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

The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true

Sheppey Energy Limited is a private company limited by shares incorporated in England and Wales. The registered office is The Old School, High Street, Stretham, Ely, CB6 3LD. The principal place of business is New Hook Farm, Lower Road, Minster-on-Sea, Sheerness, ME12 3SU.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

As at 30 March 2025, the company has net liabilities of £16,270,385 (2024: £13,341,837). Included in the net liabilities balance is a loan from a parent company of £29,643,471 (2024: £27,619,986), as disclosed in note 7 of the financial statements. The company has made a loss after tax of £2,928,548 (2024: £4,252,417).

The parent company has confirmed through a formal letter of support that they will continue to provide financial support for a period of at least twelve months from the date of the approval of the financial statements. For this reason the directors continue to prepare the financial statements on a going concern basis.

Turnover represents sales of feedstock, electricity units generated, and the value of Renewable Heat Incentives and other subsidies which are recognised upon generation of the electricity.

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

Sale of energy:

• 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 probably that the company will received the consideration due under the transaction; and

• The costs incurred or to be incurred in respect of the transaction can e measured reliably.

Turnover represents amounts receivable for energy generated in the period net of any applicable value added tax. Any uninvoiced income is accrued in the period in which it has been generated.

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

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

Borrowing costs associated with financing capital expenditure on construction of the plant and machinery are capitalise as part of the cost of the asset. The anaerobic digestion plant was completed in the year to 31 March 2021 at which point the plant became operational. Further costs are only capitalised to the extent that can be classified as tangible fixed assets under FRS 101 Section 1A.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items. Stock represents 'feed stock' held for consumption by the anaerobic digestion plant.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

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

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

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

During the year £nil (2024 - £nil) of interest costs directly attributable to the financing of freehold property developments were capitalised at the weighted average cost of the related borrowings. The total capitalised interest at 30 March 2025 was £2,517,073 (2024 - £2,517,073).

At year end a parent company, Privilege Project Finance Limited, was owed a balance of £29,643,471 (2024: £27,619,986). The parent company has a fixed and floating charge over the assets of the company.

On 6 March 2025, a deed of amendment was agreed by both parties which extended the date of maturity of the loan through to 30 June 2026.

As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006.

The auditor's report is unqualified and includes the following:

In our opinion the financial statements:

• give a true and fair view of the state of the company's affairs as at 30 March 2025 and of its loss 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.

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

The parent company of the smallest group for which consolidated financial statements are drawn up of which Sheppey Energy Limited is a member is Privilege Project Finance Limited and its registered office is The Old School, High Street, Stretham, Ely, England, CB6 3LD.

The ultimate parent company is Privilege Holdings Limited, registered at The Old School High Street, Stretham, Ely, England, CB6 3LD. The controlling party is Craig Reeves by virtue of a majority shareholding in Privilege Holdings Limited.