Modo Energy Limited

	Page
Balance Sheet	1—2
Notes to the Financial Statements	3—8

1. General Information

Modo Energy Limited is a private company, limited by shares, incorporated in England & Wales, registered number 11998983 . The registered office is 5th Floor 24 Stephenson Way, London, NW1 2HD.

2. Accounting Policies

2.1. Basis of Preparation of Financial Statements

The financial statements have been prepared under the historical cost convention and in accordance with Financial Reporting Standard 102 section 1A Small Entities "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006.

2.2. Going Concern Disclosure

The company’s financial statements have been prepared on a going concern basis on the grounds that current and future sources of funding or support will be more than adequate for the company’s needs. In assessing going concern, the directors have a reasonable expectation that the company will continue as a going concern and is able to meet all of its obligations as they fall due for a minimum of 12 months from the date of approval of these financial statements.

2.3. Significant judgements and estimations

The valuation of share-based payment awards requires management to make significant estimates and judgements. The fair value of options granted was estimated using the Black-Scholes model, which involves assumptions about expected volatility, option life, and risk-free rates. These assumptions are based on management's best estimates but are inherently uncertain and may differ from actual outcomes.

2.4. Turnover

Turnover is recognised to the extent there is probable economic benefits will flow to the company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Turnover from a contract to provide services is recognised in the period in which the services are provided.

Deferred Income

Deferred income represents amounts invoiced or received in advance of the provision of services. These amounts are recognised as revenue in the period in which the related services are performed.

Interest

Interest income and interest payable are recognised in profit or loss as they accrue, using the effective interest rate method.

2.5. Intangible Fixed Assets and Amortisation - Other Intangible

Purchased intangible assets

Purchased intangible assets are initially recognised at cost. After recognition, intangible assets are measured at cost less any accumulated amortization and impairment losses.

All intangible assets are considered to have a finite useful life. The estimated useful lives are as follows:

Goodwill – XXX years.

Development expenditure – XXXX years

Purchased intangibles – XXXX years

At each reporting date the company assesses whether there is any indication of impairment. If such indications exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. Any impairment loss is recognised immediately as an expense within profit or loss.

2.6. Research and Development

Expenditure on research activities is recognised within profit or loss as an expense is incurred.

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Modo Energy Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 October 2024

2.7. Tangible Fixed Assets and Depreciation

Tangible fixed assets are stated at historical cost less accumulated depreciation and any impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Depreciation is charged to profit or loss over the estimated useful economic lives as follows -

Leasehold	4 years on a straight line basis
Fixtures & Fittings	3 years on a straight line basis
Computer Equipment	3 years on a straight line basis

The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Repairs and maintenance costs are charged to profit or loss during the period in which they are incurred.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined, which is the higher of its fair value less costs to sell and its value in use. Any impairment loss is recognised immediately as an expense within the profit or loss.

2.8. Leasing and Hire Purchase Contracts

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

Leases in which the company assumes substantially all the risks and rewards of ownership of the leased asset are classified as finance leases. All other leases are classified as operating leases.

Payments (excluding costs for services and insurance) made under operating leases are recognised in the profit and loss account on a straight-line basis over the term of the lease unless the payments to the lessor are structured to increase in line with expected general inflation; in which case the payments related to the structured increases are recognised as incurred. Lease incentives received are recognised in profit and loss over the term of the lease an an integral part of the total lease expenses.

2.9. Financial Instruments

Trade and other debtors / creditors

Trade and other debtors are recognised initially at transaction prices less attributable transaction costs. Trade and other creditors are recognised initially at transaction price plus attributable transaction costs. Subsequent to initial recognition they are measured at amortised cost using the effective interest method, less any impairment losses in the case of trade debtors. If the arrangement constitutes a financing transaction, for example if payment is deferred beyond normal business terms, then it is measured at the present value of future payments discounted at a market rate of interest for a similar debt instrument.

Investments

Investments in subsidiaries are held at cost less accumulated impairment losses.

Impairment of financial assets

Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found an impairment loss is recognised within profit or loss.

For financial assets that are measured at amortised cost, the impairment loss is measured as the difference between the asset’s carrying amount and the present value of estimated cash flows discounted at the asset’s original effective interest rate.

For financial assets measured at cost less impairment, the impairment loss is measured as the difference between the asset’s carrying amount and the best estimate of the amount that the company would receive for the asset if it were to be sold at the balance sheet date.

2.10. Foreign Currencies

Monetary assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate ruling on the date of the transaction. Exchange differences are taken into account in arriving at the operating profit.

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Modo Energy Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 October 2024

2.11. Taxation

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

The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the statement of comprehensive income because of items of income or expense that are taxable or deductible in other years and 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 end of the reporting period.

Deferred tax is recognised on timing differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable timing differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible timing differences can be utilised. The carrying amount of deferred tax assets is reviewed at the end of each reporting period 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 assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. Deferred tax liabilities are presented within provisions for liabilities and deferred tax assets within debtors. The measurement of deferred tax liabilities and assets reflect the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

Current and deferred tax are recognised in profit or loss for the year, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case current and deferred tax are recognised in other comprehensive income or directly in equity respectively.

2.12. Pensions

The company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions in a separate entity. Once the contributions have been paid the company has no further payment obligations. The contributions are recognised as an expense in profit or loss in the periods during which services are rendered by employees.

2.13. Share-based Payments

Share options charges

The grant date fair value of share-based payments awards granted to employees is recognised as an employee expense, with a corresponding increase in equity, over the period in which the employees become unconditionally entitled to the awards. The fair value of the awards granted is measured using an option valuation model, taking in to account the terms and conditions upon which the awards were granted. The amount recognised as an expense is adjusted to reflect the actual number of awards for which the related service and non-market vesting conditions are expected to be met, such that the amount ultimately recognised as an expense is based on the number of awards that do not meet the related service and non-market performance conditions at the vesting date. For share-based payment awards with non-vesting conditions, the grant date fair value of the share-based payment is measured to reflect such conditions and there is no true-up for differences between expected and actual outcomes.

2.14. Convertible Debt

During the prior year, the company entered into a convertible loan agreement. Convertible loans were initially recognised as financial liabilities at amortised cost. In the current year, the loan was converted to equity in accordance with its terms and there is no outstanding balance at the balance sheet date.

2.15. Related Party Exemption

The company has taken advantage of the exemption available under FRS 102 not to disclose related party transactions with wholly owned subsidiaries within the group.

Preparation of Consolidated Financial Statements

The company is exempt under Section 399 of the Companies Act from the requirement to prepare consolidated financial statements by virtue of the fact it is subject to the small companies regime. These financial statements contain information the company as an individual undertaking and not about this group.

3. Average Number of Employees

Average number of employees during the year was as follows: 28 (2023: 21)

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Modo Energy Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 October 2024

4. Intangible Assets

	Other
	£
Cost
As at 1 November 2023	-
Additions	391,298

As at 31 October 2024	391,298

Amortisation
As at 1 November 2023	-
Provided during the period	27,172

As at 31 October 2024	27,172

Net Book Value
As at 31 October 2024	364,126

As at 1 November 2023	-

5. Tangible Assets

	Land & Property
	Leasehold	Fixtures & Fittings	Computer Equipment	Total
	£	£	£	£
Cost
As at 1 November 2023	249,444	42,211	126,627	418,282
Additions	49,962	4,903	35,982	90,847
Disposals	-	(3,831 )	(1,377 )	(5,208 )

As at 31 October 2024	299,406	43,283	161,232	503,921

Depreciation
As at 1 November 2023	47,968	24,616	44,008	116,592
Provided during the period	68,994	14,757	41,590	125,341

As at 31 October 2024	116,962	39,373	85,598	241,933

Net Book Value
As at 31 October 2024	182,444	3,910	75,634	261,988

As at 1 November 2023	201,476	17,595	82,619	301,690

6. Investments

	Unlisted
	£
Cost
As at 1 November 2023	8
Additions	52

As at 31 October 2024	60

...CONTINUED

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Modo Energy Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 October 2024

Provision
As at 1 November 2023	-

As at 31 October 2024	-

Net Book Value
As at 31 October 2024	60

As at 1 November 2023	8

7. Debtors

	2024	2023
	£	£
Due within one year
Trade debtors	906,704	517,470
Prepayments and accrued income	324,043	171,418
Other debtors	255,694	281,406
Corporation tax recoverable assets	924,257	365,825
VAT	-	5,680
Amounts owed by group undertakings	2,307,070	1,704,855

	4,717,768	3,046,654

8. Creditors: Amounts Falling Due Within One Year

	2024	2023
	£	£
Trade creditors	178,514	316,524
Convertible loans	-	2,600,000
Other taxes and social security	86,504	88,580
VAT	115,497	-
Other creditors	3,419	371,569
Accruals and deferred income	2,301,435	1,056,647

	2,685,369	4,433,320

The company operates a defined contribution pension scheme for employees. The assets of the scheme are held separately from those of the company in an independently administered fund. At the balance sheet date unpaid contributions amount to £2,822, (2023 : £NIL) were due to the fund and included in Other Creditors.

9. Share Capital

	2024	2023
	£	£
Allotted, Called up and fully paid	4	3

10. Other Commitments

The total of future minimum lease payments under non-cancellable operating leases are as following:

	2024	2023
	£	£
Not later than one year	258,562	289,812
Later than one year and not later than five years	179,010	437,572

	437,572	727,384

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Modo Energy Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 October 2024

11. Related Party Transactions

During the year the company made loans to a director of £NIL (2023: £2,892) and received repayments of £2,892 (2023: £NIL). As at 31 October 2024 Modo Energy Limited was owed £NIL (2023: £2,892) by the director.

All balances attract a nil rate of interest and are repayable upon demand.

12. Shared-based payment transactions

The company operates an equity based share option scheme to certain employees which provides additional remuneration for those employees who are key to the company. The options are granted under approved and unapproved EMI option plans, with the exercise price varying per each employee agreement. The options expire ten years after the date of the grant. Employees are not entitled to dividends until the shares are exercised. All options granted have performance conditions relating to the relevant employee remaining in the employment of the company at exercise.

A reconciliation of share option movements during the year ended 31 October 2024 is shown below:

Number of options - weighted average exercise price
Outstanding as at 01 November 2023: 250,420 - £552,409

Granted during the year: 214,677 - £79,321 (2023: 14,034 - £447,124)

Forfeited during the year: nil - £nil (2023: nil - £nil)

Exercised during the year: 92,520 - £168,562 (2023: nil - £nil)

Outstanding as at 31 October 2024: 372,577 - £463,168

The company is unable to directly measure the fair value of the share options. Instead the fair value of the share options granted during the year is determined using the Black-Scholes model. The model is internationally recognised as being appropriate to value share option schemes similar to that of the company.

Equity settled schemes - charges arising: £107,495

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		2024		2023
	Notes	£	£	£	£
FIXED ASSETS
Intangible Assets	4		364,126		-
Tangible Assets	5		261,988		301,690
Investments	6		60		8

			626,174		301,698
CURRENT ASSETS
Debtors	7	4,717,768		3,046,654
Cash at bank and in hand		3,584,219		9,616,746

		8,301,987		12,663,400
Creditors: Amounts Falling Due Within One Year	8	(2,685,369 )		(4,433,320 )

NET CURRENT ASSETS (LIABILITIES)			5,616,618		8,230,080

TOTAL ASSETS LESS CURRENT LIABILITIES			6,242,792		8,531,778

NET ASSETS			6,242,792		8,531,778

CAPITAL AND RESERVES
Called up share capital	9		4		3
Share premium account			16,350,196		13,388,493
Other reserves			463,168		524,234
Profit and Loss Account			(10,570,576 )		(5,380,952 )

SHAREHOLDERS' FUNDS			6,242,792		8,531,778