Company registration number: 9432751
COMPANY INFORMATION
CONTENTS
GROUP STRATEGIC REPORT
FOR THE 9 MONTHS ENDED 31 DECEMBER 2024
The principal activity of the Group is the manufacture of Spectroscopy accessories, sample preparation, process, and optical products for the scientific instrument sector and various other applications within industry.
The Group continued to follow its long-term strategy in the 9 months ended 31 December 2024, supplying market leading products to its global customers, with exports contributing 97.3% to group sales in the year (95.5% FY24).
Sales in the 9 months ended 31 December 2024 proportionately increased by 13.1% (FY24 3.4% fall), excluding the impact of the acquisition of Harric Scientific at the end of the previous period, as the business continued to capitalise on-going growth in our core markets coupled with growth accelerating initiatives implemented to further underpin and accelerate growth. Including, enhancing corporate strategy and its implementation to ensure significant organic and accelerated growth (including acquisition) year on year long term.
The business continues a rigorous approach to both Top and Bottom line. Top line focussing on improving Sales performance and New Product Development. Bottom line focussing on improved cost control, driving improved ROI, coupled with strong debt management.
Sales in the 9 months ended 31 December 2024 proportionately increased by 13.1% (FY24 3.4% fall), excluding the impact of the acquisition of Harric Scientific at the end of the previous period, as the business continued to capitalise on-going growth in our core markets coupled with growth accelerating initiatives implemented to further underpin and accelerate growth. Including, enhancing corporate strategy and its implementation to ensure significant organic and accelerated growth (including acquisition) year on year long term.
The business continues a rigorous approach to both Top and Bottom line. Top line focussing on improving Sales performance and New Product Development. Bottom line focussing on improved cost control, driving improved ROI, coupled with strong debt management.
The Company governs and manages various business and operational risks which are typical for a company of its size and sector. Governance is enhanced through regular Board and Leadership meetings which discuss and manage these risks to minimise their likelihood or impact on the company as far as is possible. Insurance, Proforma invoices for new customers, Quality audits and Health and Safety reviews amongst other activities play an appropriate role in mitigating these risks. The Company reviews its strategy on a regular basis to maximise its performance potential.
The Directors regard the following measures as key performance indicators of Company performance. These are as follows:
The Company has continued to perform well in the period with the key performance indicators above expectations. The Directors were satisfied with the performance of the Company in the current year against these key performance indicators.
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GROUP STRATEGIC REPORT (CONTINUED)
FOR THE 9 MONTHS ENDED 31 DECEMBER 2024
This report was approved by the board and signed on its behalf.
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DIRECTORS' REPORT
FOR THE 9 MONTHS ENDED 31 DECEMBER 2024
The directors present their report and the financial statements for the 9 months ended 31 December 2024.
The directors are responsible for preparing the Group Strategic Report, the Directors' Report and the consolidated financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements 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 Group 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 the Group and to enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The profit for the 9 months, after taxation, amounted to £330,197 (Year to 31 March 2024 - £1,918,019).
No dividends have been proposed or declared in the period or since the period end (Year to 31 March 2024: Nil).
The directors who served during the 9 months were:
Our success and financial performance are dependent on our ability to serve as a trusted, long-term partner to our many diverse customers. We continue to make targeted investments across high growth areas, and the success of the seinvestments depends on their successful management and execution.
We will continue to make strategic acquisitions in current and complementary customer market segments to supplement organic growth, solidify our current market presence and expand into new areas.
We will continue to make strategic acquisitions in current and complementary customer market segments to supplement organic growth, solidify our current market presence and expand into new areas.
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DIRECTORS' REPORT (CONTINUED)
FOR THE 9 MONTHS ENDED 31 DECEMBER 2024
The company undertakes ongoing research and development activities in relation to its spectroscopy accessories and sample preparation products, with the objective of enhancing product performance, usability and innovation in line with customer and market requirements. Investment in research and development remains an important element of the company’s strategy to support future growth and maintain technological leadership in its markets.
The Company has chosen in accordance with Section 414C(II) of the Companies Act 2006 (Strategic Report and Directors' Report) Regulations 2013 to set out within the Company’s Strategic Report, the information required by Schedule 7 of the Large and Medium Sized Companies and Groups (Accounts and Reports) Regulation 2008. This include information that would have been included in the business review and details of the principal risks and uncertainties.
There have been no significant events affecting the Group since the year end.
The auditor, Menzies LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SPECAC INTERNATIONAL LIMITED
We have audited the financial statements of Specac International Limited (the 'parent Company') and its subsidiaries (the 'Group') for the 9 months ended 31 December 2024, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Statement of Financial Position, the Company Statement of Financial Position, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and the related notes, 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).
We were unable to observe the counting of physical inventories at the end of the previous period for the stock relating to the acquired trade and assets in that period. We were unable to satisfy ourselves by alternative means concerning the inventory quantities held at 31 March 2024 of £962,442. Consequently we were unable to determine whether any adjustment to this amount as at 31 March 2024 was necessary or whether there was any consequential effect on cost of sales in the 9 month period to 31 December 2024. In addition, were any adjustment to the cost of sales to be required, the Strategic Report would also need to be amended.
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 Auditor's 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 United Kingdom, including the Financial Reporting Council'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 qualified opinion.
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's or the parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SPECAC INTERNATIONAL LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditor's Report thereon. The directors are responsible for the other information contained within the Annual Report. 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. 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 course of 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.
As described in the basis for qualified opinion section of our report, we were unable to satisfy ourselves concerning the inventory quantities of £962,442 held at 31 March 2024 and therefore we were unable to determine whether there was any consequential effect on cost of sales. We have concluded that where the other information refers to the related amounts such as EBITDA, it may be materially misstated for the same reason.
Except for the possible effects of the matters described in the basis for qualified opinion section of our report, in our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group Strategic Report and the Directors' Report for the financial 9 months for which the financial statements are prepared is consistent with the financial statements; and
∙the Group Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.
Except for the matters described in the basis for qualified opinion section of our report, 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 Directors' Report.
Arising solely from the limitation on the scope of our work relating to inventory, referred to above:
∙we have not obtained all the information and explanations that we considered necessary for the purpose of our audit; and
∙we were unable to determine whether adequate accounting records have been kept.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
∙returns adequate for our audit have not been received from branches not visited by us;
∙the parent Company financial statements are not in agreement with the accounting records and returns; or
∙certain disclosures of Directors' remuneration specified by law are not made.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SPECAC INTERNATIONAL LIMITED (CONTINUED)
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 an Auditor's Report 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 Group financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
The Group is subject to laws and regulations that directly affect the financial statements including financial reporting legislation. We determined that the following laws and regulations were most significant:
∙The Companies Act 2006;
∙Financial Reporting Standard 102;
∙UK employment legislation;
∙General Data Protection Regulations; and,
∙UK tax legislation
We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.
We understood how the Group is complying with those legal and regulatory frameworks by, making inquiries to management and those responsible for legal and compliance procedures.
The engagement partner assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations. The assessment did not identify any issues in this area.
We assessed the susceptibility of the Group financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the engagement team included:
We understood how the Group is complying with those legal and regulatory frameworks by, making inquiries to management and those responsible for legal and compliance procedures.
The engagement partner assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations. The assessment did not identify any issues in this area.
We assessed the susceptibility of the Group financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the engagement team included:
∙Identifying and assessing the measures management has in place to prevent and detect fraud;
∙Understanding how those charged with governance considered and addressed the potential for override of controls or other inappropriate influence over the financial reporting process;
∙Challenging assumptions and judgements made by management in its significant accounting estimates; and
∙Identifying and testing journal entries, in particular any journal entries posted with unusual account combinations.
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INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF SPECAC INTERNATIONAL LIMITED (CONTINUED)
Auditor's responsibilities for the audit of the financial statements (continued)
As a result of the above procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas:
As a result of the above procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas:
∙The use of management override of controls to manipulate results, or to cause the Group to enter into transactions not in its best interests; or
∙Posting of unusual journals and complex transactions.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
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 Auditor's 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 an Auditor's Report 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.
for and on behalf of
Chartered Accountants
Statutory Auditor
4th Floor
95 Gresham Street
EC2V 7AB
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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE 9 MONTHS ENDED 31 DECEMBER 2024
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CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 14 to 32 form part of these financial statements.
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COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 14 to 32 form part of these financial statements.
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