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

The group’s principal activity is to provide contract electronic manufacturing to a wide range of customers from varying sectors focusing on aerospace & defence, oil & gas, medical and others. The services offered cover a full turnkey solution with a dedicated in-house design and product development team.

The group’s strategy is to strengthen and increase customer relationships by offering a wider range of synergistic service offerings, closely controlled by the quality, processes and systems that the group has been founded on.

The group saw a reduction in top line revenue with turnover for the 2024 financial year being £15 million (2023: £17.3 million). The revenue reduction largely stemmed from orders being delayed/pushed back (2025) because of the UK economic uncertainties / UK general election. This year the business has continued to focus its attention on delivering high quality, flexible manufacturing solutions to our clients and has a strong orderbook.

A consequence of the reduced revenue has been a decrease in the gross profit margin from 29.9% to 22.1%. In terms of overheads, standard costs have risen to 29.5% of turnover (2023: 23.9%).

We plan to continue to develop the synergies realised through our two operating companies, Jaltek Systems Limited and Jaltek Design Services and expect this to continue to deliver continued growth with existing clients whilst in turn crystalising new relationships delivering additional revenues in 2025 and beyond.

The continuation of service to our customers is the most important aspect of our service delivery, closely followed by physical security of the site and customer areas and equipment. The status of these areas is measured continuously, 24 hours of every day, and performance is reported monthly to the board.

The group has an ongoing program of investment in these areas to ensure customer services remain at the highest expected levels. The group is also encouraging its customers to monitor and review all aspects of our services to ensure they adhere to or exceed standards they would expect.

The forex risk taken on when purchasing and subsequently supplying components, is mitigated by virtue of buying the majority of components in GBP from UK suppliers. The business has systems in place to monitor actual performance against what is expected. Liquidity and cash flow risks are mitigated through trading cashflows. The directors do not consider price or credit risk to be significant with adequate controls in place.

The board continues to manage the group's business by reference to a range of key performance indicators. The principal indicators include gross margin, sales and customer satisfaction, which in 2024, all produced satisfactory returns against the targets set.

On behalf of the board

The directors present their annual report and financial statements for the year ended 31 December 2024.

The results for the year are set out on page 7.

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

The auditor, Shaw Gibbs (Audit) Limited, were appointed during the year and are deemed to be reappointed under section 487(2) of the Companies Act 2006.

The directors are responsible for preparing the Annual Report 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 group and company, 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;

• state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

The directors are mindful of the company’s loss for the year of £630,935 and the group’s loss for the year of £1,306,378. They are also mindful of the company’s net current liabilities and net liabilities position of £10,970,956 and £7,189,788 respectively, and of the group’s net current liabilities and net liabilities position of £1,943,522 and £768,812 respectively.

The performance of the group for the year was largely impacted by the UK economic uncertainties which resulted to delayed customer investments and orders being pushed back to 2025. At the time of approving the financial statements and having carefully considered the sales pipeline, the post year performance and the forecasted performance, the directors have a reasonable expectation that the company and the group have adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of strategy of the company, risks and performance and future developments.

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

We have audited the financial statements of Jaltek Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2024 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including 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 the parent company's 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 Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent 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 group's and 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 other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

• The information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• The strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

We have nothing to report in respect of the following matters in relation to which 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.

As explained more fully in the directors' responsibilities statement, 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 is 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 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 parent company or to cease operations, or have no realistic alternative but to do so.

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

1. At the planning stage of the audit we gain an understanding of the laws and regulations which apply to the company and how the management seek to comply with those laws and regulations. This helps us to plan appropriate risk assessments.

    

2. During the audit we focus on relevant risk areas and review the compliance with the laws and regulations by making relevant enquiries and undertaking corroboration, for example by reviewing Board Minutes and other documentation.

    

3. We assess the risk of material misstatement in the financial statements including as a result of fraud and undertake procedures including:

   1. Reviewing the controls set in place by management;

   2. Making enquiries of management as to whether they consider fraud or other irregularity may have taken place, or where such opportunity might exist;

   3. Challenging management assumptions with regard to accounting estimates; and

   4. Identifying and testing journal entries, particularly those which appear to be unusual by size or nature.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

This report is made solely to the parent 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 parent company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the parent company and the parent company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

The statement of comprehensive income has been prepared on the basis that all operations are continuing operations.

The notes on pages 13 to 30 form part of these financial statements.

These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.

Jaltek Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Unit 13 Sundon Business Park, Dencora Way, Sundon Park, Luton, Bedfordshire, LU3 3HP.

The group consists of Jaltek Holdings Limited and all of its subsidiaries.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent (being this company) of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

• Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

• Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

• Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s loss for the year was £630,935 (2023 - £526,526 loss).

The group restated some of its comparatives to better present certain balances. Details can be found in notes 6, 9, 10 and 13. This has no impact on 2023 profit and loss reserves.

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

The consolidated group financial statements consist of the financial statements of the parent company Jaltek Holdings Limited together with all entities controlled by the parent company (its subsidiaries).

All financial statements are made up to 31 December 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

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.

The directors are mindful of the company’s loss for the year of £630,935 and the group’s loss for the year of £1,306,378. They are also mindful of the company’s net current liabilities and net liabilities position of £10,970,956 and £7,189,788 respectively, and of the group’s net current liabilities and net liabilities position of £1,943,522 and £768,812 respectively.

The performance of the group for the year was largely impacted by the UK economic uncertainties which resulted to delayed customer investments and orders being pushed back to 2025. At the time of approving the financial statements and having carefully considered the sales pipeline, the post year performance and the forecasted performance, the directors have a reasonable expectation that the company and the group have adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:

• the group has transferred the significant risks and rewards of ownership to the buyer;

• the group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;

• the amount of revenue that can be measured reliably;

• it is probable that the group will receive the consideration due under the transaction; and

• the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:

• the amount of revenue can be measured reliably;

• it is probable that the group will receive the consideration due under the contract;

• the stage of completion of the contract at the end of the reporting period can be measured reliably; and

• the costs incurred and the costs to complete the contract can be measured reliably.

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

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

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

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

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, 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.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally 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.

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.

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

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

The group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the group pays fixed contributions into a separate entity. Once the contributions have been paid the group has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the balance sheet. The assets of the plan are held separately from the group in independently administered funds.

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

In the application of the group’s accounting policies, the directors are required to make judgements, 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 estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Judgements are made by the directors when considering if items within stock require a provision for diminution in value. Management base their assessments on the age of stocks and demand for products. Management believe that after applying the provision the value is a reasonable expectation of what could be obtained in the normal course of trade.

These judgements are reviewed regularly to reflect the changing environment. At the year end date, there is a stock provision in place of £261,426.

A full line by line review of trade and other receivables is carried out at the end of each month. Whilst every attempt is made to ensure that the bad debt provisions are as accurate as possible, there remains a risk that the provisions do not match the level of debts which ultimately prove to be uncollectable. The directors consider it necessary to provide for debts of £5,071,296 at the year end date, of which £5,068,096 relate to related parties. Details in relation to this can be found in note 24.

The useful economic lives used by the group in respect of tangible fixed assets are set out in the accounting policies. These estimates are the directors' best estimate based on past experience and expected performance and are regularly reviewed to ensure they remain appropriate. The net book value of tangible fixed assets as at 31 December 2024 was £1,148,865 after a depreciation charge in the year of £306,053.

The useful economic lives used by the group in respect of intangible fixed assets are set out in the accounting policies. These estimates are the directors' best estimate based on past experience and expected performance and are regularly reviewed to ensure they remain appropriate. The net book value of intangible fixed assets as at 31 December 2024 was £211,275 after an amortisation charge in the year of £97,044.

Some of the group’s employees were granted options for the shares of Jaltek Holdings Limited under the relevant EMI share option plan. The directors, having taken into consideration the estimated fair value of the relevant options and the vesting conditions, are of the opinion that the impact of the share options scheme is immaterial to the financial statements and as a result, no adjustments have been processed in respect of this scheme since it was established in 2016.

The whole turnover is attributable to the main trading activities.

As total directors' remuneration was less than £200,000 in the current year, no disclosure is provided for the 2024 year.

During the year retirement benefits were accruing to 3 directors (2023: 3) in respect of defined contribution pension schemes.

The average monthly number of persons (including directors) employed by the group and company during the year was:

The 2023 average employee numbers have been restated as the figures disclosed previously, omitted the average employee numbers of Jaltek Design Services Limited.

Their aggregate remuneration comprised:

The actual credit for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:

The opening balances of intangible and tangible fixed assets were restated so that the ERP system costs and amortisation brought forward of £452,345 and £196,207 respectively are presented in a way that reflects better the nature of the relevant expenditure as intangible assets rather than tangible as previously stated. This has no impact on the 2023 profit and profit and loss reserves.

For the details of the restatement to the computer opening balances refer to note 9.

The net book value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

Details of the company's subsidiaries at 31 December 2024 are as follows:

A restatement was processed so that stock balances are presented in a manner that better reflects their nature. Stocks that relate to work in progress and finished goods were previously presented as raw materials and consumables. This has no impact on 2023 profit and loss reserves.

Obligations under finance leases are secured on the relevant assets concerned.

Obligations under finance leases are secured on the relevant assets concerned.

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

Contributions totalling £50,093 (2023 - £24,568) were payable to the fund at the balance sheet date and are included in creditors.

Share Premium Account

This represents the excess paid for shares over their nominal value.

Merger reserve

This represents the excess of consideration paid over the nominal value of shares on acquisition using merger accounting rules.

Profit and loss account

This reserve represents the accumulated profits and losses of the Company net of dividends paid.

On 19 November 2012, Picton (UK) Listed Real Estate Nominee (No.1) Limited and Picton (UK) Listed Real Estate Nominee (No.2) Limited created a rent deposit deed requiring any late payments of rent and resulting interest to be deducted from the rent deposit held by the Landlord or Landlord's managing agent. This relates solely to Jaltek Systems Limited.

On 27 March 2019, IGF Business Credit Limited created a fixed and floating charge, with negative pledge, over all the property or undertaking of the following group companies.

• Jaltek Systems Limited

• Jaltek Design Services Limited

• Jaltek Holdings Limited

At the balance sheet date, the relevant group borrowings totalled £2,400,233. After the year end date the facility was extended to £3,000,000.

At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

During the year, the group had the following transactions with Wavesight Limited, a company in which P Sood and A Sood are directors. Total sales for the year were £44,653 (2023: £36,667). Total purchases for the year were £nil (2023: £nil). Cash loans provided totalled £6,300. The amount due from Wavesight Limited at 31 December 2024 was £328,218 (2023: £274,065) and was provided for in full.

During the year, the group had the following transactions with Hidalgo Limited, a company in which P Sood and A Sood are directors. Total sales in the year were £326,161 (2023: £303,522). Total purchases for the year were £nil (2023: £2,743). Cash loans provided totalled £58,228. The amount due from Hidalgo Limited at 31 December 2024 was £4,739,878 (2023: £4,355,489) and was provided for in full.

At the year end, there was an amount outstanding to Bermudiana Management Limited, a shareholder of Jaltek Holdings Limited, amounting to £1,091,538 (2023: £1,091,538). No guarantees have been given or received in respect of this amount.

At the year end, there were amounts owed to a director totalling £1,841,990 (2023: £1,891,990). No guarantees have been given or received in respect of this amount.

Total interest of £231,365 (2023: £139,528) was payable in respect of these amounts outstanding to Bermudiana Management Limited and the director of the company. The relevant amounts are repayable on demand.

At the year end, the company was owed £13,500 (2023: £nil) by one of its directors. No interest has been charged or accrued in respect of this balance. This amount is repayable on demand.

In accordance with FRS 102 the group has not disclosed transactions with and between fellow 100% group members.

The ultimate controlling party, by virtue of a majority shareholding in Jaltek Holdings Limited, is the Jaltek Trust, a discretionary trust established in Jersey.