The directors present the strategic report for the 52 weeks ended 29 March 2025.

Principal activities

Scotts (2023) Limited is a direct-to-consumer retailer of Heritage homeware, kitchenware and gardenware principally via online and mail order channels.

Overall, the Company reported a loss before tax of £1.6m, a slight increase on the prior period loss (2024: £1.5m), which represents a disappointing year of trading, driven by a reduction in revenue and gross profit.

Revenues in the period were £13.7m (2024: £20.3m), a 32% decrease driven by a reduction in the customer base, and therefore reduced marketing investment, alongside disappointing trading performances. The gross margin % was 34% (2024: 37%), however gross profit reduced by 39% to £4.6m (2024: £7.5m) in line with the revenue reduction. Administrative expenses reduced 15% to £5.7m (2024: £6.7m).

The Directors have identified the following key risks faced by the company. These are set out below together with the mitigating actions that have been taken to minimise any potential impact on future financial results.

1. IT infrastructure and security — The Company's IT infrastructure is critical to its ability to trade. The use of a cloud-based e-commerce platform allows for quick recovery should issues occur, whilst the encryption of data, the use of third-party payment processors and Payment Card Industry compliance ensures customer data is adequately protected.

2. Physical infrastructure — The Company's operations are based on three sites in Burgess Hill, alongside a strategic retail site in Stow-on-the-Wold. A comprehensive Business Continuity Plan has been established that will enable the Company to quickly recommence operations if its principal business location was damaged in an incident.

3. Credit risk — The Company has credit risk in the form of its trade debtors and has therefore implemented strict credit control procedures.

4. Liquidity risk — Being part of a Group, the Company's principal risks and uncertainties are inherently linked to the Group. Risks to the Wourth Group are outlined in the Wourth Group Limited consolidated accounts although the group maintains a healthy cash balance so liquid funds are available when working capital is required.

5. Inflationary Risk — The company is subject to inflationary pressures across the breath of its cost base. By working with a range of suppliers in each area of the business, the company is able to ensure price competition can manage this inflation.

The Company will continue to rationalise its cost base, with a view of returning to profitability, prior to looking to return to growth.

The Company has credit risk in the form of its trade debtors and has therefore implemented strict credit control procedures.

The Company has a proactive approach to risk management and regularly reviews its risk register in collaboration with its insurance brokers to ensure appropriate insurance cover is in place and/​​or steps are taken to mitigate risks that are likely to have a higher possibility of occurrence and/​​or a greater financial and operational impact on the business.

The Directors continually monitor the effectiveness of the Company's operating performance by considering various key performance indicators. The main indicators are revenue, operating profit and EBITDA. Of the KPIs not already mentioned, EBITDA in the period was -£1.52m (2024: £0.06m).

The Company is a trading company within the Wourth Group Limited group, which provides a treasury function for the wider group. The Company made a loss of £1.2m in the year (2024: £1.6m) and has net liabilities of £3.4m (2024: £2.2m). The Company has received confirmation from its parent company that it will continue to provide support for a period of at least 12 months from the date of approval of the financial statements.

In assessing the Company's ability to continue as a going concern, given the existence of a group treasury function and the confirmed support from the parent company, the directors have made reference to the going concern note as disclosed in Wourth Group Limited as shown below:

“The Group is exposed to trading risk in a highly competitive retail sector. The Group is susceptible to a possible downturn in consumer spending, influenced by factors such as a reduction in disposable income and changing interest rates. The Directors have assessed, and stress tested the group’s financial position, budgets and cash flow forecasts for the period up to 31 December 2026.

All forecasts have also factored in the seasonality around revenue and stock purchases. Cash levels are expected to be at their lowest in August and September each year when the group are purchasing seasonal stock which is then converted to cash in a strong October to December period. This is particularly pertinent in WoolOvers Limited and Pure Collection Cashmere Limited. Even when flexed for underperformance on revenue targets, the cash forecasts remain in a positive position, in part due to the availability of a £12.5m revolving credit facility that is due to expire in April 2028.

The parent group has also confirmed it will provide financial support if required for a period of at least 12 months from the anticipated sign off date of the financial statements. Consequently, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for more than one year from the date of approval of these financial statements."

Accordingly, given the directors know of no reason why financial support will not be forthcoming in relation to the group treasury function, they continue to adopt the going concern basis of accounting in preparing the Company's financial statements.

On behalf of the board

The directors present their annual report and financial statements for the 52 weeks ended 29 March 2025.

In accordance with Section 414C(11) of the Companies Act 2006, information relating to future developments and risk management are included in the Strategic Report.

The results for the 52 weeks are set out on page 10.

The directors who held office during the 52 weeks and up to the date of signature of the financial statements were as follows:

The auditor, Moore Kingston Smith LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

The directors are responsible for preparing the annual report 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;

• state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

• 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.

We have audited the financial statements of Scotts (2023) Limited (the 'company') for the 52 weeks ended 29 March 2025 which comprise the Statement of Comprehensive Income, the Balance Sheet, the Statement of Changes in Equity 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 FRS 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 29 March 2025 and of its loss for the 52 weeks 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 Auditor's 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 other information comprises the information included in the annual report, other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

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 our audit:

• the information given in the Strategic Report and the Directors' Report for the financial 52 weeks 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.

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 Directors' Report.

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

• 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.

As explained more fully in the Directors' Responsibilities Statement, 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 is 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.

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

As part of an audit in accordance with ISAs (UK) we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purposes of expressing an opinion on the effectiveness of the company’s internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.

• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.

The objectives of our audit in respect of fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses to those assessed risks; and to respond appropriately to instances of fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both management and those charged with governance of the company.

Our approach was as follows:

• We obtained an understanding of the legal and regulatory requirements applicable to the company and considered that the most significant are the Companies Act 2006, UK financial reporting standards as issued by the Financial Reporting Council, and UK taxation legislation.

• We obtained an understanding of how the company complies with these requirements by discussions with management and those charged with governance.

• We assessed the risk of material misstatement of the financial statements, including the risk of material misstatement due to fraud and how it might occur, by holding discussions with management and those charged with governance.

• We inquired of management and those charged with governance as to any known instances of non-compliance or suspected non-compliance with laws and regulations.

• Based on this understanding, we designed specific appropriate audit procedures to identify instances of non-compliance with laws and regulations. This included making enquiries of management and those charged with governance and obtaining additional corroborative evidence as required.

There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. 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 by, for example, forgery or intentional misrepresentations, or through collusion.

Use of our report

This report is made solely to the company's member 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 member those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.

The Profit and Loss Account has been prepared on the basis that all operations are continuing operations.

The notes on pages 13 to 26 form part of these financial statements.

The notes on pages 13 to 26 form part of these financial statements.

The notes on pages 13 to 26 form part of these financial statements.

Scotts (2023) Limited is a private company limited by shares incorporated in England and Wales. The registered office is WoolOvers House, Victoria Gardens, Burgess Hill, West Sussex, United Kingdom, RH15 9NB.

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 £'000.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

This 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:

• Section 4 ‘Statement of Financial Position’ – Reconciliation of the opening and closing number of shares;

• 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’ – Carrying amounts, interest income/expense and net gains/losses for each category of financial instrument; 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 results are included in the consolidated financial statements of Wourth Group Limited. The consolidated financial statements of Wourth Group Limited are prepared in accordance with FRS 102 and are available to the public and may be obtained from Woolovers House, Victoria Gardens, Burgess Hill, RH15 9NB.

The Company is a trading company within the Wourth Group Limited group, which provides a treasury function for the wider group. The Company made a loss of £1.2m in the year (2024: £1.6m) and has net liabilities of £3.4m (2024: £2.2m). The Company has received confirmation from its parent company that it will continue to provide support for a period of at least 12 months from the date of approval of the financial statements.

In assessing the Company's ability to continue as a going concern, given the existence of a group treasury function and the confirmed support from the parent company, the directors have made reference to the going concern note as disclosed in Wourth Group Limited as shown below:

“The Group is exposed to trading risk in a highly competitive retail sector. The Group is susceptible to a possible downturn in consumer spending, influenced by factors such as a reduction in disposable income and changing interest rates. The Directors have assessed, and stress tested the group’s financial position, budgets and cash flow forecasts for the period up to 31 December 2026.

All forecasts have also factored in the seasonality around revenue and stock purchases. Cash levels are expected to be at their lowest in August and September each year when the group are purchasing seasonal stock which is then converted to cash in a strong October to December period. This is particularly pertinent in WoolOvers Limited and Pure Collection Cashmere Limited. Even when flexed for underperformance on revenue targets, the cash forecasts remain in a positive position, in part due to the availability of a £12.5m revolving credit facility that is due to expire in April 2028.

The parent group has also confirmed it will provide financial support if required for a period of at least 12 months from the anticipated sign off date of the financial statements. Consequently, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for more than one year from the date of approval of these financial statements."

Accordingly, given the directors know of no reason why financial support will not be forthcoming in relation to the group treasury function, they continue to adopt the going concern basis of accounting in preparing the Company's financial statements.

Turnover represents amounts receivable, net of value added tax and trade discounts, in respect of the sale of goods to customers.

Sale of goods

For sale of goods to retail customers, revenue is recognised when control of the goods has transferred, being at the point the customer purchases the goods at the retail store. Payment of the transaction price is due immediately at the point the customer purchases the goods.

For internet and mail order sales, revenue is recognised when the goods are despatched to customers, being at the point the goods are delivered to the customer. Delivery occurs when the goods have been shipped to the customer's specific location. When the customer initially purchases the goods, the transaction price receivable is recognised as a payment in advance in other creditors until the goods have been delivered to the customer.

Any credits issued for future purchases must be used within a finite period. The company recognises a liability for all unused credits and makes an estimate for expected breakage, being any amounts that may be unclaimed at the year end. Any breakage amount is recognised as revenue based on the historic aged usage rates that apply to credits issued to customers.

Under the company's standard contract terms, customers have a right to return within 28 days. At the reporting date, a refund liability and a corresponding adjustment to revenue is recognised for those products expected to be returned. At the same time, the company has a right to recover the product when customers exercise their right of return so consequently recognises a right to returned goods and corresponding adjustment to cost of sales. The net value of the returns provision is recognised in other creditors based on the estimated returns after the reporting date of sales that occurred in the period. The company uses its accumulated historical experience to estimate the number of returns to be provided for.

Revenue from the sale of gift cards is deferred and recognised only when the gift card is redeemed by the customer and the related goods are depatched. Until redemption, the value of outstanding gift cards is recorded as deferred income. Where it becomes virtually certain that a gift card will not be redeemed, breakage income is recognised in the profit and loss account.

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 3 years.

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

Amortisation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

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 profit or loss.

At each reporting period end 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). 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 profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

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 profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost includes expenditure incurred in acquiring the stocks, conversion costs and other costs in bringing them to their existing location and condition.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

Basic financial instruments are measured at amortised cost. The company has no other financial instruments or basic financial instruments measured at fair value.

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company 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.

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

Equity instruments issued by the company 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 company.

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 company’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 when the company has 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.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss 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 leases asset are consumed.

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 profit or loss.

In the application of the company’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.

The following judgements have had the most significant effect on amounts recognised in the financial statements.

The company makes an estimate of the net realisable values of stock which is based on assessments of future sales projections and prevailing market conditions. These are re-assessed annually and amended where necessary to reflect current estimates. Changes to these estimates could result in changes to the profit and loss for the period and to the carrying value of the stock. See note 6 for the carrying value of stock and changes to any provision made in the period.

The company makes an estimate of the post year end sales returns which is based on assessments of the expected level of returns within the 28 day returns policy. The company uses its accumulated historical experience of actual return levels to estimate the number of returns to be provided for. These are re-assessed annually and amended where necessary to reflect current estimates. Changes to these estimates could result in changes to the profit and loss for the period and to the value of the accrual.

An estimate is made for credit note breakages based on the historical trends of credit notes being claimed. This estimate is derived using aged data of the claims of credit notes during their finite lifetime. The estimate is updated at least annually to take account of any changes in trends.

The recoverability of trade debtors is regularly reviewed in the light of available economic information specific to each receivable and provisions are recognised for balances considered to be irrecoverable.

The value of goodwill is shown at cost less amortisation less provision for impairment. The amortisation policy is set at 3 years.

The carrying value of goodwill is reviewed for impairment when an event or changes in trading circumstances indicate the carrying value may not be fully recoverable.

Depreciation is provided at rates calculated to write off the cost or valuation of fixed assets, less their estimated residual value, over their expected useful lives. Amortisation is calculated to write off the cost in equal annual instalments over their estimated useful lives.

An analysis of the company's turnover is as follows:

The average monthly number of persons (including directors) employed by the company during the period was:

Their aggregate remuneration comprised:

The actual (credit)/charge for the 52 weeks can be reconciled to the expected credit for the 52 weeks based on the profit or loss and the standard rate of tax as follows:

The impairment of the carrying value of goodwill in the prior year arose due to a change in the trading circumstances.

More information on impairment movements is given in note 9.

Changes in finished goods recognised as cost of sales in the period amounted to £644k (2024: £482k) The stock provision amounted to £49k (2024: £55k).

Amounts totalling £0.91m (2024: £0.85m) relate to intercompany trading balances which do not carry any interest. All intercompany balances are repayable on demand.

Fixed and floating charges are secured over the trade and assets of the business in relation to the banking facilities available to the wider group.

Amounts totalling £4.36m (2024: £2.96m) relate to intercompany trading balances payable which do not carry any interest. All intercompany balances are repayable on demand.

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

The A Ordinary shares of £0.01 each and the B Ordinary shares of £0.01 each rank pari passu in all respects.

The group bank loan is secured by a fixed and floating charge over the trade and assets of the company.

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

In accordance with FRS102 section 33 paragraph 33.1A, the company has not disclosed transactions with wholly owned subsidiaries or its parent company within the same group.

The company is a subsidiary undertaking of Woolovers Limited, registered office Woolovers House, Victoria Gardens, Burgess Hill, RH15 9NB.

The ultimate controlling party is a fund managed by Verdane Fund Manager AB, an investment management firm, by virtue of its majority shareholding in Aurora Holdco Limited, registered office 1 Chapel Street, Warwick, United Kingdom, CV34 4HL.

The results are included in the consolidated financial statements of Wourth Group Limited. The consolidated financial statements of Wourth Group Limited are prepared in accordance with FRS 102 and are available to the public and may be obtained from Woolovers House, Victoria Gardens, Burgess Hill, RH15 9NB.