Company registration number 00626216 (England and Wales)
HODGE CLEMCO LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
HODGE CLEMCO LIMITED
COMPANY INFORMATION
Directors
M Currie
K Yang
C Twibell
J R Dodge
C A Pierce
(Appointed 2 February 2024)
S M Wieland
(Appointed 2 February 2024)
Company number
00626216
Registered office
36 Orgreave Drive
Sheffield
United Kingdom
S13 9NR
Auditor
BHP LLP
Albert Works
Sidney Street
Sheffield
S1 4RG
HODGE CLEMCO LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 5
Independent auditor's report
6 - 8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 24
HODGE CLEMCO LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 1 -

The directors present the strategic report for the year ended 31 December 2024.

Review of the business

The company has been established since 1959 and is considered a leader in the manufacture and supply of abrasive blasting sandblasting equipment and surface treatment equipment. Our product portfolio ranges from portable abrasive blast cleaning equipment, hand blast cabinets, soda blast equipment, shot blasting equipment, blast rooms, a full range of JBlast and recyclable abrasives, abrasive recovery, and dust extraction & collection. We provide blasting training, equipment servicing, abrasive reprocessing & disposal, and we supply a range of blasting substrate inspection equipment.

The company has been part of the SurfacePrep Group from September 2021, and this corporate body continues to provide exciting opportunities for Hodge Clemco Limited. This includes increased access to the sectors in which it operates, potential additional growth through economies of scale and group strategic support, which have previously not been available to the business.

The company has continued to perform well despite challenging global inflationary pressures impacting all costs including raw materials, staff costs, utilities and fuel to name a few. Turnover for the year amounts to £18.9 m (2023: £18.7m), achieving satisfactory growth of 1.13%. The company continues to be profitable, reporting profit before tax of £1.8 m (2023: £1.8m). Management continues to focus on effectively managing costs with all elements of operations, to support the continued and future profitability of the company, At the year end the net assets of the company amounted to £9.1 m (2023: £7.8m).

The management board are satisfied that the company has significant reserves, which provide financial strength and permits opportunities in respect of further expansion to be facilitated, in line with the longer-term growth strategy.

Principal risks and uncertainties

Hodge Clemco Limited has an effective risk-based quality management system (ISO9001), which supports a culture of risk reduction to drive improvements. Key risks faced by the company include, change in legislation and tariffs due to political instability, r educed sales due to new competition.

T he company uses various financial instruments such as debtors and creditors that arise directly from its operations. The existence of these financial instruments exposes the company to a few financial risks, which are described in more detail below. The directors review and agree policies for managing these risks. These policies have remained unchanged from previous years.

Liquidity risk

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

Interest risk

The company finances its operations through a combination of retained profits and finance leases and hire purchase contracts. The group exposure to interest rate fluctuations on its borrowings is managed by the use of both fixed and floating facilities.

Foreign currency risk

The company's principal foreign currency exposures arise from trading with overseas companies. Group policy permits but does not demand that these exposures may be hedged in order to fix the cost in sterling.

Credit risk

The principal credit risk arises from the company's trade debtors. All customers who wish to trade on credit terms are subject to credit verification procedures and where possible the credit limit is insured. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

HODGE CLEMCO LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 2 -
Development and performance

Being part of the SurfacePrep Group continues to provide exciting opportunities for Hodge Clemco Limited, This includes increased access to the sectors in which it operates, the potential additional growth through economies of scale and group strategic support, which have not previously not been available to the business. The company expects to strengthen its financial position by delivering the following objectives:

- Understanding the collective strengths/ weaknesses of the wider corporate group and identifying opportunities.

Improving efficiency and reporting, by replacing the company's ERP system with a modern solution to be used throughout the group Adopting the Avidian Prophet CRM solution to improve the sales management pipeline.

- Strengthening staff relationships.

- Developing the company's marketing strategy and ensure we have the correct resources in place to meet objectives.

- Recruiting dynamic individuals to strengthen the team.

Key performance indicators

The company reviews and monitors its performance against a number of key performance indicators both financial and non-financial. As a trading company, the principal measures include sales growth, gross margin, EBITDA, net current assets and net assets. These are reviewed by the management team and reported to the board on a monthly basis.

Other performance measure indicators considered by management include:

- sales order pipeline.

- monthly financial results compared to budget.

- customer satisfaction using monthly data.

The directors have and will continue to monitor all of the KPI's and daily operating controls and maintain a strong focus on increasing performance in all aspects of the business.

The main company KPI's and corresponding results are as follows:

| 2024 | 2023
Sales growth % (on 12-month comparison) | 1.13% | 8.8%
Gross margin % | 39.1% | 38.8%
EBITDA | £2.0 m | £1.9m
Net current assets | £8.6m | £7.3m
Net assets | £9.1 m | £7.8m

HODGE CLEMCO LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 3 -

The company has secured a satisfactory growth in sales on a 12-month comparison to 2023, in-line with expectations.

The increase in gross profit margin achieved in 2024 illustrates the effective cost management strategies implemented by the management board, including the mitigation of rising haulage costs from abrasive imports from Asia following strategic management decisions made.

EBITDA in 2023 was impacted by global inflationary cost increases. Following successful initiatives implemented to effectively manage EBITDA, notable improvement has been achieved in terms of profitability.

The increase in net current assets demonstrates the company's improved liquidity, because of strong working capital management. The net assets of the company remain substantial, evidencing the strong financial strength of the company. The growth achieved represents retained profits for 2024.

On behalf of the board

C Twibell
Director
6 November 2025
HODGE CLEMCO LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 4 -

The directors present their annual report and financial statements for the year ended 31 December 2024.

Principal activities
The principal activity of the company continued to be the supply of abrasive blasting machines and accessories, blast rooms and cabinets and the sale of J-Blast abrasive shotblast grit.
Results and dividends

The results for the year are set out on page 9.

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

Directors

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

M Currie
K Yang
C Twibell
J R Dodge
C A Pierce
(Appointed 2 February 2024)
S M Wieland
(Appointed 2 February 2024)
Research and development

The company engages in research and development activities with the main activities being process improvement.

Future developments

The directors continue to consider future trading opportunities, seeking growth through both existing customers and securing new opportunities as they arise. Consideration is made of industry sectors, product ranges and service offerings, applying our years of experience in order to remain blasting sector industry leaders in aerospace, automotive, marine, medical and rail.

The management board are satisfied that the company has significant reserves, providing financial strength and permits opportunities in respect of further expansion to be facilitated in-line with the longer-term growth strategy.

Auditor

The auditor, BHP LLP was appointed in the year and is deemed to be reappointed under section 487 (2) of the Companies Act 2006.

Statement of directors' responsibilities

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; and

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

HODGE CLEMCO LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 5 -

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 of disclosure to auditor
So far as the directors are aware, there is no relevant audit information of which the company's auditor are unaware. Additionally, the directors 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 auditors are aware of that information.
Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
C Twibell
Director
6 November 2025
HODGE CLEMCO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HODGE CLEMCO LIMITED
- 6 -
Opinion

We have audited the financial statements of Hodge Clemco Limited (the 'company') for the year ended 31 December 2024 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 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 December 2024 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 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' r eport 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.

HODGE CLEMCO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HODGE CLEMCO LIMITED (CONTINUED)
- 7 -
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 identifie d material misstatements in the strategic report or the directors' r eport.

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.

Responsibilities of directors

As explained more fully in the directors' r esponsibilities s tatement, 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.

Auditor's 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 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.

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

- the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;

- we identified the laws and regulations applicable to the c ompany through discussions with directors and other management, and from our commercial knowledge and experience of the sector;

- we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including Companies Act 2006, taxation legislation and data protection, employment and health and safety legislation;

- we assessed the extent of compliance with the laws and regulations considered above through making enquiries of management; and

- identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

HODGE CLEMCO LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HODGE CLEMCO LIMITED (CONTINUED)
- 8 -

We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by;

- making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and

- considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

To address the risks of fraud through management bias and override controls, we:

- performed analytical procedures to identify any unusual or unexpected relationships;

- tested journal entries to identify unusual transactions;

- assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and

- investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

- agreeing financial statement disclosures to underlying supporting documentation;

- enquiring of management as to actual and potential litigation and claims; and

- discussions with senior management regarding relevant regulations and reviewing the company’s legal and professional fees.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

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.

Daniel Varley (Senior Statutory Auditor)
For and on behalf of BHP LLP, Statutory Auditor
Chartered Accountants
Albert Works
Sidney Street
Sheffield
S1 4RG
7 November 2025
HODGE CLEMCO LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
- 9 -
2024
2023
Notes
£
£
Turnover
3
18,882,403
18,670,532
Cost of sales
(11,508,396)
(11,431,792)
Gross profit
7,374,007
7,238,740
Distribution costs
2,513
42,179
Administrative expenses
(5,619,482)
(5,533,354)
Other operating income
45,860
10,199
Operating profit
4
1,802,898
1,757,764
Interest receivable and similar income
7
17,741
6,319
Profit before taxation
1,820,639
1,764,083
Tax on profit
8
(477,900)
(179,115)
Profit for the financial year
1,342,739
1,584,968

The profit and loss account has been prepared on the basis that all operations are continuing operations.

HODGE CLEMCO LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2024
31 December 2024
- 10 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
9
588,052
550,705
Current assets
Stocks
10
3,505,057
2,597,083
Debtors
11
7,209,696
5,355,591
Cash at bank and in hand
966,508
2,320,396
11,681,261
10,273,070
Creditors: amounts falling due within one year
12
(3,031,725)
(2,928,954)
Net current assets
8,649,536
7,344,116
Total assets less current liabilities
9,237,588
7,894,821
Creditors: amounts falling due after more than one year
13
(15,770)
(29,742)
Provisions for liabilities
Deferred tax liability
15
72,937
58,937
(72,937)
(58,937)
Net assets
9,148,881
7,806,142
Capital and reserves
Called up share capital
17
250,000
250,000
Profit and loss reserves
8,898,881
7,556,142
Total equity
9,148,881
7,806,142

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved by the board of directors and authorised for issue on 6 November 2025 and are signed on its behalf by:
C Twibell
Director
Company registration number 00626216 (England and Wales)
HODGE CLEMCO LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
- 11 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2023
250,000
5,971,174
6,221,174
Year ended 31 December 2023:
Profit and total comprehensive income
-
1,584,968
1,584,968
Balance at 31 December 2023
250,000
7,556,142
7,806,142
Year ended 31 December 2024:
Profit and total comprehensive income
-
1,342,739
1,342,739
Balance at 31 December 2024
250,000
8,898,881
9,148,881
HODGE CLEMCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 12 -
1
Accounting policies
Company information

Hodge Clemco Limited is a private company limited by shares incorporated in England and Wales. The registered office is 36 Orgreave Drive, Sheffield, United Kingdom, S13 9NR.

1.1
Accounting convention

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 a mounts 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.

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. T he company has therefore taken advantage of e xemptions from the following disclosure requirements:

- 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 financial statements of the company are consolidated in the financial statements of Surface Preparation UK Holdings Limited. These consolidated financial statements are available from its registered office, 36 Orgreave Drive, Sheffield, S13 9NR.

1.2
Going concern

A true t the time of approving the financial statements, t he directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus t he directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods and installation of industrial orders), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.4
Research and development expenditure

Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.

HODGE CLEMCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 13 -
1.5
Tangible fixed assets

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:

Plant and machinery
15-25% straight line basis
Fixtures, fittings & equipment
25% straight line basis

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.

1.6
Impairment of fixed assets

At each reporting end date, the company 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 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.

1.7
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.8
Cash and cash equivalents

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.

HODGE CLEMCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 14 -
1.9
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.

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with 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

Basic financial assets, which include 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.

Impairment of financial assets

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.

Derecognition of financial assets

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.

Classification of financial liabilities

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 company after deducting all of its liabilities.

HODGE CLEMCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 15 -
Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies that are classified as debt, 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 paymen ts 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. A m ounts 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.

Derecognition of financial liabilities

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

1.10
Equity instruments

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.

1.11
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current 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

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.

HODGE CLEMCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 16 -
1.12
Employee benefits

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.

1.13
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.14
Leases

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 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 lease s asset are consumed.

1.15
Foreign exchange

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.

2
Judgements and key sources of estimation uncertainty

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.

HODGE CLEMCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
2
Judgements and key sources of estimation uncertainty
(Continued)
- 17 -
Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Tangible fixed assets

The useful economic life of tangible fixed assets has to be estimated by the directors of the company to ensure an appropriate depreciation charge is recognised in the year. The value of the assets ultimately depends on the condition of the assets and whether economic income can be derived from the asset. The directors undertake a periodic review of the assets to ensure the value of the assets is fairly stated within the financial statements.

During the year, depreciation of £229,4 28 (202 3: £221,090) has been charged.

Refer to note 9 for the carrying value of tangible fixed assets impacted by this key accounting estimate.

Stock provision

The company considers it necessary to evaluate the recoverability of the cost stock. The stock levels are constantly reviewed and should there been an indication of obsolescence, the stock is written down to its assessed net realisable value. The movement in provision is recognised in cost of sales.

The stock provision as at the balance sheet date was £23,369 (202 3: £12,138).

Refer to note 10 for the carrying value of stock impacted by this key accounting estimate.

3
Turnover and other revenue

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

2024
2023
£
£
Turnover analysed by class of business
Sale of engineering products
8,596,018
9,037,358
Sale of abrasive grit
10,286,385
9,633,174
18,882,403
18,670,532
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
15,850,912
16,877,916
Middle East
212,802
108,992
Far East
142,750
259,538
North America
355,725
39,748
European Union and Eastern Europe
2,292,970
1,345,861
Rest of the World
27,244
38,477
18,882,403
18,670,532
HODGE CLEMCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
3
Turnover and other revenue
(Continued)
- 18 -
2024
2023
£
£
Other revenue
Interest income
17,741
6,319
4
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange losses
17,970
61,039
Research and development costs
133
2,084
Fees payable to the company's auditor for the audit of the company's financial statements
28,750
14,000
Depreciation of owned tangible fixed assets
213,432
207,760
Depreciation of tangible fixed assets held under finance leases
15,996
13,330
Profit on disposal of tangible fixed assets
(29,000)
(34,630)
Operating lease charges
363,886
350,238
5
Employees

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

2024
2023
Number
Number
Administration
22
30
Production
42
39
Sales
13
7
Total
77
76

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
3,029,841
2,990,261
Social security costs
327,586
264,392
Pension costs
146,362
143,627
3,503,789
3,398,280
HODGE CLEMCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 19 -
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
98,734
101,937
Company pension contributions to defined contribution schemes
9,070
7,350
107,804
109,287

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (202 3: 2).

7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
17,741
6,319
8
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
463,900
-
0
Deferred tax
Origination and reversal of timing differences
14,000
179,115
Total tax charge
477,900
179,115
HODGE CLEMCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
8
Taxation
(Continued)
- 20 -

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:

2024
2023
£
£
Profit before taxation
1,820,639
1,764,083
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 25.00%)
455,160
441,021
Tax effect of expenses that are not deductible in determining taxable profit
888
-
0
Change in unrecognised deferred tax
14,318
-
0
Group relief
-
0
(267,942)
Permanent capital allowances in excess of depreciation
-
0
(158)
Depreciation on assets not qualifying for tax allowances
-
0
8,269
Other permanent differences
7,534
(2,075)
Taxation charge for the year
477,900
179,115
9
Tangible fixed assets
Plant and machinery
Fixtures, fittings & equipment
Total
£
£
£
Cost
At 1 January 2024
1,713,244
400,292
2,113,536
Additions
200,302
66,473
266,775
Disposals
(106,264)
-
0
(106,264)
At 31 December 2024
1,807,282
466,765
2,274,047
Depreciation and impairment
At 1 January 2024
1,237,521
325,310
1,562,831
Depreciation charged in the year
204,935
24,493
229,428
Eliminated in respect of disposals
(106,264)
-
0
(106,264)
At 31 December 2024
1,336,192
349,803
1,685,995
Carrying amount
At 31 December 2024
471,090
116,962
588,052
At 31 December 2023
475,723
74,982
550,705
HODGE CLEMCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
9
Tangible fixed assets
(Continued)
- 21 -

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

2024
2023
£
£
Plant and machinery
35,990
51,986

10
Stocks
2024
2023
£
£
Raw materials and consumables
620,267
371,897
Work in progress
298,066
302,592
Finished goods and goods for resale
2,586,724
1,922,594
3,505,057
2,597,083
11
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
3,390,616
2,712,425
Corporation tax recoverable
-
0
19,733
Amounts owed by group undertakings
3,462,682
1,795,262
Other debtors
1,242
1,026
Prepayments and accrued income
355,156
827,145
7,209,696
5,355,591

12
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Obligations under finance leases
14
11,152
10,174
Trade creditors
1,359,100
1,949,409
Corporation tax
463,900
-
0
Other taxation and social security
299,037
192,754
Other creditors
191,327
299,535
Accruals and deferred income
707,209
477,082
3,031,725
2,928,954
HODGE CLEMCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
12
Creditors: amounts falling due within one year
(Continued)
- 22 -

Obligations under finance leases are secured on the assets to which they relate.

13
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Obligations under finance leases
14
15,770
29,742
14
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
11,152
10,174
In two to five years
15,770
29,742
26,922
39,916

Finance lease payments represent rentals payable by the company for certain items of plant and machinery. 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.

15
Deferred taxation

The following are the deferred tax liabilities recognised by the company and movements thereon:

Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
72,937
62,258
Retirement benefit obligations
-
(3,321)
72,937
58,937
2024
Movements in the year:
£
Liability at 1 January 2024
58,937
Charge to profit or loss
14,000
Liability at 31 December 2024
72,937

The deferred tax liability set out above is due to reverse and relates to accelerated capital allowances that are expected to mature within the same period.

HODGE CLEMCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 23 -
16
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
146,362
143,627

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.

17
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
250,000
250,000
250,000
250,000
18
Financial commitments, guarantees and contingent liabilities

Contingent liabilities in respect of bonds and documentary credits entered into by the company were £120,000 (202 3: £12 0,000).

The company has given a guarantee in favour of HMRC amounting to £50,000 (202 3: £50,000).

19
Operating lease commitments
Lessee

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:

2024
2023
£
£
Within one year
307,408
344,446
Between two and five years
1,200,000
1,207,408
In over five years
525,000
825,000
2,032,408
2,376,854
20
Related party transactions

The company has taken advantage of the exemption available in accordance with FRS 102 section 33.1A 'Related party disclosures' not to disclose transactions entered into between two or more members of a group, as the company is a wholly owned subsidiary undertaking of the group which it is party to the transactions.

HODGE CLEMCO LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 24 -
21
Ultimate controlling party

The immediate parent company is Hodge Clemco Holdings Limited, a company registered in England and Wales.

Surface Preparation UK Holdings Limited is the ultimate UK parent company to the wider group and is registered in England and Wales.

Hodge Clemco Limited is consolidated within Surface Preparation UK Holdings Limited's group financial statements and copies can be obtained on request from the groups registered office, 36 Orgreave Drive, Sheffield, S13 9NR.

The ultimate parent company is Nautic SurfacePrep Holdings, LLC, a company registered in Delaware, United States.

2024-12-31 2024-01-01 false false false CCH Software CCH Accounts Production 2025.300 M Currie K Yang C Twibell J R Dodge C A Pierce S M Wieland 00626216 2024-01-01 2024-12-31 00626216 bus:Director1 2024-01-01 2024-12-31 00626216 bus:Director2 2024-01-01 2024-12-31 00626216 bus:Director3 2024-01-01 2024-12-31 00626216 bus:Director4 2024-01-01 2024-12-31 00626216 bus:Director5 2024-01-01 2024-12-31 00626216 bus:Director6 2024-01-01 2024-12-31 00626216 bus:RegisteredOffice 2024-01-01 2024-12-31 00626216 2024-12-31 00626216 2023-01-01 2023-12-31 00626216 core:RetainedEarningsAccumulatedLosses 2023-01-01 2023-12-31 00626216 core:RetainedEarningsAccumulatedLosses 2024-01-01 2024-12-31 00626216 2023-12-31 00626216 core:PlantMachinery 2024-12-31 00626216 core:FurnitureFittings 2024-12-31 00626216 core:PlantMachinery 2023-12-31 00626216 core:FurnitureFittings 2023-12-31 00626216 core:CurrentFinancialInstruments core:WithinOneYear 2024-12-31 00626216 core:CurrentFinancialInstruments core:WithinOneYear 2023-12-31 00626216 core:Non-currentFinancialInstruments core:AfterOneYear 2024-12-31 00626216 core:Non-currentFinancialInstruments core:AfterOneYear 2023-12-31 00626216 core:CurrentFinancialInstruments 2024-12-31 00626216 core:CurrentFinancialInstruments 2023-12-31 00626216 core:ShareCapital 2024-12-31 00626216 core:ShareCapital 2023-12-31 00626216 core:RetainedEarningsAccumulatedLosses 2024-12-31 00626216 core:RetainedEarningsAccumulatedLosses 2023-12-31 00626216 core:ShareCapital 2022-12-31 00626216 core:RetainedEarningsAccumulatedLosses 2022-12-31 00626216 core:ShareCapitalOrdinaryShareClass1 2024-12-31 00626216 core:ShareCapitalOrdinaryShareClass1 2023-12-31 00626216 core:PlantMachinery 2024-01-01 2024-12-31 00626216 core:FurnitureFittings 2024-01-01 2024-12-31 00626216 core:UKTax 2024-01-01 2024-12-31 00626216 core:UKTax 2023-01-01 2023-12-31 00626216 1 2024-01-01 2024-12-31 00626216 1 2023-01-01 2023-12-31 00626216 2 2024-01-01 2024-12-31 00626216 2 2023-01-01 2023-12-31 00626216 core:PlantMachinery 2023-12-31 00626216 core:FurnitureFittings 2023-12-31 00626216 2023-12-31 00626216 core:Non-currentFinancialInstruments 2024-12-31 00626216 core:Non-currentFinancialInstruments 2023-12-31 00626216 core:WithinOneYear 2024-12-31 00626216 core:WithinOneYear 2023-12-31 00626216 core:BetweenTwoFiveYears 2024-12-31 00626216 core:BetweenTwoFiveYears 2023-12-31 00626216 bus:OrdinaryShareClass1 2024-01-01 2024-12-31 00626216 bus:OrdinaryShareClass1 2024-12-31 00626216 bus:OrdinaryShareClass1 2023-12-31 00626216 core:MoreThanFiveYears 2024-12-31 00626216 core:MoreThanFiveYears 2023-12-31 00626216 bus:PrivateLimitedCompanyLtd 2024-01-01 2024-12-31 00626216 bus:FRS102 2024-01-01 2024-12-31 00626216 bus:Audited 2024-01-01 2024-12-31 00626216 bus:FullAccounts 2024-01-01 2024-12-31 xbrli:pure xbrli:shares iso4217:GBP