REGISTERED NUMBER: 07405239 (England and Wales)

Group Strategic Report, Report of the Directors and

Consolidated Financial Statements

for the Year Ended 31 December 2024

for

Leafield Environmental Holdings Limited

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

5

Consolidated Income Statement

8

Consolidated Other Comprehensive Income

9

Consolidated Balance Sheet

10

Company Balance Sheet

11

Consolidated Statement of Changes in Equity

12

Company Statement of Changes in Equity

13

Consolidated Cash Flow Statement

14

Notes to the Consolidated Cash Flow Statement

15

Notes to the Consolidated Financial Statements

16

DIRECTORS:

C T Edge

Ms J L D Crawford

P M Maddox

REGISTERED OFFICE:

Leafield Way

Leafield Industrial Estate

Corsham

Wiltshire

SN13 9UD

REGISTERED NUMBER:

07405239 (England and Wales)

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

The Leafield Environmental Group designs and manufactures premium plastic products. The process used is rotational moulding, a fast and efficient method that produces consistent, high-quality, hard-wearing and stress-free products.

The strategy of the business is to:

-

grow all parts of the business, with an emphasis on developing and increasing conduits to specified markets;

-

expand our export channels;

-

invest in developing new products, with our excellent in-house design team, to satisfy specific customer requirements and changing environmental legislation; and

-

reduce the environmental impact of our operations.

The Group has been honoured with a King's Award for Enterprise for its excellence in International Trade, announced on 6 May 2025, a sign that the strategy is being executed effectively.

REVIEW OF BUSINESS

Despite challenging market conditions, 2024 was an excellent year for the Group. Turnover increased by £1.85m (21.1%) to £10.62m (2023: £8.77m). The growth all came from the larger Leafield Environmental subsidiary and was due to some excellent, large contract wins for bins and cases. Export sales in the year were 38% of total sales and continue to be a well performing diversification into new markets, The Amberol subsidiary, acquired in June 2022, which focusses on planters and hanging baskets had a reasonable year but was affected by the poor spring weather and the cash-strapped local governments.

The growth in turnover dropped through to gross profit which was £4.58m (2023: £3.67m) for the year at a margin of 43.1% (2023: 41.9%). More efficient sourcing of components and the benefit of brokered low energy costs until the fourth quarter of 2024 were also contributors.

Net assets have increased by £0.60m to £4.82m (2023: £4.22m). The Group continues to invest in tooling for new products to further expand our wide product range and in gradually upgrading our manufacturing equipment to improve efficiency.

PRINCIPAL RISKS AND UNCERTAINTIES

The directors have identified the following principal risks and uncertainties affecting the Group:

Market risk

As for many businesses of our size, the principal risk continues to be the general economic environment, although our diversification into international markets helps mitigate this. The Group continues to proactively monitor the ongoing geopolitical and economic events. The directors' principal objectives are to ensure the continuity of operations and to take account of potential uncertainty when preparing plans and forecasts.

The Group is also exposed to the market price and accessibility of core commodities used in the production of its plastic products. The prices of these commodities such as polymer and gas have fluctuated significantly during the year. The Group manages this exposure by working with a broker to secure cost effective energy contracts that provide certainty and protect against price inflation, and in the case of polymer by forecasting demand and working very closely with suppliers.

Regulatory risk

The Group's principal market has been the UK, however exports have grown significantly over the recent past, exposing the Group to overseas trade and tax regulations in relation to sales. Whilst the Group does not currently have any physical presence outside the UK, the directors will consider such options to mitigate trade barriers or tariffs should they arise. In the meantime, the Group uses external advisers and employees with relevant skills to manage this risk.

Credit risk

The Group has implemented processes that require appropriate credit checks on potential UK customers before sales are made and also on a timely on-going basis. The Group carries credit protection insurance for export debt.

Liquidity risk

The Group actively maintains short-term debt finance and cash reserves that are designed to ensure the Group has sufficient available funds for operations and planned expansions.

Foreign exchange risk

The Group trades predominantly in pounds sterling though does have a relatively low number of transactions in euro. There is a small exposure to foreign currency fluctuations. Both sales and purchases are made in euro resulting in a degree of natural hedging. The Group monitors its currency exposure levels at board level and will, if felt necessary, enter into forward contracts to protect its position.

FUTURE OUTLOOK

Whilst economic uncertainty prevails across Europe coupled with ongoing inflationary and fiscal cost pressures, the directors remain confident in the future and in the Group's ability to take advantage of business opportunities as they arise.

KEY PERFORMANCE INDICATORS

The main financial KPIs that are constantly reviewed are as follows:

2024

2023

£'000

£'000

Turnover

10,616

8,766

Gross Profit Margin

43.1%

41.9%

EBITDA Margin

22.4%

20.3%

POST BALANCE SHEET EVENTS

There have not been any post balance sheet events.

ON BEHALF OF THE BOARD:

P M Maddox - Director

29 September 2025

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

PRINCIPAL ACTIVITY

The principal activity of the group in the year under review was that of the manufacture of other plastic products.

DIVIDENDS

Dividends of £280,000 (2023: £250,000) were paid during the year.

DIRECTORS

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

C T Edge

Ms J L D Crawford

P M Maddox

STATEMENT OF DIRECTORS' RESPONSIBILITIES

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

-	select suitable accounting policies and then apply them consistently;

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

-	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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group 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 group's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

AUDITORS

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

ON BEHALF OF THE BOARD:

P M Maddox - Director

29 September 2025

Opinion

We have audited the financial statements of Leafield Environmental Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2024 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, 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 group's and of the parent company affairs as at 31 December 2024 and of the group's 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 group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

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

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

Other information

The directors are responsible for the other information. The other information comprises the information in the Group 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 Group 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 Group 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 group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

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

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

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

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities 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 group's and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent 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:

Based on our understanding of the Company and industry, we identified that the principal risks of non-compliance with laws and regulations related to health and safety, anti-bribery, employment law and company legislation, and we considered the extent to which non-compliance might have a material effect on the financial statements of the Company. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006 and taxation legislation. We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries to increase revenue or reduce expenditure, and management bias in accounting estimates and judgemental areas of the financial statements. Audit procedures performed by the audit engagement team included:

-

Discussions with management, including consideration of known or suspected instances of non-compliance with laws and regulations and fraud;

-

Understanding of management's internal controls designed to prevent and detect irregularities, and fraud;

-

Reviewing the Company's legal costs to check for non-compliance with laws and regulations and fraud;

-

Reviewing Board of Directors minutes;

-

Review of tax compliance with the involvement of our tax specialists in the audit;

-

Designing audit procedures to incorporate unpredictability around the nature, timing or extent of our testing of expenses;

-

Testing transactions entered into outside of the normal course of the Company's business; and

-

Identifying and testing journal entries.

There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through 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 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.

David Iain Black (Senior Statutory Auditor)

for and on behalf of Sumer Auditco Limited

Statutory Auditors

Hermes House

Fire Fly Avenue

Swindon

Wiltshire

SN2 2GA

30 September 2025

TURNOVER

3

10,616,080

8,766,334

Cost of sales

6,039,213

5,094,977

GROSS PROFIT

4,576,867

3,671,357

Distribution costs

1,432,750

1,337,485

Administrative expenses

1,090,992

965,928

2,523,742

2,303,413

2,053,125

1,367,944

Other operating income

50,010

90,691

OPERATING PROFIT

5

2,103,135

1,458,635

Exceptional items

6

56,047

6,557

2,047,088

1,452,078

Interest receivable and similar income

12,980

282

2,060,068

1,452,360

Interest payable and similar expenses

7

115,845

121,138

PROFIT BEFORE TAXATION

1,944,223

1,331,222

Tax on profit

8

571,149

310,431

PROFIT FOR THE FINANCIAL YEAR

1,373,074

1,020,791

Profit attributable to:

Owners of the parent

1,373,074

1,020,791

PROFIT FOR THE YEAR

1,373,074

1,020,791

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,373,074

1,020,791

Total comprehensive income attributable to:

Owners of the parent

1,373,074

1,020,791

FIXED ASSETS

Intangible assets

12

1,265,950

1,434,743

Tangible assets

13

2,445,116

2,356,280

Investments

14

-

-

3,711,066

3,791,023

CURRENT ASSETS

Stocks

15

583,723

550,906

Debtors

16

1,746,161

1,540,992

Cash at bank and in hand

1,581,995

1,184,700

3,911,879

3,276,598

CREDITORS

Amounts falling due within one year

17

1,759,197

1,534,463

NET CURRENT ASSETS

2,152,682

1,742,135

TOTAL ASSETS LESS CURRENT LIABILITIES

5,863,748

5,533,158

CREDITORS

Amounts falling due after more than one year

18

(953,334

)

(1,276,667

)

PROVISIONS FOR LIABILITIES

23

(94,632

)

(33,783

)

NET ASSETS

4,815,782

4,222,708

CAPITAL AND RESERVES

Called up share capital

24

865,001

1,365,001

Capital redemption reserve

25

500,000

-

Retained earnings

25

3,450,781

2,857,707

SHAREHOLDERS' FUNDS

4,815,782

4,222,708

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:

P M Maddox - Director

FIXED ASSETS

Intangible assets

12

-

-

Tangible assets

13

-

-

Investments

14

1,365,001

1,365,001

1,365,001

1,365,001

TOTAL ASSETS LESS CURRENT LIABILITIES

1,365,001

1,365,001

CAPITAL AND RESERVES

Called up share capital

24

865,001

1,365,001

Capital redemption reserve

25

500,000

-

SHAREHOLDERS' FUNDS

1,365,001

1,365,001

Company's profit for the financial year

780,000

250,000

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:

P M Maddox - Director

Called up

Capital

share

Retained

redemption

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 January 2023

1,365,001

2,086,916

-

3,451,917

Changes in equity

Dividends

-

(250,000

)

-

(250,000

)

Total comprehensive income

-

1,020,791

-

1,020,791

Balance at 31 December 2023

1,365,001

2,857,707

-

4,222,708

Changes in equity

Redemption of preference shar

es

(500,000

)

(500,000

)

500,000

(500,000

)

Dividends

-

(280,000

)

-

(280,000

)

Total comprehensive income

-

1,373,074

-

1,373,074

Balance at 31 December 2024

865,001

3,450,781

500,000

4,815,782

Called up

Capital

share

Retained

redemption

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 January 2023

1,365,001

-

-

1,365,001

Changes in equity

Dividends

-

(250,000

)

-

(250,000

)

Total comprehensive income

-

250,000

-

250,000

Balance at 31 December 2023

1,365,001

-

-

1,365,001

Changes in equity

Redemption of preference shar

es

(500,000

)

(500,000

)

500,000

(500,000

)

Dividends

-

(280,000

)

-

(280,000

)

Total comprehensive income

-

780,000

-

780,000

Balance at 31 December 2024

865,001

-

500,000

1,365,001

Cash flows from operating activities

Cash generated from operations

1

2,323,552

1,175,449

Interest paid

(115,845

)

(121,138

)

Government grants

667

1,000

Tax paid

(381,136

)

(305,041

)

Net cash from operating activities

1,827,238

750,270

Cash flows from investing activities

Purchase of tangible fixed assets

(251,196

)

(143,227

)

Sale of tangible fixed assets

11,606

-

Interest received

12,980

282

Net cash from investing activities

(226,610

)

(142,945

)

Cash flows from financing activities

Loan repayments in year

(423,333

)

(150,000

)

Redemption of preference shares

(500,000

)

-

Equity dividends paid

(280,000

)

(250,000

)

Net cash from financing activities

(1,203,333

)

(400,000

)

Increase in cash and cash equivalents

397,295

207,325

Cash and cash equivalents at beginning of year

2

1,184,700

977,375

Cash and cash equivalents at end of year

2

1,581,995

1,184,700

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2024

2023

£

£

Profit before taxation

1,944,223

1,331,222

Depreciation charges

329,008

321,724

Profit on disposal of fixed assets

(9,461

)

-

Government grants

(667

)

(1,000

)

Finance costs

115,845

121,138

Finance income

(12,980

)

(282

)

2,365,968

1,772,802

(Increase)/decrease in stocks

(32,817

)

6,031

Increase in trade and other debtors

(205,169

)

(273,762

)

Increase/(decrease) in trade and other creditors

195,570

(329,622

)

Cash generated from operations

2,323,552

1,175,449

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 December 2024

31.12.24

1.1.24

£

£

Cash and cash equivalents

1,581,995

1,184,700

Year ended 31 December 2023

31.12.23

1.1.23

£

£

Cash and cash equivalents

1,184,700

977,375

3.	ANALYSIS OF CHANGES IN NET (DEBT)/FUNDS

At 1.1.24

Cash flow

At 31.12.24

£

£

£

Net cash

Cash at bank and in hand

1,184,700

397,295

1,581,995

1,184,700

397,295

1,581,995

Debt

Debts falling due within 1 year

(173,333

)

100,000

(73,333

)

Debts falling due after 1 year

(1,276,667

)

323,333

(953,334

)

(1,450,000

)

423,333

(1,026,667

)

Total

(265,300

)

820,628

555,328

1.	STATUTORY INFORMATION

Leafield Environmental Holdings 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 General 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 have been prepared on the going concern basis which assumes that the Group and Company will continue in operational existence for the foreseeable future. The directors have reviewed the working capital requirements of the Group and Company for a year of at least 12 months from the anticipated date of signing the financial statements and are satisfied that the Group and Company will be able to meet its liabilities as they fall due.

Financial Reporting Standard 102 - reduced disclosure exemptions

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

•

the requirement of paragraph 33.7.

The Group has applied the exemption available under paragraph 33.7 a key management personnel are deemed to be the directors of the company, therefore no additional disclosure is required.

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.

The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.

Related party exemption

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

Transactions between group entities which have been eliminated on consolidation are not disclosed within the financial statements.

Turnover

Turnover is recognised to the extent that it is probable that the economic benefits will flow to the company and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before turnover is recognised:

Sale of goods

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

- the company has transferred the significant risks and rewards of ownership to the buyer;

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

- the amount of revenue can be measured reliably;

- it is probable that the company will receive the consideration due under the transaction; and

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

Turnover represents amounts receivable for goods and services net of VAT and trade discounts.

Revenue earned but not billed to customers is included in trade receivables and amounts billed in advance of the revenue being recognised are included in trade payables.

Sales of goods are recognised on transfer of title of the goods on dispatch.

Interest income

Interest income is recognised using the effective interest rate method.

Goodwill

Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses.

Goodwill is amortised on a straight line basis to the Consolidated Statement of Comprehensive Income over its useful economic life of 20 years. Goodwill is assessed for impairment when there are indicators of impairment and any impairment is charged to profit and loss.

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.

Tangible fixed assets

Tangible assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

The company adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the company. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred.

Land is not depreciated. Depreciation on other assets is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

The estimated useful lives range are as follows:

Freehold property

20-50 years

Plant and machinery

3-10 years

Motor vehicles

2 years

Computer equipment

3 years

Government grants

Government grants are recognised based on the accrual model and are measured at the fair value of the asset received or receivable. Grants are classified as relating either to revenue or to assets. Grants relating to revenue are recognised in income over the period in which the related costs are recognised. Grants relating to assets are recognised over the expected useful life of the asset. Where part of a grant relating to an asset is deferred, it is recognised as deferred income.

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the standard cost of purchase. Work in progress and finished goods include labour and attributable overheads.

At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in the Statement of Comprehensive Income