REGISTERED NUMBER: 05446285 (England and Wales)

SARACO INDUSTRIES LIMITED

Strategic Report, Report of the Directors and

Audited Financial Statements

for the Year Ended 31 December 2024

Page

Company Information

1

Strategic Report

2

Report of the Directors

6

Report of the Independent Auditors

8

Income Statement

12

Other Comprehensive Income

13

Balance Sheet

14

Statement of Changes in Equity

15

Notes to the Financial Statements

16

DIRECTORS:

M Ahmed

I M Bapu

H Patel

B Patel

SECRETARY:

S Bapu

REGISTERED OFFICE:

Parkside House

167 Chorley New Road

Bolton

BL1 4RA

REGISTERED NUMBER:

05446285 (England and Wales)

SENIOR STATUTORY AUDITOR:

Robert Stafford BA(Hons) FCA

AUDITORS:

SCCA Ltd T/a Stafford & Co

Chartered Accountants

and Statutory Auditor

3 The Studios

320 Chorley Old Road

Bolton

Lancashire

BL1 4JU

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

REVIEW OF BUSINESS

The principal activity of the company continued to be that of manufacturing and distribution of household and babywipes.

2024

2023

£

£

Turnover

25,263,857

24,039,682

Gross profit

4,023,898

2,941,589

Net profit before tax

1,367,260

2,228,439

Turnover percentage growth / (decline) year on year

5.09%

8.72%

Gross profit percentage

15.93%

12.24%

Net profit before tax percentage

4.63%

9.27%

Saraco Industries Limited ('Saraco') turnover increased by £1.2m (5.09%) from prior year, which was largely down to organic growth with existing customers.

By managing the purchase of raw materials Saraco managed to take advantage of key raw materials when the prices were reducing. This helped manage to achieve slightly higher than prior year gross profit of 15.93%. Profit before tax reduced to 4.63% compared to 9.27% in 2023. The existing strategy to have a large portfolio of suppliers, ensures that competition in prices is controlled, and regular supply of raw materials is maintained.

The additional investment in new machinery in 2023 has helped increase for the full year of 2024 and has also allowed Saraco to remain efficient and hence reducing manufacturing scrap. Plant maintenance is key to the business to ensure reduced downtime and with additional machinery less changeovers are needed. This additional capacity can only further help growth of Saraco, who continues to increase it's share in the UK market.

Strategy remains to diversify in to new market segments and to open up new opportunities in markets where we had very little presence previously. This strategic move bodes well for future growth.

The increase in trading accounts continues to be key in our development and our risk spreading strategy. New accounts are being secured constantly and importantly are being retained, therefore growth in active accounts continue to remain on a steady and upward trajectory.

Resource planning, upskilling, multiskilling, succession programs continue and are key to driving further production efficiencies and company agility.

Saraco continues to improve on material usage and maximising efficiencies from their enhanced machinery.

Saraco is also streamlining it's supply chain, by investing locally, which shall bring raw materials closer to its manufacturing base, hence helping to be more competitive.

PRINCIPAL RISKS AND UNCERTAINTIES

The company makes little use of financial instruments other than an operational bank account, so its exposure to credit risk, liquidity risk and cash flow risk is not material for the assessment of the assets, liabilities, financial position and profit and loss of the company.

PRICE RISK

The company is exposed to commodity price risk as a result of its operations. The directors believe that the group has adequate controls established to ensure that prices charged to customers reflect any potential large price increases.

FOREIGN EXCHANGE RISK

[The company operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to Euros. Foreign risk arises from future commercial transaction and recognised assets and liabilities.]

FOREIGN EXCHANGE RISK

The company operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to Euros. Foreign risk arises from future commercial transaction and recognised assets and liabilities.

HEALTH SAFETY AND ENVIRONMENT

The key tenet of the business continues to be health, safety, quality and the environment. The health and safety of all employees remains paramount.

Our policy aims to provide and support a culture where health, safety, quality and the environment is at the top of everyone's agenda. This has been achieved by ensuring that all our staff, operatives and sub-contractors receive adequate training, have the correct personal protective equipment and feel empowered to raise any concerns that they may have.

COMPLIANCE WITH DUTY

This statement by the board describes how the responsibilities under s172 (1) (a) to (f) of the Companies Act 2006 have been approached. The directors consider that they have acted in good faith to promote the success of the company on behalf of the stakeholders, in relation to matters set out in s172 of the Act. The stakeholders of the business include the employees, clients and suppliers of the business.

The directors monitor and review strategic objectives against growth plans and regular reviews at departmental and board level are held across the business in the key areas. These areas being H & S, Financial performance, Operations, Human Resources and Risks and Opportunities.

The directors consider H&S fundamental to the management of the business. Safe working practices that minimise environmental impact are key to the success of the business and vitally important for our stakeholders, the communities and the environments we work in.

The fundamental principle in the governance of Saraco Industries Ltd is the clear, fair and trusting approach to all interactions with employees, clients and suppliers; this is reflected in the length of service of employees and management teams and the longevity of the relationships with our clients and suppliers.

The company's employees, clients and suppliers are critical to the success of the business and so it is recognised that engagement is an important aspect in those relationships.

The directors recognise and understand that it is important to keep employees informed of all matters concerning them and does this in a number of ways including meetings, verbal and written communications. The views and interests of employees are considered in consultation with them through working groups or forums, which evolve over time to meet the needs of all parties. The policy of the company is to consult and discuss with employees any issues that arise in accordance with relevant procedures or legislation.

The company has an equal opportunities policy and is committed to the principles within the policy in respect of all stakeholders.

The company has built, and continues to grow, the business on a reputation for delivering excellent customer service. The company, through the senior management team and employees, strives continuously to improve in every aspect of the products and services it provides, for the mutual benefit of all stakeholders.

The company enjoys good relationships with suppliers in relation to credit arrangements and takes a firm approach to debtor management. Payment terms reduce the risk to the business whilst the process for debt collection minimises the risk of non-payments.

The directors have overall responsibility for delivering the company's strategy and values and for ensuring high standards of governance. The primary aim of the directors is to promote the long-term sustainable success of the company to generate benefit for the stakeholders

Strong customer relationships and a reputation for delivering great customer service will provide a springboard for continued growth with existing and new customers. Our increased capability and capacity positions us well for securing sustainable growth over the ensuing years.

The experienced team, along with the supportive shareholders will continue to drive the business through 2025 and beyond. A strong balance sheet and cash position means the business is in the perfect position to build on the success of past years.

Business investment and improvement plans will continue to further enhance health and safety culture, improve the client experience, and develop our people and systems to provide greater efficiencies for the benefit of all stakeholders. Business is already looking at other avenues to improve efficiencies and to remain competitive. Business automation is high on the agenda for the Directors and is something that is seriously being considered in the near future.

Operational and financial models for a range of market situations are in place with the ability to flex resource according to volatility in demand that may arise because of a spike in demand.

The directors are very confident for the future of the business.

ON BEHALF OF THE BOARD:

I M Bapu - Director

26 September 2025

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

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of manufacture and distribution of disposable hygiene products.

DIVIDENDS

The directors recommend a final dividend of £9.10 per ordinary share paid on 31 December 2024.

The total distribution of dividends for the year ended 31 December 2024 will be £181,938.

DIRECTORS

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

M Ahmed

I M Bapu

H Patel

B Patel

POLITICAL DONATIONS AND EXPENDITURE

During the year the company made a charitable donation of £169,582 (2023: £133,915).

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, SCCA Ltd T/a Stafford & Co, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

I M Bapu - Director

26 September 2025

Opinion

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

In our opinion the financial statements:

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

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

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

Basis for opinion

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

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

Our audit procedures were primarily directed towards testing the accounting systems in operation upon which we have based our assessment of the financial statements for the year ended 31 December 2024.

We planned our audit so that we have so that we would have a reasonable expectation of detecting material misstatements in the financial statements resulting from irregularities, fraud or non-compliance with laws or regulations.

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

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:

- The engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations.

- Enquiring of management whether they are aware of any non-compliance with laws and regulations.

- Enquiring of management whether they are aware of any actual, suspected or alleged fraud.

- Enquiring of management whether they had internal controls established to mitigate risk related to fraud or non-compliance with laws and regulations.

- Discussions amongst the engagement team on 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; posting of unusual journal and fraudulent revenue recognition.

- Obtaining an understanding of the regulatory framework 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. The key laws and regulations that we considered in this context included; the financial framework the company operates under (FRS102) , the UK Companies Act, tax legislation, environmental legislation and licensing legislation.

Audit response to risks identified

Fraud due to management override

- To address the risk of fraud through management bias and override of controls, we:

- Audited the risk of management override of controls, including through testing journal entries for appropriateness.

- Assessed whether judgements and assumptions made in determining the accounting estimates included in the financial statements showed indications of potential bias; and

- Investigated the rationale behind any significant or unusual transactions included in the financial statements.

Fraudulent revenue recognition

- To address the risk of fraudulent revenue recognition we:

- Performed testing on a sample of turnover transactions that occurred during the financial year.

- Performed cut-off testing on turnover around the year end.

Irregularities and non-compliance with laws and regulations

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but are not limited to:

- Agreeing financial statement disclosures to underlying supporting documentation.

- Enquiring of management as to actual and potential litigation claims they are aware of.

- Reviewing legal costs nominals for evidence of potential litigation or claims.

- Reviewing correspondence with regulators for evidence of non-compliance with laws and regulations.

The test nature and other inherent limitations of an audit, together with the inherent limitations of any accounting and internal control system, mean that there is an unavoidable risk that even some material misstatements in respect of irregularities may remain undiscovered even though the audit is properly planned and performed in accordance with ISAs (UK). Furthermore, the more removed that laws and regulations are from financial transactions, the less likely that we would become aware of non-compliance.

Our examination should therefore not be relied upon to disclose all such material misstatements or frauds, errors or instances of non-compliance that might exist. The responsibility for the detection and prevention of fraud, error and non-compliance with laws or regulations rests with the directors.

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.

Robert Stafford BA(Hons) FCA (Senior Statutory Auditor)

for and on behalf of SCCA Ltd T/a Stafford & Co

Chartered Accountants

and Statutory Auditor

3 The Studios

320 Chorley Old Road

Bolton

Lancashire

BL1 4JU

26 September 2025

TURNOVER

25,263,857

24,039,682

Cost of sales

21,239,959

21,098,093

GROSS PROFIT

4,023,898

2,941,589

Administrative expenses

2,759,338

761,321

1,264,560

2,180,268

Other operating income

3

104,722

114,070

OPERATING PROFIT

6

1,369,282

2,294,338

Interest payable and similar expenses

7

2,022

65,900

PROFIT BEFORE TAXATION

1,367,260

2,228,438

Tax on profit

8

197,811

(146,145

)

PROFIT FOR THE FINANCIAL YEAR

1,169,449

2,374,583

PROFIT FOR THE YEAR

1,169,449

2,374,583

OTHER COMPREHENSIVE INCOME

Property revaluation

-

586,844

Income tax relating to other comprehensive income

-

-

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

-

586,844

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,169,449

2,961,427

FIXED ASSETS

Tangible assets

10

3,010,333

3,396,312

CURRENT ASSETS

Stocks

11

3,212,954

3,103,323

Debtors

12

5,950,329

8,637,732

Cash at bank

840,944

759,810

10,004,227

12,500,865

CREDITORS

Amounts falling due within one year

13

6,041,228

6,454,503

NET CURRENT ASSETS

3,962,999

6,046,362

TOTAL ASSETS LESS CURRENT LIABILITIES

6,973,332

9,442,674

CREDITORS

Amounts falling due after more than one year

14

(267,900

)

(297,350

)

PROVISIONS FOR LIABILITIES

18

(195,901

)

(273,304

)

NET ASSETS

6,509,531

8,872,020

CAPITAL AND RESERVES

Called up share capital

19

200

200

Revaluation reserve

20

586,844

586,844

Retained earnings

20

5,922,487

8,284,976

SHAREHOLDERS' FUNDS

6,509,531

8,872,020

The financial statements were approved by the Board of Directors and authorised for issue on 26 September 2025 and were signed on its behalf by:

I M Bapu - Director

Called up

share

Retained

Revaluation

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 January 2023

200

6,561,378

-

6,561,578

Changes in equity

Dividends

-

(650,985

)

-

(650,985

)

Total comprehensive income

-

2,374,583

586,844

2,961,427

Balance at 31 December 2023

200

8,284,976

586,844

8,872,020

Changes in equity

Dividends

-

(3,531,938

)

-

(3,531,938

)

Total comprehensive income

-

1,169,449

-

1,169,449

Balance at 31 December 2024

200

5,922,487

586,844

6,509,531

1.	STATUTORY INFORMATION

Saraco Industries 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 exemptions in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

•

the requirements of Section 7 Statement of Cash Flows;

•

the requirement of paragraph 3.17(d);

•

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

•

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

•

the requirement of paragraph 33.7.

The financial statements of the company are consolidated in the financial statements of Saraco Industries Holdings Limited.

Critical accounting judgements and key sources of estimation uncertainty

In the application of the companies accounting policies, the directors' are required to make judgments, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

The key critical judgements and estimates applied are stock impairment.

The Directors do not consider any significant estimates or judgements are expected to affect the company's assets and liabilities over the next 12 months.

Changes in accounting policies

During the year the Directors agreed to change the accounting policy in relation to the treatment of property and land. A change in accounting policy was made and land and buildings were included at a revalued amount and any previous depreciation, at 2% straight line on property was reversed.

Professional valuations were completed by Taylor Weaver Commercial Property Chartered Surveyors, Allsop LLP and S.Kershaw & Sons Chartered Surveyors.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, net of discounts and value added taxes. Turnover includes revenue earned from the sale of goods and from the rendering of services. Turnover from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have been transferred to the buyer.

Tangible fixed assets

Tangible fixed assets are measured at cost less accumulative depreciation and any accumulative impairment losses.

Depreciation is provided on all tangible fixed assets, other than freehold land, at rates calculated to write off the costs, less estimated residual value, of each assets evenly over its expected useful life, as follows:

Freehold buildings

- 2% straight line

Leasehold land and building

- Over the lease term

Plant and machinery

- 20% straight line

Fixtures and fittings

- 20% straight line

Motor vehicles

- 25% straight line

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

During the year the Directors agreed to change the accounting policy in relation to the treatment of property and land. A change in accounting policy was made and land and buildings were included at a revalued amount and any previous depreciation, at 2% straight line on property was reversed.

Professional valuations were completed by Taylor Weaver Commercial Property Chartered Surveyors, Allsop LLP and S.Kershaw & Sons Chartered Surveyors.

Stocks

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

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks

over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or

loss. Reversals of impairment losses are also recognised in profit or loss.

Taxation

A current tax liability is recognised for the tax payable on the taxable profit of the current and past periods. A current tax asset is recognised in respect of a tax loss that can be carried back to recover tax paid in a previous period. Deferred tax is recognised in respect of all timing differences between the recognition of incomes and expenses in the financial statement and their inclusion in tax assessments. Unrelieved tax losses and other deferred tax assets are recognised only to the extent that is it probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference, except for revalued land and investment properly where the tax rate that applies to the sale of the asset is used. Current and deferred tax assets and liabilities are not discounted.

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.

Research and development

Expenditure on research and development is written off in the year in which it is incurred.

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.

Foreign currency translation

Transactions in foreign currencies are initially recognised at the rate of exchange ruling at the date of the transaction. At the end of each reporting period foreign currency monetary items are translated at the closing rate of exchange. Non monetary items that are measured at historical costs are translated at the rate ruling at the date of the transaction. All differences are charges to profit and loss.

Debtors

Short term debtors are measured at transaction price (which is usually the invoice price), less any impairment losses for bad and doubtful debts. Loans and other financial assets are initially recognised at transaction price including any transaction costs and subsequently measured at amortised cost determined using the effective interest method, less any impairment losses for bad and doubtful debts.

Creditors

Short term creditors are measured at transaction price(which is usually the invoice price). Loans and other financial liabilities are initially recognised at transaction price net of any transaction costs and subsequently measured at amortised costs determined using the effective interest method.

3.	OTHER OPERATING INCOME

2024

2023

£

£

Rents received

73,272

82,620

Sundry receipts

31,450

31,450

104,722

114,070

4.	EMPLOYEES AND DIRECTORS

2024

2023

£

£

Wages and salaries

2,922,822

2,507,640

Social security costs

258,921

178,342

Other pension costs

20,859

16,003

3,202,602

2,701,985

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

2024

2023

Office and administration

21

21

Production and warehouse

91

91

112

112

5.	DIRECTORS' EMOLUMENTS

2024

2023

£

£

Directors' remuneration

107,705

102,918

The number of directors to whom retirement benefits were accruing was as follows:

Defined benefit schemes

3

3

6.	OPERATING PROFIT

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

2024

2023

£

£

Hire of plant and machinery

117,971

82,136

Depreciation - owned assets

399,979

403,026

Profit on disposal of fixed assets

-

(1,404,989

)

Auditors' remuneration

15,450

14,000

Foreign exchange differences

1,792

-

7.

INTEREST PAYABLE AND SIMILAR EXPENSES

2024

2023

£

£

Bank interest

2,022

42,493

Bank loan interest

-

23,407

2,022

65,900

8.

TAXATION

Analysis of the tax charge/(credit)

The tax charge/(credit) on the profit for the year was as follows:

2024

2023

£

£

Current tax:

UK corporation tax

254,218

156,997

Under/Over provision in

respect of prior years

20,996

(213,343

)

Total current tax

275,214

(56,346

)

Deferred tax

(77,403

)

(89,799

)

Tax on profit

197,811

(146,145

)

Reconciliation of total tax charge/(credit) included in profit and loss

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

2024

2023

£

£

Profit before tax

1,367,260

2,228,438

Profit multiplied by the standard rate of corporation tax in the UK of 25% (2023 - 23.500%)

341,815

523,683

Effects of:

Income not taxable for tax purposes

-

(330,172

)

Depreciation in excess of capital allowances

87,403

60,673

Research & development tax credit re prior years

(154,004

)

(288,343

)

Group loss relief

-

(22,187

)

Deferred tax movement

(77,403

)

(89,799

)

Total tax charge/(credit)

197,811

(146,145

)

Tax effects relating to effects of other comprehensive income

There were no tax effects for the year ended 31 December 2024.

2023

Gross

Tax

Net

£

£

£

Property revaluation

586,844

-

586,844

9.

DIVIDENDS

2024

2023

£

£

Ordinary shares of £0.01 each

Final

181,938

650,985

Interim

3,350,000

-

3,531,938

650,985