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REGISTERED NUMBER: 11549836 (England and Wales)
























FINANCIAL STATEMENTS

FOR THE PERIOD

1 JANUARY 2023 TO 29 DECEMBER 2023

FOR

TAE POWER SOLUTIONS ENGINEERING LIMITED

TAE POWER SOLUTIONS ENGINEERING LIMITED (REGISTERED NUMBER: 11549836)

CONTENTS OF THE FINANCIAL STATEMENTS
For The Period 1 January 2023 to 29 December 2023










Page

Company Information 1

Balance Sheet 2

Notes to the Financial Statements 3


TAE POWER SOLUTIONS ENGINEERING LIMITED

COMPANY INFORMATION
For The Period 1 January 2023 to 29 December 2023







DIRECTOR: K Munipella





REGISTERED OFFICE: C/O Thrings Llp
6 Drakes Meadow
Swindon
SN3 3LL





REGISTERED NUMBER: 11549836 (England and Wales)





AUDITORS: TC Group
1 Rushmills
Bedford Road
Northampton
Northamptonshire
NN4 7YB

TAE POWER SOLUTIONS ENGINEERING LIMITED (REGISTERED NUMBER: 11549836)

BALANCE SHEET
29 December 2023

2023 2022
Notes £    £    £    £   
FIXED ASSETS
Intangible assets 4 1,150 1,350
Tangible assets 5 1,602,652 481,985
1,603,802 483,335

CURRENT ASSETS
Debtors 6 1,529,705 1,956,407
Cash at bank 383,087 707,056
1,912,792 2,663,463
CREDITORS
Amounts falling due within one year 7 28,684,660 8,072,906
NET CURRENT LIABILITIES (26,771,868 ) (5,409,443 )
TOTAL ASSETS LESS CURRENT LIABILITIES (25,168,066 ) (4,926,108 )

PROVISIONS FOR LIABILITIES 9 302,150 94,272
NET LIABILITIES (25,470,216 ) (5,020,380 )

CAPITAL AND RESERVES
Called up share capital 10 500,001 1
Share option reserve 584,093 -
Retained earnings (26,554,310 ) (5,020,381 )
SHAREHOLDERS' FUNDS (25,470,216 ) (5,020,380 )

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

In accordance with Section 444 of the Companies Act 2006, the Income Statement has not been delivered.

The financial statements were approved by the director and authorised for issue on 17 April 2025 and were signed by:





K Munipella - Director


TAE POWER SOLUTIONS ENGINEERING LIMITED (REGISTERED NUMBER: 11549836)

NOTES TO THE FINANCIAL STATEMENTS
For The Period 1 January 2023 to 29 December 2023


1. STATUTORY INFORMATION

TAE Power Solutions Engineering Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

The presentation currency of the financial statements is the Pound Sterling (£).


The trading address of TAE Power Solutions Engineering is 3900 Parkside, Birmingham, B37 7YG

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" including the provisions of Section 1A "Small Entities" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Turnover
Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. Turnover from contracts is recognised in accordance with the stage of completion of the project.

Intangible assets
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Patents and licences are being amortised evenly over their estimated useful life of ten 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 - 25% on reducing balance
Plant and machinery - 25% on reducing balance
Fixtures and fittings - 20% on reducing balance
Computer equipment - 25% on cost

Government grants
Government grants relating to revenue shall be recognised in income on a systematic basis over the periods in which the entity recognises the related costs for which the grant is intended to compensate.

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

Current or deferred taxation assets and liabilities are not discounted.

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


TAE POWER SOLUTIONS ENGINEERING LIMITED (REGISTERED NUMBER: 11549836)

NOTES TO THE FINANCIAL STATEMENTS - continued
For The Period 1 January 2023 to 29 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 period end and that are expected to apply to the reversal of the timing difference.

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

Foreign currencies
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.

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

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

Going concern
As at 29 December 2023 the company's liabilities exceeded its assets by £25,470,216. The company is financed by its ultimate parent company, and is dependent upon the continued support of the ultimate parent company and its investors. With this support, at the time of approving the financial statements, the directors have reasonable expectation that the company has adequate resources and funding in place to continue in operational existence for the foreseeable future and pay its liabilities as they fall due.

As at the point of authorising the accounts, and for the foreseeable future, the directors consider the going concern assumption to still be appropriate. However, should continuing funding not be available, the going concern basis would be invalid and the adjustments would have to be made to reduce the value of assets to their realisable amount and to provide for any further liabilities that might arise.

The directors acknowledge that given the currently rapidly changing business and social environment, there are likely to be significant unknown factors which may present themselves. Such factors are considered by the directors to represent a general inherent level of risk in relation to the going concern assumption albeit not quantifiable at this time.

Thus the directors continue to adopt the going concern basis of accounting in preparing the financial
statements.

TAE POWER SOLUTIONS ENGINEERING LIMITED (REGISTERED NUMBER: 11549836)

NOTES TO THE FINANCIAL STATEMENTS - continued
For The Period 1 January 2023 to 29 December 2023


2. ACCOUNTING POLICIES - continued

Share based payments
The Group provides share-based payment arrangements to certain employees.
Equity-settled arrangements are measured at fair value (excluding the effect on non-market based vesting conditions) at the date of the grant. The fair value is expensed on a straight-line basis over the vesting period. The amount recognised as an expense is adjusted to reflect the actual number of shares or options that will vest.

Where equity-settled arrangements are modified, and are of benefit to the employee, the incremental fair value is recognised over the period from the date of modification to date of vesting. Where a modification is not beneficial to the employee there is no change to the charge for share-based payment. Settlements and cancellations are treated as an acceleration of vesting and the unvested amount is recognised immediately in the income statement.

Cash-settled share options are measured at fair value at the balance sheet date. The Group recognises a liability at the balance sheet date based on these fair values, taking into account the estimated number of options that will actually vest and the current proportion of the vesting period. Changes in the value of this liability are recognised in the income statement.

3. EMPLOYEES AND DIRECTORS

The average number of employees during the period was 157 (2022 - 84 ) .

4. INTANGIBLE FIXED ASSETS
Other
intangible
assets
£   
COST
At 1 January 2023
and 29 December 2023 2,000
AMORTISATION
At 1 January 2023 650
Charge for period 200
At 29 December 2023 850
NET BOOK VALUE
At 29 December 2023 1,150
At 31 December 2022 1,350

TAE POWER SOLUTIONS ENGINEERING LIMITED (REGISTERED NUMBER: 11549836)

NOTES TO THE FINANCIAL STATEMENTS - continued
For The Period 1 January 2023 to 29 December 2023


5. TANGIBLE FIXED ASSETS
Improvements Fixtures
to Plant and and Computer
property machinery fittings equipment Totals
£    £    £    £    £   
COST
At 1 January 2023 128,185 159,714 230,317 262,306 780,522
Additions 45,150 1,118,209 107,150 212,691 1,483,200
Disposals - - (708 ) - (708 )
At 29 December 2023 173,335 1,277,923 336,759 474,997 2,263,014
DEPRECIATION
At 1 January 2023 53,597 67,333 70,102 107,505 298,537
Charge for period 28,061 184,376 46,957 102,686 362,080
Eliminated on disposal - - (255 ) - (255 )
At 29 December 2023 81,658 251,709 116,804 210,191 660,362
NET BOOK VALUE
At 29 December 2023 91,677 1,026,214 219,955 264,806 1,602,652
At 31 December 2022 74,588 92,381 160,215 154,801 481,985

6. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2023 2022
£    £   
Trade debtors 151,519 75,562
Other debtors 1,378,186 1,880,845
1,529,705 1,956,407

7. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2023 2022
£    £   
Trade creditors 2,488,677 748,651
Amounts owed to group undertakings 24,633,639 6,387,861
Taxation and social security 758,882 774,507
Other creditors 803,462 161,887
28,684,660 8,072,906

8. LEASING AGREEMENTS

Minimum lease payments under non-cancellable operating leases fall due as follows:
2023 2022
£    £   
Within one year 99,137 282,564
Between one and five years 1,184 100,320
100,321 382,884

TAE POWER SOLUTIONS ENGINEERING LIMITED (REGISTERED NUMBER: 11549836)

NOTES TO THE FINANCIAL STATEMENTS - continued
For The Period 1 January 2023 to 29 December 2023


9. PROVISIONS FOR LIABILITIES
2023 2022
£    £   
Deferred tax 302,150 94,272

Deferred
tax
£   
Balance at 1 January 2023 94,272
Provided during period 207,878
Balance at 29 December 2023 302,150

10. CALLED UP SHARE CAPITAL

Allotted and issued:
Number: Class: Nominal 2023 2022
value: £    £   
500,001 Ordinary share capital 1 500,001 1

500,000 ordinary shares of £1 each were issued at par on 8 June 2023.

11. DISCLOSURE UNDER SECTION 444(5B) OF THE COMPANIES ACT 2006

The Report of the Auditors was unqualified.

Emma Jones FCCA (Senior Statutory Auditor)
for and on behalf of TC Group

Material uncertainty related to going concern

We draw attention to Note 2 in the financial statements, which indicates that as of 29 December 2023, the company’s current liabilities exceeded its total assets by £25,470,216. As stated in Note 2, these events or conditions, along with other matters, indicate that a material uncertainty exists that may cast significant doubt on the company’s ability to continue as a going concern.

Our opinion is not modified in respect of this matter.

12. CAPITAL COMMITMENTS
2023 2022
£    £   
Contracted but not provided for in the
financial statements - 320,937

13. RELATED PARTY DISCLOSURES

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

During the year, sales of £86,518 (2023: £nil) were made to non wholly owned group companies.

TAE POWER SOLUTIONS ENGINEERING LIMITED (REGISTERED NUMBER: 11549836)

NOTES TO THE FINANCIAL STATEMENTS - continued
For The Period 1 January 2023 to 29 December 2023


14. POST BALANCE SHEET EVENTS

In November 2024, the group completed an internal restructure, which saw the UK headcount reduce as we look to right-size the business and its operations to maximise potential and reduce ongoing fixed costs. No provision has been included in relation to these amounts as the restructure did not occur until late 2024.

Subsequent to the year end, 383,241 share options have been forfeited. Amounts totalling £351,765 have been released from the share option reserve in 2024 and 2025 to date in relation to these.

15. ULTIMATE CONTROLLING PARTY

The company's immediate parent company is TAE Power Solutions Limited

TAE Technologies Inc is the ultimate controlling party by virtue of their shareholding in the group.

TAE POWER SOLUTIONS ENGINEERING LIMITED (REGISTERED NUMBER: 11549836)

NOTES TO THE FINANCIAL STATEMENTS - continued
For The Period 1 January 2023 to 29 December 2023


16. SHARE-BASED PAYMENT TRANSACTIONS

The number of equity-settled share based payments has been disclosed in the below table. During the year, the charge for the equity-settled share based payment was £584,093.

Some employees of the company have been issued share options in TAE Power Solutions LLC and TAE Technologies Inc. Share options which have been granted have non-market vesting conditions attached, and there are two different classes. Share options are exercisable immediately after the vesting period between 1-6 years following their grant.

The fair value of share options granted is estimated at the date of grant. The grant date for accounting purposes is at various points as the options were issued, as this is when a shared understanding of the terms and conditions of the arrangements was achieved between various parties. When assessing the fair value at the grant date, market information was used from which the parent company is listed in.

The fair value of share options granted is estimated at the date of grant using Black Scholes model.

The following table illustrates the number and weighted average exercise price of, and movements in, share options during the year;






Number of
share options
Weighted
average
exercise
price
At 1 January 2022-
Issued 1,081,022$14,64
Forfeited(80,483)$14.64
At 29 December 20231,000,539$14.64

The options outstanding at 29 December 2023 had an exercise price ranging from £22.39 to £1.03 and a remaining contractual life of 5.66 years on average. Note the above exercise prices are in a base currency of US Dollars and have been converted at the exchange rate at the year end date.

During the year ended 29 December 2023, 1,008,539 share options were issued with a weighted average aggregate value of £2,686,716 at the date of grant to employees.

The fair value of the share options granted during the year were determined using the Black-Scholes option pricing model with the following weighted average assumptions:

Average ($)Average (£)
Share price20.3716.29
Exercise price14.6411.71
Expected volatility70.82%
Expected option life5.66 years
Risk-free interest rate2.93%

Subsequent to the year end, 383,241 share options have been forfeited. Amounts totalling £351,765 have been released from the share option reserve in 2024 and 2025 to date in relation to these.