A.W. (Europe) Limited Company accounts

COMPANY REGISTRATION NUMBER: 01517140

A.W. (EUROPE) LIMITED

FINANCIAL STATEMENTS

31 December 2024

A.W. (EUROPE) LIMITED

FINANCIAL STATEMENTS

YEAR ENDED 31 DECEMBER 2024

CONTENTS	PAGE

Officers and professional advisers	1

Strategic report	2

Directors' report	5

Independent auditor's report to the members	7

Statement of comprehensive income	11

Statement of financial position	12

Statement of changes in equity	14

Notes to the financial statements	15

A.W. (EUROPE) LIMITED

OFFICERS AND PROFESSIONAL ADVISERS

THE BOARD OF DIRECTORS	S J Kaye
	G Pugh
	M G Van Waeyenberge

REGISTERED OFFICE	F Mill
	2nd Floor East
	Dean Clough Mills
	Halifax
	West Yorkshire
	HX3 5AX

AUDITOR	Streets Spenser Wilson (Yorkshire) Limited
	Chartered accountants & statutory auditor
	Equitable House
	55 Pellon Lane
	Halifax
	West Yorkshire
	HX1 5SP

BANKERS	National Westminster Bank Plc
	1 Market Street
	Bradford
	West Yorkshire
	BD1 1EG

	KBC Bank N.V.
	5th Floor
	111 Old Broad Street
	London
	EC2N 1BR

A.W. (EUROPE) LIMITED

STRATEGIC REPORT

YEAR ENDED 31 DECEMBER 2024

PRINCIPAL ACTIVITY AND BUSINESS REVIEW

The company is a wholly-owned subsidiary of Associated Weavers International N.V. and operates as the group's UK sales and distribution unit. The company's principal activity is the commercialisation of broadloom tufted carpet and rugs. Since 1 April 2019 the company has also started trading in Luxury Vinyl Tiles. The directors are not aware, at the date of the report, of any likely major changes in the company's activities in the next year. As shown in the company's profit and loss account, the company's sales turnover has dropped down to £52m, with a profit before taxation for the year of £2,158,220 (2023: loss of £338,595). The balance sheet of the financial statements shows that, as a result of the profit for the year and the actuarial result reported in the statement of comprehensive income, the company's net assets at the year-end has moved from a deficit of £342,104 to a surplus of £1.811,116. In the current year there was a recognisable surplus of £626,000 (2023 - surplus of £604,000) related to the pension scheme. In 2024, A.W. (Europe) Ltd continued to build on the brands with some strong additions to the Invictus and GAIA brands into the UK market. Consumer confidence was still low during the year which reflected in volumes especially with our larger national customers. Obviously, the disappearance of Carpetright also did not help. LVT (Luxury Vinyl Tiles) continued to grow and carried on gaining momentum, taking market share from market leading competition. Turnover increased with another 32% in 2024 against 2023, due to a strong marketing campaign and increased presence at point of sale in the market.

KEY PERFORMANCE INDICATORS

The following KPIs are relevant when assessing performance:

	2024	2023
	£	£
Turnover	52	58
Gross profit margin	26	17
Debtor days	57	49

The company has shown a decrease in turnover as the increase in LVT sales could not fully compensate for the drop in broadloom sales. This change in product-mix also explains the significant rise in gross margin to 25.62% (2023 - 17.2%). The debtor days were increased from 2023 but are under control through the follow up of the credit management team. The directors are satisfied with the above KPIs given the difficult market conditions faced by the company. FUTURE DEVELOPMENTS In 2025, AW (Europe) Ltd will present a number of new ranges of broadloom tufted carpet to our customers and will continue to build on the existing brands. We continue to look for sustainable raw materials to produce quality products for our customers. We will start to see the full benefit of our Northampton cut length operation and the growth in market share with our independent retail customers. More point of sale will be placed in the market as the Luxury Vinyl Tiles gains further momentum and we will strengthen our product offering to our customers in the summer period with an updated collection. Credit management will continue to monitor and follow up the overdue invoices and screening of new customers.

PRINCIPAL RISKS AND UNCERTAINTIES

Competitive pressure in the UK is a continuing risk for the company, which could result in decreasing profit margins and losing sales to its competitors. The company manages this risk by providing added value services to its customers, superior product development and by maintaining strong relationships with customers. A.W. (Europe) Ltd is part of a large European based group with customers all over the world. Almost 60% of the turnover is made outside of the UK which results in a spread of the risk. Since the UK is the largest market, and therefore most important, the AW group will keep investing in A.W. (Europe) Ltd. The group has a very strong net cash position to maintain business all over the world and to keep developing new products and marketing campaigns to meet the changing needs of the customer.

FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The company's activities expose it to a number of financial risks including credit risk, cash flow risk and liquidity risk. There is no use of financial derivatives. Cash flow risk The company's activities expose it primarily to the financial risks of changes in foreign currency exchange rates and interest rates. The foreign currency exchange risk is carried by the parent company for any carpet sales, but A.W. (Europe) Ltd assumes any foreign exchange risk for LVT sales. There are no interest rate swap contracts. Credit risk The company's principal financial assets are bank balances and cash and trade and other receivables. The company's credit risk is primarily attributable to its trade receivables. The amounts presented in the balance sheet are net of allowances for doubtful receivables. An allowance for impairment is made where there is an identified loss event which, based on previous experience, is evidence of a reduction in the recoverability of the cash flows. The company is using credit insurance to ensure the credit management. The credit risk on liquid funds is limited because the counterparties are banks with high credit-ratings assigned by international credit-rating agencies. The company has no significant concentration of credit risk, with exposure spread over a large number of counterparties and customers. Liquidity risk In order to maintain liquidity to ensure that sufficient funds are available for ongoing operations and future developments, the company sells trade debts to a debt factor under a recourse financing arrangement (note 3). Further details regarding liquidity risk can be found in the statement of accounting policies in the notes to the financial statements.

This report was approved by the board of directors on 26 September 2025 and signed on behalf of the board by:

G Pugh

Director

Registered office:

F Mill

2nd Floor East

Dean Clough Mills

Halifax

West Yorkshire

HX3 5AX

A.W. (EUROPE) LIMITED

DIRECTORS' REPORT

YEAR ENDED 31 DECEMBER 2024

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

DIRECTORS

The directors who served the company during the year were as follows:

S J Kaye
G Pugh
M G Van Waeyenberge

DIVIDENDS

The directors do not recommend the payment of a dividend.

QUALIFYING INDEMNITY PROVISION

The Company has made qualifying third party indemnity provisions for the benefit of its directors which were made during the year and remain in force at the date of this report.

DISCLOSURE OF INFORMATION IN THE STRATEGIC REPORT

In accordance with section 414C(11) of the Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013 the company has chosen to set out in the company's strategic report information required by schedule 7 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008.

DIRECTORS' RESPONSIBILITIES STATEMENT

The directors are responsible for preparing the strategic report, directors' 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 company and 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 judgments 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. AUDITOR

Each of the persons who is a director at the date of approval of this report confirms that:

- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.

This report was approved by the board of directors on 26 September 2025 and signed on behalf of the board by:

G Pugh

Director

Registered office:

F Mill

2nd Floor East

Dean Clough Mills

Halifax

West Yorkshire

HX3 5AX

A.W. (EUROPE) LIMITED

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF A.W. (EUROPE) LIMITED

YEAR ENDED 31 DECEMBER 2024

OPINION

We have audited the financial statements of A.W. (Europe) Limited (the 'company') for the year ended 31 December 2024 which comprise the statement of comprehensive income, statement of financial position, statement of changes in equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 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; - 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 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 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. 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 there is a material misstatement in the financial statements or a material misstatement of the other information. 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 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.

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 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, 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; or - the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemptions in preparing the directors' report and from the requirement to prepare a strategic report.

RESPONSIBILITIES OF DIRECTORS

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 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.

AUDITOR'S 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 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: Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows: " 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. " We identified the laws and regulations applicable to the company through discussions with the directors. " We focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company. " We assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and " identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit. We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by: " making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; " considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. To address the risk of fraud through management bias and override of controls, we: " performed analytical procedures to identify any unusual or unexpected relationships; " tested journal entries to identify unusual transactions; " tested whether judgements and assumptions made in determining the accounting estimates were indicative or potential bias. " investigated the rationale behind significant or unusual transactions. In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to: " agreeing financial statement disclosures to underlying supporting documentation; " enquiring of management as to actual and potential litigation and claims; There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any. Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report. 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 an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

SALLY SHACKLOCK FCA

(Senior Statutory Auditor)

For and on behalf of

Streets Spenser Wilson (Yorkshire) Limited

Chartered accountants & statutory auditor

Equitable House

55 Pellon Lane

Halifax

West Yorkshire

HX1 5SP

26 September 2025

A.W. (EUROPE) LIMITED

STATEMENT OF COMPREHENSIVE INCOME

YEAR ENDED 31 DECEMBER 2024

		2024	2023
Note		£	£
TURNOVER	4	52,301,213	57,733,680

Cost of sales	38,890,746	47,780,212
	---------------	---------------
GROSS PROFIT	13,410,467	9,953,468

Administrative expenses		10,563,873	10,323,148
		---------------	---------------
OPERATING PROFIT/(LOSS)	5	2,846,594	( 369,680)

Other interest receivable and similar income	9	27,000	31,000
Interest payable and similar expenses	10	112	15
		---------------	---------------
PROFIT/(LOSS) BEFORE TAXATION		2,873,482	( 338,695)

Tax on profit/(loss)	11	715,262	–
		-------------	----------
PROFIT/(LOSS) FOR THE FINANCIAL YEAR		2,158,220	( 338,695)
		-------------	----------

Remeasurement of net defined benefit liability	( 5,000)	( 62,000)
	-------------	----------
TOTAL COMPREHENSIVE INCOME FOR THE YEAR	2,153,220	( 400,695)
	-------------	----------

All the activities of the company are from continuing operations.

A.W. (EUROPE) LIMITED

STATEMENT OF FINANCIAL POSITION

31 December 2024

	2024		2023
Note	£	£	£	£

FIXED ASSETS

Intangible assets	12	98,823	132,166
Tangible assets	13	2,120,839	2,501,446
		-------------	-------------
		2,219,662	2,633,612

CURRENT ASSETS

Stocks	14	2,789,999	2,814,804
Debtors	15	9,876,451	9,730,339
Cash at bank and in hand		39,093	1,607,336
		---------------	---------------
		12,705,543	14,152,479

CREDITORS: amounts falling due within one year	16	13,206,889		17,732,195
		---------------		---------------
NET CURRENT LIABILITIES			501,346		3,579,716
			-------------		-------------
TOTAL ASSETS LESS CURRENT LIABILITIES			1,718,316		( 946,104)

PROVISIONS	17	533,200	–
		-------------	----------
NET ASSETS/(LIABILITIES) EXCLUDING DEFINED BENEFIT PENSION PLAN ASSET		1,185,116	(946,104)

Defined benefit pension plan asset	19	626,000	604,000
		-------------	----------
NET ASSETS/(LIABILITIES) INCLUDING DEFINED BENEFIT PENSION PLAN ASSET		1,811,116	( 342,104)
		-------------	----------

A.W. (EUROPE) LIMITED

STATEMENT OF FINANCIAL POSITION (continued)

31 December 2024

	2024		2023
Note	£	£	£	£

CAPITAL AND RESERVES

Called up share capital	20	1,000,000	1,000,000
Profit and loss account	22	811,116	( 1,342,104)
		-------------	-------------
SHAREHOLDERS FUNDS/(DEFICIT)		1,811,116	( 342,104)
		-------------	-------------

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

These financial statements were approved by the board of directors and authorised for issue on 26 September 2025 , and are signed on behalf of the board by:

G Pugh

Director

Company registration number: 01517140

A.W. (EUROPE) LIMITED

STATEMENT OF CHANGES IN EQUITY

YEAR ENDED 31 DECEMBER 2024

		Called up share capital	Profit and loss account	Total
		£	£	£
AT 1 JANUARY 2023		1,000,000	( 941,409)	58,591

Loss for the year			( 338,695)	( 338,695)
Other comprehensive income for the year:
	Remeasurement of net defined benefit liability	–	( 62,000)	( 62,000)
		-------------	----------	----------
TOTAL COMPREHENSIVE INCOME FOR THE YEAR		–	( 400,695)	( 400,695)

AT 31 DECEMBER 2023		1,000,000	( 1,342,104)	( 342,104)

Profit for the year			2,158,220	2,158,220
Other comprehensive income for the year:
	Remeasurement of net defined benefit liability	–	( 5,000)	( 5,000)
		-------------	-------------	-------------
TOTAL COMPREHENSIVE INCOME FOR THE YEAR		–	2,153,220	2,153,220

		-------------	-------------	-------------
AT 31 DECEMBER 2024		1,000,000	811,116	1,811,116
		-------------	-------------	-------------

A.W. (EUROPE) LIMITED

NOTES TO THE FINANCIAL STATEMENTS

YEAR ENDED 31 DECEMBER 2024

1. GENERAL INFORMATION

The company is a private company limited by shares, registered in England and Wales. The address of the registered office is F Mill, 2nd Floor East, Dean Clough Mills, Halifax, West Yorkshire, HX3 5AX.

2. STATEMENT OF COMPLIANCE

These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.

3. ACCOUNTING POLICIES

Basis of preparation

The financial statements have been prepared under the historical cost convention, modified to include certain items at fair value, and in accordance with Financial Reporting Standard 102 (FRS 102) issued by the Financial Reporting Council. The functional currency of A.W. (Europe) Limited is considered to be pounds sterling because that is the currency of the primary economic environment in which the Company operates. Foreign operations are included in accordance with the policies set out below.

Going concern

In assessing the appropriateness of the application of the going concern basis, the directors have considered the uncertainties around the general economic environment, the current and future trading performance of the company and the available cash. In addition the ultimate parent company has indicated its commitment to provide financial support to this company if required. The directors have a reasonable expectation that the company and the group of which this is a part have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the annual report and financial statements.

Disclosure exemptions

The entity satisfies the criteria of being a qualifying entity as defined in FRS 102. Its financial statements are consolidated into the financial statements of Belgotex International N.V. which can be obtained from Belgotex International N.V., Groene Dreef, 5, 9770 Kruishoutem, Belgium. As such, advantage has been taken of the following disclosure exemptions available under paragraph 1.12 of FRS 102: (a) Disclosures in respect of each class of share capital have not been presented. (b) No cash flow statement has been presented for the company.(c) Disclosures in respect of financial instruments have not been presented.(d) No disclosure has been given for the aggregate remuneration of key management personnel.

Pattern books and new product promotional videos

The cost of providing pattern books is classified as a prepayment and is written off over the life of the related carpets sales estimated to be 24 months.

The cost of producing a promotional video is classified as a prepayment and is written off over a 4 year period.

Judgements and key sources of estimation uncertainty

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Accounting estimates and assumptions are made concerning the future and, by their nature, will rarely equal the related actual outcome. The key assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are assumption that sales related to each pattern book are for 24 months. The total amount of pattern books prepaid is £1,585,202 (2023 - £1,707,401). Amortisation of pattern books of £1,454,616 (2023 - - £1,453,915) is included in the income statement The assumption is that promotional videos are for four years. The total amount of promotional video costs prepaid is £nil (2023 - £6,952) Amortisation of promotional videos of £6,952 (2023 - £71,521) is included in the income statement.

Revenue recognition

Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax. Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably.

Debt factoring arrangements

Trade debts sold to a debt factor under a recourse financing arrangement are recorded within trade debtors with the balance due to the factor shown within creditors. Payments in transit to the debt factoring company are recognised as a reduction in the amounts owed to the debt factoring company equivalent to the proportion factored, with the remaining proportion recognised as amounts owed by the debt factoring company/business under the terms of the agreement.

Current and deferred tax

The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.

Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other 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. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.

Foreign currencies

Foreign currency transactions are initially recorded in the functional currency, by applying the spot exchange rate as at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate ruling at the reporting date, with any gains or losses being taken to the profit and loss account.

Operating leases

Lease payments are recognised as an expense over the lease term on a straight-line basis. The aggregate benefit of lease incentives is recognised as a reduction to expense over the lease term, on a straight-line basis.

Intangible assets

Intangible assets are initially recorded at cost, and are subsequently stated at cost less any accumulated amortisation and impairment losses. Any intangible assets carried at revalued amounts, are recorded at the fair value at the date of revaluation, as determined by reference to an active market, less any subsequent accumulated amortisation and subsequent accumulated impairment losses. Intangible assets acquired as part of a business combination are only recognised separately from goodwill when they arise from contractual or other legal rights, are separable, the expected future economic benefits are probable and the cost or value can be measured reliably.

Amortisation

Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful life of that asset as follows:

	Software/Website	-	25%/33.33% Straight line

If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates.

Tangible assets

Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses.

Depreciation

Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:

Alterations to leasehold property	-	15% straight line
Plant and machinery	-	15% straight line
Fixtures and fittings	-	15% straight line
Motor vehicles	-	20% straight line

	Equipment	-	25% straight line

Impairment of fixed assets

A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs.

Stocks

Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition.

Provisions

Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event, it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense. Provisions are initially measured at the best estimate of the amount required to settle the obligation at the reporting date and subsequently reviewed at each reporting date and adjusted to reflect the current best estimate of the amount that would be required to settle the obligation. Any adjustments to the amounts previously recognised are recognised in profit or loss unless the provision was originally recognised as part of the cost of an asset. When a provision is measured at the present value of the amount expected to be required to settle the obligation, the unwinding of the discount is recognised as a finance cost in profit or loss in the period it arises.

Financial instruments

A financial asset or a financial liability is recognised only when the entity becomes a party to the contractual provisions of the instrument. Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Debt instruments are subsequently measured at amortised cost. Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately. For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets are either assessed individually or grouped on the basis of similar credit risk characteristics.

Defined benefit plans

For defined benefit schemes the amounts charged to operating profit are the costs arising from employee services rendered during the period and the cost of plan introductions, benefit changes, settlements and curtailments. They are included as part of staff costs. The net interest cost on the net defined benefit liability is charged to profit or loss and included within finance costs. Remeasurement comprising actuarial gains and losses and the return on scheme assets (excluding amounts included in net interest on the net defined benefit liability) are recognised immediately in other comprehensive income. The retirement benefit asset or liability recognised in the balance sheet represents the surplus or deficit in defined benefit scheme. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of refunds from the scheme or reduction in future contribution in scheme. The minimum funding requirement under IFRIC 14 'The limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction' has also been considered. The defined benefit scheme is funded, with the assets of the scheme held separately from those of the company, in separate trustee administered funds. Pension scheme assets are measured at fair value and liabilities are measured on an actuarial basis using the projected unit method and discounted at a rate equivalent to the current rate of return on a high quality corporate bond of equivalent currency and term to the scheme liabilities. The actuarial valuations are obtained at least triennially and are updated at each balance sheet date. The resulting defined benefit asset or liability, net of the related deferred tax, is presented separately after other net assets on the face of the balance sheet. Further details of the company's pension arrangements are set out in note 19.

Defined contribution plans

Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund. When contributions are not expected to be settled wholly within 12 months of the end of the reporting date in which the employees render the related service, the liability is measured on a discounted present value basis. The unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

4. TURNOVER

Turnover arises from:

	2024	2023
	£	£
Sale of goods	52,301,213	57,733,680
	---------------	---------------

The whole of the turnover is attributable to the principal activity of the company wholly undertaken in the United Kingdom.

5. OPERATING PROFIT/(LOSS)

Operating profit or loss is stated after charging/crediting:

	2024	2023
	£	£
Amortisation of intangible assets	35,774	75,508
Depreciation of tangible assets	492,302	493,873
Impairment of trade debtors	164,014	53,489
Operating lease rentals	512,214	530,230
Foreign exchange differences	20,210	( 14,130)
Amortisation of pattern books	1,454,616	1,453,915
Amortisation of promotional videos	6,952	71,521
	-------------	-------------

6. AUDITOR'S REMUNERATION

	2024	2023
	£	£
Fees payable for the audit of the financial statements	16,150	9,900
	---------	-------

Fees payable to the company's auditor and its associates for other services:

Taxation advisory services	2,200	1,980
Other non-audit services	2,800	3,290
	---------	-------
	5,000	5,270
	---------	-------

7. STAFF COSTS

The average number of persons employed by the company during the year, including the directors, amounted to:

	2024	2023
	No.	No.
Distribution staff	19	18
Administrative staff	17	20
Sales and marketing	32	32
	----	----
	68	70
	----	----

The aggregate payroll costs incurred during the year, relating to the above, were:

	2024	2023
	£	£
Wages and salaries	3,252,256	3,443,230
Other pension costs	155,133	165,434
	-------------	-------------
	3,407,389	3,608,664
	-------------	-------------

8. DIRECTORS' REMUNERATION

The directors' aggregate remuneration in respect of qualifying services was:

	2024	2023
	£	£
Remuneration	297,991	392,517
Company contributions to defined contribution pension plans	20,519	22,953
	----------	----------
	318,510	415,470
	----------	----------

The number of directors who accrued benefits under company pension plans was as follows:

	2024	2023
	No.	No.
Defined contribution plans	2	3
	----	----

Remuneration of the highest paid director in respect of qualifying services:

	2024	2023
	£	£
Aggregate remuneration	184,213	166,605
Company contributions to defined contribution pension plans	9,423	9,047
	----------	----------
	193,636	175,652
	----------	----------

One of the directors who served during the year was remunerated through other group companies. It is not practicable to ascertain what proportion of this remuneration related to this company. As of the end of 2024, an accrual of £23,250 (2023 - £83,062) was set up as a director's bonus for the financial year 2024.

9. OTHER INTEREST RECEIVABLE AND SIMILAR INCOME

	2024	2023
	£	£
Net finance income in respect of defined benefit pension plans	27,000	31,000
	---------	---------

10. INTEREST PAYABLE AND SIMILAR EXPENSES

	2024	2023
	£	£
Interest on banks loans and overdrafts	112	15
	----	----

11. TAX ON PROFIT/(LOSS)

Major components of tax expense

	2024	2023
	£	£

Current tax:

UK current tax expense	182,062	–

Deferred tax:

Origination and reversal of timing differences	533,200	–
	----------	----
Tax on profit/(loss)	715,262	–
	----------	----

Reconciliation of tax expense

The tax assessed on the profit/(loss) on ordinary activities for the year is lower than (2023: lower than) the standard rate of corporation tax in the UK of 25 % (2023: 25 %).

	2024	2023
	£	£
Profit/(loss) on ordinary activities before taxation	2,873,482	( 338,695)
	-------------	----------
Profit/(loss) on ordinary activities by rate of tax	718,371	84,674
Effect of expenses not deductible for tax purposes	14,611	( 15,293)
Effect of capital allowances and depreciation	73,054	( 48,293)
Utilisation of tax losses	( 623,974)	–
Unused tax losses	–	( 21,088)
Movement on short term timing differences	533,200	–
	-------------	----------
Tax on profit/(loss)	715,262	–
	-------------	----------

Factors that may affect future tax expense

The Finance Act, increased the main rate of corporation tax to 25% for companies with profits of £250,000 or over, profits up to £50,000 will continue at 19% and profits between these two figures will be subject to a tapered rate with effect from 1 April 2023. Deferred tax has therefore been calculated using a tax rate of 25% at 31 December 2024, being the enacted future corporate tax rate at the balance sheet date.

A deferred tax liability, previously covered by corporation tax losses, of £533,200 (2023: £nil) has been recognised at 31 December 2024 in respect of timing differences based on future profit forecasts of the business. The company has used all of its corporation tax losses and has no further losses to carry forward (2023 - £2,495,894).

12. INTANGIBLE ASSETS

	Website and software
	£
Cost
At 1 January 2024	556,816
Additions	–
Additions from internal developments	2,431
	----------
At 31 December 2024	559,247
	----------
Amortisation
At 1 January 2024	424,650
Charge for the year	35,774
	----------
At 31 December 2024	460,424
	----------
Carrying amount
At 31 December 2024	98,823
	----------
At 31 December 2023	132,166
	----------

13. TANGIBLE ASSETS

	Alterations to leasehold property	Plant and machinery	Fixtures and fittings	Motor vehicles	Equipment	Total
	£	£	£	£	£	£
Cost
At 1 Jan 2024	281,500	2,691,188	338,160	13,945	180,907	3,505,700
Additions	–	68,630	–	–	43,065	111,695
	----------	-------------	----------	---------	----------	-------------
At 31 Dec 2024	281,500	2,759,818	338,160	13,945	223,972	3,617,395
	----------	-------------	----------	---------	----------	-------------
Depreciation
At 1 Jan 2024	188,209	400,950	330,496	13,945	70,654	1,004,254
Charge for the year	42,225	406,113	1,731	–	42,233	492,302
	----------	-------------	----------	---------	----------	-------------
At 31 Dec 2024	230,434	807,063	332,227	13,945	112,887	1,496,556
	----------	-------------	----------	---------	----------	-------------
Carrying amount
At 31 Dec 2024	51,066	1,952,755	5,933	–	111,085	2,120,839
	----------	-------------	----------	---------	----------	-------------
At 31 Dec 2023	93,291	2,290,238	7,664	–	110,253	2,501,446
	----------	-------------	----------	---------	----------	-------------

14. STOCKS

	2024	2023
	£	£
Finished goods and goods for resale	2,789,999	2,814,804
	-------------	-------------

15. DEBTORS

	2024	2023
	£	£
Trade debtors	8,134,249	7,741,685
Prepayments and accrued income	1,740,983	1,986,275
Other debtors	1,219	2,379
	-------------	-------------
	9,876,451	9,730,339
	-------------	-------------

Prepayments and accrued income - pattern books

	2024	2023
	£	£
Net prepayments at 1 January	1,707,401	1,661,787
Additions	1,332,417	1,499,519
Amortisation	(1,454,616)	(1,453,905)
	-------------	-------------
Net prepayments at 31 December	1,585,202	1,707,401
	-------------	-------------

New product promotion

	2024	2022
	£	£
Net prepayment at 1 January	6,952	78,473
Amortisation	(6,952)	(71,521)
	-------	---------
Net prepayment at 31 December	–	6,952
	-------	---------

16. CREDITORS: amounts falling due within one year

	2024	2023
	£	£
Trade creditors	1,695,490	1,296,679
Amounts owed to group undertakings	3,281,275	8,907,417
Accruals and deferred income	17,021	39,646
Corporation tax	182,062	–
Social security and other taxes	1,496,337	2,219,088
Amounts owed to recourse debt factor	6,334,550	5,025,040
Other creditors	200,154	244,325
	---------------	---------------
	13,206,889	17,732,195
	---------------	---------------

The company has granted a floating charge over its assets to secure the amounts owed to the debt factoring company.

17. PROVISIONS

	Deferred tax (note 18)
	£
At 1 January 2024	–
Additions	533,200
	----------
At 31 December 2024	533,200
	----------

18. DEFERRED TAX

The deferred tax included in the statement of financial position is as follows:

	2024	2023
	£	£
Included in provisions (note 17)	533,200	–
	----------	----

The deferred tax account consists of the tax effect of timing differences in respect of:

	2024	2023
	£	£
Accelerated capital allowances	374,450	463,128
Pension plan obligations	158,750	151,000
Deferred tax - covered by losses	–	( 614,128)
	----------	----------
	533,200	–
	----------	----------

19. EMPLOYEE BENEFITS

Defined contribution plans

The amount recognised in profit or loss as an expense in relation to defined contribution plans was £ 155,133 (2023: £ 165,434 ).

The company operates defined contribution retirement benefit schemes for all qualifying employees. The assets of the schemes are held separately from those of the company.

Defined benefit plans

The company operates the AW (Europe) Limited Pension Scheme (the Scheme), a UK registered trust based pension scheme that provides defined benefits. No benefits have accrued since 1 March 2003. Pension benefits are linked to the members' final pensionable salaries and service at their retirement (or date of leaving if earlier). the Trustees are responsible for running the Scheme in accordance with the Scheme's Trust Deed and Rules, which sets out their powers. The Trustees of the Scheme are required to to act in the best interests of the beneficiaries of the Scheme. There are two categories of pension scheme members Deferred members: members who have stopped accruing benefits in the Scheme but are not yet in receipt of their Scheme pension Pensioner members: in receipt of pension. The Trustees are required to carry out an actuarial valuation every three years. the last actuarial valuation of the Scheme was performed by the Scheme Actuary for the Trustees as at 31 December 2022. This valuation revealed a funding surplus of around £402,000. The Scheme is also closed to accrual. The Company therefore does not expect to pay any contributions into the Scheme during the accounting year beginning 1 January 2025.

The statement of financial position net defined benefit asset is determined as follows:

	2024	2023
	£	£
Present value of defined benefit obligations	( 2,972,000)	( 3,352,000)
Fair value of plan assets	3,598,000	3,956,000
	-------------	-------------
	626,000	604,000
	----------	----------

Changes in the present value of the defined benefit obligations are as follows:

		2024
		£
At 1 January 2024		3,352,000
Interest expense		146,000
Benefits paid		(225,000)
Remeasurements:
	Actuarial gains and losses	( 301,000)
		-------------
At 31 December 2024		2,972,000
		-------------

Changes in the fair value of plan assets are as follows:

		2024
		£
At 1 January 2024		3,956,000
Interest income		173,000
Benefits paid		( 225,000)
Remeasurements:
	Return on plan assets, excluding amount included in interest income	( 306,000)
		-------------
At 31 December 2024		3,598,000
		-------------

The total costs for the year in relation to defined benefit plans are as follows:

	2024	2023
	£	£

Recognised in profit or loss:

Net interest income	( 27,000)	( 31,000)
	---------	---------

Recognised in other comprehensive income:

Remeasurement of the liability:

Actuarial gains and losses	301,000	88,000
Return on plan assets, excluding amounts included in net interest	(306,000)	(26,000)
	----------	---------
	(5,000)	62,000
	----------	---------

The fair value of the major categories of plan assets are as follows:

	2024	2023
	£	£
Cash and cash equivalents	36,000	21,000
Bonds	2,024,000	1,890,000
Gilts	921,000	1,377,000
Annuities	617,000	668,000
	-------------	-------------
	3,598,000	3,956,000
	-------------	-------------

The return on plan assets are as follows:

	2024	2023
	£	£
Return on assets of benefit plan	( 133,000)	213,000
	----------	----------

The principal actuarial assumptions as at the statement of financial position date were:

	2024	2023
	%	%
Discount rate	5.50	4.50
Inflation assumption	3	3

Mortality rates:

Current pensioners at 65 - male	21.20	21.20
Current pensioners at 65 - female	23.70	23.70
Future pensioners at 65 - male	22.10	22.20
Future pensioners at 65 - female	24.80	24.80
	-------	-------

Demographic assumptions

	2024	2023
	£	£
Mortality (Pre retirement)
Mortality (Post retirement)

20. CALLED UP SHARE CAPITAL

Issued, called up and fully paid

	2024		2023
	No.	£	No.	£
Ordinary shares of £ 1 each	1,000,000	1,000,000	1,000,000	1,000,000
	-------------	-------------	-------------	-------------

21. ULTIMATE PARENT COMPANY

The company is a subsidiary undertaking of Associated Weavers International N.V., which is incorporated in Belgium.

The largest and smallest group of which A.W. (Europe) Limited is a member and for which group financial statements are drawn up is that headed by Belgotex International N.V., incorporated in Belgium whose principal place of business is at Groene Dreef 5, 9770 Kruishoutem, Belgium. The consolidated financial statements of this group are available to the public and may be obtained from Belgotex International N.V., Groene Dreef, 5, 9770 Kruishoutem, Belgium.

22. RESERVES

Profit and loss account - This reserve records retained earnings and accumulated losses.

23. OPERATING LEASES

The total future minimum lease payments under non-cancellable operating leases are as follows:

	2024	2023
	£	£
Not later than 1 year	1,286,619	1,241,114
Later than 1 year and not later than 5 years	2,485,759	2,162,777
Later than 5 years	1,863,189	2,102,692
	-------------	-------------
	5,635,567	5,506,583
	-------------	-------------

24. RELATED PARTY TRANSACTIONS

The majority of the goods sold by the company during the year were purchased from a fellow subsidiary undertaking, Associated Weavers Europe N.V. The company is a wholly-owned subsidiary of Associated Weavers International, N.V., and has therefore taken advantage of the exemption from the disclosure requirements of Section 33 of FRS 102. There are no loans to directors There were no other related party transactions.