The directors present the strategic report for the year ended 31 March 2025.
Broom Energy Holdings Limited was incorporated on 29 November 2023 and this is the company's first annual report and financial statements. The company was established to act as a new ultimate parent company of Blake Clough Consulting Limited and its subsidiary following completion of a corporate restructuring exercise.
Basis of preparation
As outlined above, the company was established to act as a new ultimate parent company for the Blake Clough Consulting Limited and its subsidiary following a corporate restructuring exercise. As the corporate restructuring qualified for merger accounting under FRS 102, these consolidated financial statements have been prepared by applying the principles of merger accounting. The current and comparative financial information are therefore presented as if the group was in existence throughout the entire current and prior financial periods, being the years ended 31 March 2025 and 31 March 2024.
Within this report we present a balanced and comprehensive review of the development and performance of our business during the financial year and its position at year end. Our review is consistent with a fast-growing business in the power networks sector of the market and is written in the context of the risks and uncertainties we face.
We are a specialist energy consultancy, focussed on the electricity markets. We cover a range of areas with the majority of our revenue coming from power systems studies and grid consulting work. We also cover electrical design (substations and cables), electricity regulation and electricity innovation work
Our work is underpinned by strong analytical and modelling skills, particularly with regard to scripting and automation of power systems studies and grid consulting analysis. We also carry out techno-economic assessments, cost benefit analysis and network modelling.
We work within a growing sector, due to the strong uptake of renewable technologies and the requirement for significant upgrades in grid infrastructures. Risks and challenges therefore include recruitment and retention of highly skilled staff. We meet this challenge via training of high calibre graduate and post-graduate consultants, significant work around retention and retaining an attractive working culture.
As the market grows, there is a risk of new entrants into this sector. However, since our inception we have developed a strong reputation and brand, and due to our highly skilled staff and automation we are able to deliver projects more quickly and to a high standard compared with our competition. This has also enabled us to significantly grow market share. The flexibility and customer-focus that we have achieved needs to be constantly assessed and renewed to ensure that we stay ahead of the market.
Fast-changing electricity network regulation also means that services that we have developed can become less attractive; however, conversely new regulation means that new services are constantly developed and delivered. We therefore see some services reducing in revenue but new services growing significantly. Again, we need to be constantly ahead of our game and the competition to continue to drive these new services and deliver new value.
The grid itself is also changing, which means that there are significant challenges for power systems connection studies and grid code compliance can be difficult to achieve. However, so long as the scope of contracts is well defined, this provides opportunities for variations and to deliver new studies that the network operators are asking for. In general, as the complexity of the grid continues to increase, this gives increased opportunities and revenue for the power systems studies sector. Again, it is critical for the team to stay at the cutting edge of these technical developments.
Anticipated developments have been outlined within the "Principal risks and uncertainties" where appropriate. Alongside this, the group will continue to assess opportunities to improve financial performance and operational efficiencies as they arise.
We consider that our key financial performance indicators are those that measure the financial performance and strength of the group as a whole. These are turnover, operating profit and net assets.
Turnover has increased from £2,897,058 in 2023/24 to £4,840,742 in 2024/25 (67%). This is driven by growth in the sector and recruitment.
Operating profit has increased from £1,580,541 in 2023/24 to £1,890,914 in 2024/25 (20%). This is driven by revenue growth and also strong margins due to high project profitability and utilisation.
The resultant profitability and strong group performance during the year has led to an increase in net assets from £1,081,744 as at 31 March 2024 to £2,193,856 as at 31 March 2025 (103%).
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 March 2025. Broom Energy Holdings Limited was incorporated on 29 November 2023 and this is the company's first annual report and financial statements.
The results for the year are set out on page 10.
Ordinary dividends were paid amounting to £504,150. The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
The group does not use derivatives for either financial risk management or for speculative purposes. The group's financial risk management objectives, policies and exposure to financial risks are not considered material for the assessment of the group's assets, liabilities, financial position or result for the year and as such, no further disclosure is considered necessary.
The auditor, Johnston Carmichael LLP, were appointed as auditor during the company's current period and is deemed to be reappointed under section 487(2) of the Companies Act 2006.
The group has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the group's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of future developments to the extent these are applicable.
We have audited the financial statements of Broom Energy Holdings Limited (‘the parent company’) and its subsidiaries (‘the group’) for the period ended 31 March 2025, which comprise the Group Profit and Loss Account, Group Statement of Comprehensive Income, Group Balance Sheet, Company Balance Sheet, Group Statement of Changes in Equity, Company Statement of Changes in Equity, Group Statement of Cash Flows and notes to the financial statements, including 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).
Basis for 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 or 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
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
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.
We assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations by considering their experience, past performance and support available.
All engagement team members were briefed on relevant identified laws and regulations and potential fraud risks at the planning stage of the audit. Engagement team members were reminded to remain alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
We obtained an understanding of the legal and regulatory frameworks that are applicable to the group and the parent company and the sector in which they operate, focusing on those provisions that had a direct effect on the determination of material amounts and disclosures in the financial statements. The most relevant frameworks we identified include:
Companies Act 2006;
UK Tax legislation; and
UK Generally Accepted Accounting Practice
We gained an understanding of how the group and the parent company are complying with these laws and regulations by making enquiries of management and those charged with governance. We corroborated these enquiries through our review of submitted returns and relevant correspondence with regulatory bodies..
We assessed the susceptibility of the group’s and parent company’s financial statements to material misstatement, including how fraud might occur, by meeting with management and those charged with governance to understand where it was considered there was susceptibility to fraud. This evaluation also considered how management and those charged with governance were remunerated and whether this provided an incentive for fraudulent activity. We considered the overall control environment and how management and those charged with governance oversee the implementation and operation of controls. In areas of the financial statements where the risks were considered to be higher, we performed procedures to address each identified risk. We identified a heightened fraud risk in relation to:
Management override of controls
Revenue recognition
In addition to the above, the following procedures were performed to provide reasonable assurance that the financial statements were free of material fraud or error:
Reviewing the level of and reasoning behind the group’s and parent company’s procurement of legal and professional services
Performing audit procedures over the risk of management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and assessing judgements made by management in their calculation of accounting estimates for potential management bias;
Performing audit procedures to address the risk of material misstatements relating to the cut-off of revenue recognition at the year-end by agreeing sales to invoices and the delivery of project outputs, ensuring they were recorded in the correct period.
Completion of appropriate checklists and use of our experience to assess the group’s and parent company’s compliance with the Companies Act 2006; and
Agreement of the financial statement disclosures to supporting documentation.
Our audit procedures were designed to respond to the risk of material misstatements in the financial statements, recognising that 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 intentional concealment, forgery, collusion, omission or misrepresentation. There are inherent limitations in the audit procedures performed 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 are to become aware of it.
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 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.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the period was £505,384.
Broom Energy Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 1 Blake Clough Farm Shaw Lane, Slaithwaite, Huddersfield, England, HD7 5XA.
The group consists of Broom Energy Holdings Limited and all of its subsidiaries.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements (to the extent applicable):
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The consolidated group financial statements consist of the financial statements of the parent company Broom Energy Holdings Limited together with all entities controlled by the parent company (its subsidiaries).
All financial statements are made up to 31 March 2025. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
Group reconstructions
Under FRS 102, group reconstructions can be accounted for using the merger accounting method where the use of merger accounting is not prohibited by company law or legislation, where the ultimate equity holders remain the same, and the rights of each equity holder, relative to others, are unchanged and where no non-controlling interests in the net assets of the group are altered by the reconstruction.
It is the company's policy to apply the merger accounting method to eligible group reconstructions and it has therefore applied this to the corporate reorganisation effected by the group on 29 November 2023. The merger method of accounting has been applied to the group reconstruction as if the entities had always been combined in this reconstructed form. The carrying values of the entities’ assets and liabilities have not been adjusted to fair value. The difference between the nominal value of shares issued and the value of the consideration received has been taken to a merger reserve in equity.
The directors have modelled cashflow forecasts for the period until 31 March 2029, including a Downside Scenario which excludes a significant portion of all uncontracted revenue. At the time of approving the financial statements, the directors’ forecasts indicate that there will be sufficient working capital to meet the group’s current obligations as they fall due and therefore have assumed a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus, the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
The group financial statements have been prepared for the year from 1 April 2024 to 31 March 2025 with the comparative period covering the year from 1 April 2023 to 31 March 2024.
The company financial statements have been prepared from incorporation on 29 November 2023 to 31 March 2025. There is no comparative period for the company financial statements.
Turnover is recognised at the fair value of the consideration received or receivable for services provided in the normal course of business, and is shown net of VAT and other sales related taxes.
Revenue from contracts for the provision of services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.
In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
At each reporting period end date, the group reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in the profit and loss account.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in the profit and loss account.
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include certain debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.
Basic financial liabilities, including certain creditors, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to the profit and loss account on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in the profit and loss account.
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
In preparing these financial statements, the director has made no critical accounting judgements or significant estimates.
No audit remuneration has been disclosed for the comparative reporting period as the group's result were unaudited in the year ended 31 March 2024.
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2024 - 3).
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
Details of the company's subsidiaries at 31 March 2025 are as follows:
Obligations under finance leases are secured against the underlying assets concerned.
Obligations under finance leases are secured against the underlying assets concerned.
Finance lease payments represent rentals payable by the company or group for certain motor vehicles. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 4 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund. At the reporting date, the group had pension contributions of £5,296 (2024 - £7,927) outstanding which were included within creditors falling due within one year.
The company issued 30 Ordinary shares of £1 each, 85 Ordinary B shares of £1 each and 85 Ordinary C shares of £1 each on 29 November 2023 on incorporation. Shares issued were in consideration for the acquisition of Blake Clough Consulting Limited as part of a corporate restructuring exercise.
As outlined in note 1.2 of these financial statements, group reconstructions are accounted for under the principles of merger accounting where the qualifying criteria are met. It is on this basis that the group balance sheet reflects the above share capital as at 31 March 2024 as if the company and group were in existence throughout the current and prior year.
The profit and loss reserve represents cumulative profits or losses, net of dividends paid and other adjustments.
Merger reserve
The merger reserve was created as part of a group restructuring and in application of the merger accounting basis of consolidation in presenting the results of the group.
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
During the current year, Blake Clough Consulting Middle East LLC FZ raised sales of £1,934,441 (2024 - £682,770) to Blake Clough Consulting Limited in respect of sub-contracted services provided. At the reporting date, Blake Clough Consulting Limited was owed £9,000 (2024 - £106,149) from Blake Clough Consulting Middle East LLC FZ.
Also during the current year, dividends of £944,669 (2024 - £Nil) were paid by Blake Clough Consulting Middle East LLC FZ to Blake Clough Consulting Limited.
The company has taken advantage of the exemption available in Section 33 of FRS 102 whereby it has not disclosed transactions with any wholly owned subsidiary undertaking of the group.