The directors have assessed the company's ability to continue as a going concern and have concluded that, despite the significant one-off inventory revaluation loss, the company remains financially viable.
While the loss has resulted in a negative balance sheet position as of 31st December 2024, the company continues to generate positive cash flows from trading activities. The directors note that the underlying operations remain profitable, with sufficient revenues to cover both operational costs and ongoing debt repayments.
Furthermore, the business has continued access to its existing banking facilities and finance arrangements, and no breaches of lending covenants have occurred. The company has also implemented strategic measures to strengthen future profitability, including price adjustments, cost efficiencies, new contracts with suppliers.
Based on these factors, the directors confirm that they have a reasonable expectation that the company will continue in operation for at least 12 months from the date of approval of the financial statements. Accordingly, the financial statements have been prepared on a going concern basis.