Company registration number: 10345423
COMPANY INFORMATION
CONTENTS
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The directors present their Strategic Report for the year ended 31 December 2024
The Group has produced a strong set of business results, marked by significant revenue growth and a deliberate investment strategy. Our annual turnover reached £42.0m, marking a 39% year-on-year growth from £30.2m in the previous financial year. This achievement is a testament to our organic growth driven by an expanding global customer base, our ongoing product development, our increasing market share in the enterprise sector, and the successful integration of Space Heroes Ltd, which was acquired in September 2024. The acquisition of Space Heroes Ltd’s flagship product, Clayton, has further solidified our position as the market leader in Salesforce DevOps.
The Group’s operating loss of (£1.6m), a significant improvement from the prior year’s loss of (£3.2m), is a purposeful investment in our future. This funding has accelerated key initiatives to mature our sales capabilities, deepen our go-to-market partnerships, and accelerate our product roadmap, the results of which are demonstrated through our strong revenue growth. A key milestone in 2024 was the introduction of the Gearset Long-Term Incentive Plan (LTIP), an equity program ensuring that all employees are direct participants in the value we create.
Our cash balance remains resilient and is materially in line with the prior year. This strength is a direct result of our robust financial model, which generates strong working capital from upfront payments. This self-funded approach provides the necessary capital for our strategic initiatives without reliance on external financing, demonstrating the trust our customers place in our platform and value proposition.
The Board of Directors extends its deepest gratitude to every member of the Gearset team. Your passion and hard work are the engine of our continued success. We are confident that our strategic investments in product innovation, market expansion, and our exceptional team will enable us to continue delighting our customers and driving future growth.
The Group’s operating loss of (£1.6m), a significant improvement from the prior year’s loss of (£3.2m), is a purposeful investment in our future. This funding has accelerated key initiatives to mature our sales capabilities, deepen our go-to-market partnerships, and accelerate our product roadmap, the results of which are demonstrated through our strong revenue growth. A key milestone in 2024 was the introduction of the Gearset Long-Term Incentive Plan (LTIP), an equity program ensuring that all employees are direct participants in the value we create.
Our cash balance remains resilient and is materially in line with the prior year. This strength is a direct result of our robust financial model, which generates strong working capital from upfront payments. This self-funded approach provides the necessary capital for our strategic initiatives without reliance on external financing, demonstrating the trust our customers place in our platform and value proposition.
The Board of Directors extends its deepest gratitude to every member of the Gearset team. Your passion and hard work are the engine of our continued success. We are confident that our strategic investments in product innovation, market expansion, and our exceptional team will enable us to continue delighting our customers and driving future growth.
The international scope of the Group's activities inherently presents a range of financial risks, notably concerning cash flow, credit, and liquidity.
Cash flow risk
The Group’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates. Wherever possible these are naturally hedged with similar levels of income and expenditure in each foreign currency.
Credit risk
The Group’s principal financial assets are bank balances and cash, prepayments, and trade receivables. The Group’s credit risk is primarily attributable to its trade receivables balance.
Liquidity risk
In order to maintain liquidity to ensure that sufficient funds are available for ongoing operations and future developments, the Group maintains significant cash balances.
Technological risk
In the rapidly evolving software industry, there is a constant risk that existing technologies or product offerings could become obsolete due to new innovations or shifting market demands. The Group attempts to mitigate this risk through significant and continuous investment in its exceptional engineering and product teams.
Cash flow risk
The Group’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates. Wherever possible these are naturally hedged with similar levels of income and expenditure in each foreign currency.
Credit risk
The Group’s principal financial assets are bank balances and cash, prepayments, and trade receivables. The Group’s credit risk is primarily attributable to its trade receivables balance.
Liquidity risk
In order to maintain liquidity to ensure that sufficient funds are available for ongoing operations and future developments, the Group maintains significant cash balances.
Technological risk
In the rapidly evolving software industry, there is a constant risk that existing technologies or product offerings could become obsolete due to new innovations or shifting market demands. The Group attempts to mitigate this risk through significant and continuous investment in its exceptional engineering and product teams.
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GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The directors anticipate an increase in commercial investment in 2025, broadly aligned with revenue growth. This demonstrates Gearset’s dedication to investing in product development, innovation, and attracting and retaining highly skilled employees.
The global economy, especially the political landscape, remains volatile, impacting foreign currency markets in close proximity to us. Despite this uncertainty, the directors have confidence in Gearset’s ability to adapt to any changes, whether they arise from fluctuations in foreign exchange rates or regulatory modifications.
The global economy, especially the political landscape, remains volatile, impacting foreign currency markets in close proximity to us. Despite this uncertainty, the directors have confidence in Gearset’s ability to adapt to any changes, whether they arise from fluctuations in foreign exchange rates or regulatory modifications.
This report was approved by the board and signed on its behalf.
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DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
The directors present their report and the financial statements for the year ended 31 December 2024.
The directors who served during the year were:
The loss for the year, after taxation, amounted to £1,588,961 (2023 - loss £3,178,188).
No dividends were declared during the period. The directors do not recommend payment of a dividend.
The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group 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 the Group and to 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The Group continues to develop new software products and expects further developments in 2025. The total amount charged to the profit and loss account for research and development expenditure during the year was £11.2m (2023: £8.0m).
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
The Group has chosen in accordance with Section 414C(11) of the Companies Act 2006 (Strategic Report and Director's Report) Regulations 2013 to set out within the Group's Strategic Report the Group's Report Information required by Schedule 7 of the Large and Medium Sized Companies and Groups (Accounts and Reports) Regulations 2008.
This includes information that would have been included in the business review and details of the principal risks and uncertainties.
This includes information that would have been included in the business review and details of the principal risks and uncertainties.
There have been no significant events affecting the Group since the year end.
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
Under section 487(2) of the Companies Act 2006, Menzies LLP will be deemed to have been reappointed as auditor 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.
This report was approved by the board and signed on its behalf.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF GEARSET LIMITED
We have audited the financial statements of Gearset Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2024, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Statement of Financial Position, the Company Statement of Financial Position, the Consolidated Statement of Cash Flows, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and the related notes, 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).
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 Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's or the parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF GEARSET LIMITED (CONTINUED)
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group 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 Group Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Directors' Report.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF GEARSET LIMITED (CONTINUED)
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 Group financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
The Group is subject to laws and regulations that directly affect the financial statements including financial reporting legislation. We determined that the following laws and regulations were most significant including:
∙The Companies Act 2006;
∙Financial Reporting Standard 102;
∙UK employment legislation;
∙UK health and safety legislation; and
∙General Data Protection Regulations.
We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.
We understood how the Group are complying with those legal and regulatory frameworks by making inquiries to management and those responsible for legal and compliance procedures.
The engagement partner assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations. The assessment did not identify any issues in this area.
We assessed the susceptibility of the Group's financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the engagement team included:
∙Identifying and assessing the design effectiveness of controls that management has in place to prevent and detect fraud;
∙Understanding how those charged with governance considered and addressed the potential for override of controls or other inappropriate influence over the financial reporting process;
∙Challenging assumptions and judgements made by management in its significant accounting estimates; and
∙Identifying and testing journal entries, in particular any journal entries posted with unusual account combinations.
As a result of the above procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas:
∙Management override of controls to manipulate results and;
∙Timing of revenue recognition.
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 is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
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 Auditor's Report.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF GEARSET LIMITED (CONTINUED)
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.
for and on behalf of
Chartered Accountants
Statutory Auditor
Midas House
62 Goldsworth Road
Surrey
GU21 6LQ
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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
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CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 17 to 35 form part of these financial statements.
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COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 17 to 35 form part of these financial statements.
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