Company registration number 00283933 (England and Wales)
Edbro Hydraulics Limited
Annual report and financial statements
For the year ended 31 December 2024
Edbro Hydraulics Limited
Company information
Directors
Mr F Orman
(Appointed 3 April 2025)
Mrs K Orman
(Appointed 3 April 2025)
Company number
00283933
Registered office
Edbro House
Nelson Street
Bolton
Lancashire
United Kingdom
BL3 2JJ
Auditor
DJH Audit Limited
The Exchange
5 Bank Street
Bury
Lancashire
BL9 0DN
Edbro Hydraulics Limited
Contents
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Income statement
8
Statement of comprehensive income
9
Statement of financial position
10
Statement of changes in equity
11
Statement of cash flows
12
Notes to the financial statements
13 - 27
Edbro Hydraulics Limited
Strategic report
For the year ended 31 December 2024
- 1 -

The directors present the strategic report for the year ended 31 December 2024.

Review of the business

The company manufactures hydraulic actuation equipment and distributes products worldwide; operates in two major markets, the first being Heavy Duty Road Trucks and Trailers, where it is a leading worldwide manufacturer, and secondly the Off-Road market for heavy duty mining and construction vehicles.

 

Turnover for 2024 totaled £25.7m, down 2.3% from the previous year. Revenue split was 72% on-road and 28% off-road. Demand for the company’s products was down more substantially in the UK, European and Middles-East regions but offset by buoyant demand levels from SE Asia and Australasia.

Following a capital investment of £2.5m in new production machinery, the company had planned to start serial production of its new high pressure (HP) telescopic cylinder product to select on-road UK and European customers in Q4 and saw strong interest and orders for the new product, but delays in delivery of machinery and issues with automation significantly impacted this plan.

Overall, the delays in establishing additional production capacity for the new HP product impacted revenues in the final quarter and caused disruption to our customers due to late deliveries, with a total of £850,000 of overdue backlogged at year end.

Without these delays revenue for 2024 would have been broadly in-line with 2023.

During 2024 the company began serial production deliveries to a new offroad customer but the ramp up to full volume was delayed due to a substantial capacity conflict on CNC machining processes due to delays with the new HP line.

On the 9th May 2024 the company completed the sale of its 14.4 acre 330,000ft2 site and opted to lease back a reduced area totaling 220,000ft2 which allowed the company to pay down £3.8m in long term mortgage debt.

EBITDA is one of our primary metrics measuring operational cash flow generation. EBITDA for 2024 was a loss of (£254k) compared to an EBITDA of £354k for 2023.

This includes costs for rent and service charges totaling £445k and non-reoccurring legal and advisory costs totaling £626k. The legal and advisory costs relate to two specific activities; the first was the legal costs and agent fees associated with the site sale; the second relates to advisors appointed to sell the company. Underlying EBITDA when factoring out non-reoccurring legal and advisory costs EBITDA would have been £372k, broadly in-line with 2023 despite incurring rent costs.

Order intake for Q12025 has slowed in the UK due to economic factors and reduced construction activity and delayed infrastructure projects and despite this the company is still predicting modest growth for 2025 and beyond when orders recover after customers complete de-stocking activities and on new products and business awards from existing customers.

Utility costs remained adverse compared to 2022 levels with the total cost for utilities totaling £1.34m in 2024, down from £1.44m in 2023 (2022 - £0.939m).

On the 21st March 2025 the company was sold to Orsan Automotive Ltd and is owned by Orsan Ticari Arac Ve Fren Sistemleri Anonim Sirketi registered in Turkey.

Orsan are an industrial group founding in 1978 supplying component parts to the heavy duty vehicle sector with a total of 9 manufacturing sites when including Edbro, with manufacturing locations in Turkey, Mexico, UK and soon India. There are some considerable synergies between the companies and collectively the group can offer a much wider product portfolio to its combined customer base.

As part of the deal the company has been re-capitalised and third-party debt to Endless LLP and Shawbrook Bank has been fully repaid. The details of the re-capitalisation can be found in the post balance sheet notes.

The financial statements have been prepared on a going concern basis.

Edbro Hydraulics Limited
Strategic report (continued)
For the year ended 31 December 2024
- 2 -

The company meets its day-to-day working capital requirements through cash generated from operations and had pre-sale utilized an invoice finance facility provided by Shawbrook Bank, this has been replaced with support from Orsan Industries and Ziraat Bank.

The company’s forecasts and projections show that the company should have adequate financial resources and be able to continue to trade on an on-going operational basis for the next 12 months with the continued support from Orsan and Ziraat Bank.

The company monitor critical financial KPI’s (key performance indicators) including sales revenue growth, material margin, gross margin, EBITDA, cash flow, debtor and creditors days and critical non-financial KPI’s including safety, quality, lead-time & order backlog and on-time delivery.

The company has adopted D&I (diversity and inclusion) as part of its core principles, and this is reflected across our policies covering recruitment and retention to maintain legal compliance and improve employee retention.

Edbro Hydraulics Limited operates an equal opportunities policy and welcomes applications for all vacancies from all parts of the community and will recruit the best person for each vacancy regardless of gender, race, age, religion, belief, sexual orientation, disability, ethnicity, responsibility for dependants, marital status and/or trade union activity.

Employees representatives act on behalf of all employees and are involved in regular health and safety review meetings, operational and business update meetings as well as collective bargaining meetings, and the company is actively focused on ensuring as far as practical possible that employee representatives are a fair and reasonable reflection of our employee demographic as part of our diversity and inclusion principles.

The directors believe that longer term success will be attained through good D&I and EVP programs in attracting and retained talented and engaged employees.

On behalf of the board

Mr F Orman
Director
27 August 2025
Edbro Hydraulics Limited
Directors' report
For the year ended 31 December 2024
- 3 -

The directors present their annual report and financial statements for the year ended 31 December 2024.

Principal activities

The principal activities of the company in the year under review was those of the design, manufacture and sale of hydraulic tipping hoists and hydraulic (mobile) cylinders.

Results and dividends

The results for the year are set out on page 8.

No dividends will be distributed for the year ended 31 December 2024.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Mr I Bragg
(Resigned 3 April 2025)
Mr G MacDonald
(Resigned 3 April 2025)
Mr F Orman
(Appointed 3 April 2025)
Mrs K Orman
(Appointed 3 April 2025)
Research and development

The company's activities in research and development are principally concerned with the development of new products and the improvement of existing products.

Auditor

DJH Audit Limited has indicated its willingness to be reappointed for another term and appropriate arrangements are being made for it to be deemed reappointed as auditor in the absence of an Annual General Meeting.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
Mr F Orman
Director
27 August 2025
Edbro Hydraulics Limited
Directors' responsibilities statement
For the year ended 31 December 2024
- 4 -

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with 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 of the profit or loss of the company for that period.

In preparing these financial statements, the directors are required to:

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and 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 hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Edbro Hydraulics Limited
Independent auditor's report
To the members of Edbro Hydraulics Limited
- 5 -
Opinion

We have audited the financial statements of Edbro Hydraulics Limited (the 'company') for the year ended 31 December 2024 which comprise the income statement, the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the 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 Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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 company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

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

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. 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. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Edbro Hydraulics Limited
Independent auditor's report (continued)
To the members of Edbro Hydraulics Limited
- 6 -

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue 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:

 

- We obtained an understanding of the legal and regulatory frameworks applicable to the company. We determined that the following were most relevant: FRS 102, Companies Act 2006, health and safety legislation and control of substances hazardous to health.

- We enquired of management the systems and controls the company has in place, the areas of the financial statements that are mostly susceptible to the risk of irregularities and fraud, and whether there was any known, suspected or alleged fraud. The company did not inform us of any known, suspected or alleged fraud.

- We considered the incentives and opportunities that exist in the company, including the extent of management bias, which present a potential for irregularities and fraud to be perpetuated, and tailored our risk assessment accordingly.

- Using our knowledge of the company, together with the discussions held with the company at the planning stage, we formed a conclusion on the risk of misstatement due to irregularities including fraud and tailored our procedures according to this risk assessment.

 

Edbro Hydraulics Limited
Independent auditor's report (continued)
To the members of Edbro Hydraulics Limited
- 7 -

The key procedures we undertook to detect irregularities including fraud during the course of the audit included:

- Identifying and testing journal entries, in particular those that were significant and unusual.

- Performing walkthrough tests of sales and purchases to ensure that appropriate controls and segregation of duties are in place.

- Reviewing the financial statement disclosures and determining whether accounting policies have been appropriately applied.

- Reviewing and challenging the assumptions and judgements used by management in their significant accounting estimates, in particular in relation to depreciation and the level of stock provision required.

- Assessing the extent of compliance, or lack of, with the relevant laws and regulations.

- Testing key revenue lines for evidence of management bias.

- Performing a physical verification of key assets, including stock.

- Obtaining third-party confirmation of material bank and loan balances.

- Documenting and verifying all significant related party balances and transactions.

 

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements even though we have properly planned and performed our audit in accordance with auditing standards. The primary responsibility for the prevention and detection of irregularities and fraud rests with the directors of the entity.

 

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 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.

Richard Taylor FCA (Senior Statutory Auditor)
For and on behalf of DJH Audit Limited, Statutory Auditor
Accountants
The Exchange
5 Bank Street
Bury
Lancashire
BL9 0DN
27 August 2025
Edbro Hydraulics Limited
Income statement
For the year ended 31 December 2024
- 8 -
2024
2023
Notes
£
£
Revenue
5
25,740,703
26,354,297
Cost of sales
(16,123,437)
(16,769,575)
Gross profit
9,617,266
9,584,722
Administrative expenses
(11,292,089)
(11,189,139)
Other operating income
197,724
394,937
Operating loss
6
(1,477,099)
(1,209,480)
Investment income
9
4,784
10,143
Finance costs
10
(953,986)
(1,056,866)
Loss before taxation
(2,426,301)
(2,256,203)
Tax on loss
11
1,274,093
-
0
Loss for the financial year
(1,152,208)
(2,256,203)

The income statement has been prepared on the basis that all operations are continuing operations.

Edbro Hydraulics Limited
Statement of comprehensive income
For the year ended 31 December 2024
- 9 -
2024
2023
£
£
Loss for the year
(1,152,208)
(2,256,203)
Other comprehensive income
Revaluation of property, plant and equipment
(1,000,000)
-
0
Total comprehensive income for the year
(2,152,208)
(2,256,203)
Edbro Hydraulics Limited
Statement of financial position
As at 31 December 2024
- 10 -
2024
2023
Notes
£
£
£
£
Non-current assets
Property, plant and equipment
12
5,941,845
11,161,531
Current assets
Inventories
13
3,955,792
5,442,141
Trade and other receivables
14
13,925,498
13,344,755
Cash and cash equivalents
1,656,981
1,403,089
19,538,271
20,189,985
Current liabilities
15
(7,376,796)
(9,215,349)
Net current assets
12,161,475
10,974,636
Total assets less current liabilities
18,103,320
22,136,167
Non-current liabilities
16
(5,910,882)
(7,772,768)
Provisions for liabilities
Provisions
19
125,247
144,000
(125,247)
(144,000)
Net assets
12,067,191
14,219,399
Equity
Called up share capital
21
4,093
4,093
Share premium account
22
25,403,440
25,403,440
Revaluation reserve
23
-
0
5,180,518
Capital redemption reserve
24
2,245,850
2,245,850
Retained earnings
(15,586,192)
(18,614,502)
Total equity
12,067,191
14,219,399

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved by the board of directors and authorised for issue on 27 August 2025 and are signed on its behalf by:
Mr F Orman
Director
Company registration number 00283933 (England and Wales)
Edbro Hydraulics Limited
Statement of changes in equity
For the year ended 31 December 2024
- 11 -
Share capital
Share premium account
Revaluation reserve
Capital redemption reserve
Retained earnings
Total
£
£
£
£
£
£
Balance at 1 January 2023
4,093
25,403,440
5,180,518
2,245,850
(16,358,299)
16,475,602
Year ended 31 December 2023:
Loss and total comprehensive income
-
-
-
-
(2,256,203)
(2,256,203)
Balance at 31 December 2023
4,093
25,403,440
5,180,518
2,245,850
(18,614,502)
14,219,399
Year ended 31 December 2024:
Loss
-
-
-
-
(1,152,208)
(1,152,208)
Other comprehensive income:
Revaluation of property, plant and equipment
-
-
(1,000,000)
-
-
(1,000,000)
Total comprehensive income
-
-
(1,000,000)
-
(1,152,208)
(2,152,208)
Transfers
-
-
(4,180,518)
-
4,180,518
-
Balance at 31 December 2024
4,093
25,403,440
-
0
2,245,850
(15,586,192)
12,067,191
Edbro Hydraulics Limited
Statement of cash flows
For the year ended 31 December 2024
- 12 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
1
100,896
950,919
Interest paid
(953,986)
(823,483)
Net cash (outflow)/inflow from operating activities
(853,090)
127,436
Investing activities
Purchase of property, plant and equipment
(1,233,336)
(363,953)
Proceeds from disposal of property, plant and equipment
5,300,987
240,739
Interest received
4,784
10,143
Net cash generated from/(used in) investing activities
4,072,435
(113,071)
Financing activities
Proceeds from borrowings
-
0
200,000
Repayment of borrowings
(2,852,633)
(688,788)
Repayment of bank loans
-
0
(233,383)
Payment of finance leases obligations
(112,820)
(279,739)
Loan repayments from group undertakings
-
0
106,454
Net cash used in financing activities
(2,965,453)
(895,456)
Net increase/(decrease) in cash and cash equivalents
253,892
(881,091)
Cash and cash equivalents at beginning of year
1,403,089
2,284,180
Cash and cash equivalents at end of year
1,656,981
1,403,089
Edbro Hydraulics Limited
Statement of cash flows (continued)
For the year ended 31 December 2024
- 13 -
1
Cash generated from operations
2024
2023
£
£
Loss after taxation
(1,152,208)
(2,256,202)
Adjustments for:
Taxation credited
(1,274,093)
-
0
Finance costs
953,986
1,056,866
Investment income
(4,784)
(10,143)
Loss on disposal of property, plant and equipment
199,013
64,081
Depreciation and impairment of property, plant and equipment
1,219,734
1,562,902
Decrease in provisions
(18,753)
-
Movements in working capital:
Decrease/(increase) in inventories
1,486,349
(342,028)
Decrease in trade and other receivables
693,350
248,096
(Decrease)/increase in trade and other payables
(2,001,698)
627,347
Cash generated from operations
100,896
950,919
2
Analysis of changes in net debt
1 January 2024
Cash flows
New leases
31 December 2024
£
£
£
£
Cash at bank and in hand
1,403,089
253,892
-
1,656,981
Borrowings excluding overdrafts
(8,308,528)
2,852,633
-
(5,455,895)
Lease liabilities
(246,662)
112,820
(1,266,712)
(1,400,554)
(7,152,101)
3,219,345
(1,266,712)
(5,199,468)
Edbro Hydraulics Limited
Notes to the financial statements
For the year ended 31 December 2024
- 14 -
3
Accounting policies
Company information

Edbro Hydraulics Limited is a company registered in England and Wales, limited by shares, registration number 00283933. The registered office is Edbro House, Nelson Street, Bolton, Lancashire, BL3 2JJ.

3.1
Accounting convention

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 as modified by the revaluation of certain assets.

The company's forecasts and projections show that the company should have adequate financial resources and be able to continue to trade on an on-going operational basis for the next 12 months with the continued support of Endless LLP.

The financial statements have been prepared on a going concern basis.

3.2
Going concern

The company meets its day-to-day working capital requirements through cash generated from operations andtrue through utilisation of an invoice finance facility provided by Shawbrook Bank, post year end, this facility is now supplied by Ziraat Bank. The company is in regular communication with Shawbrook bank and provide monthly management accounts and cash flow reports, and operates within governance levels set by the bank. The directors have no reason to believe the finance facility will not remain on an ongoing basis.

3.3
Revenue

Revenue comprises revenue recognised by the company in respect of goods and services supplied during the year, excluding Value Added Tax and trade discounts. Revenue is recognised upon despatch of the goods or the provision of the service.

3.4
Property, plant and equipment

Property, plant and equipment are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Leasehold land and buildings
4% on cost
Plant and equipment
33% on cost, 20% on cost and 10% on cost

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 credited or charged to profit or loss.

3.5
Impairment of non-current assets

At each reporting period end date, the company reviews the carrying amounts of its tangible 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.

Edbro Hydraulics Limited
Notes to the financial statements (continued)
For the year ended 31 December 2024
3
Accounting policies
(Continued)
- 15 -

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 profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

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 profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

3.6
Inventories

Inventories and work in progress are valued at the lower of cost and net realisable value after making due allowance for obsolete, slow-moving inventories and defective items.

 

Costs includes materials, direct labour, an an attributable proportion of manufacturing overheads based on normal levels of activity, Net realisable value is based on estimated selling price, less further costs expected to be incurred to completion and disposal.

3.7
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

3.8
Financial instruments

The company 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 company's statement of financial position when the company becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset, with 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

Basic financial assets, which include trade and other receivables 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.

Edbro Hydraulics Limited
Notes to the financial statements (continued)
For the year ended 31 December 2024
3
Accounting policies
(Continued)
- 16 -
Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

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 profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company 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.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including trade and other payables, bank loans, loans from fellow group companies and preference shares that are classified as debt, 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 payables 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 payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Edbro Hydraulics Limited
Notes to the financial statements (continued)
For the year ended 31 December 2024
3
Accounting policies
(Continued)
- 17 -
Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

3.9
Equity instruments

Equity instruments issued by the company 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 company.

3.10
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement 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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

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 income statement, 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 when the company has 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.

Edbro Hydraulics Limited
Notes to the financial statements (continued)
For the year ended 31 December 2024
3
Accounting policies
(Continued)
- 18 -
3.11
Provisions

Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

 

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

3.12
Employee benefits

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 non-current 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.

3.13
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

3.14
Leases
As lessee

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the statement of financial position as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Edbro Hydraulics Limited
Notes to the financial statements (continued)
For the year ended 31 December 2024
- 19 -
4
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. Although these estimates are based on management's best knowledge of the amount, events or actions, actual results ultimately may differ from those estimates.

 

The estimates are continually evaluated. Revisions to accounting estimates are recognised in the period in which the estimate is revised.

 

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are outlined below.

 

Estimating the useful economic life of an asset and the anticipated residual value are considered key judgement in calculating an appropriate depreciation charge.

 

In categorising leases as finance or operating leases, the directors make judgements as to whether significant risks and rewards of ownership have transferred to the company as lessee.

 

Making judgement based on historical experience on the level of provision required for impairment of stock and bad debts. Further information received after the statement of financial position date may impact on the level of provision required.

 

Making judgement based on historical experience on the level of provision required for warranties provided to customers.

5
Revenue
2024
2023
£
£
Revenue analysed by geographical market
United Kingdom
8,090,170
8,582,825
Rest of Europe
3,573,481
3,829,533
Rest of World
14,077,052
13,941,939
25,740,703
26,354,297
2024
2023
£
£
Other revenue
Interest income
4,784
10,143
Edbro Hydraulics Limited
Notes to the financial statements (continued)
For the year ended 31 December 2024
- 20 -
6
Operating loss
2024
2023
Operating loss for the year is stated after charging:
£
£
Exchange losses
22,584
16,430
Fees payable to the company's auditor for the audit of the company's financial statements
18,750
18,750
Depreciation of owned property, plant and equipment
1,194,464
1,537,041
Depreciation of property, plant and equipment held under finance leases
25,270
25,861
Loss on disposal of property, plant and equipment
199,013
64,081
7
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2024
2023
Number
Number
Manufacturing
114
118
Administration and marketing
47
48
Total
161
166

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
6,161,170
6,276,272
Social security costs
577,477
656,421
Pension costs
291,813
254,909
7,030,460
7,096,602
8
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
344,447
323,833
Company pension contributions to defined contribution schemes
15,891
15,330
360,338
339,163

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2023 - 2).

Edbro Hydraulics Limited
Notes to the financial statements (continued)
For the year ended 31 December 2024
8
Directors' remuneration
(Continued)
- 21 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
202,582
193,576
9
Investment income
2024
2023
£
£
Interest income
Interest on bank deposits
4,784
10,143
2024
2023
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
4,784
10,143
10
Finance costs
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
669,141
839,018
Other interest on financial liabilities
244,932
200,000
914,073
1,039,018
Other finance costs:
Interest on finance leases and hire purchase contracts
39,913
17,848
953,986
1,056,866
Edbro Hydraulics Limited
Notes to the financial statements (continued)
For the year ended 31 December 2024
- 22 -
11
Taxation
2024
2023
£
£
Deferred tax
Origination and reversal of timing differences
(1,274,093)
-
0

The actual (credit)/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:

2024
2023
£
£
Loss before taxation
(2,426,301)
(2,256,203)
Expected tax credit based on the standard rate of corporation tax in the UK of 25.00% (2023: 25.00%)
(606,575)
(564,051)
Tax effect of income not taxable in determining taxable profit
1,384
1,702
Unutilised tax losses carried forward
374,506
474,791
Effect of change in corporation tax rate
-
0
87,918
Deferred tax adjustments in respect of prior years
172,064
-
0
Capital allowances in excess of depreciation
230,685
(360)
Deferred tax adjustments in respect of current year
(1,446,157)
-
0
Taxation credit for the year
(1,274,093)
-
12
Property, plant and equipment
Leasehold land and buildings
Plant and equipment
Total
£
£
£
Cost
At 1 January 2024
10,555,753
31,737,181
42,292,934
Additions
18,868
2,481,180
2,500,048
Disposals
(10,555,753)
(118,760)
(10,674,513)
At 31 December 2024
18,868
34,099,601
34,118,469
Depreciation and impairment
At 1 January 2024
4,055,753
27,075,650
31,131,403
Depreciation charged in the year
1,887
1,217,847
1,219,734
Eliminated in respect of disposals
(4,055,753)
(118,760)
(4,174,513)
At 31 December 2024
1,887
28,174,737
28,176,624
Edbro Hydraulics Limited
Notes to the financial statements (continued)
For the year ended 31 December 2024
12
Property, plant and equipment
Leasehold land and buildings
Plant and equipment
Total
£
£
£
(Continued)
- 23 -
Carrying amount
At 31 December 2024
16,981
5,924,864
5,941,845
At 31 December 2023
6,500,000
4,661,531
11,161,531

Property, plant and equipment includes assets held under finance leases or hire purchase contracts, as follows:

2024
2023
£
£
Plant and equipment
1,948,366
340,246
13
Inventories
2024
2023
£
£
Raw materials and consumables
2,655,986
3,783,464
Work in progress
838,818
978,936
Finished goods and goods for resale
460,988
679,741
3,955,792
5,442,141
14
Trade and other receivables
2024
2023
Amounts falling due within one year:
£
£
Trade receivables
4,113,761
4,760,928
Amounts owed by group undertakings
7,488,933
7,497,701
Prepayments and accrued income
294,724
332,139
11,897,418
12,590,768
Deferred tax asset (note 20)
2,028,080
753,987
13,925,498
13,344,755
Edbro Hydraulics Limited
Notes to the financial statements (continued)
For the year ended 31 December 2024
- 24 -
15
Current liabilities
2024
2023
Notes
£
£
Obligations under finance leases
18
297,584
79,756
Other borrowings
17
647,983
702,666
Trade payables
2,668,116
3,971,309
Taxation and social security
143,886
354,520
Other payables
3,196,205
3,430,502
Accruals and deferred income
423,022
676,596
7,376,796
9,215,349
16
Non-current liabilities
2024
2023
Notes
£
£
Obligations under finance leases
18
1,102,970
166,906
Other borrowings
17
4,807,912
7,605,862
5,910,882
7,772,768
17
Borrowings
2024
2023
£
£
Other loans
5,455,895
8,308,528
Payable within one year
647,983
702,666
Payable after one year
4,807,912
7,605,862

There is a fixed and floating charge on the assets of the company by way of debenture in respect of borrowings from Barclays Bank Limited. There is also a fixed and floating charge over all intellectual property by way of a composite guarantee and debenture in respect of borrowings from a related party.

18
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
297,584
79,756
In two to five years
1,102,970
166,906
1,400,554
246,662

The hire purchase liability is secured against the related assets.

Edbro Hydraulics Limited
Notes to the financial statements (continued)
For the year ended 31 December 2024
- 25 -
19
Provisions for liabilities
2024
2023
£
£
Warranty provision
125,247
144,000
Movements on provisions:
Warranty provision
£
At 1 January 2024
144,000
Reversal of provision
(18,753)
At 31 December 2024
125,247
20
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Assets
Assets
2024
2023
Balances:
£
£
Accelerated capital allowances
(324,832)
(1,598,925)
Tax losses
2,352,912
2,352,912
2,028,080
753,987
2024
Movements in the year:
£
Asset at 1 January 2024
(753,987)
Credit to profit or loss
(1,274,093)
Asset at 31 December 2024
(2,028,080)
21
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of 25p each
16,371
16,371
4,093
4,093

In the prior year, a reclassification was made between share capital and share premium to better reflect reserves. There is no overall impact on reported prior year reserves.

Edbro Hydraulics Limited
Notes to the financial statements (continued)
For the year ended 31 December 2024
- 26 -
22
Share premium account

Amount subscribed for share capital in excess of nominal value.

23
Revaluation reserve

Gains/losses arising on the revaluation of the company's property.

24
Capital redemption reserve

Amounts transferred from share capital of redemption of issued shares.

25
Operating lease commitments

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2024
2023
£
£
Within 1 year
810,975
4,934
Years 2-5
2,721,698
6,942
3,532,673
11,876
26
Capital commitments

Amounts contracted for but not provided in the financial statements:

2024
2023
£
£
Acquisition of property, plant and equipment
632,762
2,677,952
27
Related party transactions

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.

28
Ultimate controlling party

At the year end the intermediate parent company was Edbro (Bidco) Ltd, a company registered in the United Kingdom. The ultimate parent company and controlling party was Enact, a private equity fund managed by Endless LLP. The registered office is 12 King Street, Leeds, England, LS1 2HL.

 

The parent of the smallest group in which these figures are consolidated is Edbro Holdings Limited, a company registered in the United Kingdom. The registered office is Edbro House, Nelson Street, Bolton, England, BL3 2JJ.

Edbro Hydraulics Limited
Notes to the financial statements (continued)
For the year ended 31 December 2024
- 27 -
29
Post balance sheet events

Post year end, the company was sold to Orsan Automotive Ltd. As part of the sale, a number of debts have been repaid and some written off. Ongoing working capital is being provided by the new owners.

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