REGISTERED NUMBER: 01154477 (England and Wales)

Strategic Report,

Report of the Directors and

Audited Financial Statements

for the Year Ended

31 December 2024

for

Kuka Systems UK Limited

Page

Company Information

1

Strategic Report

2

Report of the Directors

5

Report of the Independent Auditors

7

Statement of Comprehensive Income

9

Balance Sheet

10

Statement of Changes in Equity

11

Notes to the Financial Statements

12

DIRECTORS:

N P Owen

M J Russell

REGISTERED OFFICE:

19 Hereward Rise

Halesowen

West Midlands

B62 8AN

REGISTERED NUMBER:

01154477 (England and Wales)

AUDITORS:

DJH Audit Limited

Statutory Auditors

Church Court

Stourbridge Road

Halesowen

West Midlands

B63 3TT

The directors present their strategic report for the year ended 31 December 2024.

The principal activities of the Company are the design, manufacture and supply of solid phase welding machines (covering rotary friction welding, linear friction welding and friction stir welding) and the development and supply of specialist automation systems and robot cells, together with ancillary services. The Company operates globally in a range of market sectors.

REVIEW OF BUSINESS

This report provides an overview of the Company's performance in the year 2024.

In overview, 2024 has been a transitional year for KUKA Systems UK, with a change of leadership and a significant operational restructuring programme. The new management team has acted to complete, and exit from, a number of loss making and low margin activities, and to invest in the development of new products and new business streams (in complementary technologies). The business has been reshaped to match the needs of this new strategy and as part of this process some non-recurring restructuring costs have been incurred. These activities, plus a legacy position of low orders, has resulted in an operating loss for the year 2024.

Looking ahead, the business has experienced much improved trading conditions into 2025, with a significant rise in orderbook and a regular and cumulative run of operational profitability. The new strategic direction of the business is delivering improved results and significant new orders have been won across a range of business streams (including those recently introduced). Management is confident that 2024 represents a turning point for KUKA Systems UK, and we look forward to the future with renewed confidence.

Strong financial support for the UK business remains in place (via our parent company), and this facility has allowed KUKA Systems UK to retain and to build upon its core technical capabilities in order to deliver the recovery that is now being experienced. The UK management team is grateful to the parent company board, and to our network of loyal customers and stakeholders, for their support during this transitional year.

Key Performance Indicators (KPIs):

Company's key performance indicators as below:

2024

2023

2022

2021

2020

Order Income

K- GBP

24,240

6,497

14,482

10,213

15,126

Sales

K-GBP

6,957

11,728

14,723

15,155

16,187,

Gross (Loss)/Profit

K- GBP

(1,872)

(211)

(259)

(280)

(99)

Gross Loss %

%

-26.91%

-1.80%

-1.76%

-1.85%

-0.61%

(Loss)/ Profit before tax

K-GBP

(5,853)

(3,692)

(2,804)

(2,137)

(2,211)

PRINCIPAL RISKS AND UNCERTAINTIES

The Company is exposed to certain risks and uncertainties as described below:

Contractual Risks

The company enters into long-term contracts with customers to supply designed and manufactured to order machines and automated solutions. These contracts may contain penalty clauses connected with specific performance criteria and delivery dates. Failure to meet these contractual obligations can result in the company incurring significant costs - typically 5 to 10% of a total project value. In order to minimize this risk, the company has strict project execution processes and quality control procedures. The company also seeks to mitigate the risk by applying similar conditions to its supplier base, where reasonable.

Market Risks

The Company operates in a competitive market where the key challenges are on-going price sensitivity and customer demand for continuous product innovation. The Company embraces these challenges with a range of technologically forward products and solutions that offer customers quantifiable financial advantages driven by fast payback periods. The Company also seeks to differentiate itself from its competitors via an improved customer service level.

Credit Risk

The Company operates a credit management policy in order to minimise the risk of losses should a counter party default on its obligations. This requires appropriate credit checks to be performed on potential and existing customers prior to entering into transactions. Credit limits for counterparties are established and regularly maintained from those recommended by a respected business information provider.

Foreign Currency Risks

The Company operates globally and has transactional exposure from sales or purchases that are denominated in foreign currencies. The company has a policy of hedging all significant foreign currency-based contracts via the KUKA group's treasury functions.

Liquidity Risk

In order to maintain liquidity and to ensure that sufficient funds are available for ongoing and future commitments the company uses intercompany loans from its parent, KUKA AG.

Personnel Risks

The performance of the Company depends to a great degree on having qualified technical and management staff. Personnel risks exist in respect of the potential for employee turnover in key positions within the Company. To mitigate this risk the Company invests in ongoing staff training and development and offers a comprehensive employee remuneration and benefits package. The company also operates an active and successful apprenticeships programme, for which KUKA Systems UK has recently achieved Gold standard 'Excellent Employer' status from Make UK Engineering Apprenticeships.

DIRECTORS' STATEMENT OF COMPLIANCE WITH DUTY TO PROMOTE SUCCESS OF THE COMPANY

The Directors act in good faith to make decisions, the outcomes of which, they consider will be most likely to promote the success of the Company and Group for the benefit of its members as a whole, both in the current period and in the long term.

In discharging their duties above, the Directors carefully consider, amongst other matters, the impact on, and interests of, other stakeholders and factor these into their decision making process. Further information on stakeholder engagement is included in the Directors' Report.

FUTURE OUTLOOK

As noted above, our new business strategy had resulted in a significant upturn in orders as well as reduced operational and administrative costs. The combined effect of these factors has delivered consistent operational profitability (of circa 10% EBITDA) throughout 2025, including Q1, Q2 and Q3 to date.

Trading conditions for the future are promising in most of our key markets, although some headwinds are also noted in relation to increased import tariffs in the US. The business overall now has a range of attractive technology offerings and qualified prospects for future sales in many markets. Closure of sales remains challenging for high-cost capital equipment (due in large part to low industrial confidence in some territories and the high cost of capital worldwide). Despite these conditions, our product offerings are proving attractive to the market and new orders are being won.

Going forward KUKA Systems UK remains committed to the provision of world class technical solutions and ongoing customer service excellence. These enduring company principles support our market leading reputation, and provide an important degree of differentiation between the company and its competitors.

ON BEHALF OF THE BOARD:

N P Owen - Director

6 October 2025

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

DIVIDENDS

No dividends will be distributed for the year ended 31 December 2024.

The loss for the year, after taxation, amounted to £5,064,667 (2023 - loss £3,901,531).

RESEARCH AND DEVELOPMENT

The Company is engaged in research and development consistent with applying the latest technology to the design and manufacture of friction welders and automation systems.

FUTURE DEVELOPMENTS

The year ending 2024 has seen a significant restructuring of the business to ensure future profitability. The company will continue the core business and has strengthened its forward position via the introduction of complementary business streams. This strategy is proving effective, with the current financial year showing strong operational profitability. The business remains committed to the provision of high quality of products and services and to the recruitment, development, and retention of high calibre employees.

DIRECTORS

The directors who have held office during the period from 1 January 2024 to the date of this report are as follows:

J A Nowill - resigned 24 July 2024

I M Martinez - resigned 17 June 2024

N P Owen - appointed 17 June 2024

M J Russell - appointed 17 June 2024

DIRECTORS' INDEMNITIES

During the year an indemnity from the Company was available to the directors against liabilities that might be incurred by them in defending proceedings against them in respect of the affairs of the Company. The indemnity is subject to the provisions of the Companies Act and is set out in the Articles of Association.

ENGAGEMENT WITH SUPPLIERS, CUSTOMERS AND OTHERS

As part of the global KUKA group, the Company engages with key stakeholders based on Group Board level policy, supplemented by Company Board level modifications to meet the needs of local stakeholders.

GROUP APPROACH

KUKA is in regular contact with various social groups. These may at times place quite different demands or requirements on the Company and may impact the Company's reputation. Our key stakeholders are customers, business partners, suppliers and our employees, plus investors and shareholders as well as media representatives and the public. We have been collaborating closely with various customers for many years, for example implementing technical innovations in industrial production within the scope of joint projects.

Communicating with stakeholders is important to KUKA, because an open exchange of thoughts is the basis for mutual understanding and acceptance of business decisions. The respective divisions are responsible for communication with the various stakeholders: for example, Purchasing is the contact for suppliers, HR for employees, and the Press department for media representatives. The Investor Relations department is in direct contact with investors and analysts. Sustainability rating agencies are served by the Management Systems department. KUKA AG has been involved in the Carbon Disclosure Project (CDP) since 2008, an organization that analyses information relating to environmental risks on a yearly basis.

ENGAGEMENT WITH EMPLOYEES

The KUKA Group is directly responsible for more than 14,000 employees worldwide. In order to minimise health risks, we place great importance on high safety standards in all activities within the Company and in handling our products, and we are committed to responsible economic activities. This also ensures that we remain an attractive employer, thereby counteracting a shortage of skilled personnel in our Company.

IMPACT ON THE ECONOMY, ENVIRONMENT AND SOCIETY

KUKA's products and solutions make an important contribution to the economic growth, technological progress and improved working conditions of its customers. For this reason, KUKA considers itself to be a partner to its customers and a responsible employer for its workforce and their families.

KUKA protects the environment through the careful use of natural resources and an effective environmental management system. Applicable laws and regulations are always observed. KUKA takes this responsibility seriously and is also aware of any negative effects that may be associated with its own actions and which could have consequences for the economy, environment and society as well as for the Company and its employees if they do occur.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

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, DJH Audit Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

N P Owen - Director

6 October 2025

Opinion

We have audited the financial statements of Kuka Systems UK Limited (the 'company') for the year ended 31 December 2024 which comprise the Statement of 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 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.

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 Statement of Directors' Responsibilities set out on page six, 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:

We identify and assess risks of material misstatement of the financial statements, whether due to fraud and error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:

- the nature of the industry, control environment and business performance;

- results of our enquiries of management about their own identification and assessment of the risks of irregularities;

- any matters we have identified having reviewed the company's procedures for complying with laws and regulations and whether they were aware of any instances of non-compliance. The key laws and regulations we considered in this context included the Companies Act 2006.

Our audit procedures in relation to fraud included but were not limited to:

- reviewing balance sheet control accounts to ensure properly reconciled;

- addressing the risks of fraud through management override of controls by performing journal entry testing;

- performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;

- enquiring with management concerning actual and potential litigation claims.

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 Wright FCA (Senior Statutory Auditor)

for and on behalf of DJH Audit Limited

Statutory Auditors

Church Court

Stourbridge Road

Halesowen

West Midlands

B63 3TT

6 October 2025

TURNOVER

4

6,957,307

11,630,569

Cost of sales

8,829,906

12,745,906

GROSS LOSS

(1,872,599

)

(1,115,337

)

Administrative expenses

2,975,600

2,238,392

(4,848,199

)

(3,353,729

)

Other operating income

125,574

150,000

OPERATING LOSS

6

(4,722,625

)

(3,203,729

)

Interest receivable and similar income

8

15

2,363

(4,722,610

)

(3,201,366

)

Interest payable and similar expenses

9

1,020,658

700,165

LOSS BEFORE TAXATION

(5,743,268

)

(3,901,531

)

Tax on loss

10

(678,601

)

-

LOSS FOR THE FINANCIAL YEAR

(5,064,667

)

(3,901,531

)

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(5,064,667

)

(3,901,531

)

FIXED ASSETS

Intangible assets

11

19,888

49,261

Tangible assets

12

1,351,587

1,561,558

1,371,475

1,610,819

CURRENT ASSETS

Stocks

13

1,485,853

1,735,006

Debtors

14

3,458,300

3,028,622

Cash at bank

821,881

1,047,255

5,766,034

5,810,883

CREDITORS

Amounts falling due within one year

15

21,292,119

16,477,780

NET CURRENT LIABILITIES

(15,526,085

)

(10,666,897

)

TOTAL ASSETS LESS CURRENT LIABILITIES

(14,154,610

)

(9,056,078

)

PROVISIONS FOR LIABILITIES

17

211,605

245,470

NET LIABILITIES

(14,366,215

)

(9,301,548

)

CAPITAL AND RESERVES

Called up share capital

18

4,428,880

4,428,880

Retained earnings

19

(18,795,095

)

(13,730,428

)

SHAREHOLDERS' FUNDS

(14,366,215

)

(9,301,548

)

The financial statements were approved by the Board of Directors and authorised for issue on 6 October 2025 and were signed on its behalf by:

N P Owen - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2023

4,428,880

(9,828,897

)

(5,400,017

)

Changes in equity

Total comprehensive income

-

(3,901,531

)

(3,901,531

)

Balance at 31 December 2023

4,428,880

(13,730,428

)

(9,301,548

)

Changes in equity

Total comprehensive income

-

(5,064,667

)

(5,064,667

)

Balance at 31 December 2024

4,428,880

(18,795,095

)

(14,366,215

)

1.	STATUTORY INFORMATION

Kuka Systems UK 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.

Kuka Systems UK Limited designs and manufactures automated cells and friction welding machines, together with ancillary services.

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.

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 3.17(d);

•

the requirements of paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);

•

the requirements of paragraphs 12.26, 12.27, 12.29(a), 12.29(b) and 12.29A;

•

the requirement of paragraph 33.7.

This information is included in the consolidated financial statements of KUKA AG as at 31 December 2023

Turnover

Turnover represents sales and commission receivable, net of value added tax.

Sales are recognised once the significant risks and rewards have been transferred to the customer. Interim invoices in advance of this are credited to payments on account.

Turnover on larger projects is recognised on a percentage of completion basis over the period from the commencement of performance of the contract to customer acceptance. The degree of completion of the contract is measured using the costs incurred to date or milestones reached, depending on the nature of the individual contract and the most appropriate measure of the percentage of completion. Amounts recoverable on contracts are included in debtors and represent turnover recognised in excess of payments on account. Losses on contracts are recognised as soon as a loss is foreseen by reference to the estimated costs of completion.

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.

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

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Freehold property

-

at varying rates on cost

Leasehold improvements

-

25% on cost

Plant and machinery

-

10% to 25% on cost

Fixtures and fittings

-

25% on cost

Training and demo equipment

-

25% on cost

Stocks

Stocks are stated at the lower of cost and net releasable value, being the estimated selling prices less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

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

Debtors

Short term debtors are measured at transaction price, less any impairment.

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours.

Creditors

Short term creditors are measures at the transaction price.

Payments received on account are deducted from amounts recoverable on contracts. Excess progress payments are included in creditors as payments received on account.

Financial instruments

The Company enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other accounts receivable and payable.

Derivatives, including interest rate swaps and forward exchange contracts, are not basic financial instruments. Derivatives are initially recognised at the 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 and loss. The Company does not currently apply hedge accounting for interest rate and foreign exchange derivatives.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, 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.

Research and development

In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research is recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight line basis over their useful economic lives, which range from 3 to 6 years.

If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.

Foreign currencies

The Company's functional and presentational currency is GBP.

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non­ monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Hire purchase and leasing commitments

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

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.

Provisions for liabilities

Provisions are charged as an expense to the Statement of Income and Retained Earnings in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the Balance Sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.

Going concern

The Company is currently dependent for its working capital upon funds provided to it by KUKA AG - the Company's parent holding company. The ultimate parent company and controlling party of KUKA AG - and the Company - is MIDEA Group Co Ltd.

KUKA AG has provided the Company with an undertaking for at least 12 months from the date of approval of these financial statements that it will not call upon group loan balances unless sufficient working capital is available. This should enable the Company to continue in operational existence for the foreseeable future by meeting its liabilities as they fall due for payment.

Additionally, the Directors have considered the Company's position at the Balance Sheet date, reviewed forecasts of order income, turnover, expenditure and cash flows together with current orders on hand - as well as the financial strength of the Group of which it is part.

Based on the above, the Directors believe that it remains appropriate to prepare the financial statements on a going concern basis. The financial statements do not include any adjustments that would result in the basis of preparation being inappropriate.

3.	CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

Preparation of the financial statements requires management to make significant judgements and estimates. The items in the financial statements where these judgements and estimates have been made include:

Warranty

The Company provides a standard warranty coverage on products, providing labour and parts necessary to repair machinery during the warranty period. The estimated warranty costs are based on a percentage of the turnover as per group policy. The actual warranty costs may differ and in those cases warranty reserves are adjusted accordingly. Future warranty expenses may exceed initial estimates, which would lead to an increase in the reported Cost of Sales.

Stock provisioning

Stocks are stated at the lower of costs and net realisable value. Net realisable value is based on selling price less any further costs expected to be incurred to completion and disposal. Provision is made for obsolete, slow-moving or defective items where appropriate, based on management's knowledge and historical information. If actual demand or usage were to be lower than estimated, additional stock provisions for excess or obsolete stocks may be required, which could have an adverse effect on the reporting result.

Trade debtors provisioning

An allowance for doubtful accounts in maintained for potential credit losses based upon management's assessment of collectabilty of all accounts receivable.The allowance for doubtful debts is reviewed periodically to assess the adequacy of the allowance.

Long term contracts

Long term contracts revenues and costs are recognised on a stage-of-completion basis at the reporting date, based on estimated costs to complete each project. This estimate is calculated using management's knowledge of the expected project out-turn which is based upon both historical and future information to the Company at the time.

4.

TURNOVER

An analysis of turnover is not provided, as, in the the opinion of the Directors, disclosure of such information would be seriously prejudicial to the Company's interest.

5.	EMPLOYEES AND DIRECTORS

2024

2023

£

£

Wages and salaries

5,530,781

5,223,407

Social security costs

474,880

518,655

Other pension costs

112,009

124,590

6,117,670

5,866,652

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

2024

2023

Production

59

72

Sales

11

11

Administration

15

8

85

91

2024

2023

£

£

Directors' remuneration

163,670

-

In 2023 and for part of 2024 directors were remunerated through other group companies.

6.	OPERATING LOSS

The operating loss is stated after charging:

2024

2023

£

£

Other operating leases

165,932

234,099

Depreciation - owned assets

310,286

332,959

Loss on disposal of fixed assets

25,782

-

Computer software amortisation

29,590

24,581

7.	AUDITORS' REMUNERATION

2024

2023

£

£

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

29,500

36,350

8.

INTEREST RECEIVABLE AND SIMILAR INCOME

2024

2023

£

£

Deposit account interest

15

2,363

9.

INTEREST PAYABLE AND SIMILAR EXPENSES

2024

2023

£

£

Group interest payable

1,020,658

700,165

10.

TAXATION

Analysis of the tax credit

The tax credit on the loss for the year was as follows:

2024

2023

£

£

Current tax:

Taxation earlier years

(678,601

)

-

Tax on loss

(678,601

)

-

Reconciliation of total tax credit included in profit and loss

The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

2024

2023

£

£

Loss before tax

(5,743,268

)

(3,901,531

)

Loss multiplied by the standard rate of corporation tax in the UK of 25% (2023 - 25%)

(1,435,817

)

(975,383

)

Effects of:

Expenses not deductible for tax purposes

125

-

Depreciation in excess of capital allowances

47,180

69,775

R & D tax credits

(678,601

)

-

Adjustment for provisions

-

(82,093

)

Losses carried forward

1,388,512

987,701

Total tax credit

(678,601

)

-

There are trading losses carried forward which will be available to utilise against suitable future trading profits of approximately £15,000,000.

11.	INTANGIBLE FIXED ASSETS

Computer

software

£

COST

At 1 January 2024

428,692

Additions

3,125

Disposals

(3,404

)

At 31 December 2024

428,413

AMORTISATION

At 1 January 2024

379,431

Amortisation for year

29,590

Eliminated on disposal

(496

)

At 31 December 2024

408,525

NET BOOK VALUE

At 31 December 2024

19,888

At 31 December 2023

49,261

12.	TANGIBLE FIXED ASSETS

Freehold

Leasehold

Plant and

property

improvements

machinery

£

£

£

COST

At 1 January 2024

2,378,043

292,904

3,413,441

Additions

-

2,832

108,033

Disposals

-

(143,485

)

(743,061

)

Reclassification/transfer

(82,597

)

82,532

(904,666

)

At 31 December 2024

2,295,446

234,783

1,873,747

DEPRECIATION

At 1 January 2024

1,051,500

271,421

3,300,556

Charge for year

122,933

106,845

28,163

Eliminated on disposal

-

(143,485

)

(699,179

)

Reclassification/transfer

-

-

(908,167

)

At 31 December 2024

1,174,433

234,781

1,721,373

NET BOOK VALUE

At 31 December 2024

1,121,013

2

152,374

At 31 December 2023

1,326,543

21,483

112,885