REGISTERED NUMBER: 00979006 (England and Wales)

ELLIS STEEL GROUP LIMITED

STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED

31 DECEMBER 2024

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

5

Income Statement

8

Other Comprehensive Income

9

Balance Sheet

10

Statement of Changes in Equity

11

Notes to the Financial Statements

12

DIRECTORS:

R H J Ellis

Mrs E Ellis

A Lavercombe

SECRETARY:

Mrs K Bresner

REGISTERED OFFICE:

Kemys Way

Swansea Enterprise Park

Swansea

SA6 8QF

REGISTERED NUMBER:

00979006 (England and Wales)

AUDITORS:

Bevan Buckland LLP

Chartered Accountants

And Statutory Auditors

Ground Floor Cardigan House

Castle Court

Swansea Enterprise Park

Swansea

SA7 9LA

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

REVIEW OF BUSINESS

Ellis Steel Group Limited is a long-established steel stockholder and processor. The company operates from five locations across the UK, stretching from Milford Haven to Swindon offering a wide range of steel products to a diverse range of industries including civil engineering, house building and agriculture. The company also specialises in the fabrication of structural and reinforced steel to these industries, as well as to small individual projects.

The company's key financial and other performance indicators during the year were as follows:

2024

2023

2022

Turnover

£

13,412,751

16,329,622

22,960,394

Gross Profit

£

2,754,706

3,566,945

6,508,849

Gross Profit Margin

21

22

28

Profit/(Loss) before tax

£

(404,858

)

110,510

2,834,372

Like 2023, 2024 was a very difficult year for Steel Stockholding after two very good years for the industry. Demand was weak which resulted in a sharp fall in the price of steel. As a result the Directors took the decision to reduce the company's stock position which resulted in unusually tight margins however they are satisfied it was the correct decision. The company remains very liquid with large cash balances and no borrowings and is in a strong position to benefit from the inevitable upturn in demand.

PRINCIPAL RISKS AND UNCERTAINTIES

Financial Risk

The company uses various financial instruments which include cash and other items such as trade debtors and trade creditors that arise directly from its operations. The main purpose of these financial instruments is to raise finance for the company's operations.

The main risk arising from the company's financial instruments are price risk, credit risk and liquidity risk. The directors review and agree policies for managing each of these risks.

Product and Price Risk

The company is exposed to raw material price risk as a result of its operations of which future steel prices are inherently difficult to forecast and volatile. However, given the size of the company's operations, the costs of managing exposure to raw material price risk exceeds the potential benefits. The directors will revisit the appropriateness of this policy should the company's operations change in size or nature. The company has no exposure to equity securities price risk and as it holds no listed or equity investments.

Although efficient buying strategy can be to purchase large quantities, there are a number of potential suppliers and as such reliance is never placed on a single supplier.

Liquidity Risk

The company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest cash assets safely and profitability. The company does not rely on short term financing due to the strong cash position.

Customer and Credit Risk

The company's principal financial assets are cash and trade debtors. The principal credit risk arises from its trade debtors. In order to manage credit risk the directors have implemented policies that require appropriate credit checks on potential customers before sales are made. Customers are assigned credit limits and overdue debts are chased on a regular basis.

It is the company has also avoided customer concentration to ensure there is not a single or small group of customers that the company places significant reliance upon its sales.

Health & Safety

The business has in place a rigorous and far reaching health & safety policy, and is committed to adhering to all legislation requirements imposed on it through the various enforcing authorities.

Government Legislation

The business operates under a variety of controls and regulations implemented by government bodies. These regulations set stringent operational standards and enhance the safety and environmental characteristics of the industry. Management ensures it has sufficient, robust procedures and controls in place to remain compliant with existing legislation and to enable it to react quickly to implement any changes.

ON BEHALF OF THE BOARD:

R H J Ellis - Director

7 July 2025

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

DIVIDENDS

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

EVENTS SINCE THE END OF THE YEAR

Information relating to events since the end of the year is given in the notes to the financial statements.

DIRECTORS

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

R H J Ellis

Mrs E Ellis

A Lavercombe

STATEMENT OF DIRECTORS' RESPONSIBILITIES

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.

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.

AUDITORS

The auditors, Bevan Buckland LLP, will be proposed for re-appointment.

ON BEHALF OF THE BOARD:

R H J Ellis - Director

7 July 2025

Opinion

We have audited the financial statements of Ellis Steel Group 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 loss 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 Auditors' 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 directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

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.

In connection with our audit of the financial statements, 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 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 the audit:

-	the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors 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 Report of the Directors.

We have nothing to report in respect of the following matters where 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 Statement of Directors' Responsibilities set out on page four, 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 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 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.

Extent to which the audit was considered capable of detecting irregularities, including fraud

We identify and assess the risks of material misstatement of the Financial Statements, whether due to fraud or error, and then, design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.

We discussed our audit independence complying with the Revised Ethical Standard 2019 with the engagement team members whilst planning the audit and continually monitored our independence throughout the process.

Identifying and assessing potential risks related to irregularities.

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:

-

enquiring of management, including obtaining and reviewing supporting documentation, concerning the Company's policies and procedures relating to:

-

identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;

-

detecting and responding to the risks of fraud and whether they have knowledge of any actual. suspected or alleged fraud;

-

the internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations;

-

discussing among the engagement team how and where fraud might occur in the Financial Statements and any potential indicators of fraud. As part of this discussion, we identified potential for fraud in the following areas;

-

Assumptions used for valuing work in progress at the year end, and;

-

Potential for deferring income already earned at the year end.

-

obtaining an understanding of the legal and regulatory frameworks that the Company operates in, focusing on those laws and regulations that had a direct effect on the Financial Statements or that had a fundamental effect on the operations of the Company, The key laws and regulations we considered in this context included the UK Companies Act and relevant tax legislation.

Audit response to risks identified

In addition to the above, our procedures to respond to risks identified included the following:

-

reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with relevant laws and regulations;

-

enquiring of management concerning actual and potential litigation and claims; performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;

-

reading minutes of meetings of those charged with governance and reviewing correspondence with HMRC; and

-

in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments;

-

assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and

-

evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

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 Report of the Auditors.

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 a Report of the Auditors 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.

Alison Vickers (Senior Statutory Auditor)

for and on behalf of Bevan Buckland LLP

Chartered Accountants

And Statutory Auditors

Ground Floor Cardigan House

Castle Court

Swansea Enterprise Park

Swansea

SA7 9LA

7 July 2025

TURNOVER

13,412,751

16,329,622

Cost of sales

10,658,045

12,762,677

GROSS PROFIT

2,754,706

3,566,945

Distribution costs

1,384,370

1,383,238

Administrative expenses

1,929,833

2,210,063

3,314,203

3,593,301

(559,497

)

(26,356

)

Other operating income

266

750

OPERATING LOSS

4

(559,231

)

(25,606

)

Interest receivable and similar income

154,373

136,116

(LOSS)/PROFIT BEFORE TAXATION

(404,858

)

110,510

Tax on (loss)/profit

5

(73,504

)

(20,159

)

(LOSS)/PROFIT FOR THE FINANCIAL YEAR

(331,354

)

130,669

(LOSS)/PROFIT FOR THE YEAR

(331,354

)

130,669

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(331,354

)

130,669

FIXED ASSETS

Intangible assets

7

-

-

Tangible assets

8

2,138,803

2,246,978

Investments

9

310,001

310,001

Investment property

10

866,522

637,233

3,315,326

3,194,212

CURRENT ASSETS

Stocks

11

1,515,796

1,807,222

Debtors

12

3,543,231

3,212,447

Cash at bank and in hand

5,214,702

5,907,245

10,273,729

10,926,914

CREDITORS

Amounts falling due within one year

13

3,179,165

3,309,009

NET CURRENT ASSETS

7,094,564

7,617,905

TOTAL ASSETS LESS CURRENT LIABILITIES

10,409,890

10,812,117

PROVISIONS FOR LIABILITIES

15

458,487

529,360

NET ASSETS

9,951,403

10,282,757

CAPITAL AND RESERVES

Called up share capital

16

41,919

41,919

Revaluation reserve

17

856,351

877,238

Capital redemption reserve

17

8,081

8,081

Retained earnings

17

9,045,052

9,355,519

SHAREHOLDERS' FUNDS

9,951,403

10,282,757

The financial statements were approved by the Board of Directors and authorised for issue on 7 July 2025 and were signed on its behalf by:

R H J Ellis - Director

Called up

Capital

share

Retained

Revaluation

redemption

Total

capital

earnings

reserve

reserve

equity

£

£

£

£

£

Balance at 1 January 2023

41,919

9,353,963

898,125

8,081

10,302,088

Changes in equity

Dividends

-

(150,000

)

-

-

(150,000

)

Total comprehensive income

-

151,556

(20,887

)

-

130,669

Balance at 31 December 2023

41,919

9,355,519

877,238

8,081

10,282,757

Changes in equity

Total comprehensive income

-

(310,467

)

(20,887

)

-

(331,354

)

Balance at 31 December 2024

41,919

9,045,052

856,351

8,081

9,951,403

1.	STATUTORY INFORMATION

Ellis Steel Group 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 as modified by the revaluation of certain assets.

Financial Reporting Standard 102 - reduced disclosure exemptions

The company has taken advantage of the following disclosure exemption 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.

Preparation of consolidated financial statements

The financial statements contain information about Ellis Steel Group Limited as an individual company and do not contain consolidated financial information as the parent of a group. The company is exempt under Section 400 of the Companies Act 2006 from the requirements to prepare consolidated financial statements as it and its subsidiary undertaking are included by full consolidation in the consolidated financial statements of its parent, Ellis Steel Holdings Limited, Kemys Way, Swansea Enterprise Park, Swansea, SA6 8QF.

Related party exemption

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.

Critical accounting judgements and key sources of estimation uncertainty

The preparation of the financial statements requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results in the future may differ from these estimates.

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 and in any future periods affected.

Significant management judgements

The following are management judgements in applying the accounting policies of the company that have the most significant effect on the amounts recognised in the financial statements.

Carrying value of stock

The directors review the market value of and demand for the company's stock on a periodic basis to ensure stock is recorded in the financial statements at the lower of cost and net realisable value, being the estimated selling price less cost to complete and sell. The directors use their knowledge of market conditions, historical experiences and estimates of future events to assess future demand for the company's products and achievable selling prices.

Leasehold property valuation

Leasehold property is valued professionally every 3 years, unless there is an indication of a significant change in market values.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

The company recognises revenue when:

-

The amount of revenue can be reliably measured;

-

it is probable that future economic benefits will flow to the entity; and

-

specific criteria have been met for each of the company's activities.

Interest income is recognised in the Statement of Comprehensive Income using the effective interest method.

Goodwill

Goodwill arising on the acquisition of an early represents the excess of the cost of acquisition over the company's interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is held in the currency of the acquired entity and revalued to the closing rate at each reporting period date. Goodwill is amortised over its useful life, which shall not exceed ten years if a reliable estimate of the useful life cannot be made.

Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life over 10 years.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Long leasehold

-

Straight line over 50 years

Plant and Machinery

-

10 - 20% on cost

Fixtures and fittings

-

25% on cost and 20% on cost

Motor vehicles

-

25% on cost

Leasehold property is measured under the revaluation model. The assets are carried at the revalued amount, being its fair value at the date of revaluation less any subsequent accumulated depreciation and impairment losses. Revaluations are made every 3 years unless there is an indication of significant market changes to ensure the carrying amount does not differ materially from the fair value at the reporting date.

All other category of assets are measured using the cost method. Cost comprises the purchase price of the asset and expenditure directly attributable to the acquisition of the item.

A fixed asset is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. 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 the income statement.

Impairment of fixed assets

The company performs impairment testing where there are any indicators of impairment. Impairment is calculated as the difference between the carrying value and the recoverable value of the asset. Recoverable value is the higher of net realisable value and estimated value in use at the date the impairment loss is recognised. Value in use represents the present value of expected future discounted cash flows. If incurred, impairment is recognised immediately in the income statement.

Where an impairment loss subsequently reverses, the carrying value of the asset is increased to the revised estimate of the recoverable amount, but so that the increased carrying value does not exceed the carrying value that would have been determined if no impairment loss had been recognised for the asset in prior years. A reversal of an impairment loss is recognised immediately as a credit to the income statement.

Investments in subsidiaries

Investments in subsidiary undertakings are recognised at cost.

Investment property

Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss.

Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in the statement of comprehensive income. Deferred tax is provided against these gains at the rate expected to apply when the property is sold. The treatment is in line with the fair value provisions of the Companies Act.

Investment properties are derecognised when either they have been disposed of or when the investment property is permanently withdrawn from use and no future economic benefit is expected from its disposal.

Investment properties are reclassified as 'held for sale' assets from commencement of marketing for disposal, provided that the directors have reasonable expectation that they will be sold within a period of 12 months.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Cost is determined using the first-in, first-out (FIFO) method.

Trade Debtors

Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provisions for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables.

Cash and cash equivalents

Cash at bank and cash in hand includes cash and short term highly liquid investments with a short maturity of three months or less from the date of acquisition or opening of the deposit or similar account.

Financial instruments

The company enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities such as trade and other receivables and payables, amounts due to and from related parties.

Financial instruments are classified and accounted for according to the substance of the contractual arrangement, as financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Debt instruments like loans and other receivables and payables are initially measured at present value of the future payments and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade payables or receivables, are measured, initially and subsequently, at the undiscounted amount of cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or financed at a rate of interest that is not a market rate or in case of an outright short-term loan not at market rate, the financial asset or liability is measured, initially and subsequently, at the present value of future payments discounted at a market rate of interest for a similar debt instrument.

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 in profit or loss. For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying value and the present value of estimated cash flows discounted at the assets original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and the best estimate, which is an approximation, of the amount that the group would receive for the asset if it were to be sold at the reporting date.

Financial assets and liabilities are offset and the net amount recognised in the balance sheet when there is an 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. At each reporting date non-financial assets not carried at fair value, such as property, plant and equipment are reviewed to determine whether there is an indication that an asset may be impaired. If there is an indication of possible impairment, the recoverable amount of any asset or group of related assets, which is the higher of value in use and the fair value less costs to sell, is estimated and compared with its carrying amount. If the recoverable amount is lower, the carrying amount of the asset is reduced to its recoverable amount and an impairment loss is recognised immediately in profit or loss.

If an impairment loss is subsequently reversed, the carrying amount of the asset or group of related assets is increased to the revised estimate of its recoverable amount, but not to exceed the amount that would have been determined had no impairment loss been recognised for the asset or group of related assets in prior periods. A reversal of an impairment loss is recognised immediately in profit or loss.

Trade Creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.

Provisions for liabilities

Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.

Provisions are charged as an expense to the Statement of Comprehensive Income in the year the Company becomes aware of the obligation, and are measured at the best estimate at the Statement of Financial Position date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.

When payments are eventually made, they are charged to the provision carried in the Statement of financial position.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Foreign currencies

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 of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Hire purchase and leasing commitments

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

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

Employee benefits

The company provides a range of benefits to employees, including bonus arrangements, paid holiday arrangements and defined contribution pension plans. Short term benefits, including holiday pay and other similar non-monetary benefits, are recognised as an expense in the new period which the service is received. Bonus arrangements are recognised as an expense in the profit and loss account when the company has a legal and constructive obligation to make payments as a result of a past event and a reliable estimate can be made.

Functional and presentation currency

These financial statements are presented in pounds sterling because that is the currency of the primary economic environment in which the Company operates (its functional currency).

Share Capital

Ordinary shares are classified as equity.

Dividends to equity holders

Dividends and other distributions to the company's shareholders are recognised as a liability in the financial statements in the period in which the dividend and other distributions are approved by the shareholders. These amounts are recognised in the statement of changes in equity.

3.	EMPLOYEES AND DIRECTORS

2024

2023

£

£

Wages and salaries

2,043,144

2,235,606

Social security costs

231,440

233,042

Other pension costs

107,946

92,883

2,382,530

2,561,531

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

2024

2023

Warehousing

45

48

Administration and support

8

8

Sales

18

19

71

75

2024

2023

£

£

Directors' remuneration

202,892

319,441

Directors' pension contributions to money purchase schemes

50,000

30,000

Information regarding the highest paid director is as follows:

2024

2023

£

£

Emoluments etc

79,533

146,740

Pension contributions to money purchase schemes

30,000

-

4.	OPERATING LOSS

The operating loss is stated after charging/(crediting):

2024

2023

£

£

Other operating leases

662,819

677,961

Depreciation - owned assets

249,167

236,962

Profit on disposal of fixed assets

-

(1,381

)

Auditors' remuneration

20,645

15,500

Taxation compliance services

3,450

3,800

5.

TAXATION

Analysis of the tax credit

The tax credit on the loss for the year was as follows:

2024

2023

£

£

Current tax:

UK corporation tax

-

2,631

(Over)/under provision in previous years

(2,631

)

(33,487

)

Total current tax

(2,631

)

(30,856

)

Deferred tax

(70,873

)

10,697

Tax on (loss)/profit

(73,504

)

(20,159

)

Reconciliation of total tax credit included in profit and loss

The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

2024

2023

£

£

(Loss)/profit before tax

(404,858

)

110,510

(Loss)/profit multiplied by the standard rate of corporation tax in the UK of 25% (2023 - 19%)

(101,215

)

20,997

Effects of:

Expenses not deductible for tax purposes

2,081

187

Capital allowances in excess of depreciation

-

(13,605

)

Depreciation in excess of capital allowances

49,832

-

Utilisation of tax losses

49,212

-

Adjustments to tax charge in respect of previous periods

(2,631

)

(38,435

)

Deferred tax

(70,783

)

10,697

Total tax credit

(73,504

)

(20,159

)

Deferred taxes have been calculated at 25% (2023: 25%).

6.

DIVIDENDS

2024

2023

£

£

Ordinary shares of £1 each

Interim

-

150,000

7.	INTANGIBLE FIXED ASSETS

Goodwill

£

COST

At 1 January 2024

and 31 December 2024

185,000

AMORTISATION

At 1 January 2024

and 31 December 2024

185,000

NET BOOK VALUE

At 31 December 2024

-

At 31 December 2023

-