REGISTERED NUMBER: 04305426 (England and Wales)

Strategic Report, Report of the Directors and

Financial Statements for the Year Ended 31 December 2024

for

Brook Crompton UK Limited

Page

Company Information

1

Strategic Report

2

Report of the Directors

5

Statement of Directors' Responsibilities

6

Independent Auditors' Report

7

Income Statement

11

Other Comprehensive Income

12

Balance Sheet

13

Statement of Changes in Equity

14

Notes to the Financial Statements

15

DIRECTORS:

J M Crossland

J Ristov

REGISTERED OFFICE:

St Thomas Road

Huddersfield

West Yorkshire

United Kingdom

HD1 3LJ

REGISTERED NUMBER:

04305426 (England and Wales)

AUDITORS:

Azets Audit Services

2 Regan Way

Chetwynd Business Park

Chilwell

Nottinghamshire

NG9 6RZ

FAIR REVIEW OF THE BUSINESS

Results for the year are shown in the Profit and loss account on page 11.

Turnover for the year to 31 December 2024 of £17,000,521 (2023 - £22,994,702) has decreased by £5,994,181 (-26.1%). 2023 saw a number of one-off projects within BCUK which did not repeat in 2024. It was also evident that after Covid a large number of our customers stocked up in 2023 thus reducing demand in 2024. The market in general in the UK on both replacement motors and general motor sales was slow in 2024, along with some major projects which were put on hold by the new UK Government. In addition to lower than expected sales in the UK business, expected growth through our Italian branch was also slow due to low market growth in Italy and a slow down in Middle East distribution sales planned for the business.

Gross Profit of £5,187,684 (2023 - £6,291,393) decreased by £1,103,709 (-17.54%) year on year, due to the down turn in sales coupled with an increase in inbound transportation costs YOY.

Operating profit of £908,852 (2023 - £1,704,019) has decreased year on year, mainly linked to the decrease in sales revenue. 2023 also benefitted from receipts due to outstanding debts.

The value of the company's stock at the year-end of £4,608,206 (2023 - £6,441,577) has decreased by £1,833,371 (-28.5%). Lower demand in 2024 resulted in less purchase requirements and opportunities were taken to reduce stock by way of creating sales of aged stock. Improved stock turn, stock rotation and supply chain management led to reductions in lead times and volumes of stock required.

The company's creditors at the year end were £4,839,122 (2023 - £6,546,092). Main decreases relate to corporation tax accrual reduced in line with profit decreases and also reductions in accruals and monies owed to creditors due to improved supply chain management.

The Directors have proposed a dividend to be paid in 2024 of £1,000,000 (2023 - £1,500,000).

PRINCIPAL RISKS AND UNCERTAINTIES

Principal risks and uncertainties

The Company's risk management framework helps it to meet its objectives within acceptable parameters and is regularly reviewed so that new or emerging risks are identified early.

Key risks for the company are set out below:

Risk

Description

Mitigation

Credit

Risk of a counterparty defaulting on payment of a debt

The company's credit risks are assessed, monitored and managed on an ongoing basis. The company also holds appropriate insurance policies as part of its credit risk management strategy. Following an in depth focus and detailed credit controls in 2022 we have strengthened our credit controls and the risk in this area has been reduced.

Liquidity

Risk that the company may be unable to meet its payment obligations when they fall due.

The company's liquidity is closely managed by the company's finance function which ensures that the Company has sufficient cash and liquid assets to meet its liabilities. All commitments for the following 12 months are reviewed on a regular basis.

Technology / Legislation

Risk of technological changes and/or legislation driving changes in market product expectations.

The company adopts a strategy of constantly monitoring market expectations and legislative changes to enable it to work closely with key suppliers to develop new product opportunities

Currency

Risk of currency fluctuation between GBP and other major international currencies affecting the value of both collections and payments denominated in currencies other than GBP.

The company regularly reviews its currency exposure and has a hedging policy in place.

Reputational

Risk that negative publicity regarding the company or the brand will lead to legislation or lack of customer confidence. This risk is more likely to result from one of the risks described above materialising rather than as a standalone risk.

The company believes that reputational risk is mitigated through the effective mitigation of the other key risks.

Brexit

Risk to the company's performance arising from the uncertainties caused by the United Kingdom leaving the European Union.

Business set up in Italy will continue to mitigate the risk of the UK leaving the EU.

Covid-19

Risk to the company arising by global geopolitical distruptions.

Whilst an element of uncertainty remains from the geopolitcal events, the company has sufficent inventory in place in case of additional supply chain distruption.

Development and performance

The current market for electric motors remains competitive, with a number of large competitors achieving significant market share and benefitting from reduced operating costs. However, despite this background the company has continued to grow trading levels and achieve an improved financial performance year on year. With the new Italian branch the company can cover wider markets and strengthen the company performance.

Key performance indicators

The company's directors are of the opinion that the business is most appropriately reviewed through analysis within the fair review of the business section considering the straightforward nature of our business model.

Future Developments

The market remains competitive but the company continues to build upon its reputation for quality products and has established many new opportunities with the existing and new markets. The company is driven by a clear vision of its target for building on its existing profitable base through sound strategies and new opportunities in developing new markets

ON BEHALF OF THE BOARD:

J Ristov - Director

4 September 2025

The directors present their report with the financial statements of the company for the year ended 31 December 2024.

DIVIDENDS

Ordinary dividends were paid amounting to £1,000,000. The directors do not recommend payment of a further dividend.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2024 to the date of this report.

J M Crossland

J Ristov

DISCLOSURE IN THE STRATEGIC REPORT

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company'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.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

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

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.

ON BEHALF OF THE BOARD:

J Ristov - Director

4 September 2025

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

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

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's 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.

Opinion

We have audited the financial statements of Brook Crompton UK Limited (the 'company') for the year ended 31 December 2024 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 December 2024 and of its profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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.

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.

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:

- adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

- the financial statements are not in agreement with the accounting records and returns; or

- certain disclosures of directors' remuneration specified by law are not made; or

- we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the 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.

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report 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.

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.

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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council's website, to detect material misstatements in respect of irregularities, including fraud.

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework.

Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed

procedures which included:

- Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud;

- Reviewing minutes of meetings of those charged with governance;

- Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the company through enquiry and inspection;

- Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;

- Performing audit work over the risk of management bias and 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 reviewing accounting estimates for indicators of potential bias.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' 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 Auditors' 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.

Matthew Woodhead BSc FCA (Senior Statutory Auditor)

for and on behalf of Azets Audit Services

2 Regan Way

Chetwynd Business Park

Chilwell

Nottinghamshire

NG9 6RZ

4 September 2025

TURNOVER

4

17,000,521

22,994,702

Cost of sales

11,812,837

16,703,309

GROSS PROFIT

5,187,684

6,291,393

Distribution costs

1,958,204

2,190,493

Administrative expenses

2,658,225

2,832,896

4,616,429

5,023,389

571,255

1,268,004

Other operating income

5

337,597

436,015

OPERATING PROFIT

7

908,852

1,704,019

Interest receivable and similar income

8

247,849

194,125

PROFIT BEFORE TAXATION

1,156,701

1,898,144

Tax on profit

9

290,633

476,749

PROFIT FOR THE FINANCIAL YEAR

866,068

1,421,395

PROFIT FOR THE YEAR

866,068

1,421,395

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

866,068

1,421,395

FIXED ASSETS

Intangible assets

11

45,373

13,011

Tangible assets

12

137,584

173,750

Investments

13

297

297

183,254

187,058

CURRENT ASSETS

Stocks

14

4,608,206

6,441,577

Debtors

15

4,968,325

4,726,717

Cash at bank

5,674,005

5,911,610

15,250,536

17,079,904

CREDITORS

Amounts falling due within one year

16

4,846,852

6,546,092

NET CURRENT ASSETS

10,403,684

10,533,812

TOTAL ASSETS LESS CURRENT LIABILITIES

10,586,938

10,720,870

CAPITAL AND RESERVES

Called up share capital

20

4,800,000

4,800,000

Retained earnings

21

5,786,938

5,920,870

10,586,938

10,720,870

The financial statements were approved by the Board of Directors and authorised for issue on 4 September 2025 and were signed on its behalf by:

J Ristov - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2023

4,800,000

5,999,475

10,799,475

Changes in equity

Dividends

-

(1,500,000

)

(1,500,000

)

Total comprehensive income

-

1,421,395

1,421,395

Balance at 31 December 2023

4,800,000

5,920,870

10,720,870

Changes in equity

Dividends

-

(1,000,000

)

(1,000,000

)

Total comprehensive income

-

866,068

866,068

Balance at 31 December 2024

4,800,000

5,786,938

10,586,938

1.	STATUTORY INFORMATION

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

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

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

Financial Reporting Standard 102 - reduced disclosure exemptions

The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

•

the requirements of Section 7 Statement of Cash Flows;

•

the requirements of paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);

•

the requirements of paragraphs 12.26, 12.27, 12.29(a), 12.29(b) and 12.29A;

•

the requirement of paragraph 33.7.

Consolidated financial statements

The company has taken advantage of the exemption under section 401 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.

The financial statements of the company are consolidated in the financial statements of Brook Crompton Holdings Limited. See note 23 for further information on the parent undertakings.

Going concern

In assessing the appropriateness of the going concern assumption, the Directors have reviewed detailed profit and loss forecasts and cash flow forecasts, considering all reasonably foreseeable potential scenarios and uncertainties in relation to revenue and expenditure for a period of at least 12 months from the date these financial statements have been signed. Based on these forecasts, the Directors have a reasonable expectation that the company can meet its liabilities as they fall due and that there are no matters which give rise to a material uncertainty. As such, the financial statements have been prepared on the going concern basis.

Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Other income represents management fees charged to fellow group undertakings. Amounts are recorded in the statement of income and retained earnings over the period to which they relate. Any amounts which are due or received in advance are recorded as either accrued or deferred income accordingly in the statement of financial position.

Goodwill

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.

Intangible assets

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

Amortisation 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:

Trademarks

10% straight line

Tangible fixed assets

Tangible fixed assets 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 improvements

Over the term of the lease

Plant and equipment

7.5%-33% straight line

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.

Fixed asset investments

Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

Impairment of fixed assets

At each reporting period end date, the company 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 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.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand.

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 balance sheet 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 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.

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 creditors, 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 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.

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.

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.

Taxation

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 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 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 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.

Foreign currencies

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.

Leases

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 leases asset are consumed.

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 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.

Retirement benefits

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

3.	CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the company’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.

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

The directors believe that no critical judgements (apart from those involving estimates) have had a significant effect on amounts recognised in the financial statements.

Key sources of estimation uncertainty

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.

Stock provisions

The company has recognised provisions for the impairment of stock. The judgement, estimates and associated assumptions necessary to calculate these provisions are based on historical experience and other reasonable factors. In the case of the provision for the impairment of stock, this covers obsolescence through technological or customer specific reasons. This provision is based on the assessment of stock value and ageing, quantities on hand and usage. See note 14 for the carrying value of stock.

Bad debt provisions

The company has recognised provisions for bad debts. This is based on an assessment of ageing and due date of receivables and other risk indicators. The judgement of management is then applied to provide for debts which are no longer considered recoverable. That total provision identified at the year end was £39,113 (2023 - £34,706). See note 15 for the carrying value of trade debtors.

4.

TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the company.

An analysis of turnover by geographical market is given below:

2024

2023

£

£

United Kingdom

13,739,630

13,123,881

Europe

2,035,332

3,179,432

Rest of World

1,225,559

6,691,389

17,000,521

22,994,702

5.	OTHER OPERATING INCOME

2024

2023

£

£

Rents received

26,201

26,000

Recharges

97,166

43,794

Other income

214,230

366,221

337,597

436,015

6.	EMPLOYEES AND DIRECTORS

2024

2023

£

£

Wages and salaries

1,974,151

2,093,521

Social security costs

276,922

286,769

Other pension costs

164,350

316,969

2,415,423

2,697,259

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

2024

2023

Marketing and distribution

36

37

Technical

4

5

Finance and administration

4

4

44

46

2024

2023

£

£

Directors remuneration

246,836

270,467

Director company pension contributions to define contribution schemes

65,214

37,121

312,050

307,588

Information regarding the highest paid director is as follows:

2024

2023

£

£

Remuneration for qualifying services

173,411

166,000

Company pension contributions to defined contribution schemes

54,317

28,320

227,728

194,320

7.	OPERATING PROFIT

2024

2023

Operating profit for the year is stated after charging / (crediting):

£

£

Exchange losses / (gains)

7,815

80,895

Fees payable to the company's auditor for the audit of the company's financial statements

53,747

53,097

Depreciation of owned tangible fixed assets

139,379

50,050

Amortisation of intangible assets

53,231

10,088

Operating lease charges

315,909

279,783

8.

INTEREST RECEIVABLE AND SIMILAR INCOME

2024

2023

£

£

Interest income

247,849

194,125

9.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2024

2023

£

£

Current tax:

UK corporation tax

291,131

436,095

Tax adjust prior year

(18,610

)

(3,419

)

Foreign tax

7,694

10,663

Total current tax

280,215

443,339

Deferred tax

10,418

33,410

Tax on profit

290,633

476,749