REGISTERED NUMBER: 11922190 (England and Wales)

Group Strategic Report,

Report of the Directors and

Consolidated Financial Statements

for the Year Ended 31 December 2024

for

SDS Protection (Holdings) Limited

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

5

Report of the Independent Auditors

7

Consolidated Statement of Comprehensive Income

10

Consolidated Statement of Financial Position

11

Company Statement of Financial Position

12

Consolidated Statement of Changes in Equity

13

Company Statement of Changes in Equity

14

Consolidated Statement of Cash Flows

15

Notes to the Consolidated Statement of Cash Flows

16

Notes to the Consolidated Financial Statements

17

DIRECTORS:

R James

R A Critchley

SECRETARY:

D Woolsgrove

REGISTERED OFFICE:

Chancery House

30 St Johns Road

Woking

Surrey

GU21 7SA

BUSINESS ADDRESS:

Unit 1

Bordon Trading Estate

Old Station Way

Bordon

Hampshire

GU35 9HH

REGISTERED NUMBER:

11922190 (England and Wales)

AUDITORS:

WP Audit Services LLP

Chancery House

30 St Johns Road

Woking

Surrey

GU21 7SA

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

PRINCIPAL ACTIVITY

The principal activity for the group in the year under review was that of the manufacture of specialist doorsets for healthcare, education and pharmaceutical.

REVIEW OF BUSINESS

The Board aims to present a review of the development and performance of the group during the year under review and its position at the year end. This review is consistent with the size and nature of the group and is written in the context of risks and uncertainties it faces.

The directors recognise a reduction in both turnover and profitability during the year. During the year, the business began investing in its future with development of its infrastructure, product range and team expertise. The directors expect that this will lead to improved performance in 2025 and beyond.

The directors consider that the key performance indicators are those that communicate the financial performance and strength of the group, primarily turnover, gross profit, EBITDA, net assets and cash. The group experienced a reduction in turnover with overall sales decreasing from £11.8m to £9.9m as a direct result of an underperformance of new sales in the preceding 12 to 18 months; in addition, the group saw a reduction in gross margin from 61.1% to 57.6% although this remained significantly above historical averages. This resulted in the gross profit decreasing from £7.2m to £5.7m in the year.

During the year, the group identified a historical manufacturing issue with a small number of doors (less than 1% of manufactured doors) that required some remedial works. All affected clients were contacted and remedial action is underway. A provision of c£765K for this remedial work has been recorded in the year. As a result, the EBITDA for the year reduced from £3.5m to £1.0m.

The group's net assets decreased from £1.5m to £0.3m. and cash increased from £1.3m to £1.7m.

The directors aim to maintain the group's existing management policies which have resulted in the group's period of trading. These policies include the intention to grow sales and maintain control over costs. The directors are confident that the group will continue to trade profitably in the future. The continuing profitability has left the company in a sound financial position at the end of the year and is in line with the group's expectations. They anticipate further growth in 2025 and beyond.

KEY PERFORMANCE INDICATORS

The group considers its Key Performance Indicators to be turnover, gross profit, net assets and cash.

2024

2023

2022

£

£

£

Sales

9,936,268

11,818,411

11,355,468

Gross profit

5,722,738

7,218,557

5,842,060

Gross profit margin

57.6%

61.1%

51.4%

EBITDA

1,006,172

3,505,135

2,726,048

Net assets

261,020

1,537,980

1,522,426

Cash

1,666,318

1,330,429

1,010,649

PRINCIPAL RISKS AND UNCERTAINTIES

The management of the group and the nature of its trading strategy are subject to a number of risks. The group operates a thorough risk assessment and management process which involves a formal review of all the risks identified and introducing processes to monitor and mitigate each risk, where possible.

The directors review the principal risks and uncertainties facing the group on a regular basis and ensure systems and policies are continuously updated to reflect any changes, they work in an efficient manner to minimise those risks and help achieve the group's objectives.

Cost inflation and supply chain

The group continues to have a strong supply chain system, which allows it to negotiate better purchasing terms and work with suppliers to improve supply chain efficiency. However, the group remains exposed to periods of cost inflation and continually assesses any risks identified with the aim of mitigating the threats these may have on the group's operations and profitability.

Principal financial instruments

The group's principal financial instruments comprise of bank balances, inventories, trade debtors, trade creditors, hire purchase finance and debenture loan notes. The main purpose of these instruments is to provide funds for the group's operations. Their existence exposes the group to a number of financial risks, which have been considered and are managed as follows:

Operational risk

Operational risk is the risk of a direct or indirect loss resulting from the inadequacies or failures of processes or controls due to technology, staff, organisation or external factors. To monitor and control operational risk, the group maintains a system of comprehensive policies and a control framework which is designed to provide a sound and well-controlled operational environment.

Liquidity risk

Liquidity risk is the risk that the group will have insufficient resources to meet its financial liabilities as they fall due. The group's strategy to managing liquidity risk is to ensure that the group has sufficient funds to meet all its potential liabilities as they fall due.

Interest rate risk

Interest rate risk is the risk that the financial performance of the group will be adversely affected by adverse fluctuations on interest rates being charged to the group on its financial instruments. The interest rate risk is managed by using fixed low interest rates on its borrowing. This is deemed sufficient to mitigate this risk.

Credit risk

The group has a significant and diverse customer base, ranging from large contractors to individual operations. The group works closely with a credit risk insurer whenever possible. This, combined with undertaking stringent credit checks, raising proforma invoices where considered appropriate and the implementation of further safeguards, where necessary, minimises credit risk.

Currency risk

Currency risk is the risk that the financial performance of the group will be adversely affected by adverse fluctuations in foreign currencies used by the group. The group has minimal exposure to foreign currency risk.

GOING CONCERN

The group's business activities, together with the factors likely to affect its future development, performance and position are set out above. After making enquiries, the directors believe the group has sufficient resources to continue in operational existence for the foreseeable future.

The directors have therefore concluded that it is appropriate to prepare the financial statements on a going concern basis.

ON BEHALF OF THE BOARD:

R James - Director

6 August 2025

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

DIVIDENDS

Interim dividends of £440,000 (2023: £1,660,000) were paid in the year. The directors recommend that no final dividend be paid.

RESEARCH AND DEVELOPMENT

The group is engaged in ongoing research and development aimed at improving and developing the next generation of fire door systems for hospitals and clinical environments.

DIRECTORS

R James has held office during the whole of the period from 1 January 2024 to the date of this report.

Other changes in directors holding office are as follows:

D Blake - resigned 11 November 2024

R A Critchley - appointed 1 January 2024

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Group 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 the group and of the profit or loss of the group 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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group 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 group's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

AUDITORS

The auditors, WP Audit Services LLP, have indicated their willingness to continue in office.

ON BEHALF OF THE BOARD:

R James - Director

6 August 2025

Opinion

We have audited the financial statements of SDS Protection (Holdings) Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2024 which comprise the Consolidated Statement of Comprehensive Income, Consolidated Statement of Financial Position, Company Statement of Financial Position, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Statement of Cash Flows and Notes to the Consolidated Statement of Cash Flows, 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 group's and of the parent company affairs as at 31 December 2024 and of the group's 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 group 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 group's and 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.

Other information

The directors are responsible for the other information. The other information comprises the information in the Group 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 Group 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 Group 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 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 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

-	the parent company 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 five, 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 group's and the parent 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 group or the parent 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.

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

We obtained an understanding of the legal and regulatory framework that the company operates in, focussing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context include the Companies Act and tax legislation. In addition we considered the provisions of other laws and regulations that do not have an effect on the financial statements but compliance with which may be fundamental to the company's ability to incur or to avoid a material penalty, including the company's operating licences and environmental regulations.

Our procedures in response to the risks identified included reviewing the financial statements disclosures and testing supporting documentation to assess compliance with the provisions of relevant laws and regulations considered to have a direct effect in the financial statements, enquiring of management concerning actual or 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, reviewing correspondence with relevant regulatory authorities 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 audit 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.

Stuart Wright (Senior Statutory Auditor)

for and on behalf of WP Audit Services LLP

Chancery House

30 St Johns Road

Woking

Surrey

GU21 7SA

6 August 2025

TURNOVER

3

9,936,268

11,818,411

Cost of sales

(4,213,530

)

(4,599,854

)

GROSS PROFIT

5,722,738

7,218,557

Administrative expenses

(6,280,469

)

(5,282,800

)

(557,731

)

1,935,757

Other operating income

87,518

87,518

OPERATING (LOSS)/PROFIT

5

(470,213

)

2,023,275

Interest receivable and similar income

-

23,955

(470,213

)

2,047,230

Interest payable and similar expenses

6

(168,491

)

(191,362

)

(LOSS)/PROFIT BEFORE TAXATION

(638,704

)

1,855,868

Tax on (loss)/profit

7

(198,256

)

(180,314

)

(LOSS)/PROFIT FOR THE FINANCIAL YEAR

(836,960

)

1,675,554

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(836,960

)

1,675,554

(Loss)/profit attributable to:

Owners of the parent

(836,960

)

1,675,554

Total comprehensive income attributable to:

Owners of the parent

(836,960

)

1,675,554

FIXED ASSETS

Intangible assets

10

5,305,884

6,530,319

Tangible assets

11

1,977,999

2,158,536

Investments

12

-

-

7,283,883

8,688,855

CURRENT ASSETS

Stocks

13

538,940

669,192

Debtors

14

1,328,234

1,783,479

Cash at bank and in hand

1,666,318

1,330,429

3,533,492

3,783,100

CREDITORS

Amounts falling due within one year

15

(4,182,702

)

(3,515,753

)

NET CURRENT (LIABILITIES)/ASSETS

(649,210

)

267,347

TOTAL ASSETS LESS CURRENT LIABILITIES

6,634,673

8,956,202

CREDITORS

Amounts falling due after more than one year

16

(6,276,967

)

(7,280,574

)

PROVISIONS FOR LIABILITIES

20

(96,686

)

(137,648

)

NET ASSETS

261,020

1,537,980

CAPITAL AND RESERVES

Called up share capital

21

100

100

Retained earnings

22

260,920

1,537,880

SHAREHOLDERS' FUNDS

261,020

1,537,980

The financial statements were approved by the Board of Directors and authorised for issue on 6 August 2025 and were signed on its behalf by:

R James - Director

FIXED ASSETS

Intangible assets

10

-

-

Tangible assets

11

-

-

Investments

12

10,307,155

17,307,155

10,307,155

17,307,155

CURRENT ASSETS

Debtors

14

100

100

Cash at bank

672,496

442,343

672,596

442,443

CREDITORS

Amounts falling due within one year

15

(2,194,825

)

(2,348,194

)

NET CURRENT LIABILITIES

(1,522,229

)

(1,905,751

)

TOTAL ASSETS LESS CURRENT LIABILITIES

8,784,926

15,401,404

CREDITORS

Amounts falling due after more than one year

16

(6,210,000

)

(7,170,000

)

NET ASSETS

2,574,926

8,231,404

CAPITAL AND RESERVES

Called up share capital

21

100

100

Retained earnings

2,574,826

8,231,304

SHAREHOLDERS' FUNDS

2,574,926

8,231,404

Company's (loss)/profit for the financial year

(5,216,478

)

1,619,032

The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the Board of Directors and authorised for issue on 6 August 2025 and were signed on its behalf by:

R James - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2023

100

1,522,326

1,522,426

Changes in equity

Dividends

-

(1,660,000

)

(1,660,000

)

Total comprehensive income

-

1,675,554

1,675,554

Balance at 31 December 2023

100

1,537,880

1,537,980

Changes in equity

Dividends

-

(440,000

)

(440,000

)

Total comprehensive income

-

(836,960

)

(836,960

)

Balance at 31 December 2024

100

260,920

261,020

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2023

100

8,272,272

8,272,372

Changes in equity

Dividends

-

(1,660,000

)

(1,660,000

)

Total comprehensive income

-

1,619,032

1,619,032

Balance at 31 December 2023

100

8,231,304

8,231,404

Changes in equity

Dividends

-

(440,000

)

(440,000

)

Total comprehensive income

-

(5,216,478

)

(5,216,478

)

Balance at 31 December 2024

100

2,574,826

2,574,926

Cash flows from operating activities

Cash generated from operations

1

2,104,863

2,686,087

Interest paid

(158,000

)

(172,200

)

Interest element of hire purchase payments paid

(10,491

)

(19,162

)

Tax paid

417,447

(228,955

)

Net cash from operating activities

2,353,819

2,265,770

Cash flows from investing activities

Purchase of tangible fixed assets

(74,119

)

(130,932

)

Sale of tangible fixed assets

-

500

Interest received

-

23,955

Net cash from investing activities

(74,119

)

(106,477

)

Cash flows from financing activities

Loan repayments in year

(960,000

)

(960,000

)

Capital repayments in year

(100,884

)

(114,671

)

Amount introduced by directors

-

995,158

Amount withdrawn by directors

(442,927

)

(100,000

)

Equity dividends paid

(440,000

)

(1,660,000

)

Net cash from financing activities

(1,943,811

)

(1,839,513

)

Increase in cash and cash equivalents

335,889

319,780

Cash and cash equivalents at beginning of year

2

1,330,429

1,010,649

Cash and cash equivalents at end of year

2

1,666,318

1,330,429

1.	RECONCILIATION OF (LOSS)/PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

31/12/24

31/12/23

£

£

(Loss)/profit before taxation

(638,704

)

1,855,868

Depreciation charges

1,479,091

1,481,860

Profit on disposal of fixed assets

-

(219

)

Finance costs

168,491

191,362

Finance income

-

(23,955

)

1,008,878

3,504,916

Decrease in stocks

130,252

45,333

Decrease/(increase) in trade and other debtors

315,588

(723,245

)

Increase/(decrease) in trade and other creditors

650,145

(140,917

)

Cash generated from operations

2,104,863

2,686,087

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 31 December 2024

31/12/24

1/1/24

£

£

Cash and cash equivalents

1,666,318

1,330,429

Year ended 31 December 2023

31/12/23

1/1/23

£

£

Cash and cash equivalents

1,330,429

1,010,649

3.	ANALYSIS OF CHANGES IN NET DEBT

At 1/1/24

Cash flow

At 31/12/24

£

£

£

Net cash

Cash at bank and in hand

1,330,429

335,889

1,666,318

1,330,429

335,889

1,666,318

Debt

Finance leases

(208,469

)

100,884

(107,585

)

Debts falling due within 1 year

(960,000

)

-

(960,000

)

Debts falling due after 1 year

(7,170,000

)

960,000

(6,210,000

)

(8,338,469

)

1,060,884

(7,277,585

)

Total

(7,008,040

)

1,396,773

(5,611,267

)

1.	STATUTORY INFORMATION

SDS Protection (Holdings) 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 General Information page.

The presentation currency of the financial statements is the Pound Sterling (£).

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.

Change in accounting policy

The group has changed its accounting policy on the amortisation rate of the goodwill arising on the acquisition of its subsidiary. Previously an annual impairment review was carried out, with no amortisation charge made if there was indication of an impairment. In line with UK GAAP the revised policy is to write the goodwill off over the estimated useful economic life of 10 years. See Note 10 for the impact of the change in the accounting policy.

Going concern

After reviewing the group's cash position, forecasts and projections for a period of 12 months from the accounts signing date, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. The group therefore continues to adopt the going concern basis in preparing its consolidated financial statements.

Basis of consolidation

The consolidated financial statements incorporate those of SDS Protection (Holdings) Ltd and all of its subsidiaries (i.e. entities that the Group controls through its power to govern the financial and operating policies so as to obtain economic benefits). All financial statements are made up to 31 December 2024.

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Acquisitions of subsidiaries and businesses are accounted for using the purchase method. The cost of the business combination is measured at the aggregate of the fair values (at the date of exchange) of assets given, liabilities incurred or assumed, and equity instruments issued by the group in exchange for control of the acquiree plus costs directly attributable to the business combination.

Any excess of the cost of the business combination over the acquirer's interest in the net fair value of the identifiable assets and liabilities is recognised as goodwill. In accordance with Financial Reporting Standard 102 goodwill arising on consolidation is not amortised but must be tested annually for impairment.

Revenue

Revenue is recognised to the extent that it is probable that the 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.

Goodwill

Goodwill represents the excess of the cost of a business combination over the fair value of the group's share of the net identifiable assets of the acquired subsidiary at the date of acquisition.

Goodwill is carried at cost less accumulated amortisation and accumulated impairment losses. Goodwill amortisation is calculated by applying the straight line method to its estimated useful life. Goodwill is being amortised over a period of 10 years.

Goodwill is reviewed for impairment if events or changes in circumstances indicate that the carrying amount may not be recoverable or as otherwise required by relevant accounting standards.

Shortfalls between the carrying value of fixed assets and their recoverable amounts, being the higher of net realisable value and value-in-use, are recognised as impairments. Impairment losses are recognised in the profit and loss account.

Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost, net of depreciation and any impairment losses. Depreciation is provided on all tangible fixed assets, other than freehold land, at the following rates:-

Long leasehold - straight line over 50 years

Improvements to property - 10% on cost

Plant and machinery - 10% and 25% on cost

Motor vehicles - 33% on reducing balance

Residual value is calculated on prices prevailing at the reporting date, after estimated costs of disposal, for the asset as if it were at the age and in the condition expected at the end of its useful life.

Impairment of fixed assets

Fixed assets are reviewed for impairment if events or changes in circumstances indicate that the carrying amount may not be recoverable or as otherwise required by relevant accounting standards.

Shortfalls between the carrying value of fixed assets and their recoverable amounts, being the higher of net realisable value and value-in-use, are recognised as impairments. Impairment losses are recognised in the profit and loss account.

Stocks and work in progress

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.