REGISTERED NUMBER: 02417996 (England and Wales)

SKELTON THOMAS ENGINEERING LIMITED

STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED

31 JANUARY 2025

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

5

Income Statement

8

Other Comprehensive Income

9

Statement of Financial Position

10

Statement of Changes in Equity

12

Notes to the Financial Statements

13

DIRECTORS:

T F Lewis

Mrs S W Lewis

REGISTERED OFFICE:

Tank Farm Road

Llandarcy

Neath

SA10 6EN

REGISTERED NUMBER:

02417996 (England and Wales)

AUDITORS:

Bevan Buckland LLP (Statutory Auditors)

Ground Floor Cardigan House

Castle Court

Swansea Enterprise Park

Swansea

SA7 9LA

BANKERS:

Natwest

Phoenix Way

Llansamlet

Swansea

SA7 9FS

The directors present their strategic report for the year ended 31 January 2025.

Skelton Thomas Engineering Limited aspire to be the leading multi-disciplined contractor in South Wales, delivering a premium service and effective solutions to our customers.

We value our people, customers, partners and the communities in which we operate.

Our core values and behaviours underpin everything we do;

Safety

We are in a hazardous business and everything we do relies upon the safety of our workforce and the communities around us. Safe working is good business and takes priority above all.

Leadership

Our leaders have created a vision and will passionately own and drive it to completion.

Our people share our vision and work in line with our actions, beliefs, values, and goals.

Responsibility

We care about the safe management of the environment. We are committed to supporting the communities which we operate. Our people operate in an ethical manner at all times.

Excellence

We strive for excellence through systematic and disciplined management of our operations and commit to quality outcomes, having a thirst to learn, and to improve.

Discipline

We follow and uphold the rules and standards we set for our company. If something is not right, we correct it.

Collaboration

We work to a defined and common business purpose as we accomplish more together, trusting our teams and partners to deliver on our obligations and put the team ahead of personal success.

REVIEW OF BUSINESS

During the year Skelton Thomas Engineering Limited decreased its turnover by 40.52% which was in line with the projected forecasts as a key customer continued with the restructuring of its operations. During the year the direct costs and administrative expenses were successfully managed in line with the reduction in turnover. This has resulted in a reported profit before tax of £491,795 (2024: £1,114,509).

The Senior Management team of Skelton Thomas Engineering Limited are constantly reviewing the risks that may impact on the group and actively take measures to minimise these as they are identified. We believe we are well placed within our sector and now have a wealth of expertise at manager level to enable us to continue to explore new avenues for additional work and attract new customers.

PRINCIPAL RISKS AND UNCERTAINTIES

Financial Risk

The company uses various financial instruments which include cash and other items such as trade debtors and trade creditors that arise directly from its operations. The main purpose of these financial instruments is to raise finance for the company's operations.

The main risk arising from the company's financial instruments are price risk, credit risk and liquidity risk. The directors review and agree policies for managing each of these risks.

Liquidity Risk

The company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest cash assets safely and profitability.

Customer and Credit Risk

The company's principal financial assets are cash and trade debtors. The principal credit risk arises from its trade debtors. In order to manage credit risk the directors have implemented policies that require appropriate credit checks on potential customers before sales are made. Customers are assigned credit limits and overdue debts are chased on a regular basis.

The company is also looking to diversify to avoid customer concentration to ensure there is not a single or small group of customers that the company places significant reliance upon its sales.

Health & Safety

The business has in place a rigorous and far reaching health & safety policy, and is committed to adhering to all legislation requirements imposed on it through the various enforcing authorities.

Government Legislation

The business operates under a variety of controls and regulations implemented by government bodies. These regulations set stringent operational standards and enhance the safety and environmental characteristics of the industry. Management ensures it has sufficient, robust procedures and controls in place to remain compliant with existing legislation and to enable it to react quickly to implement any changes.

KEY PERFORMANCE INDICATORS

The main key performance indicators were as follows:

Gross Profit Margin: 2025: 9.35% (2024 9.06%)

Gross Profit: 2025 £1,252,886 (2024:2,041,620)

Net Profit Margin: 2025 3.43% (2024 3.72%)

Net Profit before Tax: 2025 £491,392 (2024 £1,114,509)

Net Profit After Tax: 2025 £349,073 (2024 £838,413)

The key performance indicators are monitored by the senior management team to ensure that they are progressing as planned in a timely manner. At this stage the senior management team is confident that these targets are being met.

ON BEHALF OF THE BOARD:

T F Lewis - Director

30 October 2025

The directors present their report with the financial statements of the company for the year ended 31 January 2025.

DIVIDENDS

No interim dividend was paid during the year. The directors recommend a final dividend of £39.60 per share.

The total distribution of dividends for the year ended 31 January 2025 will be £ 400,000 .

DIRECTORS

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

T F Lewis

Mrs S W Lewis

KEY PERFORMANCE INDICATORS

The directors consider that key performance indicators are those that communicate the financial performance and strength of the company as a whole, these being turnover, gross profit, operating profit and profit/loss before taxation as set out in the financial statements profit & loss account. These give a measure of work undertaken and measure of profit generated from core operations before the impact of taxation respectively.

The directors do monitor other KPIs, however the directors choose not to include the outcomes of these KPIs in the financial statements due to the commercial sensitivity of such KPIs.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

ON BEHALF OF THE BOARD:

T F Lewis - Director

30 October 2025

Opinion

We have audited the financial statements of Skelton Thomas Engineering Limited (the 'company') for the year ended 31 January 2025 which comprise the Income Statement, Other Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 January 2025 and of its 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 company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

-	the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

-	adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of directors' remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page four, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Extent to which the audit was considered capable of detecting irregularities, including fraud

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

We discussed our audit independence complying with the Revised Ethical Standard 2019 with the engagement team members whilst planning the audit and continually monitored our independence throughout the process.

Identifying and assessing potential risks related to irregularities.

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

-

enquiring of management, including obtaining and reviewing supporting documentation, concerning the Company's policies and procedures relating to:

-

identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;

-

detecting and responding to the risks of fraud and whether they have knowledge of any actual. suspected or alleged fraud;

-

the internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations;

-

discussing among the engagement team how and where fraud might occur in the Financial Statements and any potential indicators of fraud. As part of this discussion, we identified potential for fraud in the following areas;

-

Assumptions used for valuing work in progress at the year end, and;

-

Potential for deferring income already earned at the year end.

-

obtaining an understanding of the legal and regulatory frameworks that the Company operates in, focusing on those laws and regulations that had a direct effect on the Financial Statements or that had a fundamental effect on the operations of the Company, The key laws and regulations we considered in this context included the UK Companies Act and relevant tax legislation.

Audit response to risks identified

In addition to the above, our procedures to respond to risks identified included the following:

-

reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with relevant laws and regulations;

-

enquiring of management concerning actual and potential litigation and claims; performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;

-

reading minutes of meetings of those charged with governance and reviewing correspondence with HMRC; and

-

in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments;

-

assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and

-

evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

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.

Alison Vickers (Senior Statutory Auditor)

for and on behalf of Bevan Buckland LLP (Statutory Auditors)

Ground Floor Cardigan House

Castle Court

Swansea Enterprise Park

Swansea

SA7 9LA

30 October 2025

REVENUE

13,399,063

22,526,990

Cost of sales

12,146,177

20,485,370

GROSS PROFIT

1,252,886

2,041,620

Administrative expenses

818,558

943,311

434,328

1,098,309

Other operating income

41,467

3,180

OPERATING PROFIT

4

475,795

1,101,489

Interest receivable and similar income

15,597

13,020

PROFIT BEFORE TAXATION

491,392

1,114,509

Tax on profit

5

142,319

276,096

PROFIT FOR THE FINANCIAL YEAR

349,073

838,413

PROFIT FOR THE YEAR

349,073

838,413

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

349,073

838,413

FIXED ASSETS

Intangible assets

7

160,000

200,000

Property, plant and equipment

8

383,577

6,289

543,577

206,289

CURRENT ASSETS

Inventories

9

450,083

438,195

Debtors

10

12,179,657

16,717,064

Cash at bank and in hand

268,652

277,611

12,898,392

17,432,870

CREDITORS

Amounts falling due within one year

11

11,218,872

15,595,588

NET CURRENT ASSETS

1,679,520

1,837,282

TOTAL ASSETS LESS CURRENT LIABILITIES

2,223,097

2,043,571

PROVISIONS FOR LIABILITIES

14

(379,268

)

(379,078

)

ACCRUALS AND DEFERRED INCOME

15

(230,263

)

-

NET ASSETS

1,613,566

1,664,493

CAPITAL AND RESERVES

Called up share capital

16

10,100

10,100

Retained earnings

17

1,603,466

1,654,393

SHAREHOLDERS' FUNDS

1,613,566

1,664,493

The financial statements were approved by the Board of Directors and authorised for issue on 30 October 2025 and were signed on its behalf by:

T F Lewis - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 February 2023

10,100

1,510,980

1,521,080

Changes in equity

Dividends

-

(695,000

)

(695,000

)

Total comprehensive income

-

838,413

838,413

Balance at 31 January 2024

10,100

1,654,393

1,664,493

Changes in equity

Dividends

-

(400,000

)

(400,000

)

Total comprehensive income

-

349,073

349,073

Balance at 31 January 2025

10,100

1,603,466

1,613,566

1.	STATUTORY INFORMATION

Skelton Thomas Engineering Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

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

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

The company is both the smallest and largest undertaking of a group and as such has taken advantage of the exemption available under the Companies Act 2006 to prepare consolidated financial statements.

Financial Reporting Standard 102 - reduced disclosure exemptions

The company has taken advantage of the following disclosure exemption in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

•

the requirements of Section 7 Statement of Cash Flows.

Significant judgements and estimates

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be appropriate and reasonable in the circumstances.

a) Critical judgements in applying the company's accounting policies

The directors do not consider there to be any critical accounting judgements to the financial statements.

b) Key accounting estimates and assumptions

i) Long term contracts

Where the Company enters into long term contracts, revenue is recognised on the percentage of completion basis. Under the percentage of completion method, the Company makes an estimate of the percentage to complete for a project and recognises the proportion of revenue and profit accordingly. In forecasting the profitability of contracts, management makes best estimates of the impact of customer disputes and claims brought by contractors. Any expected losses on long term contracts are recognised immediately and are written off to the Statement of comprehensive income.

ii) Recognition of income

Turnover represents the fair value of services provided during the year under review on client assignments. Turnover is recognised as contract activity progresses and the right to consideration is earned. this represents a risk as the turnover recognised is based on an assessment of the time spent, skills and expertise provided.

Turnover

Turnover from the sale of goods is recognised in the profit and loss account when significant risks and rewards of ownership have been transferred to the buyer. Turnover from the projects or contracts is recognised as income in proportion to the stage of completion of the transaction at the balance sheet date. The stage of completion is assessed depending on the specific circumstances of each case. No turnover is recognised if there are significant uncertainties regarding recovery of the consideration due to associated costs, or there is the possibility of return of the goods. Turnover represents the sale of goods/revenue from contracts, excluding tax.

Deferred Income

Deferred income represents monies received in advance for contracts.

Goodwill

Goodwill, being the amount paid in connection with the acquisition of a business in 2024, is being amortised evenly over its estimated useful life of five years.

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.

Tangible fixed assets

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

Improvements to property

-

equal instalments over the lease period

Fixtures and fittings

-

20% on cost

All categories of assets are measured using the cost method. Cost comprises the purchase price of the asset and expenditure directly attributable to the acquisition of the item.

A fixed asset is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. 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 credited or charged to the income statement.

Impairment of fixed assets

At each reporting date, the company reviews the carrying amounts of its tangible and intangible 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).

Recoverable amount is the higher of fair value less costs to sell and value in use.

If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss.

Stocks

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

Cost is calculated using the first-in, first-out method and includes all purchase, transport, and handling costs in bringing inventories to their present location and condition.

Work in Progress

Work-in-progress represents the cost of services rendered and materials used on projects that have not yet reached completion. For accounting purposes, WIP is recognised as part of the company's assets until the project is invoiced or otherwise recognised as revenue.

The revenue associated with each construction project is recognised based on the percentage of completion method, whereby the revenue and costs are recognised in proportion to the work performed as at the reporting date.

Revenue from construction contracts is recognised based on the stage of completion. This is determined as the proportion of contract costs incurred for work performed to date relative to the estimated total contract costs. Revenue recognised on WIP is limited to the amount that is reasonably certain to be recoverable.

When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised immediately as an expense in the income statement. The amount recognised is the expected excess of costs over revenue, measured at the reporting date.

WIP is reviewed at each reporting date to ensure it remains recoverable. Any impairment loss is recognised if the carrying amount exceeds its net realisable value.

Financial instruments

The company 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.

The company enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities such as trade and other receivables and payables, amounts due to and from related parties.

Financial instruments are classified and accounted for according to the substance of the contractual arrangement, as financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

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

Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in profit or loss. For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying value and the present value of estimated cash flows discounted at the assets original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and the best estimate, which is an approximation, of the amount that the group would receive for the asset if it were to be sold at the reporting date.

Financial assets and liabilities are offset and the net amount recognised in the balance sheet when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously. At each reporting date non-financial assets not carried at fair value, such as property, plant and equipment are reviewed to determine whether there is an indication that an asset may be impaired. If there is an indication of possible impairment, the recoverable amount of any asset or group of related assets, which is the higher of value in use and the fair value less costs to sell, is estimated and compared with its carrying amount. If the recoverable amount is lower, the carrying amount of the asset is reduced to its recoverable amount and an impairment loss is recognised immediately in profit or loss.

If an impairment loss is subsequently reversed, the carrying amount of the asset or group of related assets is increased to the revised estimate of its recoverable amount, but not to exceed the amount that would have been determined had no impairment loss been recognised for the asset or group of related assets in prior periods. A reversal of an impairment loss is recognised immediately in profit or loss.

Basic financial assets

Basic financial assets, which include trade and other receivables 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.

Basic financial liabilities

Basic financial liabilities, including trade and other payables, bank loans, loans from fellow group companies are initially recognised at transaction price unless the measurement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest.

Trade Debtors

Trade debtors are amounts due from customers for services performed in the ordinary course of business.

Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provisions for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables.

Amounts Recoverable under contracts

Amounts recoverable under contracts represent work done at the year-end where a continuing right to receive income exists and is valued at the estimated amount recoverable in excess of fees already rendered on account.

Cash and cash equivalents

Cash at bank and cash in hand includes cash and short term highly liquid investments with a short maturity of three months or less from the date of acquisition or opening of the deposit or similar account.

Taxation

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

Current or deferred taxation assets and liabilities are not discounted.

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

Deferred tax

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

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Hire purchase and leasing 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.

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 or the lease term, whichever is the shorter.

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

Pension costs and other post-retirement benefits

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

Government grants

Government grants are recognised in the profit and loss account so as to match them with the expenditure towards which they are intended to contribute.

To the extent that grants are made as a contribution towards specific expenditure on fixed assets, they are recognised over the useful economic life of the related asset.

Grants made to give immediate financial support or assistance to an enterprise or to reimburse costs previously incurred are recognised in the profit and loss account of the period in which they become receivable.

Provisions for liabilities

Provisions are made when an event has taken place that gives the company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.

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

When payments are eventually made, they are charged to the provision carried in the Balance Sheet.

Dilapidation Provision

Provisions are made for dilapidations, estimate for the provision is based on expected cost to restore the building to its original state.

Share Capital

Ordinary shares are classified as equity.

Dividends to equity holders

Dividends and other distributions to the company's shareholders are recognised as a liability in the financial statements in the period in which the dividend and other distributions are approved by the shareholders. These amounts are recognised in the statement of changes in equity.

3.	EMPLOYEES AND DIRECTORS

2025

2024

£

£

Wages and salaries

2,864,232

2,712,721

Social security costs

277,603

266,057

Other pension costs

79,129

76,500

3,220,964

3,055,278

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

2025

2024

Direct Wages

49

52

Administration

3

6

52

58

2025

2024

£

£

Directors' remuneration

-

-

4.	OPERATING PROFIT

The operating profit is stated after charging:

2025

2024

£

£

Hire of plant and machinery

1,072,931

3,089,375

Vehicle Hire

335,573

281,311

Depreciation - owned assets

2,712

3,335

Goodwill amortisation

40,000

-

Auditors' remuneration

9,500

8,450

Taxation compliance services

2,500

2,200

Other assurance services

550

500

Other non- audit services

7,103

15,645

5.

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

128,996

284,123

Deferred tax

13,323

(8,027

)

Tax on profit

142,319

276,096

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

491,392

1,114,509

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

122,848

278,627

Effects of:

Expenses not deductible for tax purposes

19,471

10,744

Adjustments to tax charge in respect of previous periods

-

12,366

tax purposes

in excess of depreciation

CT Marginal rates

-

(10,810

)

Deferred Tax

-

(14,277

)

Effect of change on DT to 24%

-

(554

)

Development

Total tax charge

142,319

276,096

6.

DIVIDENDS

2025

2024

£

£

Ordinary shares of £1 each

Final

400,000

695,000

7.	INTANGIBLE FIXED ASSETS

Goodwill

£

COST

At 1 February 2024

and 31 January 2025

200,000

AMORTISATION

Amortisation for year

40,000

At 31 January 2025

40,000

NET BOOK VALUE

At 31 January 2025

160,000

At 31 January 2024

200,000

8.	PROPERTY, PLANT AND EQUIPMENT

Improvements

Fixtures

to

and

property

fittings

Totals

£

£

£

COST

At 1 February 2024

26,538

69,049

95,587

Additions

380,000

19,800

399,800

Disposals

-

(19,800

)

(19,800

)

At 31 January 2025

406,538

69,049

475,587

DEPRECIATION

At 1 February 2024

26,538

62,760

89,298

Charge for year

-

2,712

2,712

At 31 January 2025

26,538

65,472

92,010

NET BOOK VALUE

At 31 January 2025

380,000

3,577

383,577

At 31 January 2024

-

6,289

6,289

9.	INVENTORIES

2025

2024

£

£

Stocks

239,869

170,243

Work-in-progress

210,214

267,952

450,083

438,195

10.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2025

2024

£

£

Trade debtors

1,481,880

7,728,118

Amounts owed by group undertakings

9,367,889

8,034,079

Amounts owed by participating interests

90,373

145,638

Amounts owed by joint ventures

890,763

87,570

Other debtors

3,068

300,600

Amounts due from contracts

19,930

322,040

VAT

245,910

-

Deferred tax asset

-

13,134

Prepayments

79,844

85,885

12,179,657

16,717,064