BEHALF OF THE BOARD:



S M Hanlon - Director


6 March 2025

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

REPORT OF THE DIRECTORS
FOR THE YEAR ENDED 31 DECEMBER 2023


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

DIVIDENDS
No dividends will be distributed for the year ended 31 December 2023.

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

S M Hanlon
B Selman

Other changes in directors holding office are as follows:

M C Hoyer was appointed as a director after 31 December 2023 but prior to the date of this report.

J S A Smith ceased to be a director after 31 December 2023 but prior to the date of this report.

DISCLOSURE IN THE STRATEGIC REPORT
The group has chosen, in accordance with the Companies Act 2006 s414C(11), to set out in the group's strategic report information required by Schedule 7 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 to be contained in the directors' report.

STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Group Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and the group and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

- select suitable accounting policies and then apply them consistently;
- make judgements and accounting estimates that are reasonable and prudent;
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

ON BEHALF OF THE BOARD:





S M Hanlon - Director


6 March 2025

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
ADVANCED INSTRUMENTS HOLDINGS LTD


Opinion
We have audited the financial statements of Advanced Instruments Holdings Ltd (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2023 which comprise the Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:
-give a true and fair view of the state of the group's and of the parent company affairs as at 31 December 2023 and of the group's 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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and the parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

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

Other information
The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the Group Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Group Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
ADVANCED INSTRUMENTS HOLDINGS LTD


Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
- adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
- the parent company financial statements are not in agreement with the accounting records and returns; or
- certain disclosures of directors' remuneration specified by law are not made; or
- we have not received all the information and explanations we require for our audit.

Responsibilities of directors
As explained more fully in the Statement of Directors' Responsibilities set out on page three, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the group's and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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

Based on our understanding of the company and industry, we considered the risk of non-compliance with laws and regulations, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the financial statements such as the Companies Act 2006. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls). Audit procedures performed included:

- Enquiring of management whether there were instances of non-compliance with laws and regulation or fraud;
- Review of legal expenses for evidence of fees relating to non-compliance;
- Review of provision estimates to ensure not influenced by management bias;

-
Review of journal entries, non-sales bank receipts and non-purchase bank payments for unusual accounting
entries; and

-
Cut off procedures to confirm that revenue from goods and services had been recognised as revenue in the
correct period.

There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by for example, forgery or intentional misrepresentations, or through 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 Report of the Auditors.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
ADVANCED INSTRUMENTS HOLDINGS LTD


Use of our report
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.




Christian Heeger BSc FCA (Senior Statutory Auditor)
for and on behalf of Galloways Accounting
Statutory Auditor
15 West Street
Brighton
East Sussex
BN1 2RL

12 March 2025

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

CONSOLIDATED
STATEMENT OF COMPREHENSIVE
INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023 2022
Notes £    £    £    £   

TURNOVER 3 19,071,003 22,128,923

Cost of sales 10,641,621 10,232,989
GROSS PROFIT 8,429,382 11,895,934

Distribution costs 366,611 408,724
Administrative expenses 86,606,110 21,935,354
86,972,721 22,344,078
(78,543,339 ) (10,448,144 )

Other operating income 38,972 -
OPERATING LOSS 5 (78,504,367 ) (10,448,144 )

Loss on disposal of fixed
asset investment 6 - 1,216,049
(78,504,367 ) (11,664,193 )

Interest receivable and similar income 10,898 4,469
Interest payable and similar expenses 7 (6,308,606 ) (5,382,320 )
LOSS BEFORE TAXATION (84,802,075 ) (17,042,044 )

Tax on loss 8 (585,004 ) (3,199,469 )
LOSS FOR THE FINANCIAL YEAR (84,217,071 ) (13,842,575 )

OTHER COMPREHENSIVE INCOME
Unrealised foreign exchange gains 93,229 73,566
Income tax relating to other comprehensive
income

-

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

93,229

73,566
TOTAL COMPREHENSIVE LOSS FOR THE
YEAR

(84,123,842

)

(13,769,009

)

Loss attributable to:
Owners of the parent (84,217,071 ) (13,842,575 )

Total comprehensive loss attributable to:
Owners of the parent (84,123,842 ) (13,769,009 )

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

CONSOLIDATED BALANCE SHEET
31 DECEMBER 2023

2023 2022
Notes £    £    £    £   
FIXED ASSETS
Intangible assets 10 105,912,500 182,830,075
Tangible assets 11 1,002,412 592,840
Investments 12 - -
106,914,912 183,422,915

CURRENT ASSETS
Stocks 13 4,640,437 5,719,647
Debtors 14 2,300,949 3,545,837
Cash at bank and in hand 3,761,595 3,725,048
10,702,981 12,990,532
CREDITORS
Amounts falling due within one year 15 21,328,894 15,478,347
NET CURRENT LIABILITIES (10,625,913 ) (2,487,815 )
TOTAL ASSETS LESS CURRENT
LIABILITIES

96,288,999

180,935,100

CREDITORS
Amounts falling due after more than one
year

16

(100,045,597

)

(100,000,000

)

PROVISIONS FOR LIABILITIES 18 (20,148,469 ) (20,716,325 )
NET (LIABILITIES)/ASSETS (23,905,067 ) 60,218,775

CAPITAL AND RESERVES
Called up share capital 19 75,000,070 75,000,070
Capital redemption reserve 35 35
Foreign translation reserve 171,566 78,337
Retained earnings (99,076,738 ) (14,859,667 )
SHAREHOLDERS' (DEFICIT)/FUNDS (23,905,067 ) 60,218,775

The financial statements were approved by the Board of Directors and authorised for issue on 6 March 2025 and were signed on its behalf by:





S M Hanlon - Director


ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

COMPANY BALANCE SHEET
31 DECEMBER 2023

2023 2022
Notes £    £    £    £   
FIXED ASSETS
Intangible assets 10 - -
Tangible assets 11 - -
Investments 12 102,545,755 167,948,093
102,545,755 167,948,093

CURRENT ASSETS
Debtors 14 12,011,139 10,315,414
Cash at bank 224,240 1,916,186
12,235,379 12,231,600
CREDITORS
Amounts falling due within one year 15 14,352,813 8,020,294
NET CURRENT (LIABILITIES)/ASSETS (2,117,434 ) 4,211,306
TOTAL ASSETS LESS CURRENT
LIABILITIES

100,428,321

172,159,399

CREDITORS
Amounts falling due after more than one
year

16

100,000,000

100,000,000
NET ASSETS 428,321 72,159,399

CAPITAL AND RESERVES
Called up share capital 19 75,000,070 75,000,070
Capital redemption reserve 35 35
Retained earnings (74,571,784 ) (2,840,706 )
SHAREHOLDERS' FUNDS 428,321 72,159,399

Company's loss for the financial year (71,731,078 ) (5,266,312 )

The financial statements were approved by the Board of Directors and authorised for issue on 6 March 2025 and were signed on its behalf by:





S M Hanlon - Director


ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

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

Called up Capital Foreign
share Retained redemption translation Total
capital earnings reserve reserve equity
£    £    £    £    £   
Balance at 1 January 2022 70 (1,012,321 ) 35 - (1,012,216 )

Changes in equity
Deficit for the year - (13,842,575 ) - - (13,842,575 )
Other comprehensive income - 73,566 - - 73,566
Total comprehensive loss - (13,769,009 ) - - (13,769,009 )
Issue of share capital 75,000,000 - - - 75,000,000
Transfer between reserves - (78,337 ) - 78,337 -
Balance at 31 December 2022 75,000,070 (14,859,667 ) 35 78,337 60,218,775

Changes in equity
Deficit for the year - (84,217,071 ) - - (84,217,071 )
Other comprehensive income - 93,229 - - 93,229
Total comprehensive loss - (84,123,842 ) - - (84,123,842 )
Transfer between reserves - (93,229 ) - 93,229 -
Balance at 31 December 2023 75,000,070 (99,076,738 ) 35 171,566 (23,905,067 )

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

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

Called up Capital
share Retained redemption Total
capital earnings reserve equity
£    £    £    £   
Balance at 1 January 2022 70 2,425,606 35 2,425,711

Changes in equity
Issue of share capital 75,000,000 - - 75,000,000
Total comprehensive income - (5,266,312 ) - (5,266,312 )
Balance at 31 December 2022 75,000,070 (2,840,706 ) 35 72,159,399

Changes in equity
Total comprehensive income - (71,731,078 ) - (71,731,078 )
Balance at 31 December 2023 75,000,070 (74,571,784 ) 35 428,321

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023

2023 2022
Notes £    £   
Cash flows from operating activities
Cash generated from operations 24 863,940 2,368,781
Interest paid (6,923 ) (67 )
Tax paid (138,598 ) (213,310 )
Net cash from operating activities 718,419 2,155,404

Cash flows from investing activities
Purchase of intangible fixed assets (2,862 ) (22,571 )
Purchase of tangible fixed assets (951,350 ) (540,383 )
Sale of tangible fixed assets 186,839 116,469
Purchase of subsidiary net of cash - (4,750,517 )
Interest received 10,898 4,469
Net cash from investing activities (756,475 ) (5,192,533 )

Cash flows from financing activities
Capital repayments in year (16,944 ) -
Interest paid on finance leases (1,683 ) -
Net cash from financing activities (18,627 ) -

Decrease in cash and cash equivalents (56,683 ) (3,037,129 )
Cash and cash equivalents at beginning
of year

25

3,725,048

6,688,611
Effect of foreign exchange rate changes 93,230 73,566
Cash and cash equivalents at end of year 25 3,761,595 3,725,048

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

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


1. STATUTORY INFORMATION

Advanced Instruments Holdings Ltd is a private company, limited by shares, registered in England and Wales. The company's registered number, registered office address and principal business address are as below:

Registered number: 01830061

Registered office:
5th Floor
One New Change
London
EC4M 9AF

Principal business address:
Solent House
Johnson Road
Fernside Business Park
Wimborne
Dorset
BH21 7SE

The principal activity of the group was the supply of scientific instruments.

2. ACCOUNTING POLICIES

Basis of preparing the financial statements
These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Going concern
In 2022, the group's debt was re-structured to secure its liability position for the coming few years. £100 million of debt due within one year was subject to a new loan agreement with payment due in 2030, while £75 million was capitalised into share capital. The group has repayable on demand loans amounting to £17 million due to the parent group. A letter of support has been provided by the group undertakings, confirming repayment of the loans will not be demanded in the near future.

The directors' assessment of going concern takes into account the terms of the loan and group cash flow forecasts to conclude that there are no uncertainties over the group's ability to continue as a going concern.

Reduced disclosures
The parent company has taken advantage of the exemption from disclosing the following information, as permitted by the reduced disclosure regime within FRS 102, since the financial statements of the parent company are consolidated in the group financial statements:

- Section 7 ‘Statement of Cash Flows’ - Presentation of a Statement of Cash Flow and related notes and disclosures
- Section 33 ‘Related Party Disclosures’ - Compensation for key management personnel

Basis of consolidation
The group consolidated financial statements include the financial statements of the company and all of its subsidiary undertakings.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. Where the group owns less than 50% of the voting powers of an entity but controls the entity by virtue of an agreement with other investors which give it control of the financial and operating policies of the entity, it accounts for that entity as a subsidiary.

Any subsidiary undertakings sold or acquired during the year are included up to, or from, the dates of change of control or change of significant influence respectively.

All intra-group transactions, balances, income and expenses are eliminated on consolidation.

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


2. ACCOUNTING POLICIES - continued

Critical accounting judgements and key sources of estimation uncertainty
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below.

i. Dilapidation provision
Provision is made for dilapidations. This requires management’s best estimate of the expenditure that will be incurred based on contractual requirements. The provision has been calculated using market data on average costs for similar office space.

ii. Investments and goodwill valuation
Annually, the group considers whether intangible assets and goodwill and the company considers whether the investments in subsidiaries are impaired. Where an indication of impairment is identified the estimation of recoverable value requires estimation of the recoverable value of the cash generating unit (CGU).

This requires estimation of the future cash flows from the CGUs and also selection of appropriate discount rates in order to calculate the net present value of those cash flows. The recoverable amount of the CGUs are a source of significant estimation uncertainty and determining this involved the use of significant assumptions.

iii. Stock valuation
Where necessary, provision is made for slow moving and obsolete inventories. Calculation of these provisions requires judgements to be made, which include forecast of customer demand and promotional, competitive and economic environment trends.

Turnover
Turnover is measured at the fair value of the consideration received or receivable net of VAT and trade discounts. The policies adopted for the recognition of turnover are as follows:

Sale of goods
Turnover from the sale of machines and consumables is recognised when significant risks and rewards of ownership of the goods have transferred to the buyer, the amount of turnover can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the company and the costs incurred or to be incurred in respect of the transaction can be measured reliably. This is usually on dispatch of the goods.

Rendering of services
Turnover from service agreements is recognised on a straight line basis over the service agreement.

Business combinations and goodwill
Business combinations are accounted for by applying the acquisition method.

The cost of a business combination is the fair value of the consideration given, liabilities incurred or assumed and of equity instruments issued plus the costs directly attributable to the business combination.

On acquisition of a business, fair values are attributed to the identifiable assets, liabilities and contingent liabilities unless the fair value cannot be measured reliably, in which case the value is incorporated in goodwill. Intangible assets are only recognised separately from goodwill where they are separable and arise from contractual or other legal rights.

Goodwill recognised represents the excess of the fair value and directly attributable costs of the purchase consideration over the fair values to the group’s interest in the identifiable net assets, liabilities and contingent liabilities acquired.

On acquisition, goodwill is allocated to cash-generating units (‘CGU’s’) that are expected to benefit from the combination.

Goodwill is amortised over its expected useful life which is estimated to be 5 to 15 years.

Goodwill is assessed for impairment when there are indicators of impairment and any impairment is charged to the income statement.

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


2. ACCOUNTING POLICIES - continued

Intangible assets
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

The estimated useful lives range as follows (pending patents are not amortised):

Patents and licences - over 20 years
Technology- over 15 years

Tangible fixed assets
Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.
Improvements to property - 20% on cost
Plant and machinery - 33% on cost, 20% on cost and 10% on cost
Fixtures and fittings - 20% on cost
Computer equipment - 50% on cost and 33% on cost

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.

Stocks
Stocks and work in progress are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Stock is valued on a first in, first out basis. Work in progress and finished goods are valued for direct material only, and do not include labour or 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 is recognised immediately in profit and loss.

Financial instruments
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102, in full, to all of its financial instruments.

Financial assets and financial liabilities are recognised when the group becomes a party to the contractual provisions of the instrument.

Basic financial assets and liabilities
Trade, group and other debtors (including accrued income) which are receivable within one year and which do not constitute a financing transaction are initially measured at the transaction price and subsequently measured at amortised cost, being the transaction price less any amounts settled and any impairment losses.

A provision for impairment of debtors is established when there is objective evidence that the amounts due will not be collected according to the original terms of the contract. Impairment losses are recognised in profit or loss for the excess of the carrying value of the trade debtor over the present value of the future cash flows discounted using the original effective interest rate. Subsequent reversals of an impairment loss that objectively relate to an event occurring after the impairment loss was recognised, are recognised immediately in profit or loss.

Trade, group and other creditors (including accruals) payable within one year that do not constitute a financing transaction are initially measured at the transaction price and subsequently measured at amortised cost, being transaction price less any amounts settled.

Debt instruments are carried at amortised cost using the effective interest rate method.

Taxation
Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


2. ACCOUNTING POLICIES - continued

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

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Research and development
In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence are all recognised an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequent amortised on a straight line basis over their useful economic lives.

Foreign currencies
The group financial statements are presented in pound sterling and rounded to thousands.

The company’s functional and presentation currency is the pound sterling.

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

The trading results of group undertakings are translated into sterling at the average exchange rates for the year. The assets and liabilities of overseas undertakings, including goodwill and fair value adjustments arising on acquisition, are translated at the exchange rates ruling at the year end. Exchange adjustments arising from the retranslation of opening net investments and from the translation of the profits or losses at average rates are recognised in ‘Other comprehensive income’.

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

Assets acquired under finance leases are capitalised and depreciated over the shorter of the lease term and the expected useful life of the asset. Minimum lease payments are apportioned between the finance charge and the reduction of the outstanding lease liability using the effective interest method. The related obligations, net of future finance charges, are included in creditors.

Pension costs and other post-retirement benefits
The group operates a defined contribution pension scheme. Contributions payable to the group's pension scheme are charged to profit or loss in the period to which they relate.

Provisions
Provisions are recognised when the company has an obligation at the balance sheet date as a result of a past event, it is probable that an outflow of economic benefits will be required in settlement and the amount can be reliably estimated.

Impairment
Assets not measured at fair value are reviewed for any indication that the asset may be impaired at each balance sheet date. If such indication exists, the recoverable amount of the asset, or the asset's cash generating unit, is estimated and compared to the carrying amount. Where the carrying amount exceeds its recoverable amount, an impairment loss is recognised in profit or loss unless the asset is carried at a revalued amount where the impairment loss is a revaluation decrease.

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


3. TURNOVER

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

An analysis of turnover by geographical market is given below:

2023 2022
£    £   
United Kingdom 4,609,078 6,456,988
Europe 5,097,647 2,104,033
United States of America 6,113,666 9,340,085
Asia 3,217,858 4,105,100
Australasia 32,754 122,717
19,071,003 22,128,923

Turnover is categorised as following:

2023 2022
£    £   
Sale of goods 17,690,509 18,537,327
Rendering of services 1,380,493 3,591,596
19,071,003 22,128,923

4. EMPLOYEES AND DIRECTORS
2023 2022
£    £   
Wages and salaries 6,639,954 5,823,958
Social security costs 865,777 700,954
Other pension costs 373,898 324,911
7,879,629 6,849,823

The average number of employees during the year was as follows:
2023 2022

Production 44 40
Distribution 30 20
Service 12 10
Admin and management 22 21
108 91

2023 2022
£    £   
Directors' remuneration - 148,005
Directors' pension contributions to money purchase schemes - 7,152

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

Money purchase schemes - 1

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


5. OPERATING LOSS

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

2023 2022
£    £   
Other operating leases 184,984 171,075
Depreciation - owned assets 572,782 271,986
Profit on disposal of fixed assets (140,173 ) (73,718 )
Goodwill amortisation 7,515,615 6,975,508
Patents and licences amortisation 42,287 4,469
Technology amortisation 6,466,667 6,466,667
Auditors' remuneration 21,750 17,500
Foreign exchange differences (171,746 ) (430,087 )
Research and development expenditure 290,029 546,103

6. EXCEPTIONAL ITEMS

During the year, an amount of £62,895,868 was written off goodwill following the group's impairment review of its goodwill relating to the acquisition of a subsidiary. The impairment is included within administrative expenses.

On 30 November 2022, the ownership of the shares in a subsidiary of the group were transferred to the parent company, Advanced Instruments LLC. There was no consideration, resulting in a loss on disposal of £1,216,049 in the prior year.

7. INTEREST PAYABLE AND SIMILAR EXPENSES
2023 2022
£    £   
Bank loan interest 6,923 68
Interest payable to group undertakings 6,300,000 5,382,252
Leasing 1,683 -
6,308,606 5,382,320

8. TAXATION

Analysis of the tax credit
The tax credit on the loss for the year was as follows:
2023 2022
£    £   
Current tax:
Overseas corporation tax 2,192 29,510
Under/(over) provision prior year tax 2,270 (557,520 )
Total current tax 4,462 (528,010 )

Deferred tax (589,466 ) (2,671,459 )
Tax on loss (585,004 ) (3,199,469 )

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


8. TAXATION - continued

Reconciliation of total tax credit included in profit and loss
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

2023 2022
£    £   
Loss before tax (84,802,075 ) (17,042,044 )
Loss multiplied by the standard rate of corporation tax in the UK of 23.500
% (2022 - 19 %)

(19,928,488

)

(3,237,988

)

Effects of:
Expenses not deductible for tax purposes 16,843,812 1,205,159
Income not taxable for tax purposes (324,247 ) (16,786 )
Utilisation of tax losses (22,748 ) (727,893 )
Adjustments to tax charge in respect of previous periods 2,270 (557,520 )
Tax at different rates 152,948 135,559
Unrecognised deferred tax 2,691,449 -
Total tax credit (585,004 ) (3,199,469 )

Tax effects relating to effects of other comprehensive income

2023
Gross Tax Net
£    £    £   
Unrealised foreign exchange gains 93,229 - 93,229

2022
Gross Tax Net
£    £    £   
Unrealised foreign exchange gains 73,566 - 73,566

An increase in the UK corporation rate from 19% to 25% was effective from 1 April 2023.

9. INDIVIDUAL STATEMENT OF COMPREHENSIVE INCOME

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


ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


10. INTANGIBLE FIXED ASSETS

Group
Patents
and
Goodwill licences Technology Totals
£    £    £    £   
COST
At 1 January 2023 103,477,010 153,824 97,000,000 200,630,834
Additions - 2,862 - 2,862
At 31 December 2023 103,477,010 156,686 97,000,000 200,633,696
AMORTISATION
At 1 January 2023 9,172,081 6,455 8,622,223 17,800,759
Amortisation for year 7,515,615 42,287 6,466,667 14,024,569
Impairments 62,895,868 - - 62,895,868
At 31 December 2023 79,583,564 48,742 15,088,890 94,721,196
NET BOOK VALUE
At 31 December 2023 23,893,446 107,944 81,911,110 105,912,500
At 31 December 2022 94,304,929 147,369 88,377,777 182,830,075

Technology with a carrying value of £81.9 million was acquired as part of a business combination. It has been recognised separately from goodwill since it arises from contractual rights to the group's developed instruments and consumables, and it is a separable asset.

The amortisation charge is included in administrative expenses within the statement of comprehensive income.

11. TANGIBLE FIXED ASSETS

Group
Improvements Fixtures
to Plant and and
property machinery fittings
£    £    £   
COST
At 1 January 2023 35,746 736,489 123,978
Additions - 912,621 37,595
Disposals (18,352 ) (196,157 ) (10,056 )
At 31 December 2023 17,394 1,452,953 151,517
DEPRECIATION
At 1 January 2023 13,356 257,373 55,531
Charge for year 5,470 513,040 22,692
Eliminated on disposal (18,635 ) (159,264 ) -
At 31 December 2023 191 611,149 78,223
NET BOOK VALUE
At 31 December 2023 17,203 841,804 73,294
At 31 December 2022 22,390 479,116 68,447

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


11. TANGIBLE FIXED ASSETS - continued

Group

Motor Computer
vehicles equipment Totals
£    £    £   
COST
At 1 January 2023 - 63,697 959,910
Additions 77,670 1,134 1,029,020
Disposals - - (224,565 )
At 31 December 2023 77,670 64,831 1,764,365
DEPRECIATION
At 1 January 2023 - 40,810 367,070
Charge for year 15,103 16,477 572,782
Eliminated on disposal - - (177,899 )
At 31 December 2023 15,103 57,287 761,953
NET BOOK VALUE
At 31 December 2023 62,567 7,544 1,002,412
At 31 December 2022 - 22,887 592,840

Company
Improvements Fixtures
to Plant and and
property machinery fittings Totals
£    £    £    £   
COST
At 1 January 2023
and 31 December 2023 9,795 72,692 35,637 118,124
DEPRECIATION
At 1 January 2023
and 31 December 2023 9,795 72,692 35,637 118,124
NET BOOK VALUE
At 31 December 2023 - - - -
At 31 December 2022 - - - -

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


12. FIXED ASSET INVESTMENTS

Company
Shares in
group
undertakings
£   
COST
At 1 January 2023 167,948,093
Impairments (65,402,338 )
At 31 December 2023 102,545,755
NET BOOK VALUE
At 31 December 2023 102,545,755
At 31 December 2022 167,948,093

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

Subsidiaries

Advanced Instruments Ltd
Registered office: Solent House, Johnson Road, Fernside Business Park, Wimborne, Dorset BH21 7SE
Nature of business: Cell line development instruments
%
Class of shares: holding
Ordinary £0.0001 100.00

Advanced Instruments SAS
Registered office: 30 Rue Godot de Mauroy, 75009 Paris, France
Nature of business: Cell line development instruments
%
Class of shares: holding
Ordinary 100.00

Advanced Instruments Denmark ApS
Registered office: Sundkrogsgade 21, 2100 Copenhagen, Denmark
Nature of business: Cell line development instruments
%
Class of shares: holding
Ordinary 100.00

Advanced Instruments (Shanghai) Technology Co., Ltd
Registered office: Room 721, Building 1, No 22-23, Lane 466, Yindu Road, Minhang District, Shanghai, People's Republic of China
Nature of business: Cell line development instruments
%
Class of shares: holding
Ordinary RMB1 100.00

Advanced Instruments (Shanghai) Technology Co., Ltd is a 100% subsidiary of Advanced Instruments Ltd.

Advanced Instruments Limited
Registered office: 25-28 North Wall Quay, Dublin 1, Dublin, Ireland
Nature of business: Cell line development instruments
%
Class of shares: holding
Ordinary €1 100.00

Advanced Instruments Limited is a 100% subsidiary of Advanced Instruments Ltd.

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


12. FIXED ASSET INVESTMENTS - continued

Advanced Instruments (Belgium) BV
Registered office: Marnixlaan 23, 1000 Brussel, Belgium
Nature of business: Cell line development instruments
%
Class of shares: holding
Ordinary 100.00

Advanced Instruments GmbH
Registered office: Eschersheimer Landstraße 14, 60322 Frankfurt am Main, Germany
Nature of business: Cell line development instruments
%
Class of shares: holding
Ordinary 100.00

Advanced Instruments GmbH is a 100% subsidiary of Advanced Instruments Limited.

Advanced Instruments Life Sciences GmbH
Registered office: c/o Intertrust (Suisse) SA, Zählerweg 6, 6300 Zug, Switzerland
Nature of business: Cell line development instruments
%
Class of shares: holding
Ordinary 100.00

Advanced Instruments Life Sciences GmbH is a 100% subsidiary of Advanced Instruments Ltd.

SAL Scientific Limited
Registered office: Solent House, Johnson Road, Fernside Business Park, Wimborne, Dorset BH21 7SE
Nature of business: Biotechnology supplies
%
Class of shares: holding
Ordinary 100.00

SAL Scientific Limited is a 100% subsidiary of Advanced Instruments Ltd. Its reporting accounting period is from 1 August to 31 July. It has claimed exemption from audit under section 479A of the Companies Act 2006, whereby Advanced Instruments Holdings Ltd provides a guarantee under section 479C of the Companies Act 2006.

Advanced Instruments Korea,LLC
Registered office: 901-903Ho 15, Dasanjungang-ro 145beon-gil, Namyangju-si, Gyeonggi-do, Republic of Korea 12248
Nature of business: Dormant
%
Class of shares: holding
Ordinary 100.00

Advanced Instruments Korea LLC was incorporated on 25 September 2023. It is a 100% subsidiary of Advanced Instruments Ltd.

All of the subsidiaries are included within these consolidated financial statements.


ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


13. STOCKS

Group
2023 2022
£    £   
Consumables 91,461 53,620
Raw materials 3,050,845 3,227,269
Work-in-progress 84,562 617,705
Finished goods 1,413,569 1,821,053
4,640,437 5,719,647

Group
Stock is stated after provision for impairment of £550,329 (2022: £306,329). The movement in the provision of £244,000 (2022: £203,552) is included within cost of sales in the statement of comprehensive income.

14. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group Company
2023 2022 2023 2022
£    £    £    £   
Trade debtors 1,857,615 2,088,127 33,100 54,124
Amounts owed by group undertakings 77,468 - 11,972,754 10,259,280
Other debtors 118,132 130,664 - -
Tax - 94,802 - -
VAT - 81,533 5,285 2,010
Prepayments and accrued income 247,734 1,150,711 - -
2,300,949 3,545,837 12,011,139 10,315,414

15. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group Company
2023 2022 2023 2022
£    £    £    £   
Finance leases (see note 17) 15,129 - - -
Payments on account - 190,788 - -
Trade creditors 326,106 700,445 679 (230 )
Amounts owed to group undertakings 17,139,583 11,190,908 13,234,791 6,934,791
Tax 860,905 1,089,843 1,079,929 1,046,280
Social security and other taxes 222,442 237,035 - -
VAT 197,002 - - -
Other creditors 350,395 388,815 - -
Accruals and deferred income 2,217,332 1,680,513 37,414 39,453
21,328,894 15,478,347 14,352,813 8,020,294

Amounts owed to group undertakings includes £13,202,678 (2022: £6,902,678) of accrued interest on a £100m liability included in creditors due after more than one year. The accrued interest is payable quarterly in arrears with any unpaid interest payable on the loan due date.

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


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

Group Company
2023 2022 2023 2022
£    £    £    £   
Finance leases (see note 17) 45,597 - - -
Amounts owed to group undertakings 100,000,000 100,000,000 100,000,000 100,000,000
100,045,597 100,000,000 100,000,000 100,000,000

The amount due to a group undertaking of £100m is subject to interest payable at 6.3% from 21 March 2022. During the year, the interest charged was £6,300,000 (2022: £5,382,252). The loan is repayable, other than by instalment, by 21 March 2030.

17. LEASING AGREEMENTS

Minimum lease payments fall due as follows:

Group
Finance leases
2023 2022
£    £   
Net obligations repayable:
Within one year 15,129 -
Between one and five years 45,597 -
60,726 -

Group
Non-cancellable operating leases
2023 2022
£    £   
Within one year 39,166 139,419
Between one and five years 8,300 57,983
47,466 197,402

The finance leases are in respect of motor vehicles with a carrying value of £62,567 at the balance sheet date (2022: £nil).

The operating leases are in respect of property and office equipment.

Company
Non-cancellable operating leases
2023 2022
£    £   
Within one year - 21,348
Between one and five years - 12,067
- 33,415

The operating leases are in respect of property, motor vehicles and office equipment.

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


17. LEASING AGREEMENTS - continued

Group and company:

As lessor:

The total future minimum lease payments receivable under non-cancellable operating leases are as follows:

2023 2022
£    £   
Within one year 25,758 25,758
Between one and five years 34,645 46,554
60,403 72,312

The operating leases are in respect of medical instruments.

18. PROVISIONS FOR LIABILITIES

Group
2023 2022
£    £   
Deferred tax
Accelerated capital allowances - 138,377
Tax losses carried forward - (1,129,846 )
Timing difference on fair value of acquired
assets

20,025,172

21,606,107
20,025,172 20,614,638
Other provisions
Warranty provision 23,297 1,687
Dilapidation provision 100,000 100,000
123,297 101,687

Aggregate amounts 20,148,469 20,716,325

Group
Deferred Other
tax provisions
£    £   
Balance at 1 January 2023 20,614,638 101,687
(Credit)/charge to Statement of Comprehensive Income during year (589,466 ) 21,610
Business combination
Balance at 31 December 2023 20,025,172 123,297

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


18. PROVISIONS FOR LIABILITIES - continued

Deferred tax
Deferred tax includes £20,025,172 (2022: £21,606,107) arising as a result of the fair value uplift of stock and the recognition of technology intangibles on acquisition of a subsidiary in the year. £1,580,935 (2022: £1,610,272) of this adjustment unwound during the year. In addition, £nil (2022: £2,419) of deferred tax was acquired through the business combination in relation to timing differences.

The deferred tax liability expected to reverse in 2024 is £1,579,006. This relates to the reversal of timing differences on the technology intangibles fair value uplift and timing differences between acquired tangible assets capital allowances and depreciation.

Other provisions
Other provisions include £100,000 (2022: £100,000) for dilapidations and £23,297 (2022: £1,687) for warranties.

Dilapidation provision
As part of the group’s property leasing arrangements there is an obligation to repair damages which are incurred during the life of the lease, such as wear and tear. The cost is charged to profit and loss as the obligation arises. The provision is expected to be utilised in 2024 as the leases terminate.

Warranty provision
The group provides warranties for its instruments. The provision is an estimate of the expected costs to be incurred based on historical costs.

19. CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:
Number: Class: Nominal 2023 2022
value: £    £   
75,000,070 Ordinary £1 75,000,070 75,000,070

The company has one class of ordinary shares which carry full voting, dividends and capital distribution (including on winding up) rights.

20. PENSION COMMITMENTS

The group operates defined contribution pension plans for its employees. The amounts recognised as an expense in the year were:

Group: £373,898 (2022: £324,910)
Company: £nil (2022: £21,409)

21. ULTIMATE PARENT COMPANY

Advanced Instruments Limited is a subsidiary undertaking of Advanced Instruments LLC, which is the immediate parent company and incorporated in the United States of America. Its registered office is Two Technology Way, Norwood, MA 02062.

The ultimate parent company is Investor AB, a company incorporated in Sweden. Its registered office is Arsenalsgatan 8C, 103 32 Stockholm.

Advanced Instruments LLC is the smallest group to consolidate these financial statements. Investor AB is the largest group to consolidate these financial statements. The consolidated financial statements for Investor AB are publicly available and can be obtained from www.investorab.com.

22. CONTINGENT LIABILITIES

There are fixed and floating charges in place over the group's assets as security for loans. At 31 December 2023, the group debt outstanding, subject to these cross guarantees totalled $234.5 million (2022: $219.5 million).

23. RELATED PARTY DISCLOSURES

ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


23. RELATED PARTY DISCLOSURES - continued

Key management personnel of the entity or its parent (in the aggregate)
2023 2022
£    £   
Amount due to related party - 1,784

During the year, a total of key management personnel compensation of £ 1,214,762 (2022 - £ 1,232,882 ) was paid.

24. RECONCILIATION OF LOSS BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2023 2022
£    £   
Loss before taxation (84,802,075 ) (17,042,044 )
Depreciation charges 14,597,350 13,718,628
Profit on disposal of fixed assets (140,173 ) (73,718 )
Provisions 21,610 (7,158 )
Loss on disposal of investment - 1,216,049
Goodwill impairment 62,895,868 -
Finance costs 6,308,606 5,382,320
Finance income (10,898 ) (4,469 )
(1,129,712 ) 3,189,608
Decrease/(increase) in stocks 1,079,210 (2,608,086 )
Decrease/(increase) in trade and other debtors 1,150,086 (201,166 )
(Decrease)/increase in trade and other creditors (235,644 ) 1,988,425
Cash generated from operations 863,940 2,368,781

25. CASH AND CASH EQUIVALENTS

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

Year ended 31 December 2023
31.12.23 1.1.23
£    £   
Cash and cash equivalents 3,761,595 3,725,048
Year ended 31 December 2022
31.12.22 1.1.22
£    £   
Cash and cash equivalents 3,725,048 6,688,611


ADVANCED INSTRUMENTS HOLDINGS LTD (REGISTERED NUMBER: 01830061)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2023


26. ANALYSIS OF CHANGES IN NET FUNDS

Other
non-cash
At 1.1.23 Cash flow changes At 31.12.23
£    £    £    £   
Net cash
Cash at bank
and in hand 3,725,048 36,547 3,761,595
3,725,048 36,547 3,761,595
Debt
Finance leases - 16,944 (77,670 ) (60,726 )
- 16,944 (77,670 ) (60,726 )
Total 3,725,048 53,491 (77,670 ) 3,700,869

27. MAJOR NON-CASH TRANSACTIONS

The group was charged interest of £6,300,000 (2022: £5,382,252) by its parent company. The interest was credited to intercompany creditors.

During the year, the group impaired goodwill by £62,895,868. The impairment is included within the operating loss.

During the prior year, £75,000,000 of a £176,035,576 group loan was capitalised into 75,000,000 £1 ordinary shares.