Smiths Equipment Hire (Holdings) Limited - Limited company accounts 25.1

REGISTERED NUMBER: 05048553 (England and Wales)

GROUP STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 28 FEBRUARY 2025

FOR

SMITHS EQUIPMENT HIRE (HOLDINGS) LIMITED

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

7

Report of the Independent Auditors

9

Consolidated Statement of Comprehensive Income

13

Consolidated Balance Sheet

14

Company Balance Sheet

15

Consolidated Statement of Changes in Equity

16

Company Statement of Changes in Equity

17

Consolidated Cash Flow Statement

18

Notes to the Consolidated Cash Flow Statement

19

Notes to the Consolidated Financial Statements

21

DIRECTORS:

Mr D Smith

Mr T G Smith

REGISTERED OFFICE:

De Havilland House

15-16 Avroe Crescent

Blackpool

Lancashire

FY4 2DP

REGISTERED NUMBER:

05048553 (England and Wales)

AUDITORS:

Xeinadin Audit Limited

Statutory Auditor

17 St Peters Place

Fleetwood

Lancashire

FY7 6EB

The directors present their strategic report of the company and the group for the year ended 28 February 2025.

The parent company rents property primarily to the subsidiary for use in the group's principal activity in the year under review which was the hiring of plant, access and construction equipment to the construction, maintenance and DIY markets.

REVIEW OF BUSINESS

Company

The Company's income from rental activity has increased during the year ended 28th February 2025 which is attributable to rent reviews being agreed.

The Company presents the following key performance indicators: -

2025

2024

2023

£

Rent received from properties for the year

546

491

477

Net operating profit

820

607

857

During the year the Company owned 18 rental properties. The Company achieved 100% occupancy until May 2024 when 1 small property became vacant. Another unit was vacated in September 2024. We are endeavouring to find new tenants for these units.

The rent yield for the year was 10.05% (2024: 9.1%).

Interest cover ignoring dividends received has increased to 11.78:1 in 2025 from 10.47:1 in 2024. The main impact of the Interest cover has been the rent reviews undertaken and the erosion of debt..

The ratio of bank debt to property value increased to 24.8% (2023 18.1%).

Subsidiary

During the financial year turnover has decreased by 0.5% even with the opening of 2 new depots. The decline has been due to uncertainty in the construction sector with many new developments being cancelled or delayed. The personal cost of living crisis has also had a negative impact on our consumer business.

The company presents the following key performance indicators:

2025

2024

2023

£

Turnover

19,919

20,021

18,244

Gross profit

8,964

9,318

8,881

Profit before tax

1,255

1,850

2,042

A further breakdown of turnover is shown in the below table:

2025

2024

2023

£

Hire of own fleet

13,727

14,038

12,484

Consumables and other sales

1,983

1,744

1,899

Transport

1,330

1,312

1,284

Rehire

2,378

2,504

2,248

Training

501

423

329

During the year we opened new depots in Trafford Park, Manchester (September 2024) and Bradford (January 2025) bringing the number of operational depots to 18. The opening of these depots had a detrimental impact on profit in the year of c£120k as they are both within their establishment phases. We expect both depots to positively contribute to profit from FY26 onwards

At the end of February 2025 the Company had hire fleet assets with a cost totalling £26.0m (2024 £25.8m). The main categories of items included within this figure are: -

2025

2024

No.

£

No.

£

Powered Access Equipment

658

10,254

678

10,422

Excavators

148

2,907

144

2,854

Bulk Items (Scaffold towers, fencing etc)

1,834

1,708

Telehandlers

41

1,917

40

1,904

Dumpers

70

1,065

67

1,103

Generators

343

655

370

655

Rollers

63

766

65

797

All categories of hire fleet are monitored on a weekly / monthly basis for levels of utilisation and return on hire fleet investment. The results of these help formulate purchasing strategies for future additions enabling us to maximise our investments.

Maintaining cash flow is a high priority of the company considering the intensity of the capital expenditure required to not only maintain the hire fleet but to also expand it. The collection of customer debt is closely monitored and controlled. The average debtor days for the ¼ to 28th February 2025 was 56.83 (2024 55.21). Keeping debtor days below 60 is one of the highest priorities.

The balance sheet at 28th February 2025 shows net current liabilities of £2,502k (2024 £3,081k). Included within in this are asset finance repayments due over the next 12 months of £2.15m. The financing of the hire fleet assets has allowed the cash flow requirements to be met and this is expected to continue.

Larger items of hire fleet are financed by way of asset finance funding lines from 3 major banks. At the year end the total owing on these facilities was £3.22m with headroom available of £8.78m. All asset finance agreement are for a term no longer than 36 months. During the year the company has reduced its asset finance debt by £2.1m

At the end of February 2025 the company had an overdraft by way of an invoice finance facility in the amount of £1,239k with a further £761k available.

The directors are of the opinion that the Balance Sheet is strong, and are confident that working capital is available to ensure the commitments the Company have can be met through cash flow and asset finance funding. This means the Company is reasonably placed to meet the demands placed upon it.

Non Financial KPI's

The Company also monitors the following non financial KPI's all of which improve the service to our customers and efficiency of the business. All of the KPI's are monitored on a weekly basis and monthly comparisons to previous periods / years.

- Transport planning & efficiency

- Equipment testing and inspections

- Workshop productivity & efficiency

- Equipment off hire & returns

- Depot resale stock & hire fleet availability and accuracy

- Depot safety & cleanliness

- Daily live open contracts

- Hire fleet utilisation

PRINCIPAL RISKS AND UNCERTAINTIES

Company

The main areas of uncertainty currently lies with the ability of third party tenants being able to meet rental commitments.

In addition the potential for further interest rate rises may impact on the profitability of the Company.

The directors are however satisfied that the Company will continue to meet its objective of continued growth and profitability.

Subsidiary

In the opinion of the directors the principal risks currently facing the company are:

- Rising costs for our business and the economy as a whole which may impact on activity levels.

- Increasingly competitive market environment

- Bad debts

- Skilled labour shortages

Costs incurred by the Company are continually monitored and negotiated to ensure the best value for money is achieved. This linked with the extremely competitive marketplace in which operate could adversely affect the business. This risk is managed by ensuring that the best possible customer service is provided along with a modern well serviced hire fleet thus retaining customers and hire rates.

Trade debtors are closely managed and reported on a weekly basis to enable the Directors to ensure that the exposure to the risk of bad debts is mitigated as far as possible.

We continually try to enhance our employment packages in order to attract the best possible employees and provide extensive training and benefits in order to retain them.

The business is capital intensive and the company has deals with 2 main lenders for asset finance and an invoice finance facility, none of which are fully utilised. This ensures that there is sufficient working capital available for the continuing trading of the Company.

ON BEHALF OF THE BOARD:

Mr D Smith - Director

25 October 2025

The directors present their report with the financial statements of the company and the group for the year ended 28 February 2025.

DIVIDENDS

Interim dividends totalling £21 per share were paid on the A Ordinary 1p shares during the year. No dividends were paid on the Ordinary £1 shares.

The total distribution of dividends for the year ended 28 February 2025 will be £ 1,050,000 .

FUTURE DEVELOPMENTS

The directors and senior management are continuing to focus on and are confident of achieving the growth forecasts for the forthcoming financial year and continue to invest in staff training and development.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 March 2024 to the date of this report.

Mr D Smith

Mr T G Smith

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Group 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 the group and of the profit or loss of the group 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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 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 directors are 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 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 group's auditors are aware of that information.

ON BEHALF OF THE BOARD:

Mr D Smith - Director

25 October 2025

Opinion

We have audited the financial statements of Smiths Equipment Hire (Holdings) Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 28 February 2025 which comprise the Consolidated Statement of 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 28 February 2025 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 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 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 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 Group 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 Group 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 Group 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 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 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 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 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 seven, 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 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 directors either intend to liquidate the group or the parent 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:

Based on our understanding of the entity and the industry in which it operates we identified principal risks of non-compliance with laws and regulations related to Health and Safety, Sale of Goods Act and other trading laws. We considered the extent to which non-compliance with these laws and regulations might have a material effect on the financial statements. We also considered the Companies Act 2006 as this has a direct impact on the financial statements. We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements, including the risk of override of controls, and determined that the principal risks were related to the posting of inappropriate journals in order to impact profitability and misappropriation of stock. Significant accounting estimates which could give rise to management bias within the company are: depreciation and useful economic life of Fixed Assets.

Audit procedures performed in order to mitigate the risks highlighted include the following:

- Discussions with management, including consideration of known or suspected instances of non-compliance with laws and regulation and fraud.

- Evaluation the operating effectiveness of the management's controls designed to prevent and detect irregularities.

- Reviewing key correspondence with regulatory authorities in relation to compliance with relevant regulations.

- Challenging assumptions and judgements made by the management as well as explanations given.

- Identifying and testing journal entries, in particular those posted with unusual account combinations.

- Testing specific assets for existence and signs of impairment.

- Reviewing valuation and ownership documents regarding investment properties.

There are limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment.

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.

Charles Bryning FCA (Senior Statutory Auditor)

for and on behalf of Xeinadin Audit Limited

Statutory Auditor

17 St Peters Place

Fleetwood

Lancashire

FY7 6EB

25 October 2025

REVENUE

3

19,919,486

20,021,054

Cost of sales

10,955,407

10,702,851

GROSS PROFIT

8,964,079

9,318,203

Administrative expenses

6,847,849

6,815,874

2,116,230

2,502,329

Other operating income

63,955

73,024

OPERATING PROFIT

5

2,180,185

2,575,353

Interest receivable and similar income

-

71

2,180,185

2,575,424

Interest payable and similar expenses

6

364,601

394,916

PROFIT BEFORE TAXATION

1,815,584

2,180,508

Tax on profit

7

523,704

598,385

PROFIT FOR THE FINANCIAL YEAR

1,291,880

1,582,123

OTHER COMPREHENSIVE INCOME

-

TOTAL COMPREHENSIVE INCOME
FOR THE YEAR

1,291,880

1,582,123

Profit attributable to:

Owners of the parent

1,291,880

1,582,123

Total comprehensive income attributable to:

Owners of the parent

1,291,880

1,582,123

FIXED ASSETS

Intangible assets

10

221,890

271,199

Property, plant and equipment

11

19,038,646

20,062,545

Investments

12

-

Investment property

13

526,500

19,787,036

20,860,244

CURRENT ASSETS

Inventories

14

648,512

603,817

Debtors

15

3,327,768

3,267,795

Cash at bank and in hand

55,114

71,632

4,031,394

3,943,244

CREDITORS

Amounts falling due within one year

16

(7,813,313

)

(7,580,646

)

NET CURRENT LIABILITIES

(3,781,919

)

(3,637,402

)

TOTAL ASSETS LESS CURRENT
LIABILITIES

16,005,117

17,222,842

CREDITORS

Amounts falling due after more than one year

17

(1,462,623

)

(3,013,004

)

PROVISIONS FOR LIABILITIES

21

(2,057,784

)

(1,967,008

)

NET ASSETS

12,484,710

12,242,830

CAPITAL AND RESERVES

Called up share capital

22

500

Revaluation reserve

23

61,446

Capital redemption reserve

23

250

Retained earnings

23

12,422,514

12,180,634

SHAREHOLDERS' FUNDS

12,484,710

12,242,830

The financial statements were approved by the Board of Directors and authorised for issue on 25 October 2025 and were signed on its behalf by:

Mr D Smith - Director

FIXED ASSETS

Intangible assets

10

-

Property, plant and equipment

11

-

Investments

12

1,502

Investment property

13

5,433,617

5,405,000

5,435,119

5,406,502

CURRENT ASSETS

Debtors

15

198,595

17,560

Cash at bank

3,389

16,914

201,984

34,474

CREDITORS

Amounts falling due within one year

16

(1,481,806

)

(590,803

)

NET CURRENT LIABILITIES

(1,279,822

)

(556,329

)

TOTAL ASSETS LESS CURRENT
LIABILITIES

4,155,297

4,850,173

CREDITORS

Amounts falling due after more than one year

17

(385,370

)

(593,524

)

PROVISIONS FOR LIABILITIES

21

(144,178

)

(143,801

)

NET ASSETS

3,625,749

4,112,848

CAPITAL AND RESERVES

Called up share capital

22

500

Revaluation reserve

23

1,079,673

Capital redemption reserve

23

250

Retained earnings

23

2,545,326

3,032,425

SHAREHOLDERS' FUNDS

3,625,749

4,112,848

Company's profit for the financial year

562,901

1,780,065

The financial statements were approved by the Board of Directors and authorised for issue on 25 October 2025 and were signed on its behalf by:

Mr D Smith - Director

Called up

Capital

share

Retained

Revaluation

redemption

Total

capital

earnings

reserve

equity

£

Balance at 1 March 2023

500

11,498,511

61,446

250

11,560,707

Changes in equity

Dividends

-

(900,000

)

-

(900,000

)

Total comprehensive income

-

1,582,123

-

1,582,123

Balance at 29 February 2024

500

12,180,634

61,446

250

12,242,830

Changes in equity

Dividends

-

(1,050,000

)

-

(1,050,000

)

Total comprehensive income

-

1,291,880

-

1,291,880

Balance at 28 February 2025

500

12,422,514

61,446

250

12,484,710

Called up

Capital

share

Retained

Revaluation

redemption

Total

capital

earnings

reserve

equity

£

Balance at 1 March 2023

500

2,152,360

1,079,673

250

3,232,783

Changes in equity

Dividends

-

(900,000

)

-

(900,000

)

Total comprehensive income

-

1,780,065

-

1,780,065

Balance at 29 February 2024

500

3,032,425

1,079,673

250

4,112,848

Changes in equity

Dividends

-

(1,050,000

)

-

(1,050,000

)

Total comprehensive income

-

562,901

-

562,901

Balance at 28 February 2025

500

2,545,326

1,079,673

250

3,625,749

Cash flows from operating activities

Cash generated from operations

1

5,849,792

5,721,635

Interest paid

(80,455

)

(91,413

)

Interest element of hire purchase payments
paid

(284,146

)

(303,503

)

Tax paid

(339,053

)

(274,109

)

Net cash from operating activities

5,146,138

5,052,610

Cash flows from investing activities

Purchase of tangible fixed assets

(2,338,123

)

(2,146,560

)

Sale of tangible fixed assets

840,121

816,182

Interest received

-

71

Net cash from investing activities

(1,498,002

)

(1,330,307

)

Cash flows from financing activities

New loans in year

750,000

-

Loan repayments in year

(377,373

)

(359,066

)

Movement on HP and finance leases

(2,757,832

)

(3,553,377

)

Amount introduced by directors

268,192

(899,967

)

Amount withdrawn by directors

(1,063,259

)

(71

)

Net cash from financing activities

(3,180,272

)

(4,812,481

)

Increase/(decrease) in cash and cash equivalents

467,864

(1,090,178

)

Cash and cash equivalents at beginning of
year

2

(1,651,835

)

(561,657

)

Cash and cash equivalents at end of year

2

(1,183,971

)

(1,651,835

)

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

2025

2024

£

Profit before taxation

1,815,584

2,180,508

Depreciation charges

3,293,569

3,226,388

Profit on disposal of fixed assets

(62,367

)

(72,871

)

Finance costs

364,601

394,916

Finance income

-

(71

)

5,411,387

5,728,870

(Increase)/decrease in inventories

(44,695

)

57,968

(Increase)/decrease in trade and other debtors

(60,044

)

86,469

Increase/(decrease) in trade and other creditors

543,144

(151,672

)

Cash generated from operations

5,849,792

5,721,635

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 28 February 2025

28/2/25

1/3/24

£

Cash and cash equivalents

55,114

71,632

Bank overdrafts

(1,239,085

)

(1,723,467

)

(1,183,971

)

(1,651,835

)

Year ended 29 February 2024

29/2/24

1/3/23

£

Cash and cash equivalents

71,632

81,232

Bank overdrafts

(1,723,467

)

(642,889

)

(1,651,835

)

(561,657

)

3.	ANALYSIS OF CHANGES IN NET DEBT

Other

non-cash

At 1/3/24

Cash flow

changes

At 28/2/25

£

Net cash

Cash at bank

and in hand

71,632

(16,518

)

55,114

Bank overdrafts

(1,723,467

)

484,382

(1,239,085

)

(1,651,835

)

467,864

(1,183,971

)

Debt

Finance leases

(5,321,355

)

2,757,832

-

(3,223,515

)

Debts falling due

within 1 year

(382,298

)

(580,781

)

-

(963,079

)

Debts falling due

after 1 year

(593,524

)

208,154

-

(385,370

)

(6,297,177

)

2,385,205

-

(4,571,964

)

Total

(7,949,012

)

2,853,069

-

(5,755,935

)

1.	STATUTORY INFORMATION

Smiths Equipment Hire (Holdings) 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 General Information page.

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 as modified by the revaluation of certain assets.

Going concern

The directors going concern assessment covers 12 months and confirms that the group will continue in

existence for the foreseeable future.The group has clearly demonstrated profitability over the past 12 months during times of uncertainty and there are no significant concerns at this time. There is a strong history of profitability and working capital management within the business. The group also has adequate resources to continue in operational existence and has a large quantity of unused additional finance available should it be required.

The group balance sheet shows net assets at the year end of £12,484,710 and net current liabilities of £3,781,919.

The directors have considered the future profitability of the group and its ability to continue as a going concern through the use of profit and cash flow forecasts. These cover a period of more than 12 months. Based on these projections the the directors are satisfied that for the foreseeable future the group can meet its working capital requirements and continue to be a profitable entity.

Basis of consolidation

The consolidation includes the results of the subsidiary undertakings for the period to 29 February 2024. Where a subsidiary has different accounting policies to the Group, adjustments are made to those subsidiary financial statements to apply the Group’s accounting policies when preparing the consolidated financial statements. Any subsidiary undertakings or associates sold or acquired during the year are included up to, or from, the dates of change of control or change of significant influence respectively.

Critical accounting judgements and key sources of estimation uncertainty

In the application of the Groups accounting policies, which are described in note 2, the directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and 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 if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.

Critical judgements in applying the Groups accounting policies and key source of estimation uncertainty

Estimates

Fixed assets

Accounting for fixed assets involves the use of estimates for (a) the useful live of the assets over which they are to be depreciated and (b) the existence and any amount of impairment.

Fixed assets are depreciated on a straight line basis over the estimated useful lives. When the group estimates useful lives various factors are considered including expected technology obsolescence and the expected usage of the asset. The group regularly reviews these assets useful lives and future economic utilization and the physical condition of the assets concerned.

The carrying value of the assets is assessed periodically to determine whether there are any indications of any impairment of the value beyond the depreciation charge. If this is the case, an impairment charge is taken against the carrying value of the assets and charged to profit and loss account. The impairment of fixed assets require management judgement in determining the amounts to be impaired, in particular judgement is used when assessing the future cash flows.

Fair value of investment property

The investment property of the group is carried at fair value which the directors have determined based on recent open market valuation and by drawing reference to market evidence and similar property transactions.

Provisions

Provisions for onerous hire contracts are recognised when the group believes that there is no longer a possibility of economic benefits being received under the contract. The group monitors the risk profile of the debtors and provides a bad debt provision based on the directors past experiences and assessment of the current economic climate.

Judgements

Determining if an arrangement constitutes a lease

The directors have concluded that none of the groups hire contracts with customers are dependent on the use of a specific asset or group of assets as the group can swap hire stock as required to provide tool and equipment hire services. These arrangements are therefore not leases.

Turnover

Where turnover represents the value of hire services provided under contracts it is recognised to the extent that there is a right to consideration and is recorded at the value of the consideration due. Where a contract has only been partially completed at the balance sheet date turnover represents the value of the service provided to date based on a proportion of the total expected consideration at completion. Where payments are received from customers in advance of services provided, the amounts are recorded as deferred income and included as part of creditors due within one year.

Where turnover represents sales of goods it is shown net of VAT and trade discounts. Turnover is recognised when the goods are physically delivered to the customer.

Goodwill

Goodwill recognised represents the excess of the fair value and directly attributable costs of the purchase consideration over the fair values to the Group’s interest in the identifiable net assets, liabilities and contingent liabilities acquired.

Goodwill is amortised over its expected useful life which is estimated to be ten years. Goodwill is assessed for impairment when there are indicators of impairment and any impairment is charged to the income statement.

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.

Property, plant and equipment

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 or, if held under a finance lease, over the lease term, whichever is the shorter.

Freehold property

-

Straight line over 27 years

Short leasehold

-

Over the remaining period of the lease

Long leasehold

-

Straight line over 27 years

Plant and machinery

-

Between 5 and 12 years

Fixtures and fittings

-

33% on cost

Motor vehicles

-

20% on cost

Computer equipment

-

33% on cost

Property, plant and equipment 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.

Investment property

No depreciation is provided for on investment property as a result of FRS 102 section 16. While this represents a departure from the requirements of the Companies Act management has concluded that the financial statements present fairly the entity's financial position, financial performance and cash flows. Investment property is instead shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss.

Stocks

Inventories are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Cost includes all costs incurred in bringing each product to its present location and condition on a first in, first out basis.

Net realisable value is based on estimated selling price less any further costs expected to be incurred to disposal.

Financial instruments

Cash and cash equivalents

Cash and cash equivalents in the balance sheet comprise cash at banks and in hand and short-term deposits with an original maturity date of three months or less. For the purpose of the cash flow statement, cash and cash equivalents consist of cash and cash equivalents as defined above, net of outstanding bank overdrafts.

Short-term debtors and creditors

Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the income statement in other operating expenses.

Invoice financing

The company has an invoice finance facility secured against trade receivables which is presented as an overdraft within creditors.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated 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.

Hire purchase and leasing commitments

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the future payments is treated as a liability.

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 group operates a defined contribution pension scheme. Contributions payable to the group's pension scheme are charged to profit or loss in the period to which they relate.

Operating lease income

Property rentals received under operating leases are credited to profit and loss account on a straight line basis over the period of the lease.

Operating lease commitments

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

3.

REVENUE

The revenue and profit before taxation are attributable to the one principal activity of the group.

An analysis of revenue by class of business is given below:

2025

2024

£

Equipment hire

13,726,981

13,681,035

Re-sales

1,455,256

1,609,108

Transport

1,329,703

1,312,116

Cross hire

2,378,156

2,504,336

Hire protect

389,268

356,874

Other sales

139,085

134,346

Training

501,037

423,239

19,919,486

20,021,054

4.	EMPLOYEES AND DIRECTORS

2025

2024

£

Wages and salaries

6,447,524

6,119,602

Social security costs

645,395

605,594

Other pension costs

119,035

146,722

7,211,954

6,871,918

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

2025

2024

Employees

191

186

Directors

2

193

188

2025

2024

£

Directors' remuneration

18,492

19,692

Directors' pension contributions to money purchase schemes

-

33,000

5.	OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2025

2024

£

Other operating leases

293,883

314,022

Depreciation - owned assets

2,215,801

2,015,788

Depreciation - assets on hire purchase contracts

1,028,459

1,161,292

Profit on disposal of fixed assets

(62,367

)

(72,871

)

Goodwill amortisation

49,309

Auditors' remuneration

16,000

15,250

Other accountancy and tax services provided by the auditor

13,568

12,275

Other operating lease expenditure

274,618

271,832

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

2025

2024

£

Bank loan interest

69,616

88,263

Interest on corporation tax

10,839

3,150

Hire purchase

284,146

303,503

364,601

394,916

7.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2025

2024

£

Current tax:

UK corporation tax

432,928

335,903

Origination and reversal of

timing differences

90,776

262,482

Tax on profit

523,704

598,385

Reconciliation of total tax charge 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:

2025

2024

£

Profit before tax

1,815,584

2,180,508

Profit multiplied by the standard rate of corporation tax in the UK of 25 %
(2024 - 24.492 %)

453,896

534,050

Effects of:

Expenses not deductible for tax purposes

14,773

8,988

Income not taxable for tax purposes

(15,762

)

-

Capital allowances in excess of depreciation

(67,446

)

(253,246

)

properties

Deferred tax

90,776

262,482

Effect of different treatment on consolidation under FRS 102

47,467

46,111

Total tax charge

523,704

598,385

8.	INDIVIDUAL STATEMENT OF COMPREHENSIVE INCOME

As permitted by Section 408 of the Companies Act 2006, the Statement of Comprehensive Income of the parent company is not presented as part of these financial statements.

9.

DIVIDENDS

2025

2024

£

A Ordinary shares of 1p each

Interim

1,050,000

900,000

10.	INTANGIBLE FIXED ASSETS

Group

Goodwill

£

COST

At 1 March 2024

and 28 February 2025

493,090

AMORTISATION

At 1 March 2024

221,891

Amortisation for year

49,309

At 28 February 2025

271,200

NET BOOK VALUE

At 28 February 2025

221,890

At 29 February 2024

271,199

11.	PROPERTY, PLANT AND EQUIPMENT

Group

Freehold

Short

Long

Plant and

property

leasehold

machinery

£

COST

At 1 March 2024

2,276,964

247,506

1,475,207

26,062,277

Additions

28,617

26,229

-

2,045,823

Disposals

-

(1,838,291

)

At 28 February 2025

2,305,581

273,735

1,475,207

26,269,809

DEPRECIATION

At 1 March 2024

791,760

209,158

451,694

10,332,256

Charge for year

85,922

14,898

54,638

2,534,551

Eliminated on disposal

-

(1,109,414

)

At 28 February 2025

877,682

224,056

506,332

11,757,393

NET BOOK VALUE

At 28 February 2025

1,427,899

49,679

968,875

14,512,416

At 29 February 2024

1,485,204

38,348

1,023,513

15,730,021

Fixtures

and

Motor

Computer

fittings

vehicles

equipment

Totals

£

COST

At 1 March 2024

598,498

3,355,268

324,402

34,340,122

Additions

35,788

861,658

-

2,998,115

Disposals

-

(472,496

)

-

(2,310,787

)

At 28 February 2025

634,286

3,744,430

324,402

35,027,450

DEPRECIATION

At 1 March 2024

526,561

1,668,806

297,342

14,277,577

Charge for year

51,023

493,040

10,188

3,244,260

Eliminated on disposal

-

(423,619

)

-

(1,533,033

)

At 28 February 2025

577,584

1,738,227

307,530

15,988,804

NET BOOK VALUE

At 28 February 2025

56,702

2,006,203

16,872

19,038,646

At 29 February 2024

71,937

1,686,462

27,060

20,062,545

All freehold property, long leasehold property and plant and machinery is held for use in operating leases.

Fixed assets, included in the above, which are held under hire purchase contracts are as follows:

Plant and

Motor

machinery

vehicles

Totals

£

COST

At 1 March 2024

9,971,698

1,707,876

11,679,574

Additions

616,522

43,470

659,992

Disposals

(28,414

)

-

(28,414

)

Transfer to ownership

(3,481,812

)

(207,980

)

(3,689,792

)

At 28 February 2025

7,077,994

1,543,366

8,621,360

DEPRECIATION

At 1 March 2024

1,596,693

591,122

2,187,815

Charge for year

733,594

294,865

1,028,459

Eliminated on disposal

(8,636

)

-

(8,636

)

Transfer to ownership

(999,042

)

(205,900

)

(1,204,942

)

At 28 February 2025

1,322,609

680,087

2,002,696

NET BOOK VALUE

At 28 February 2025

5,755,385

863,279

6,618,664

At 29 February 2024

8,375,005

1,116,754

9,491,759

All freehold and long leasehold property is held for use in operating leases primarily with the subsidiary undertaking.

12.	FIXED ASSET INVESTMENTS

Company

Shares in

group

undertakings

£

COST

At 1 March 2024

and 28 February 2025

1,502

NET BOOK VALUE

At 28 February 2025

1,502

At 29 February 2024

1,502

The group or the company's investments at the Balance Sheet date in the share capital of companies include the following:

Subsidiaries

Smiths Equipment Hire Limited

Registered office: United Kingdom

Nature of business: Plant hire

%

Class of shares:

holding

Ordinary

100.00

2025

2024

£

Aggregate capital and reserves

11,121,222

10,202,375

Profit for the year

918,847

1,378,769

Formby Tool Hire Limited

Registered office: United Kingdom

Nature of business: Plant Hire

%

Class of shares:

holding

Ordinary

100.00

13.	INVESTMENT PROPERTY

Group

Total

£

FAIR VALUE

At 1 March 2024

and 28 February 2025

526,500

NET BOOK VALUE

At 28 February 2025

526,500

At 29 February 2024

526,500

Fair value at 28 February 2025 is represented by:

£

Valuation in 2016

1,446

Valuation in 2019

(17,500

)

Valuation in 2023

77,500

Cost

465,054

526,500

If investment properties had not been revalued they would have been included at the following historical cost:

2025

2024

£

Cost

465,054

Investment properties were valued on an open market basis on 28 February 2023 by Eckersley .

The directors are of the opinion that these market values are unchanged at the year end date.

Company

Total

£

FAIR VALUE

At 1 March 2024

5,405,000

Additions

28,617

At 28 February 2025

5,433,617

NET BOOK VALUE

At 28 February 2025

5,433,617

At 29 February 2024

5,405,000

Fair value at 28 February 2025 is represented by:

£

Valuation in 2016

72,337

Valuation in 2019

112,797

Valuation in 2020

(15,559

)

Valuation in 2021

(55,000

)

Valuation in 2023

1,073,200

Cost

4,245,842

5,433,617

If investment properties had not been revalued they would have been included at the following historical cost:

2025

2024

£

Cost

4,245,842

4,217,225

Investment properties were valued on open market basis on 28 February 2023 by Eckersley .

14.

STOCKS

Group

2025

2024

£

Stocks

648,512

603,817

15.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group

Company

2025

2024

2025

2024

£

Trade debtors

2,910,913

3,003,091

3,000

102

Amounts owed by group undertakings

-

182,139

-

Other debtors

3,905

8,811

-

300

Directors' current accounts

-

71

-

71

Prepayments

412,950

255,822

13,456

17,087

3,327,768

3,267,795

198,595

17,560

16.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

Group

Company

2025

2024

2025

2024

£

Bank loans and overdrafts (see note 18)

2,202,164

2,105,765

963,079

382,298

Hire purchase contracts (see note 19)

2,146,262

2,953,094

-

Trade creditors

1,788,426

1,087,310

1,266

-

Amounts owed to group undertakings

-

14,006

Tax

432,928

339,053

187,070

126,670

Social security and other taxes

146,515

130,703

-

VAT

489,243

558,634

52,737

42,475

Other creditors

30,983

26,994

-

Directors' current accounts

254,862

-

254,862

-

Accruals and deferred income

321,930

379,093

22,792

25,354

7,813,313

7,580,646

1,481,806

590,803

17.

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE
YEAR

Group

Company

2025

2024

2025

2024

£

Bank loans (see note 18)

385,370

593,524

385,370

593,524

Hire purchase contracts (see note 19)

1,077,253

2,368,261

-

Trade creditors

-

51,219

-

1,462,623

3,013,004

385,370

593,524

18.

LOANS

An analysis of the maturity of loans is given below:

Group

Company

2025

2024

2025

2024

£

Amounts falling due within one year or on

demand:

Bank overdrafts

1,239,085

1,723,467

-

Bank loans

963,079

382,298

963,079

382,298

2,202,164

2,105,765

963,079

382,298

Amounts falling due between one and two

years:

Bank loans

283,595

419,888

283,595

419,888

Amounts falling due between two and five

years:

Bank loans

101,775

173,636

101,775

173,636

The group has three bank loans with terms as follows:

Repayable by
instalments of

Interest rate

Fixed to Variable rate loan facility

£35,000 per
month

8%

Fixed to Variable rate loan facility

£2,700 per
month

8%

Fixed to Variable rate loan facility

£65,100 per
month

8%

19.	LEASING AGREEMENTS

Minimum lease payments fall due as follows:

Group

Hire purchase

contracts

2025

2024

£

Net obligations repayable:

Within one year

2,146,262

2,953,094

Between one and five years

1,077,253

2,368,261

3,223,515

5,321,355

Group

Non-cancellable

operating leases

2025

2024

£

Within one year

350,695

256,104

Between one and five years

1,180,266

530,542

In more than five years

727,707

145,833

2,258,668

932,479

As lessor the group is due to receive the following the future minimum lease payments under non-cancellable operating leases:

£23,500 not later than one year;

£42,333 later than one year and not later than five years; and

£6,708 later than five years.

Company

Non-cancellable

operating leases

2025

2024

£

20.	SECURED DEBTS

The following secured debts are included within creditors:

Group

Company

2025

2024

2025

2024

£

Bank overdrafts

1,239,085

1,723,467

-

Bank loans

1,348,449

975,822

1,348,449

975,822

Hire purchase contracts

3,223,515

5,321,355

-

5,811,049

8,020,644

1,348,449

975,822

The bank borrowings are secured over the assets of the group.

The hire purchase creditors in the subsidiary undertaking are secured over the assets to which they relate.

21.	PROVISIONS FOR LIABILITIES

Group

Company

2025

2024

2025

2024

£

Deferred tax

Accelerated capital allowances

2,057,784

1,967,008

144,178

143,801

Group

Deferred

tax

£

Balance at 1 March 2024

1,967,008

Provided during year

90,776

Balance at 28 February 2025

2,057,784

Company

Deferred

tax

£

Balance at 1 March 2024

143,801

Provided during year

377

Balance at 28 February 2025

144,178

22.	CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:

Number:

Class:

Nominal

2025

2024

value:

£

50,000

A Ordinary

1p

500

23.

RESERVES

Group

Capital

Retained

Revaluation

redemption

earnings

reserve

Totals

£

At 1 March 2024

12,180,634

61,446

250

12,242,330

Profit for the year

1,291,880

Dividends

(1,050,000

)

(1,050,000

)

At 28 February 2025

12,422,514

61,446

250

12,484,210

Company

Capital

Retained

Revaluation

redemption

earnings

reserve

Totals

£

At 1 March 2024

3,032,425

1,079,673

250

4,112,348

Profit for the year

562,901

Dividends

(1,050,000

)

(1,050,000

)

At 28 February 2025

2,545,326

1,079,673

250

3,625,249

24.	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.

Transactions between group entities which have been eliminated on consolidation are not disclosed within the financial statements.

Entities with control, joint control or significant influence over the entity

2025

2024

£

Dividends paid by the company

1,050,000

900,000

Amounts advanced

-

829

Amounts repaid

71

791

Amount due from related party

-

71

Amount due to related party

254,862

-

The advance to the director is unsecured and repayable on demand. Interest is being charged at the HMRC rate for beneficial loan arrangements.

25.	ULTIMATE CONTROLLING PARTY

The ultimate controlling parties are Mr D and Mr T Smith who, between them, hold all of the issued share capital of the company.