REGISTERED NUMBER: 11520080 (England and Wales)

AUDITED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31ST DECEMBER 2024

FOR

ALFANAR ENERGY LIMITED

Page

Company Information

1

Statement of Financial Position

2

Notes to the Financial Statements

3

DIRECTORS:

Mr M S M Almutlaq

Mr J Wadi

REGISTERED OFFICE:

1-6 Lombard Street

London

EC3V 9AA

REGISTERED NUMBER:

11520080 (England and Wales)

INDEPENDENT AUDITORS:

Watergates Ltd (Statutory Auditor)

109 Coleman Road

Leicester

Leicestershire

LE5 4LE

FIXED ASSETS

Intangible assets

4

14,534

10,571

Tangible assets

5

52,727

40,537

67,261

51,108

CURRENT ASSETS

Stocks

31,926,521

-

Debtors

6

29,676,250

25,340,628

Cash at bank and in hand

1,540,572

1,795,049

63,143,343

27,135,677

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

7

(63,861,563

)

(27,551,358

)

NET CURRENT LIABILITIES

(718,220

)

(415,681

)

TOTAL ASSETS LESS CURRENT LIABILITIES

(650,959

)

(364,573

)

CAPITAL AND RESERVES

Called up share capital

9

10,000

10,000

Retained earnings

(660,959

)

(374,573

)

SHAREHOLDERS' FUNDS

(650,959

)

(364,573

)

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

In accordance with Section 444 of the Companies Act 2006, the Income Statement has not been delivered.

The financial statements were approved by the Board of Directors and authorised for issue on 26th September 2025 and were signed on its behalf by:

Mr J Wadi - Director

1.	STATUTORY INFORMATION

Alfanar Energy 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.

The presentation currency of the financial statements is the Pound Sterling (£).

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" including the provisions of Section 1A "Small Entities" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

GOING CONCERN

After reviewing the company's forecasts and projections, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The company therefore continues to adopt the going concern basis in preparing its financial statements.

The directors have reviewed future cash flow projections and financial modelling, which they feel adequately reflect the current uncertain economic environment. The directors are satisfied that this shows its future plans to be viable, and there will be sufficient cash resources available for the forthcoming 12 months to enable the entity to continue as a going concern.

As shown in the accompanying financial statements, the Company incurred a net loss before taxation of £286,386 for the year ended 31 December 2024 (2023: £143,172). As of 31 December 2024, despite having a positive cash balance of £1,540,572 (2023: £1,795,049) the Company was in a net liability position of £650,959 with net current liabilities of £718,220. However it must be noted that a significant portion of the creditors relates to funding arrangement with a fellow group company.

The Company’s ability to continue as a going concern is dependent upon successfully executing its plans to achieve profitability in the long-term. The Company’s financial statements do not include any adjustments that might be necessary if it were unable to continue as a going concern.

It must be noted that the above results are in line with management's expectations and part of their long term plans of development for future positive results and arrangements through loans and parent support are in place. Finance has been secured and the funding arrangement is expected to continue into the future. The company also has support from its controlling parent accompanied by a going concern comfort letter to ensure its going concern.

The financial statements do not include any adjustments that might be necessary if it were unable to continue as a going concern. After considering all relevant uncertainties, the directors have a reasonable expectation that the entity has adequate resources to continue in operational existence for the foreseeable future. Thus, they continue to adopt the going concern basis of accounting in preparing the annual financial statements.

TURNOVER

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Turnover is recognised based on stage of completion of the project, being when each milestone is reached and signed off by the customer, and when all of the following conditions are satisfied:

- the amount of revenue can be measured reliably;

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

- the stage of completion of the contract at the end of the reporting period can be measured

reliably; and

- the costs incurred and the costs to complete the contract can be measured reliably.

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 are being amortised evenly over their estimated useful life of five years.

TANGIBLE FIXED ASSETS

Tangible fixed assets are stated at cost less accumulated depreciation and accumulated impairment

losses. Such cost includes costs directly attributable to making the asset capable of operating as intended.

Depreciation is provided at the following annual rates in order to write off the cost less estimated residual value of each asset over its estimated useful life:

Office equipment - 33% on cost

The carrying values of tangible fixed assets are reviewed annually for impairment in periods if events or changes in circumstances indicate the carrying value may not be recoverable.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Income Statement.

Impairment of assets

At each reporting date fixed assets are reviewed to determine whether there is any indication that those assets have suffered an impairment loss. If there is an indication of possible impairment, the recoverable amount of any affected asset is estimated and compared with its carrying amount. If estimated recoverable amount is lower, the carrying amount is reduced to its estimated recoverable amount, and an impairment loss is recognised immediately in profit or loss.

If an impairment loss subsequently reverses, the carry amount of the asset is increased to the revised estimate of its recoverable amount, but not in excess of the amount that would have been determined had no impairment loss been recognised for the asset in prior years. A reversal of an impairment loss is recognised immediately in profit or loss.

STOCKS

Stock represents work in progress and is valued at the lower of cost and net realisable value

Work in progress represents expenses which will be recharged once the milestone has been reached and signed off by the customer. The expenses to be recharged are based on the portion that relates to the agreed expenditure that is re-chargeable with mark-up.

FINANCIAL INSTRUMENTS

The Company only enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in non-puttable ordinary shares.

Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or financed at a rate of interest that is not a market rate or in case of an out-right short-term loan not at market rate, the financial asset or liability is measured, initially, at the present value of the future cash flow discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost.

Investments in non-convertible preference shares and in non-puttable ordinary and preference shares are measured:

- at fair value with changes recognised in the Income Statement if the shares are publicly traded or

their fair value can otherwise be measured reliably;

- at cost less impairment for all other investments.

Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Income Statement.

For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.

For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Company would receive for the asset if it were to be sold at the Balance Sheet date.

Financial assets and liabilities are offset and the net amount reported in the Balance sheet when there is an 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.

TAXATION

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

Current or deferred taxation assets and liabilities are not discounted.

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

DEFERRED TAX

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position 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

Expenditure on research and development is written off in the year in which it is incurred.

FOREIGN CURRENCIES

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.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Income Statement except when deferred in other comprehensive income as qualifying cash flow hedges.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Income Statement within 'finance income or costs'.

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.

Employee benefits and contributions to defined contribution plans are recognised as an expense in the period in which they are incurred.

HIRE PURCHASE AND LEASING COMMITMENTS

Rentals payable under operating leases are charged to the Income Statement on a straight-line basis over the lease term.

3.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was 22 (2023 - 14 ) .

4.	INTANGIBLE FIXED ASSETS

Other

intangible

assets

£

COST

At 1st January 2024

13,524

Reclassification/transfer

6,944

At 31st December 2024

20,468

AMORTISATION

At 1st January 2024

2,953

Charge for year

2,981

At 31st December 2024

5,934

NET BOOK VALUE

At 31st December 2024

14,534

At 31st December 2023

10,571

5.	TANGIBLE FIXED ASSETS

Office

equipment

£

COST

At 1st January 2024

84,328

Additions

59,134

Disposals

(21,686

)

Reclassification/transfer

(6,944

)

At 31st December 2024

114,832

DEPRECIATION

At 1st January 2024

43,791

Charge for year

18,314

At 31st December 2024

62,105

NET BOOK VALUE

At 31st December 2024

52,727

At 31st December 2023

40,537

6.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

31/12/24

31/12/23

£

£

Amounts owed by group undertakings

26,470,509

6,203,661

Other debtors

3,205,741

19,136,967

29,676,250

25,340,628

Amounts owed by group undertakings are interest free, have no fixed repayment date and are repayable on demand.

7.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

31/12/24

31/12/23

£

£

Trade creditors

4,964,074

824,430

Amounts owed to group undertakings

58,449,799

26,532,949

Taxation and social security

97,909

-

Other creditors

349,781

193,979

63,861,563

27,551,358

Amounts owed to group undertakings includes creditors which are interest bearing at 5%, have no fixed repayment date and are repayable on demand.

8.	LEASING AGREEMENTS

Minimum lease payments under non-cancellable operating leases fall due as follows:

31/12/24

31/12/23

£

£

Within one year

561,906

15,480

Between one and five years

2,247,624

-

2,809,530

15,480

9.	CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:

Number:

Class:

Nominal

31/12/24

31/12/23

value:

£

£

1,000

Ordinary

£10

10,000

10,000

10.	DISCLOSURE UNDER SECTION 444(5B) OF THE COMPANIES ACT 2006

The Report of the Auditors was unqualified.

Nazir Malida FCCA (Senior Statutory Auditor)

for and on behalf of Watergates Ltd (Statutory Auditor)

11.	RELATED PARTY DISCLOSURES

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.

Amounts owed by related parties with mutual directors or common control and not wholly owned subsidiaries at the year ended 31 December 2024 was £955,195 (2023: £403,091), with sales of £172,746 (2023: £808,077).

12.	ULTIMATE CONTROLLING PARTY

The smallest group for which consolidated financial statements are drawn up is headed by Al Fanar Company, a company incorporated in Saudi Arabia. Group financial statements are not publically available. Al Fanar Company's principal place of business is Al-Nafl, Northern Ring Road, Riyadh 11411, KSA.

The Company's ultimate parent undertaking is Arabian Trading Group which is registered in Saudi Arabia.

The ultimate controlling party are the shareholders of the ultimate parent company, in the current and preceding year.