The principal activity of the company throughout the year continued to be the manufacture and sale of timber stair parts, decking and mouldings.

Overall, the directors are satisfied with the performance of the company in the period under review. The market continued to be challenging due to increased pressures in the wider UK economy in particular labour, shipping and energy costs. The board continues to invest in updating product ranges, investing in production capability and investment in IT, to maintain its quality product and services. The directors remain confident that the business is well placed to continue deliver unrivalled service levels to its customers.

In October 2024 the business was acquired by the Summit Timber Group. Summit Timber Group plans to consolidate its existing performance, to increase capacity and broaden the capabilities of the business group and its product offerings.

Trading Performance

Trading performance and key performance indicators (KPI's) may be summarised as follows:

2024 (£’000)                 2023 (£’000)

Turnover                      43,763            37,730

Gross profit             14,614            11,446

Operating profit             3,424              2,434

In addition to the KPI's above, the board also monitors a number of operational measures within its manufacturing facility, which are reported within the suite of comprehensive management information produced each month.

Whilst general trading in the year remained competitive in the face of rising inflation, the company’s core ranges of timber stair parts, mouldings and wall panels continue to be well received and the company continues to expand the customer/supplier base. This helps mitigate any exposure to a downturn in any one area. The directors continually reviews market conditions and supply chains to assess both risks and opportunities that the company faces. Whilst at the same time as expanding the company's product range, the board has also undertaken a review of the company's operations so as to optimise the use of working capital.

The company trades with high profile customers who have strong credit ratings in the industry and as such the directors do not believe that the company is exposed unduly to the risk of significant bad debts. Credit limits are set based on a combination of payment history and credit agency ratings and the company utilises a credit insurance policy to mitigate risk in this area. Similarly, stock ranges are restricted to, wherever possible, core ranges in the DIY retailers, as well as for the company's own branded ranges sold via multiple builder’s merchants to mitigate the risk of stock obsolescence.

The company is exposed to fluctuations in exchange rates, higher prices for raw material and higher freight costs on its imported goods and seeks to mitigate these or pass on such costs wherever possible.

The board is mindful of its responsibilities in respect of Health and Safety Legislation and continues to invest in this area.

The company’s impact on the community, environment and continuing its sustainability work continues to remain important. The company ensures that corporate and social responsibility is a high priority. The directors will continue to monitor performance in all these areas as the company looks to optimise performance.

The following disclosure describes how the directors have had regard to the matters set out in section 172(1a) – (f) and forms the directors’ statement required under section 414CZA of the Companies Act 2006.

Promoting the success of the company

The Board believes that, individually and collectively, they have acted in the way they consider, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole, having regard to the stakeholders and matters set out in s172(1) (a-f) of the Companies Act 2006, as detailed below, in the decisions taken during the year ended 31 December 2024, when performing their duty to promote the success of the company:

a)    the likely consequences of any decision in the long term;

b)    the interests of the company's employees;

c)    the need to foster the company's business relationships with suppliers, customers and others;

d)    the impact of the company's operations on the community and the environment;

e)    the desirability of the company maintaining a reputation for high standards of business conduct; and

f)    the need to act fairly as between members of the company.

The company's stakeholder engagement aims to create trusted relationships to understand the needs of all of our stakeholders so that we can deliver value and build a resilient business:

Business relationships

The company maintains strong relationships with customers and suppliers, adapting to ever-changing needs and demands. We encourage communication from customers and take swift action to ensure any necessary changes to supply demands are met. Our long-established supply partners ensure continuity of supply of materials at the most competitive prices. The most demanding of market conditions, such as those experienced in recent years during and post-pandemic, highlighted the importance of such mutual loyalty.

Employees

The directors ensure that employees are kept informed regarding the company’s affairs through regular communications. Employees are encouraged to participate in group discussions and bring forward any suggestions to the board.

Partners

The company maintains strong relations with banking and finance providers. Information is exchanged on a regular basis to ensure suitable and adequate facilities are in place.

Shareholders

We prioritise transparency and effective communication to ensure shareholders are informed about the company's strategies, performance, and decisions. We seek to uphold their trust and confidence by delivering long-term value and sustainable growth.

Communities

The company contributes to local charities and good causes by way of sponsorship.

Governing bodies and regulators

The company is affiliated to the FSC and PEFC organisations, who promote sustainable and responsible forest management.

The company is also affiliated to the Timber Decking and Cladding Association and is EUTR compliant and is also ISO 9001:2015 accredited.

By prioritising the interests of our stakeholders and engaging with them proactively, we aim to foster trust, create shared value, and drive sustainable growth for the benefit of all.

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 10.

Prior to the acquisition by the Summit Timber Group, ordinary dividends were paid amounting to £166,470. The directors do not recommend payment of a further dividend.

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

The company holds or issues financial instruments in order to achieve three main objectives, being:

(a) to finance its operations;

(b) to manage its exposure to interest and currency risks arising from its operations and from its sources of finance; and

(c) for trading purposes.

In addition, various financial instruments (e.g. trade debtors, trade creditors, accruals and prepayments) arise directly from the company's operations.

Transactions in financial instruments result in the company assuming or transferring to another party one or more of the financial risks described below:

The company manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the company has sufficient liquid resources to meet the operating needs of the business. The company funds its operations through the use of cash generated from profits earned and an invoice finance facility.

The company’s principal foreign currency exposures arise from trading with overseas companies. The company policy permits but does not demand that these exposures may be hedged in order to fix the cost in sterling. The company holds foreign currency reserves to mitigate the risk of adverse foreign currency movements.

The company monitors credit risk closely and considers that its current policy of credit checks meets in objectives of managing exposure to credit risk. Significantly, the company has credit insurance in place to manage its exposure to credit risk.

In accordance with the company's articles, a resolution proposing that Azets Audit Services be reappointed as auditor of the company will be put at a General Meeting.

The company is committed to reducing it's impact on climate change and the reduction of carbon emissions associated with its products and services. This is in line with customer requirements and the UK government Net Zero target of 2050. The requirements to monitor our Scope 1 and 2 emissions relevant to our business are well understood by the company, as is the need to reduce emissions going forward.

During the financial year January - December 2024, the company has monitored the carbon emissions associated with various aspects of its operations, limited to the UK. The table below shows energy comsumption, the Carbon Dioxide (equivalent) emissions in tonnes and indirect emissions.

Quantification and reporting methodology

Associated greenhouse gas emissions have been calculated using rates derived from the UK Government Department for Energy Security and Net Zero GHG Conversion Factors For Company Reporting 2024 paper.

Intensity measurement

The intensity ratio is based on per £100,000 of sales revenue for the twelve month reporting period.

Measures taken to improve energy efficiency

The Company has further developed and continued with its Carbon Reduction Action Plan in line with Government requirements and guidelines. Carbon reduction projects started in 2024 include:

• Further investment in green energy and biomass heating

• Increase in planned maintenance programmes for high energy equipment leading to less energy use

• Currently reviewing all electricity suppliers to the business to change to green energy tariff options

• Internal training to staff on carbon reduction processes

• Scope 3 data development started 2024 with completion 2025 Q2.

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 company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

• select suitable accounting policies and then apply them consistently;

• make judgements and accounting estimates that are reasonable and prudent;

• 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 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.

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 company’s auditor 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 company’s auditor is aware of that information.

We have audited the financial statements of Cheshire Mouldings & Woodturnings Limited (the 'company') for the year ended 31 December 2024 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity 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 company's affairs as at 31 December 2024 and of its profit for the year then ended;

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

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

Basis for opinion

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

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.

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.

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.

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

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework.  Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.  This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

• Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud; 

• Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the company through enquiry and inspection; 

• Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;

• Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias. 

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 of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

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.

The profit and loss account has been prepared on the basis that all operations are continuing operations.

Cheshire Mouldings & Woodturnings Limited is a private company limited by shares incorporated in England and Wales. The registered office is Cheshire House, Unit 7 Normans Road, Sutton, St. Helens, Merseyside, United Kingdom, WA9 4JQ Cheshire House, 7 Normans Road, Sutton, St Helens, Merseyside, WA9 4JQ.

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 modified to include the revaluation of certain assets at fair value. The principal accounting policies adopted are set out below.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent 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:

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

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

The financial statements of the company are consolidated in the financial statements of Summit Timber Group Limited. These consolidated financial statements are available from Companies House.

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has 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.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

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 gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and other direct costs that have been incurred in bringing the stocks to their present location and condition.

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 at bank and in hand are basic financial assets and include cash in hand, deposits held at call with banks and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

In the statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.

The company 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 company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with 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 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.

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

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 company 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 company after deducting all of its liabilities.

Basic financial liabilities, including creditors, bank loans, and loans from fellow group companies 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.

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

Equity instruments issued by the company 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 company.

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 company’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 when the company has 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.

Contingencies

Contingent liabilities arise as a result of past events when (i) it is not probable that there will be an outflow of resources of that the amount cannot be reliably measured at the reporting date or (ii) when the existence will be confirmed by the occurrence or non-occurrence of uncertain future events not wholly within the Company's control. Contingent liabilities are disclosed in the financial statements unless the probability of an outflow of resources is remote, in which case contingent liabilities are not recognised.

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.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

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 and hire purchase 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 the profit and loss account 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 leases asset are consumed.

Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.

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 company’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.

The directors have applied their knowledge of the operations of the business when reviewing the stock listing at the balance sheet date, and have made appropriate provision for any items deemed to be slow moving or obsolete. The movement in the provision is shown in the profit and loss account and recognised in cost of sales.

All turnover is generated from the principal activity of the company.

*Following the group reorganisation in the period, the management charge represents the cost of services provided by the parent company in connection with the performance of management functions at group level.

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

Their aggregate remuneration comprised:

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

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts. Following the acquisition of Cheshire Mouldings & Woodturnings Limited during the financial year, the finance leases in respect of these assets were fully paid.

Netted off against stock is a provision of £824,965 (2023: £967,719).

All bank borrowings are secured by way of a debenture including a fixed charge over all leasehold property, book and other debts, chattels, goodwill and uncalled share capital. There is a floating charge over all assets of the Company, together by way of a general letter of pledge.

Included within other borrowings are Invoice discounting advances of £2,875,044 (2023: £3,153,400) which are secured by way of a first fixed charge over the book and other debts of the Company.

All bank borrowings are secured by way of a debenture including a fixed and floating charge over all assets of the Company.

Invoice discounting advances of £2,875,044 (2023: £3,153,400) are secured by way of a first fixed charge over the book and other debts of the company.

Hire purchase and finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 3 to 5 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments. Following the acquisition of Cheshire Mouldings & Woodturnings Limited during the financial year, the finance leases in respect of these assets were fully paid.

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

The deferred tax liability set out above is expected to reverse within 3 years and relates to accelerated capital allowances that are expected to mature within the same period.

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund. At the balance sheet date £nil (2023: £6,329) was outstanding.

The other reserves consist of items for which allocation to the profit and loss account is deemed unsuitable.

The increase in other reserves in the current financial year relates to direct capital contributions from the new parent company, following the acquisition of Cheshire Mouldings & Woodturnings Limited in 2024, which do not form part of distributable reserves.

Profit and loss reserves represent accumulated profits less equity dividends paid.

During the current year there have been non-cash distributions to the previous shareholders, prior to the acquisition by Summit Timber Group Limited, amounting to £2,394,377. The company had sufficient distributable reserves available for this.

The Company is party to a cross guarantee, in favour of RBS Invoice Finance Ltd, in respect of all borrowings of the parent undertaking, Summit Timber Group Limited.

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

As at the balance sheet date £5,000,000 was owed by Cheshire Mouldings Topco Limited, the immediate parent company, in relation to the facility draw-down payment, included within other debtors. As at the balance sheet date £2,192,596 was owed to Summit Timber Group Limited, in relation to management charges for the current period.

During the period the company was charged rent of £2,197,721 (2023: £2,304,720) by CMW Property and Machinery Limited, a company related by way of common control. At the balance sheet date the aggregate due from CMW Property and Machinery Limited was £nil (2023: £765,410).

During the period the company advanced £nil (2023: £864,556) to Square Brick Investments Limited, a company related by way of common control. At the balance sheet date the amount due from Square Brick Investments Limited was £nil (2023: £864.556). As part of the acquisition by Summit Timber Group Limited all previous intercompany balances were waived and treated as adjustments to equity.

At 31 December 2024, the total amount due from directors totalled £nil (2023: £80,152) and is included with other debtors. At the same date, the company owed a director £nil (2023: £104,316) and is included with other creditors. As part of the acquisition by Summit Timber Group Limited all directors loan accounts were written off.

The ultimate parent company in which the financial statements of the company are consolidated is Summit Timber Group Limited and these consolidated financial statements are available from the Companies House registered address at Crown Way, Cardiff, CF14 3UZ.

Summit Timber Group Limited is under the control of the directors, the controlling shareholders of that company.

Previously, the parent company was CMW Property & Machinery Limited however a restructure and acquisition took place on 28 October 2024.