The directors present their Strategic Report for the year ended 31 March 2024 in respect of APEX Topco Limited (the “company”) and its subsidiaries, (collectively known as the “Group”). This report outlines the Group’s principal activities, reviews performance and key developments during a transitional year, and provides insight into financial results, risks, and outlook.
The Group is a private equity–backed provider of multi-country payroll services and global mobility solutions for corporate clients. The Group’s principal activities include delivering integrated global and domestic payroll processing, expatriate tax services, and human resource (HR) support to organisations worldwide. Headquartered in Aberdeen, Scotland, and operating through regional hubs and partners around the globe, the Group serves over 500 companies across more than 140 countries. Its highly experienced team and worldwide footprint enable the Group to help clients navigate complex international payroll, tax, and compliance challenges while providing consistent, high-quality service. The Group’s mission is to support the payroll and mobility needs of growth-oriented businesses wherever they operate, leveraging technology and expertise to ensure accurate, compliant, and timely payroll operations.
Business Review
Overview
The year ended 31 March 2024 was a transitional and challenging period for APEX Topco Limited, marked by ongoing investment in product development and the strategic acquisition of a complementary business midway through the year. Although profitability declined compared to the prior period, the Group delivered year-on-year revenue growth, underpinned by resilient customer demand and the early impact of strategic initiatives.
In response to operational and financial challenges, management implemented a series of targeted measures to strengthen the business for long-term success. This included investment in talent at both the operational level and by significant change across senior management and director level, process improvement, and the continued development of its global footprint. As a result, the Group enters future financial years with a broader service offering, enhanced tax and mobility capabilities, and a stronger foundation for sustainable, profitable growth.
Revenue and Performance
Group turnover for FY2024 increased to £52.2 million, up from £46.7 million in FY2023. This continued top-line expansion was driven mainly by contributions from the LIMES International BV acquisition, organic growth, new customer acquisitions and expanded engagements with existing clients, which broadened our geographic reach.
A key driver of this sustained revenue growth is the Group’s unwavering focus on cultivating long-term, trusted relationships with clients. By consistently delivering high-quality, compliant payroll and mobility solutions, the Group has excellent customer retention, even amidst increasing competition in the global payroll sector. This commitment to customer success has translated into a steady increase in annual recurring revenue, underscoring the resilience and predictability of our revenue base.
The global payroll division performed well, with particularly strong demand in key markets. Meanwhile, the global mobility and tax advisory services saw increased activity as clients sought integrated support for their internationally mobile employees.
The directors believe that the strength and longevity of our customer relationships are fundamental to our sustained growth and market leadership. By prioritising client satisfaction and delivering consistent value, the Group continues to reinforce its position as a trusted partner in global payroll and mobility solutions.
Profitability
The Group’s operating loss for FY2024 was £6.5 million, compared to an operating profit of £0.2 million in FY2023. The reduction primarily reflects the impact of several non-recurring events during the year:
Acquisition-Related Costs: The successful acquisition of LIMES International in October 2023 introduced integration and transaction-related expenses, contributing to a temporary increase in administrative costs.
Revised Bad Debt Provisioning: In alignment with FRS 102 requirements, the Group adopted a more conservative approach to estimating bad debt provisions. This increase in provision was brought about by a thorough analysis of trade receivables, collections and managements’ view on recoverability which led to a one-off increase in bad debt expense, reducing operating profit by £4.0 million.
Legal and settlement costs were incurred in relation to Board level changes in the year as the Group made changes to executive management.
Excluding these significant and non-recurring costs, the underlying trading performance remained robust. The directors monitor adjusted EBITDA, FY24 £13.0m (FY23 £13.6m) as a key measure of underlying performance; on this basis, the Group did not achieve results of continued adjusted EBITDA growth.
The decline in statutory profit is viewed as a temporary effect of the Group’s strategic investment in FY2024 and the change in credit risk policy. Management is confident that these investments will yield accelerating returns in the coming year, positioning the Group for sustainable growth and improved profitability.
Operational Improvement Initiatives
In FY2024 the Group launched a series of internal operational improvement initiatives aimed at boosting service delivery, and working capital management. A top priority was placed on enhancing internal systems and processes – for example, upgrading payroll software integrations and streamlining process workflows – to support scalability and consistency across our global operations. The benefits of these operational improvements were evident in service quality metrics: payroll processing accuracy and on-time delivery rates improved, and client satisfaction scores remained high.
Additionally, employee training and development programs were expanded, contributing to better staff productivity and engagement. While some of these initiatives added to costs in the short term (as noted above), they have started to deliver efficiencies and are laying the groundwork for margin improvement in future periods.
Strategic Acquisition – LIMES International
A major milestone in the year was the acquisition of LIMES International B.V. in October 2023. LIMES is a Netherlands-based firm specialising in global mobility tax, HR advisory, and payroll management services. This strategic acquisition has significantly bolstered the Group’s capabilities in the global mobility arena and expanded our presence in Continental Europe. Through the transaction, the Group gained deep in-country expertise in Dutch and Belgian payroll, enhancing our service offering to international clients in those jurisdictions. The acquisition also brought in the MILES suite of services (an Employer of Record solution) under the Group’s umbrella, enabling the ability to offer clients comprehensive support when hiring and managing talent in the Netherlands. Key LIMES consultants and leaders were retained, ensuring continuity of expertise, and teams began collaborating to cross-sell services to each other’s client bases. The acquisition contributed to revenue growth in the second half of the year and is expected to be a significant lever for future growth. By combining the Group’s global payroll services with LIMES’ tax and mobility know-how, the Group is positioned as a “one-stop” global HR, tax, and payroll partner for clients. Management is confident that this business combination will offer a unique proposition, broaden our market reach, and enhance the Group’s competitive differentiation in the global mobility and compliance space. The goodwill recognised on this acquisition reflects the strong future earnings potential of the combined business.
Outlook
Looking ahead, the directors are optimistic about the Group’s prospects. The customer base continues to expand, and demand for multi-jurisdictional payroll and mobility solutions remains strong. With the LIMES acquisition still to be fully integrated and the full internal improvements taking effect, the Group is strategically positioned to return to profit growth in the coming years. Management will maintain its focus on operational excellence and cost discipline, while continuing to invest in technology and talent to support scalable growth. The Group’s broadened service suite – spanning payroll, tax, mobility, and HR advisory – provides multiple avenues for revenue growth within our existing client portfolio and through new client acquisitions. Overall, despite the challenges faced during this transitional year, the Group has emerged with a wider service offering with the addition of the LIMES acquisition. The Board is confident that the foundations laid in FY2024, together with our committed team and supportive shareholders, will drive improved performance and value creation in future periods.
The Group uses both financial and non-financial Key Performance Indicators (KPIs) to monitor progress against its strategic objectives. Financial KPIs are tracked on a monthly basis and reviewed by the Board to evaluate the Group’s growth, profitability, and financial stability. Key financial performance indicators for the year (with prior-year comparatives in parentheses) include:
Metric | 2024 | 2023 |
Turnover | £52.2m | £46.7m |
Gross profit | £25.2m | £22.8m |
Operating (loss)/profit | (£6.5m) | £0.2m |
EBITDA | £5.7m | £10.6m |
Adjusted EBITDA* | £13.0m | £13.6m |
Net current assets | £6.8m | £13.2m |
* Adjusted EBITDA is a non-GAAP measure used by management to assess the underlying performance of the Group. Adjusted EBITDA is calculated as EBITDA plus the one-off bad debt provision £4.0m and other non-trading significant items such as the Limes International BV acquisition costs and outgoing executive team legal and settlement costs totalling £2.7m which makes up the majority of the remaining £3.3m.
In addition to these financial KPIs, the Group monitors several non-financial KPIs to ensure long-term business health and stakeholder satisfaction. These include: staff turnover and satisfaction, payroll processing accuracy and timeliness, client retention rates, and customer satisfaction scores. During the year, performance against these non-financial metrics was strong – for example, client retention remained high and on-time payroll processing consistently exceeded our target threshold – reflecting the Group’s focus on quality service and engaged employees. The Board considers both financial and non-financial KPIs in its decision-making, as they together provide a balanced view of the Group’s operational success and areas for improvement.
Principal risks and uncertainties
The Group faces a range of risks and uncertainties inherent in its operations and the broader business environment. The Board regularly reviews these principal risks and has implemented policies and controls to mitigate them as part of our risk management framework. The following are the key risks and uncertainties identified for the Group:
Regulatory Compliance Risk: The Group operates in a highly regulated domain across numerous jurisdictions. Payroll and tax regulations change frequently and vary from country to country. Non-compliance or errors could lead to legal penalties, client dissatisfaction, and reputational damage. The Group mitigates this risk by maintaining rigorous compliance processes and investing in expert knowledge. We continuously monitor legislative changes in every jurisdiction we serve. Regular training, and quality control checks are in place to ensure adherence to all applicable laws and regulations.
Operational and Integration Risk:
As the Group continues to scale and pursue growth opportunities, including through acquisitions, there is an inherent risk of operational disruption or delay in realising expected benefits. Key challenges include aligning IT systems, standardising processes, and managing change across different geographies and operating models. To mitigate these risks, the Group undertakes detailed planning for operational transitions, supported by experienced project teams and phased implementation strategies. Engagement with customers remains a priority throughout periods of change to ensure service continuity and maintain confidence. The Group remains focused on strengthening its operational infrastructure and controls to support sustainable growth and safeguard service quality.
Technology and Data Security Risk: The Group relies on sophisticated payroll software, cloud platforms, and IT infrastructure to deliver services. Any significant system downtime, cyber-attack, or data breach could severely impact our ability to serve clients and compromise sensitive personal data. Recognising this, the Group has made data security and system resilience a top priority. We employ robust cybersecurity measures, including data encryption, firewalls, access controls, and regular vulnerability assessments. Dedicated IT teams monitor system performance and have disaster recovery plans in place to ensure continuity of service. The Group is certified to high industry standards for information security and undergoes independent audits of its controls. Ongoing investments in technology upgrades and security enhancements help reduce the likelihood of disruptions and protect client data integrity.
Market and Competition Risk: The global payroll and HR solutions market is competitive and evolving. Competitors range from large multinational firms to local providers in various countries. There is a risk that increased competition or innovation by others could pressure our market share or pricing. Furthermore, macroeconomic factors (such as economic downturns or reductions in client headcount) can affect demand for our services. The Group manages this risk by continuously innovating its service offering and maintaining a differentiated value proposition. Our comprehensive suite of services (payroll, tax, mobility, HR) and reputation for reliability position us well against competitors. We focus on delivering excellent customer service, which drives client loyalty and referrals. In addition, our diversified global client base across many industries provides some protection against regional or sector-specific downturns. The management team monitors market trends closely and adapts the Group’s strategy (including exploring new service lines or technologies) to ensure we remain competitive and responsive to client needs.
Financial Risk (Currency and Credit): Operating internationally exposes the Group to foreign exchange fluctuations and credit risks. Revenue and costs denominated in multiple currencies, mainly USD, Euro and GBP, mean that exchange rate movements can impact our reported financial performance. To mitigate currency risk, the Group employs natural hedging where possible—matching costs with revenue in the same currency—and periodically reviews the need for financial hedging instruments.
Credit risk arises from the possibility that clients may delay payments or, in rare cases, default on their obligations, affecting cash flow. To manage this, the Group conducts stringent client onboarding checks, maintains diversified client exposure, and employs active credit control measures.
Post year end, the Group undertook a comprehensive review of its credit risk assessment procedures. As a result, the Group adopted a more conservative approach to estimating bad debt provisions, aligning with best practices under FRS 102. This change reflects a heightened focus on credit risk management and a commitment to prudent financial reporting.
The revised provisioning policy led to an increase in the bad debt expense recognised in the income statement, thereby reducing the Group's operating profit for the year by £4.0 million. This adjustment ensures that the financial statements more accurately reflect the current credit risk environment and the recoverability of trade receivables. The Group believes that this proactive approach to credit risk assessment strengthens its financial position and better prepares it to manage potential future credit losses. The impact of this change is expected to stabilise in subsequent periods, providing a more robust foundation for financial planning and analysis.
Additionally, the improvement in aged debt recovery noted since the year end has reduced our outstanding receivables risk. The Group also maintains sufficient cash reserves and access to funding to cushion against any short-term working capital impacts from these financial risks.
The directors are satisfied that, with the aforementioned risk mitigations and the ongoing monitoring in place, the Group’s principal risks are being managed appropriately. There remains uncertainty in the external environment (including regulatory changes and economic conditions), but the Board is confident that the Group’s business model and prudent risk management approach provide a strong degree of resilience against these challenges.
Section 172 of the UK Companies Act 2006 requires directors to act in a way they consider, in good faith, would promote the success of the company for the benefit of its members as a whole, and in doing so have regard (among other matters) to various stakeholders and factors. The directors of APEX Topco Limited embrace these duties and recognise that the long-term success of the Group is dependent on nurturing positive relationships with employees, customers, suppliers, the community and the environment, as well as acting fairly between members (shareholders). Throughout the year ended 31 March 2024, the Board took into account the needs and priorities of these stakeholders in its decision-making processes. Below we outline how the directors have fulfilled their Section 172(1) responsibilities:
Employees: Our people are central to the business, and the directors have ensured that employee interests were considered in all major decisions. During the leadership restructuring and operational changes this year, we engaged in open and frequent communication with staff. The Group held regular all-hands updates and management forums to explain the rationale for changes, address employee concerns, and gather feedback. We also continued to invest in our team’s professional development and well-being – for example, expanding training programs and offering flexible working arrangements – to maintain morale and retention. The safety and welfare of employees remained a top priority, and the Board monitored staff engagement through surveys, employee net promoter, and direct interactions. By actively supporting and listening to our employees, the directors aim to foster a positive workplace culture that drives the Group’s long-term success.
Customers:
The directors recognise that client satisfaction and trust are fundamental to the Group’s continued success. The Group has a long-standing track record of prioritising service quality, particularly in the accurate and timely delivery of payroll and the provision of responsive, reliable support. Even during periods of internal change and investment, the business maintained high service standards, with strong on-time delivery performance and a consistent focus on customer needs.
Strategic decisions, including growth initiatives and resource expansion, are assessed with customer impact in mind. Where new capabilities have been introduced—such as enhanced local expertise in specific markets—the Group has taken steps to communicate transparently with clients and ensure a smooth transition. Continuance client conversations are maintained through monthly governance and quarterly business reviews, and where material, client input is escalated to the Board and used to inform ongoing process improvement. By consistently delivering value and maintaining close client engagement, the Group fosters long-term relationships that underpin sustainable growth.
Suppliers and Business Partners: The Group recognises that its suppliers—including in-country partners—are critical to delivering compliant, timely, and reliable services to customers. These relationships form an integral part of the Group’s global operating model.
Supplier engagement is managed through a combination of the contracts, operations, and finance teams, who work together to ensure clear expectations and collaborative delivery. A rigorous onboarding process is followed before engaging any new in-country partner, with checks in place to assess data security compliance, technical capability, and alignment with the Group’s service standards.
Ongoing communication with suppliers is prioritised throughout the relationship to ensure service levels are maintained and evolving requirements are met. The Group aims to meet its obligations with suppliers and maintains open dialogue to address any issues or disputes constructively and transparently.
Community and Environment: As a global service organisation, the Group has a relatively low environmental footprint; nevertheless, the directors remain committed to operating responsibly and sustainably. Environmental considerations are taken into account in our day-to-day operations and decision making. During the year, the Group continued initiatives to reduce paper usage by leveraging digital documentation and encouraged remote collaboration tools to reduce business travel where possible. In our offices, we promote recycling and energy-efficient practices. The Board also encourages involvement in local community projects, particularly in regions where we have a significant presence. In our Aberdeen headquarters, for example, staff participated in community fundraising events and volunteer programs supported by the company. By considering the broader community and environmental impact, the directors aim to contribute positively to society while ensuring the company’s activities remain sustainable in the long run.
Shareholders (Investors):
The company’s shareholders, including its private equity backers, are key stakeholders in the Group’s long-term success. Throughout the year, the Board maintained regular, transparent engagement with investors, providing timely updates on financial performance, strategic developments, and operational challenges. This open dialogue ensured shareholders remained well-informed and able to contribute their perspectives on key decisions.
Material actions—such as the strategic acquisition of LIMES and the post-year-end capital injection—were subject to Investment Committee approval, with the Board carefully considering their impact on long-term value creation. The £7.5 million capital injection secured after year-end reflects strong alignment between the Board and shareholders on supporting the Group’s growth strategy and strengthening its financial position.
The Board recognises the importance of maintaining trust and alignment with its investors. By focusing on transparent communication and execution of strategy, the directors aim to promote the sustained success of the company in line with shareholder expectations.
In summary, the directors confirm that during FY2024 they have acted in a manner consistent with the requirements of Section 172, by actively considering the company’s stakeholders and the long-term consequences of decisions. This approach underpinned the Board’s key resolutions, from day-to-day operational improvements to transformational transactions, ensuring that the Group remains a sustainable and responsible business positioned for continued success.
Events After the Reporting Date
Shareholder Capital Injection: On 28 May 2025, the Group secured a significant capital injection from its shareholders to support its ongoing growth and strategic initiatives. £7.5 million of additional funding was provided in the form of new loan notes issued by activpayroll Group Ltd. These proceeds were made available to the Group via an intercompany loan. This post-year-end capital infusion has strengthened the Group’s balance sheet and liquidity position, providing resources to invest in future expansion and to accelerate integration initiatives. The funding underscores the shareholders’ ongoing commitment to the Group’s strategy and their confidence in the long-term prospects of the business. This fresh capital will be used prudently to drive product development, enhance operational capacity, and explore further strategic opportunities as they arise.
Renegotiation of facilities: In addition, on 28 May 2025, the Group negotiated an amended Senior Facilities Agreement with its banking partner, replacing the previous facility. The new agreement reflects a realignment of the Group’s capital structure in support of its long-term strategic plans and includes revised covenant terms designed to provide greater financial flexibility.
Deferred Consideration: Agreement has been reached post year end to further defer part of the consideration in relation to the acquisition of Limes International BV due in October 2024, to October 2025. The EUR3m deferred has resulted in an additional EUR 0.6m settlement.
Other Matters: There were no other material events after the reporting date that require disclosure in this report. The Board confirms that, aside from the above-noted events, there have been no significant changes in the Group’s financial position or operations since 31 March 2024 that would necessitate adjustment to the figures reported or affect the understanding of the financial statements. The Group continues to trade in line with expectations in the post-year-end period. With a reinforced balance sheet, the Group is well-positioned to execute its growth strategy in the year ahead.
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 March 2024.
The results for the year are set out on page 16.
No ordinary dividends were paid. The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Total charitable donations made by the Group during the year amounted to £7,081 (2023: £8,839).
The Group has extensive processes for engaging with and motivating its employees, which are detailed in the Section 172 statement within the Strategic Report.
The Group has chosen in accordance with Companies Act 2006, s.414C(11) to set out in the Group's strategic report information required by Large and Medium sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of future developments and financial risk management objectives and policies where applicable.
The Group is required to present the following information in relation to energy use, methods of calculation, and the measures being undertaken to improve energy efficiency.
In line with the Greenhouse Gas (GHG) Protocol Corporate Accounting and Reporting Standard, the Group continues to be engaged in reducing its greenhouse gas emissions. The Group currently has scope 1, 2 and 3 emissions.
Scope 1 and Scope 2 data is sourced from mater readings and energy supplier invoices. Scope 3 data only includes consumption of fuel in employee-owned vehicles, not other travel, waste disposal or purchased materials, and is sourced from employee mileage records.
|
| 2024 | 2023 |
Scope1 | kWh | - | - |
Combustion of natural gas | TCO2e | - | - |
|
|
|
|
Scope 2 | kWh | 180,537.27 | 179,046.27 |
Grid electricity including for transport | TCO2e | 37.38 | 37.08 |
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|
|
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Scope 3 | kWh | 10,916.56 | 10,568.78 |
Consumption of fuel in employee-owned vehicles | TCO2e | 2.63 | 2.53 |
|
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Total | kWh | 191,453.83 | 189,615.05 |
| TCO2e | 40.01 | 39.61 |
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Intensity ratio | TCO2e per £m turnover | 0.74 | 0.86 |
Energy efficiency action
The Group is committed to tackling climate change and its strategy for reducing its carbon emissions include:
Review of travel for work arrangements including allowing employees to work from home and implementing a cycle-to-work scheme.
Purchasing energy efficient equipment where appropriate.
Replacing heating and ventilation systems with energy efficient equipment where possible.
Adapting behavioural change measures.
The auditor, Johnston Carmichael LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
We have audited the financial statements of APEX Topco Limited (‘the parent company’) and its subsidiaries (‘the group’) for the year ended 31 March 2024, which comprise the Group Statement of Comprehensive Income, Group and Company Balance Sheets, Group Statement of Changes in Equity, Company Statement of Changes in Equity, Group Statement of Cash Flows, and notes to the financial statements, including 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 (United Kingdom Generally Accepted Accounting Practice).
Basis for 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 or 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
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our 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.
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:
We assessed whether the engagement team, including component auditors, collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations by considering their experience, past performance and support available.
All engagement team members and component auditors were briefed on relevant identified laws and regulations and potential fraud risks at the planning stage of the audit. Engagement team members and component auditors were reminded to remain alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
Extent to which the audit is considered capable of detecting irregularities, including fraud (continued)
We obtained an understanding of the legal and regulatory frameworks that are applicable to the group and the parent company and the sector in which they operate, focusing on provisions that had a direct effect on the determination of material amounts and disclosures in the financial statements. The most relevant frameworks we identified include:
Companies Act 2006;
Corporation Tax legislation;
VAT legislation;
UK Generally Accepted Accounting Policies; and
General Data Protection Regulations (GDPR).
We gained an understanding of how the group and the parent company are complying with these laws and regulations by making enquiries of management and those charged with governance including management and those charged with governance of component entities where necessary. We corroborated these enquiries through our review of board meeting minutes and through discussions with component auditors.
We assessed the susceptibility of the group’s financial statements to material misstatement, including how fraud might occur, by meeting with management and those charged with governance to understand where it was considered there was susceptibility to fraud. This evaluation also considered how management and those charged with governance were remunerated and whether this provided an incentive for fraudulent activity. We considered the overall control environment and how management and those charged with governance oversee the implementation and operation of controls. We identified a heightened fraud risk in relation to:
Management override of controls; and
Revenue recognition.
In addition to the above, the following procedures were performed to provide reasonable assurance that the financial statements were free of material fraud or error:
Performing audit procedures confirming that revenue recognised within the financial statements have occurred and are accurately recorded in the correct period by selecting a sample and agreeing to relevant source documents.
Reviewing minutes of meetings of those charged with governance for reference to: breaches of laws and regulation or for any indication of any potential litigation and claims; and events or conditions that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud;
Reviewing the level of and reasoning behind the group’s and parent company’s procurement of legal and professional services
Performing audit procedures over the risk of management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and assessing judgements made by management in their calculation of accounting estimates for potential management bias;
Direction and reviewing the work and reporting completed by component auditors;
Completion of appropriate checklists and use of our experience to assess the group’s and parent company’s compliance with the Companies Act 2006; and
Agreement of the financial statement disclosures to supporting documentation.
Our audit procedures were designed to respond to the risk of material misstatements in the financial statements, recognising that 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 intentional concealment, forgery, collusion, omission or misrepresentation. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.
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 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.
The statement of comprehensive income has been prepared on the basis that all operations are continuing operations.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s result for the year was £0 (2023 - £0 result).
APEX Topco (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is One, St. Peters Square, Manchester, England, M2 3DE.
The Group consists of APEX Topco and all of its subsidiaries.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £000.
The financial statements have been prepared under the historical cost convention, modified to include certain financial instruments at fair value. The principal accounting policies adopted are set out below.
The company is a qualifying entity for the purposes of FRS 102 and has taken advantage of the exemption available from the requirement to present a company only cash flow statement and related notes and disclosures.
The consolidated group financial statements consist of the financial statements of the parent company APEX Topco together with all entities controlled by the parent company (its subsidiaries).
All financial statements are made up to 31 March 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the Group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Subsidiaries are consolidated in the Group’s financial statements from the date that control commences until the date that control ceases.
After making enquiries, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the financial statements.
On May 28 2025, the business received a £7.5 million liquidity infusion by way of new loan notes issued by activpayroll Group Ltd. These funds were made available to the Group through an intercompany loan arrangement and have materially strengthened the operating company's liquidity position.
The Directors have prepared forecasts for the going concern assessment period to 30 June 2026, which reflect the most recent trading performance and expected developments in the business. These forecasts demonstrate that the Group maintains significant liquidity headroom throughout the period and is expected to operate within all covenant thresholds under the Group’s financing arrangements.
The Directors have considered a range of downside sensitivities, including delays in customer receipts, a flattening of revenue growth, and potential cost inflation across delivery operations. Even under such scenarios, the Group is forecast to maintain sufficient liquidity and continue to meet its financial obligations as they fall due. These downside cases were modelled without factoring in any mitigating actions within management’s control.
In addition, a reverse stress test was performed to identify the extent of deterioration in financial performance required to exhaust the Group's liquidity headroom. This scenario would require a material and sustained decline in profitability with no corresponding cost or operational response, which the Directors consider to be remote. Management retains a wide range of actions available to preserve cash, including further efficiency savings and working capital controls.
Accordingly, having considered the business’s financial position, forecast performance, and the operational flexibility available to it, the Directors are satisfied that the Group has adequate resources to continue in operational existence for the foreseeable future and continue to adopt the going concern basis in preparing these financial statements.
Turnover is recognised at the fair value of the consideration received or receivable for services provided in the normal course of business, and is shown net of VAT and other sales related taxes.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
No depreciation is charged on assets in the course of construction.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the statement of comprehensive income.
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the Group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
At each reporting period end date, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in the statement of comprehensive income.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in the statement of comprehensive income.
The Group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the Group's balance sheet when the Group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally 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.
Basic financial assets, which certain include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in the statement of comprehensive income.
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 the statement of comprehensive income.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the Group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
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 Group after deducting all of its liabilities.
Basic financial liabilities, including certain creditors, bank loans 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. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Financial liabilities are derecognised when the Group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the Group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the Group.
Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.
A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Equity-settled share-based payments are measured at fair value at the date of issue by reference to the fair value of those equity instruments, using a Capital Asset Pricing Methodology. The fair value determined at the issue date is expensed on a straight-line basis over the expected period before an exit event. A corresponding adjustment is made to equity.
The expense in relation to parent company’s shares issued to the employees of a subsidiary is recognised by the subsidiary company as a capital contribution, and presented as an increase in the parent company’s investment in that subsidiary.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
Client Monies
Client monies held in earmarked bank accounts are not recognised in the financial statements, reflecting the substance of the arrangement.
As at 31 March 2024, the total amount of client monies held by the Group was £68,650,907 (2023 - £70,529,764).
In the application of the Group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
As disclosed in note 1.4, management have made judgements on the Going concern status of the Group and the company.
Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years. This amortisation period is a judgement made by management.
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
In accounting for business combinations the Group are required to consider the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed as well as the fair value of the identifiable assets, liabilities and contingent liabilities acquired. In making the necessary assessments the Group consider third party specialist support and observable market data where appropriate as well as the nature and anticipated useful economic life of assets acquired.
Details of acquisitions in the year are outlined at note 26.
The Group is subject to income taxation, where judgement arises in determining the provision for income taxes. During the ordinary course of business, there are transactions and calculations for which the ultimate tax determination is uncertain. As a result, the Group recognises tax liabilities based on estimates where additional taxes and interest will be due. The Group believes its accruals for tax liabilities and provisions for deferred tax are adequate for all financial years based on its assessment for many factors including past experience and interpretations of tax law. This assessment relies on estimates and assumptions and may involve a series of judgements about future events. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will impact the taxation charge made in the statement of comprehensive income in the period in which such determination is made.
Management has undertaken a post year end review of estimated bad debts. Based on updated analysis on the level of collections and a more prudent view of recoverability, management have decided to make a one-off adjustment resulting in a provision of £4m.
The average monthly number of persons (including directors) employed by the Group and company during the year was:
Their aggregate remuneration comprised:
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2023 - 2).
Other interest relates to the unwinding of deferred consideration due by the group which was initially discounted to reflect the time value of money.
Fair value gains/(losses) are in respect of the Group's forward foreign currency exchange contracts as well as an interest rate cap in place over the Group's third party borrowings.
The actual charge for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
A change in the UK Corporation tax rate to 25% took effect from 1 April 2023.
Additions relating to business combinations include £18k of costs incurred in the current year in relation to a group acquisition in the prior financial year. The balance of additions (£27,005k) are in respect of a current year business combination. Further details of the business combination are outlined at note 26.
Details of the company's subsidiaries at 31 March 2024 are as follows:
The registered office of these subsidiary undertakings is Voorschoterweg 23G, 2235 SE Valkenburg, Zuid Holland, Netherlands.
Derivative financial assets
The derivative financial asset at the reporting date is in relation to an interest rate swap. The Group has entered into an interest rate swap agreement to receive SONIA and pay a fixed rate of 4.97% on a notional principal of £74,200,000. The effect of this is to fix the SONIA element of the bank loan (see note 20) at 4.97%. The agreement was entered into in December 2023, was effective from 1 January 2024, and expired on 31 December 2024. The interest rate swap agreement is a financial instrument carried at fair value through profit and loss. Fair value is calculated using readily observable market prices. Hedge accounting is not used.
Derivative financial liabilities
The derivative financial liability at the reporting date is in relation to foreign exchange forward contracts and options. The Group entered into various foreign exchange forward contracts and options and at the reporting date contracts and options remain with maturities from 24 April 2024 to 24 September 2024, to sell up to 1.455m EUR and 2.865m USD and buy GBP. The forward contracts and options are financial instruments carried at fair value through profit and loss. Fair value is calculated using readily observable market prices. Hedge accounting is not used.
Trade debtors are stated net of provision for doubtful debt of £4.0m (2023 - £Nil).
Amounts owed by group undertakings to the company are interest free and repayable on demand with no fixed repayment terms.
Included in other creditors is £4,842k (2023 - £457k) relating to deferred consideration due in respect of the Group's business combinations (see note 26 and 28).
The bank loan carries interest at a variable rate of SONIA plus a margin that varies between 5.8693% and 7.3693% depending on the net leverage of the Group. Interest is payable quarterly and the principal is repayable in a single bullet repayment on 24 January 2027. The lending bank has security over the assets of all material companies in the Group.
The loan notes were issued on 24 January 2020 and are redeemable at par together with accrued interest on 22 January 2027. All loan notes accrue interest at a fixed rate of 8% per annum.
A breakdown of the balance at the reporting date by loan note is outlined below:
Loan notes | Currency | Nominal interest rate (p/a) | Year of maturity | Carrying value at 31 March 2024 | Carrying value at 31 March 2023 |
|
|
|
|
|
|
A loan notes | GBP | 8% | 2027 | 8,389 | 7,740 |
B1 loan notes | GBP | 8% | 2027 | 33,501 | 30,916 |
B2 loan notes | GBP | 8% | 2027 | 34,186 | 31,540 |
|
|
|
|
|
|
|
|
|
| 76,076 | 70,196 |
The following are the major deferred tax liabilities and assets recognised by the Group and company, and movements thereon:
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the Group in an independently administered fund.
Included within other creditors due within one year are pension contributions payable of £88k (2023 - £85k).
Certain employees of the Group participate in a share-based payment arrangement granted to the Group's employees by the parent company, APEX Topco Limited. Accordingly, a total of 15,590 C2 Ordinary Shares have been issued at prices of £65 and £148 per share which represent a discount to fair value at the date of issue. These shares represent an equity-settled share-based payment on application of FRS 102 and allow participation in the sale proceeds of the parent company upon an exit event in accordance with the investment agreement. The recognition period for the share-based payment is estimated to be 3 years based on industry norms.
The Group employed a Capital Asset Pricing Methodology in applying an appropriate discount rate to expected returns over an assumed exit horizon.
The total charge for the year relating to equity-settled share-based payment plans was £364,000 (2023 - £302,000).
The following movements in share capital have been reflected in the current year:
370 C3 Ordinary shares issued on 25 May 2023 for a consideration of £54,760.
830 C2 Ordinary shares issued on 7 June 2023 for a consideration of £122,840.
The A and B Ordinary shares have attached full voting, dividend and capital distribution rights although confer no right of redemption.
The C1 and C2 Ordinary shares have attached full voting and dividend rights as well as capital distribution rights subject to certain restrictions in respect of the allocation of assets. Neither the C1 or C2 Ordinary shares have any right of redemption.
1,000 C2 Ordinary shares are held by an Employee Benefit Trust (“EBT”) for the benefit of certain directors and employees of the Group. Although the EBT has separate legal standing and is not legally controlled by the Group, it is considered to be under the de facto control of the Group in accordance with FRS 102 s9.33, and it is therefore accounted for as such, with these shares accounted for as though they had been purchased by the Group. An amount of £65,000 has been deducted from equity in relation to this representing the present value of the consideration on the shares still due.
The share premium account represents the premium arising on the issue of shares net of issue costs. The time value of money is taken into consideration in accounting for share issues with deferred payment terms.
The own share reserves represents 1,000 C2 Ordinary shares held by an Employee Benefit Trust (“EBT”) which has been accounted for in accordance with FRS 102 s9.33. Further details are outlined at note 24.
The profit and loss account represents cumulative profits and losses net of dividends and other adjustments.
On 19 October 2023 the Group acquired 100 percent of the issued capital of Limes International B.V. and Miles International Payrolling B.V..
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
Shareholder capital injection:
On 28 May 2025, the Group received a capital injection of £7.5 million via an intercompany loan from activpayroll Group Ltd. This funding was facilitated by the issue of new loan notes by activpayroll Group Ltd to existing shareholders. The proceeds were subsequently made available to activpayroll Ltd as part of the Group’s broader liquidity and investment strategy.
This post year-end funding has significantly strengthened the Group’s liquidity position and will support continued operational investment, product development, and the integration of recent acquisitions. The event is considered non-adjusting, as it relates to conditions that arose after the balance sheet date, and therefore no adjustments have been made to the financial statements as at 31 March 2024.
Renegotiation of facilities:
In addition, on 28 May 2025, the Group negotiated an amended Senior Facilities Agreement with its banking partner, replacing the previous facility. The new agreement reflects a realignment of the Group’s capital structure in support of its long-term strategic plans and includes revised covenant terms designed to provide greater financial flexibility.
Deferred Consideration:
Agreement has been reached post year end to further defer part of the consideration in relation to the acquisition of Limes International BV due in October 2024, to October 2025. The EUR3m deferred has resulted in an additional EUR 0.6m settlement.
Remuneration paid to key management personnel in the year was £1,664k (2023 - £1,569k).
The Group has taken advantage of the exemption available under paragraph 33.1A of Financial Reporting Standard 102 not to disclose transactions with other wholly owned members of the Group.