REGISTERED NUMBER: 11078580 (England and Wales)

GROUP STRATEGIC REPORT, REPORT OF THE DIRECTOR AND

CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2024

FOR

RIOT LABS LTD

Page

Company Information

1

Group Strategic Report

2

Report of the Director

4

Report of the Independent Auditors

5

Consolidated Income Statement

9

Consolidated Other Comprehensive Income

10

Consolidated Balance Sheet

11

Company Balance Sheet

12

Consolidated Statement of Changes in Equity

13

Company Statement of Changes in Equity

14

Consolidated Cash Flow Statement

15

Notes to the Consolidated Cash Flow Statement

16

Notes to the Consolidated Financial Statements

18

DIRECTOR:

B Johnson

REGISTERED OFFICE:

35 Sherbourne Drive

Tilbrook

Milton Keynes

Buckinghamshire

MK7 8BA

REGISTERED NUMBER:

11078580 (England and Wales)

AUDITORS:

Ad Valorem Audit Services Limited

Chartered Certified Accountants

2 Manor Farm Court

Old Wolverton Road

Old Wolverton

Buckinghamshire

MK12 5NN

The director presents his strategic report of the company and the group for the year ended 31 December 2024.

REVIEW OF BUSINESS

Riot Lab Ltd is a specialist manufacturer and distributor of premium e-liquid pods and reusable vaping systems. The Group focuses on innovation, quality, and sustainability in the nicotine alternatives market, delivering products to a growing base of domestic and international customers.

Despite continued regulatory pressures across the sector, the financial year ending 2024 represented a period of strong performance and operational progress for the business.

Revenue Growth: Turnover increased by 39% to £15.1 million (2023: £10.9 million), driven by robust demand across existing markets and successful penetration into new territories. This reflects the effectiveness of the Group’s expansion strategy and the deepening of long-term customer relationships.

Profitability: Gross profit margin improved by 45%, supported by economies of scale, operational streamlining, and enhanced pricing models. Profit before tax rose by 72% to £1.54 million (2023: £870,194), underlining the company’s disciplined cost management and commercial agility.

Investment in Capabilities: The company invested in new manufacturing technologies, supply chain systems, and expanded warehousing capacity, enabling improved order fulfilment, faster lead times, and higher customer satisfaction. These initiatives also position Riot Lab to respond effectively to future growth opportunities.

PRINCIPAL RISKS AND UNCERTAINTIES

The directors recognise a number of risks and uncertainties that may affect performance:

Economic Conditions: Consumer confidence, inflationary pressures, and global trade dynamics may impact demand and cost structures.

Supply Chain Risks: Reliance on certain raw materials and international logistics introduces potential volatility in costs and availability.

Regulatory Environment: Increasing scrutiny and evolving legislation in the nicotine alternatives sector may affect product ranges, marketing, and market access.

Technological Change: Rapid innovation within the industry creates risks of product obsolescence if advancements are not matched.

Reputation and ESG Expectations: Heightened awareness around health, sustainability, and corporate responsibility may expose the business to reputational risks if not addressed proactively.

Mitigation strategies include diversifying supply chains, forward purchasing key inventory, regular FX risk reviews, and continued investment in research and development. The Group also engages with regulators and industry bodies to ensure compliance and contribute to responsible industry standards.

FUTURE DEVELOPMENTS

Looking ahead, Riot Lab Ltd intends to:

Expand into additional international markets, with a focus on regions with favourable regulatory environments.

Continue investing in product development, including sustainable and recyclable solutions, to align with consumer trends and ESG commitments.

Enhance digital platforms and customer engagement tools to strengthen brand loyalty.

Drive further operational efficiencies through automation and advanced data analytics.

KEY ACTIONS DURING THE YEAR

Strengthening employee engagement through training programmes, wellbeing initiatives, and opportunities for career development.

Collaborating with suppliers to uphold high ethical and quality standards.

Engaging with regulators and trade associations to ensure responsible business conduct and industry-wide best practice.

Supporting local communities through charitable partnerships and sustainability projects.

The board remains committed to responsible growth and long-term value creation, guided by ethical business practices and proactive stakeholder engagement.

ON BEHALF OF THE BOARD:

B Johnson - Director

30 September 2025

The director presents his report with the financial statements of the company and the group for the year ended 31 December 2024.

DIVIDENDS

The total distribution of dividends for the year ended 31 December 2024 will be £764,451.

DIRECTOR

B Johnson held office during the whole of the period from 1 January 2024 to the date of this report.

STATEMENT OF DIRECTOR'S RESPONSIBILITIES

The director is responsible for preparing the Group Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations.

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is 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 director is 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 him to ensure that the financial statements comply with the Companies Act 2006. He is 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 director is 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 he 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 group's auditors are aware of that information.

AUDITORS

The auditors, Ad Valorem Audit Services Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

B Johnson - Director

30 September 2025

Opinion

We have audited the financial statements of Riot Labs Ltd (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 director's 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 director with respect to going concern are described in the relevant sections of this report.

Other information

The director is responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Director, 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 Director 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 Director 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 Director.

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 director's remuneration specified by law are not made; or

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

Responsibilities of director

As explained more fully in the Statement of Director's Responsibilities set out on page four, the director is 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 director determines 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 director is 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 director either intends to liquidate the group or the parent company or to cease operations, or has 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:

In our process of identifying fraud risks we assessed events or conditions that indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud ("fraud risk factors") to determine how fraud risks are relevant to our audit. Based on the auditing standards we addressed two fraud risks that were relevant to our audit, in relation to revenue recognition and management override of controls. Based upon our analysis of fraud risk factors, we have not identified any additional fraud risks.

Our audit procedures included an evaluation of the design, implementation as well as the operating effectiveness of internal controls relevant to mitigate these risks. We also performed substantive audit procedures, including detailed testing of high risk journal entries and procedures to satisfy ourselves that revenue has been properly recognised in the financial statements in accordance with financial reporting standards and the Company's accounting policies. Through these procedures, we did not identify any material actual or suspected incidences of fraud. We have evaluated facts and circumstances in order to assess laws and regulations relevant to the Company. We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general and sector experience, through discussion with the Directors and other management (as required by auditing standards) and discussed with the Directors and other management the policies and procedures regarding compliance with laws and regulations. We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit.

The potential effect of these laws and regulations on the financial statements varies considerably.

Firstly, the Company is subject to laws and regulations that directly affect the financial statements including taxation and financial reporting (including related company legislation) and we assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.

Secondly, the Company is subject to many other laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines or litigation. We identified the following areas as those most likely to have such an effect:

- Employment legislation, reflecting the Company's workforce

- Health and safety regulation, reflecting the Company's production, distribution and operating processes

- Data privacy, reflecting the Company's management of personal and corporate data

Auditing standards limit the required audit procedures to identify non-compliance with these regulations to enquiry of the Directors and other management and inspection of regulatory and legal correspondence, if any. Through these procedures we did not identify any material actual or suspected non-compliance in any of the above areas.

We note that our audit is not primarily designed to detect non-compliance with laws and regulations and the Directors and other management are responsible for such internal control as the Directors and other management of the Company determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to errors or fraud, including compliance with laws and regulations. Additionally, owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

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.

Zubair Arshad FCCA ACA (Senior Statutory Auditor)

for and on behalf of Ad Valorem Audit Services Limited

Chartered Certified Accountants

2 Manor Farm Court

Old Wolverton Road

Old Wolverton

Buckinghamshire

MK12 5NN

30 September 2025

TURNOVER

15,097,638

10,833,425

Cost of sales

6,666,854

5,019,704

GROSS PROFIT

8,430,784

5,813,721

Distribution costs

348,039

342,776

Administrative expenses

6,541,232

4,534,185

6,889,271

4,876,961

OPERATING PROFIT

4

1,541,513

936,760

Interest receivable and similar income

224

312

1,541,737

937,072

Interest payable and similar expenses

6

45,517

66,878

PROFIT BEFORE TAXATION

1,496,220

870,194

Tax on profit

7

275,150

114,933

PROFIT FOR THE FINANCIAL YEAR

1,221,070

755,261

Profit attributable to:

Owners of the parent

1,221,070

755,261

PROFIT FOR THE YEAR

1,221,070

755,261

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,221,070

Prior year adjustment

(84,637

)

TOTAL COMPREHENSIVE INCOME SINCE LAST ANNUAL REPORT

670,624

Total comprehensive income attributable to:

Owners of the parent

1,221,070

670,624

FIXED ASSETS

Intangible assets

10

103,083

54,003

Tangible assets

11

1,130,089

1,121,250

Investments

12

237,655

87,655

1,470,827

1,262,908

CURRENT ASSETS

Stocks

13

1,551,698

2,258,377

Debtors

14

764,922

1,314,301

Cash at bank

1,888,382

1,294,993

4,205,002

4,867,671

CREDITORS

Amounts falling due within one year

15

2,175,587

3,118,075

NET CURRENT ASSETS

2,029,415

1,749,596

TOTAL ASSETS LESS CURRENT LIABILITIES

3,500,242

3,012,504

CREDITORS

Amounts falling due after more than one year

16

(184,599

)

(266,833

)

PROVISIONS FOR LIABILITIES

19

(362,523

)

(249,170

)

NET ASSETS

2,953,120

2,496,501

CAPITAL AND RESERVES

Called up share capital

20

100

100

Retained earnings

21

2,953,020

2,496,401

SHAREHOLDERS' FUNDS

2,953,120

2,496,501

The financial statements were approved by the director and authorised for issue on 30 September 2025 and were signed by:

B Johnson - Director

FIXED ASSETS

Intangible assets

10

103,083

54,003

Tangible assets

11

1,130,089

1,121,250

Investments

12

237,755

87,655

1,470,927

1,262,908

CURRENT ASSETS

Stocks

13

1,551,698

2,258,377

Debtors

14

764,923

1,284,219

Cash at bank

1,888,281

1,294,993

4,204,902

4,837,589

CREDITORS

Amounts falling due within one year

15

2,175,086

3,087,994

NET CURRENT ASSETS

2,029,816

1,749,595

TOTAL ASSETS LESS CURRENT LIABILITIES

3,500,743

3,012,503

CREDITORS

Amounts falling due after more than one year

16

(184,599

)

(266,833

)

PROVISIONS FOR LIABILITIES

19

(362,523

)

(249,170

)

NET ASSETS

2,953,621

2,496,500

CAPITAL AND RESERVES

Called up share capital

20

100

100

Retained earnings

21

2,953,521

2,496,400

SHAREHOLDERS' FUNDS

2,953,621

2,496,500

Company's profit for the financial year

1,221,572

755,260

The financial statements were approved by the director and authorised for issue on 30 September 2025 and were signed by:

B Johnson - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2023

100

2,567,777

2,567,877

Prior year adjustment

-

(84,637

)

(84,637

)

As restated

100

2,483,140

2,483,240

Changes in equity

Dividends

-

(742,000

)

(742,000

)

Total comprehensive income

-

755,261

755,261

Balance at 31 December 2023

100

2,496,401

2,496,501

Changes in equity

Dividends

-

(764,451

)

(764,451

)

Total comprehensive income

-

1,221,070

1,221,070

Balance at 31 December 2024

100

2,953,020

2,953,120

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2023

100

2,567,777

2,567,877

Prior year adjustment

-

(84,637

)

(84,637

)

As restated

100

2,483,140

2,483,240

Changes in equity

Dividends

-

(742,000

)

(742,000

)

Total comprehensive income

-

755,260

755,260

Balance at 31 December 2023

100

2,496,400

2,496,500

Changes in equity

Dividends

-

(764,451

)

(764,451

)

Total comprehensive income

-

1,221,572

1,221,572

Balance at 31 December 2024

100

2,953,521

2,953,621

Cash flows from operating activities

Cash generated from operations

1

2,200,080

2,519,462

Interest paid

(28,072

)

(56,161

)

Interest element of hire purchase payments paid

(17,445

)

(10,717

)

(Decrease)/ increase in other provisions

80,000

-

Tax paid

(35,512

)

(40,852

)

Net cash from operating activities

2,199,051

2,411,732

Cash flows from investing activities

Purchase of intangible fixed assets

(59,689

)

(35,187

)

Purchase of tangible fixed assets

(415,632

)

(507,152

)

Purchase of fixed asset investments

(150,000

)

-

Sale of tangible fixed assets

25,500

52,654

Sale of fixed asset investments

-

50,000

Interest received

224

312

Net cash from investing activities

(599,597

)

(439,373

)

Cash flows from financing activities

Loan repayments in year

(93,205

)

(191,895

)

Capital repayments in year

(146,228

)

(4,748

)

Amount introduced by directors

6,400

-

Amount withdrawn by directors

(6,774

)

(92,930

)

Share issue

-

100

Equity dividends paid

(764,451

)

(742,000

)

Net cash from financing activities

(1,004,258

)

(1,031,473

)

Increase in cash and cash equivalents

595,196

940,886

Cash and cash equivalents at beginning of year

2

1,293,186

352,300

Cash and cash equivalents at end of year

2

1,888,382

1,293,186

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

2024

2023

£

£

Profit before taxation

1,496,220

870,194

Depreciation charges

402,321

314,734

Profit on disposal of fixed assets

(10,419

)

(2,424

)

Finance costs

45,517

66,878

Finance income

(224

)

(312

)

1,933,415

1,249,070

Decrease/(increase) in stocks

706,679

(313,238

)

Decrease in trade and other debtors

549,379

364,766

(Decrease)/increase in trade and other creditors

(989,393

)

1,218,864

Cash generated from operations

2,200,080

2,519,462

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

1,888,382

1,294,993

Bank overdrafts

-

(1,807

)

1,888,382

1,293,186

Year ended 31 December 2023

31/12/23

1/1/23

£

£

Cash and cash equivalents

1,294,993

354,107

Bank overdrafts

(1,807

)

(1,807

)

1,293,186

352,300

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1/1/24

Cash flow

At 31/12/24

£

£

£

Net cash

Cash at bank

1,294,993

593,389

1,888,382

Bank overdrafts

(1,807

)

1,807

-

1,293,186

595,196

1,888,382

Debt

Finance leases

(351,332

)

146,228

(205,104

)

Debts falling due within 1 year

(190,436

)

76,151

(114,285

)

Debts falling due after 1 year

(71,680

)

17,054

(54,626

)

(613,448

)

239,433

(374,015

)

Total

679,738

834,629

1,514,367