REGISTERED NUMBER: 02757183 (England and Wales)

Strategic Report, Report of the Directors and

Financial Statements for the Year Ended 31 December 2024

for

Cutting Edge Services Limited

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

6

Income Statement

9

Other Comprehensive Income

10

Balance Sheet

11

Statement of Changes in Equity

12

Notes to the Financial Statements

13

DIRECTORS:

Mr I S McCall

Mr M Petersen

REGISTERED OFFICE:

Unit 8, Matrix Park

Western Avenue

Buckshaw Village

Chorley

Lancashire

PR7 7NB

REGISTERED NUMBER:

02757183 (England and Wales)

AUDITORS:

Harts Limited

Chartered Accountants and Statutory Auditors

Westminster House

10 Westminster Road

Macclesfield

Cheshire

SK10 1BX

FAIR VIEW OF BUSINESS

Turnover in 2024 was £14.3 million representing a decrease of £1.1m (7%) compared to 2023. This reduction reflects a period of operational restructuring and consolidation aimed at positioning the business for future growth and resilience. Gross margins reduced slightly during the year, primarily due to increased price competition and changes in sales mix.

Despite the reduction in turnover and margin, the company maintained strong financial discipline, strengthening its cash position by £380k over the year.

In the US market, a further modified Frenching machine was sold to the existing customer, maintaining presence in this strategically important sector.

Employee ownership continues to embed with the EOT structure now well established and the employee council active in representing staff views. The company recently held its first town hall where directors updated employees on progress and fielded a Q&A session.

During the year Phocas business intelligence software was used to prepare the 2024 budget and monthly management accounts, enhancing data analytics and reporting capabilities across the business.

Towards the end of 2024 the company retired its ageing on-premise server and migrated all files and applications to a hosted Azure instance. This enabled the upgrade of Sage 200 from the 2018 version to 2024 R2, negating the need for a new ERP system.

The company also changed its managed service provider during the year and implemented their Cyber Security Sphere, tightening the security of its IT infrastructure and providing ongoing education for staff on cyber risks.

PRINCIPAL RISKS AND UNCERTAINTIES

The principal risks within the business continue to be competitive pricing pressures and the capital investment decisions of large customers. Inflationary pressures and high interest rates continued into 2024, though there are signs these are now easing towards the year end.

The company also remains exposed to currency exchange rate risk, particularly in relation to the US Dollar and Euro, which is monitored on an ongoing basis with forward contracts used where appropriate to mitigate exposure.

DEVELOPMENT

The directors monitor performance through detailed monthly management accounts comparing actual performance against budget and prior year.

Key performance indicators utilised in monitoring performance are:

- Increase/(decrease) in annual revenue 2024: -7% (2023: +3%)

- Gross margin 2024: 34.9% (2023: 36.2%)

Other performance indicators include:

- Monitoring of turnover by business division daily vs target for the month

- Daily cash collection vs target for the month

- Break-even turnover

- Monthly detailed service/product margin analysis vs budget and previous year

- 13-week cash flows prepared on a regular basis

FUTURE PERFORMANCE

In 2025 the company intends to extend use of Phocas to assist in procurement and stock management. It will continue its rolling programme of hardware upgrades, maintain strong cyber security measures, and invest in the innovative development of food processing and safety equipment to support growth.

ON BEHALF OF THE BOARD:

Mr I S McCall - Director

29 September 2025

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

PRINCIPAL ACTIVITIES

The principal activities of the company in the year under review were those of the supply of capital equipment and ancillary parts to the meat, fish and food related industries, the provision of knife and blade sharpening services; and the supply of abattoir and butchery supplies; supported by a range of personal protective equipment.

DIVIDENDS

The total distribution of dividends for the year ended 31 December 2024 was £831,919 (2023: £901,536). We note that the distribution of £831,919 (2023: £901,536), was issued to fund the payment due to Employee Ownership Trust (EOT) by the holding company Cutting Edge Investments Limited.

DIRECTORS

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

Mr I S McCall

Mr M Petersen

DISCLOSURE IN THE STRATEGIC REPORT

In accordance with section 414A of the Companies Act 2006, the company has prepared a strategic report which can be found on page 2 and which includes a fair review of the company’s business and a description of the principal risks and uncertainties facing the company.

DIRECTORS' RESPONSIBILITIES STATEMENT

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

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

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS

The auditors, Harts Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

Mr I S McCall - Director

29 September 2025

Opinion

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

In our opinion the financial statements:

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

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

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

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

-	the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

-	adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of directors' remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Directors' Responsibilities Statement set out on page four, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

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

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

The objectives of our audit, in respect to fraud, are: to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and management.

Our approach was as follows:

We obtained an understanding of the legal and regulatory frameworks that are applicable to the Company and determined that the most significant are those that relate to the reporting framework (UK GAAP and the Companies Act 2006) and employment law. In addition the Company has to comply with laws and regulations relating to its operations and health and safety.

We understood how Cutting Edge Services Limited is complying with those frameworks by making inquiries of management and the head of technical, and confirmation to identify any non-compliance with laws and regulations.

We assessed the susceptibility of the Company's financial statements to material misstatement, including how fraud might occur by discussion with directors to understand where it's considered there was a susceptibility to fraud. We considered the controls that the Company has established to address risks identified, or that otherwise prevent, deter and detect fraud.

To address the risk of fraud through management bias and override of controls, we performed analytical procedures to identify any unusual or unexpected relationships; investigated the rationale behind significant or unusual transactions; and tested journal entries to identify unusual transactions. Controls have also been considered, that the company has established to address risks identified, or that otherwise prevent, defer and detect fraud. No susceptibilities identified in these controls.

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

Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations that could materially impact the financial statements. Taking into accounts our understanding of the Company, our procedures involved enquires of management and focussed testing as appropriate with consideration to risk assessment.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Melissa Bowers FCCA (Senior Statutory Auditor)

for and on behalf of Harts Limited

Chartered Accountants and Statutory Auditors

Westminster House

10 Westminster Road

Macclesfield

Cheshire

SK10 1BX

30 September 2025

TURNOVER

3

14,291,567

15,403,136

Cost of sales

(9,297,961

)

(9,829,452

)

GROSS PROFIT

4,993,606

5,573,684

Administrative expenses

(3,467,806

)

(4,086,260

)

OPERATING PROFIT

5

1,525,800

1,487,424

Interest payable and similar expenses

7

(145,941

)

(154,880

)

PROFIT BEFORE TAXATION

1,379,859

1,332,544

Tax on profit

8

(369,438

)

(254,880

)

PROFIT FOR THE FINANCIAL YEAR

1,010,421

1,077,664

PROFIT FOR THE YEAR

1,010,421

1,077,664

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,010,421

1,077,664

FIXED ASSETS

Intangible assets

10

52,840

69,522

Tangible assets

11

106,877

111,351

Investments

12

110,000

110,000

269,717

290,873

CURRENT ASSETS

Stocks

13

2,245,807

2,700,015

Debtors

14

3,116,420

3,080,607

Cash at bank and in hand

126,275

122,371

5,488,502

5,902,993

CREDITORS

Amounts falling due within one year

15

(4,502,701

)

(4,983,398

)

NET CURRENT ASSETS

985,801

919,595

TOTAL ASSETS LESS CURRENT LIABILITIES

1,255,518

1,210,468

CREDITORS

Amounts falling due after more than one year

16

(72,382

)

(194,432

)

PROVISIONS FOR LIABILITIES

19

(23,100

)

(34,502

)

NET ASSETS

1,160,036

981,534

CAPITAL AND RESERVES

Called up share capital

20

100

100

Retained earnings

21

1,159,936

981,434

SHAREHOLDERS' FUNDS

1,160,036

981,534

The financial statements were approved by the Board of Directors and authorised for issue on 29 September 2025 and were signed on its behalf by:

Mr I S McCall - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2023

100

805,306

805,406

Changes in equity

Dividends

-

(901,536

)

(901,536

)

Total comprehensive income

-

1,077,664

1,077,664

Balance at 31 December 2023

100

981,434

981,534

Changes in equity

Dividends

-

(831,919

)

(831,919

)

Total comprehensive income

-

1,010,421

1,010,421

Balance at 31 December 2024

100

1,159,936

1,160,036

1.	STATUTORY INFORMATION

Cutting Edge Services Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

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 of the company are consolidated in the financial statements of Cutting Edge Investments Limited. These consolidated financial statements are available from its registered office, Unit 8 Matrix Park, Western Avenue, Buckshaw Village, Chorley, PR7 7NB.

Financial Reporting Standard 102 - reduced disclosure exemptions

The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

•

the requirements of Section 7 Statement of Cash Flows;

•

the requirement of paragraph 33.7.

Turnover

Sale of goods

Turnover is recognised at the fair value of the consideration received or receivable, excluding trade discounts, settlement discounts and volume rebates, for sale of goods and is shown net of VAT and other sales related taxes.

Turnover 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.

Rendering of services

Revenue from the services, provided in the normal course of business, is recognised when the outcome of a transaction can be estimated reliably and turnover from services is recognised by reference to the stage of completion at the balance sheet date. Stage of completion is measured by reference to finalisation of work completed.

Where the outcome cannot be measured reliably, turnover is recognised only to the extent of the expenses recognised that are recoverable.

Goodwill

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

Intangible assets

Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Development costs are being amortised evenly over their estimated useful life of three years.

Computer software is being amortised evenly over its estimated useful life of three years.

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

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Improvements to property

-

Over the period of the lease

Plant and machinery

-

25% on cost

Fixtures and fittings

-

25% on cost

Motor vehicles

-

33% on cost

Computer equipment

-

33% on cost

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.

Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible 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). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Investments in subsidiaries

Investments in subsidiary undertakings are recognised at cost.

Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

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

Stocks

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

Cost is calculated using the first-in first out method and includes the normal cost of transporting stock to its 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.

Financial instruments

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

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

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.

Impairment of financial assets

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.

Derecognition of financial assets

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.

Classification of financial liabilities

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

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

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

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

Other financial liabilities

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.

Derecognition of financial liabilities

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

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Hire purchase and leasing commitments

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the future payments is treated as a liability.

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

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

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

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

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

Judgements and key sources of estimation uncertainty

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.

Key sources of estimation uncertainty

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:

Stocks

A provision in the amount of £498,011 (2023: £500,724) for old and obsolete stock has been estimated by the directors to ensure that the stock is correctly stated at the lower of cost and new realisable value.

3.

TURNOVER

The turnover and profit before taxation are attributable to the principal activities of the company.

An analysis of turnover by class of business is given below:

31.12.24

31.12.23

£

£

Sales of goods

10,216,304

11,246,043

Rendering of services

4,075,263

4,157,093

14,291,567

15,403,136

An analysis of turnover by geographical market is given below:

31.12.24

31.12.23

£

£

United Kingdom

12,339,518

13,314,471

Europe

1,731,597

1,889,259

Rest of world

220,452

199,406

14,291,567

15,403,136

4.	EMPLOYEES AND DIRECTORS

31.12.24

31.12.23

£

£

Wages and salaries

3,045,547

3,209,947

Social security costs

268,133

311,250

Other pension costs

63,714

60,487

3,377,394

3,581,684

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

31.12.24

31.12.23

Production staff

21

22

Sales & Distribution staff

32

36

Administration staff

17

17

70

75

31.12.24

31.12.23

£

£

Directors' remuneration

264,007

167,988

Directors' pension contributions to money purchase schemes

823

-

Information regarding the highest paid director for the year ended 31 December 2024 is as follows:

31.12.24

£

Emoluments etc

233,856

Pension contributions to money purchase schemes

110

5.	OPERATING PROFIT

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

31.12.24

31.12.23

£

£

Hire of plant and machinery

2,720

3,000

Other operating leases

328,350

353,146

Depreciation - owned assets

72,391

62,733

Depreciation - assets on hire purchase contracts

11,907

8,932

Profit on disposal of fixed assets

(474

)

-

Goodwill amortisation

-

61,457

Computer software amortisation

22,969

5,265

Foreign exchange differences

(231,879

)

(76,984

)

6.	AUDITORS' REMUNERATION

31.12.24

31.12.23

£

£

Fees payable to the company's auditors for the audit of the company's financial statements

20,010

16,200

The audit fee associated with Cutting Edge Investments Limited has been borne by Cutting Edge Services Limited this year.

7.

INTEREST PAYABLE AND SIMILAR EXPENSES

31.12.24

31.12.23

£

£

Bank loan interest

106,317

147,571

Other interest

35,380

3,407

Hire purchase interest expense

4,244

3,902

145,941

154,880

8.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

31.12.24

31.12.23

£

£

Current tax:

UK corporation tax

353,602

309,077

(Over) Under provision in prior year

27,238

(44,868

)

Total current tax

380,840

264,209

Deferred tax

(11,402

)

(9,329

)

Tax on profit

369,438

254,880