REGISTERED NUMBER: 11814311 (England and Wales)

Messenger BCR limited

Group Strategic Report, Report of the Directors and

Consolidated Financial Statements

for the Year Ended 31st March 2025

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

4

to

7

Consolidated Income Statement

8

Consolidated Other Comprehensive Income

9

Consolidated Balance Sheet

10

Company Balance Sheet

11

Consolidated Statement of Changes in Equity

12

Company Statement of Changes in Equity

13

Consolidated Cash Flow Statement

14

Notes to the Consolidated Financial Statements

15

to

28

DIRECTORS:

P A Gibbons

Mrs J F MacDonald

Mrs H M Gibbons

REGISTERED OFFICE:

Collyweston Heritage Centre

Main Road

Collyweston

Stamford

Lincolnshire

PE9 3PQ

REGISTERED NUMBER:

11814311 (England and Wales)

SENIOR STATUTORY AUDITOR:

Paul Sparks FCA FCCA

AUDITORS:

Cheney & Co

Statutory Auditor

310 Wellingborough Road

Northampton

NN1 4EP

The directors present their strategic report of the company and the group for the year ended 31st March 2025.

REVIEW OF BUSINESS

A substantial increase in turnover for the group, coming from our major construction projects and insurance related repairs division. Very encouraging to see this has ultimately led to an equally substantial increase to our net profit and strength of balance sheet. A strong cash flow position and a record level of secured turnover means the group is well positioned to take advantage of future opportunities for growth.

PRINCIPAL RISKS AND UNCERTAINTIES

The directors are not aware of any fundamental risks facing the business but remain aware of the growing pressure faced by potential wage increases, the increased NI and changing government policies.

KEY PERFORMANCE INDICATORS

The other key performance indicators are:-

2025

2024

2023

2022

Turnover (£ 000`s)

35,232

29,558

31,021

27,411

Gross Profit (£ 000's)

7,866

5,432

4,959

4,994

Gross Profit Percentage

22..33%

18.38%

15.99%

18.22%

Net Profit Percentage

3.66%

1.83%

1.96%

2.17%

Liquidity ratio

132.74%

123.35%

120.22%

115.31%

Debtor days

77

91

79

82

Trading ratio

0.69%

0..46%

0.17%

0.27%

Gearing

10.66%

12.04%

13.21%

16.58%

FUTURE DEVELOPMENTS

The directors are happy with the expected growth and development for the future and have taken steps to extend the service base and expand current customers winning some prestigious contracts for the forth coming years

ON BEHALF OF THE BOARD:

Director

22nd October 2025

The directors present their report with the financial statements of the company and the group for the year ended 31st March 2025.

DIVIDENDS

No dividends will be distributed for the year ended 31st March 2025.

DIRECTORS

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

P A Gibbons

Mrs J F MacDonald

Mrs H M Gibbons

DIRECTORS' RESPONSIBILITIES STATEMENT

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

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

-	select suitable accounting policies and then apply them consistently;

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

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

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

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

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

AUDITORS

The auditors, Cheney & Co, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

P A Gibbons - Director

22nd October 2025

Opinion

We have audited the financial statements of Messenger BCR limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31st March 2025 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the group's and of the parent company affairs as at 31st March 2025 and of the group's profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

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

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

Other information

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

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

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

Opinions on other matters prescribed by the Companies Act 2006

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

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

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

Matters on which we are required to report by exception

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

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

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

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

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

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

Responsibilities of directors

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

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

Auditors' responsibilities for the audit of the financial statements

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

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

Owing to the inherent limitations of an audit, there is an unavoidable risk that material misstatement in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK).

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

We obtained an understanding of the legal and regulatory frameworks applicable to the company and its subsidiaries as well as the sectors in which they operate. We determine that the following laws and regulations were most significant: the Companies Act 2006, UK taxation laws, UK GAAP and health & safety legislation applicable to the construction industry.

We obtained an understanding of how the company and its subsidiaries are complying with those legal and regulatory frameworks by making inquiries of management.

We have discussed with management the specific risk to the company of the liabilities arising from disputes relating to work undertaken by the company and its subsidiaries, leading to legal liabilities, and have concluded that this risk is small. There has been nothing that has come to light and no instances of legal action against the company and the group in this regard.

The major critical judgement in relation to the group's consolidated financial statements is the valuation of the applications for payment, and provisions against these amounts, which are a components of the balance sheet items of trade debtors, or trade creditors as accrued or deferred income, as appropriate, and also reflected in the turnover figure within the income statement.

We have undertaken high levels of testing of balances included in the balance sheet and have performed a detailed analytical review of the income statement.

Prior to commencement of the audit staff were briefed on the risk assessment of the susceptibility company's financial statements to material misstatement, including how fraud could occur.

At the completion stage of the audit the results of audit tests were re-examined to ensure that they were consistent with our knowledge of the client and did not warrant further investigation of transactions and balances.

We have assessed the susceptibility of the financial statements of the company and its subsidiaries to material misstatement, including how fraud might occur. Audit procedures performed for the company's accounts and its subsidiaries included:

- identifying and assessing the design effectiveness of controls management has in place to prevent and detect fraud;

- understanding how those charged with governance considered and addressed the potential for the override of controls or other inappropriate influence over the financial reporting process;

- challenging assumptions and judgements made by the management in its significant accounting estimates;

- identifying and testing journal entries, in particular any journal entries posted with unusual account combinations; and

- assessing the extent of the compliance with the relevant laws and regulations.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Paul Sparks FCA FCCA (Senior Statutory Auditor)

for and on behalf of Cheney & Co

Statutory Auditor

310 Wellingborough Road

Northampton

NN1 4EP

22nd October 2025

TURNOVER

3

35,231,539

29,557,893

Cost of sales

27,365,327

24,125,665

GROSS PROFIT

7,866,212

5,432,228

Administrative expenses

6,488,853

4,785,470

OPERATING PROFIT

5

1,377,359

646,758

Interest receivable and similar income

25,829

-

1,403,188

646,758

Interest payable and similar expenses

6

114,660

105,414

PROFIT BEFORE TAXATION

1,288,528

541,344

Tax on profit

7

298,787

136,012

PROFIT FOR THE FINANCIAL YEAR

989,741

405,332

Profit attributable to:

Owners of the parent

989,741

405,332

PROFIT FOR THE YEAR

989,741

405,332

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

989,741

405,332

Total comprehensive income attributable to:

Owners of the parent

986,619

405,332

Non-controlling interests

3,122

-

989,741

405,332

FIXED ASSETS

Intangible assets

9

1,790,238

1,909,586

Tangible assets

10

2,466,009

2,236,574

Investments

11

-

-

4,256,247

4,146,160

CURRENT ASSETS

Stocks

12

188,456

110,600

Debtors

13

8,064,322

7,877,601

Cash at bank and in hand

1,316,659

67,232

9,569,437

8,055,433

CREDITORS

Amounts falling due within one year

14

7,209,240

6,530,422

NET CURRENT ASSETS

2,360,197

1,525,011

TOTAL ASSETS LESS CURRENT LIABILITIES

6,616,444

5,671,171

CREDITORS

Amounts falling due after more than one year

15

(1,065,116

)

(1,093,050

)

PROVISIONS FOR LIABILITIES

19

(153,000

)

(172,857

)

NET ASSETS

5,398,328

4,405,264

CAPITAL AND RESERVES

Called up share capital

20

1,201

1,000

Merger reserve

21

1,999,000

1,999,000

Retained earnings

21

3,395,005

2,405,264

SHAREHOLDERS' FUNDS

5,395,206

4,405,264

NON-CONTROLLING INTERESTS

3,122

-

TOTAL EQUITY

5,398,328

4,405,264

The financial statements were approved by the Board of Directors and authorised for issue on 22nd October 2025 and were signed on its behalf by:

P A Gibbons - Director

FIXED ASSETS

Intangible assets

9

-

-

Tangible assets

10

-

-

Investments

11

3,333,333

3,333,333

3,333,333

3,333,333

CREDITORS

Amounts falling due within one year

14

1,083,333

1,083,333

NET CURRENT LIABILITIES

(1,083,333

)

(1,083,333

)

TOTAL ASSETS LESS CURRENT LIABILITIES

2,250,000

2,250,000

CAPITAL AND RESERVES

Called up share capital

20

1,000

1,000

Merger reserve

21

1,999,000

1,999,000

Retained earnings

21

250,000

250,000

SHAREHOLDERS' FUNDS

2,250,000

2,250,000

Company's profit for the financial year

-

-

The financial statements were approved by the Board of Directors and authorised for issue on 22nd October 2025 and were signed on its behalf by:

P A Gibbons - Director

Called up

share

Retained

Merger

capital

earnings

reserve

£

£

£

Balance at 1st April 2023

1,000

1,999,932

1,999,000

Changes in equity

Total comprehensive income

-

405,332

-

Balance at 31st March 2024

1,000

2,405,264

1,999,000

Changes in equity

Issue of share capital

201

-

-

Total comprehensive income

-

989,741

-

Balance at 31st March 2025

1,201

3,395,005

1,999,000

Non-controlling

Total

Total

interests

equity

£

£

£

Balance at 1st April 2023

3,999,932

-

3,999,932

Changes in equity

Total comprehensive income

405,332

-

405,332

Balance at 31st March 2024

4,405,264

-

4,405,264

Changes in equity

Issue of share capital

201

-

201

Total comprehensive income

989,741

3,122

992,863

Balance at 31st March 2025

5,395,206

3,122

5,398,328

Called up

share

Retained

Merger

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1st April 2023

1,000

250,000

1,999,000

2,250,000

Changes in equity

Balance at 31st March 2024

1,000

250,000

1,999,000

2,250,000

Changes in equity

Balance at 31st March 2025

1,000

250,000

1,999,000

2,250,000

Cash flows from operating activities

Cash generated from operations

26

1,800,322

2,311

Interest paid

(69,529

)

(77,276

)

Interest element of hire purchase and finance lease rental payments paid

(45,131

)

(28,138

)

Tax paid

(105,105

)

(121,434

)

Net cash from operating activities

1,580,557

(224,537

)

Cash flows from investing activities

Purchase of tangible fixed assets

(642,186

)

(547,756

)

Sale of tangible fixed assets

113,780

109,480

Interest received

25,829

-

Net cash from investing activities

(502,577

)

(438,276

)

Cash flows from financing activities

New loans in year

-

25,110

Loan repayments in year

(388,160

)

(276,157

)

New finance leases in the year

408,425

299,474

Finance lease repayments in the year

(109,228

)

(159,305

)

Capital repayments in year

260,585

(17,542

)

Amount introduced by directors

-

466

Amount withdrawn by directors

(376

)

(211

)

Share issue

201

-

Net cash from financing activities

171,447

(128,165

)

Increase/(decrease) in cash and cash equivalents

1,249,427

(790,978

)

Cash and cash equivalents at beginning of year

27

67,232

858,210

Cash and cash equivalents at end of year

27

1,316,659

67,232

1.	STATUTORY INFORMATION

Messenger BCR limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the General Information page.

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

The principal activity of the company in the year under review was that of a holding company.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires the directors to exercise judgement in the process of applying the company`s accounting policies. The areas involving a higher degree of judgement or complexity or areas where assumptions and estimates are significant to the financial statements are disclosed under critical accounting judgements and key sources of estimation uncertainty below.

The significant accounting policies applied in the preparation of these financial statements are set out below.These policies have been consistently applied to all years presented unless otherwise stated.

Critical accounting judgements and key sources of estimation uncertainty

The company makes estimates and assumptions concerning the future. The directors are also required to exercise judgement in the process of applying the company`s accounting policies. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below.

In preparing these financial statements , the directors have made the following judgements:

Recognition of profit on long - term contracts

Profit recognition is based on an assessment of the overall profitability forecast on individual contracts. Losses are recognised as soon as they are foreseen. Profits are recognised by the directors when the outcome of the contract can be assessed within reasonable certainty.The profit recognised reflects that part of the total profit currently estimated to arise over the duration of the contract that fairly represents the profit attributable to work performed at the accounting date.

Recoverability of trade and other debtors

Trade and other debtors are recognised to the extent that they are judged recoverable. The directors reviews are performed to estimate the level of reserves required for irrecoverable debt. Provisions are made specifically against invoices where recoverability is uncertain.

The directors make allowances for doubtful debts based on an assessment of the recoverability of debtors.Allowances are applied to debtors where events or changes in circumstances indicate that the carrying amounts may not be recoverable. The directors specifically analyse historical bad debts, customer creditworthiness , current economic trends and changes in customer payment terms when making a judgement to evaluate the adequacy of the provision for doubtful debts. Where the expectation is different from the original estimate, such a difference will impact the carrying value of debtors and the charge in the profit and loss account.

Provisions

A provision is recognised when the company has a present legal or constructive obligation as a result of a past event for which it is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated. If the effect is material , provisions are determined by discounting the expected future cash flow that reflects the time value of money and the risks specific to the liability.

Whether a present obligation is probable or not requires judgement. The nature and type of risks for these provisions differ, the directors`s judgement is applied regarding the nature and extent of obligations in deciding if an outflow of resources is probable or not.

Depreciation, amortisation and residual values

The directors have reviewed the asset lives and associated residual values of all fixed asset classes, and have concluded that asset lives and residual values are appropriate.

The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account.Residual value assessments consider issues such as future market conditions , the remaining life of the asset and projected disposal values.

Taxation

There are many transactions and calculations for which the ultimate tax determination is uncertain. The company recognizes liabilities for anticipated tax issues based on estimates of whether additional taxes will be due.

The directors estimation is required to determine the amount of deferred tax assets that can be recognised, based upon likely timing and level of future taxable profits together with an assessment of the effect of future tax planning strategies.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Turnover arises from increases in valuations on contracts and is the gross value of work carried out for the period to the balance sheet date, including contract variations and claims.

Variations in contract work are only included to the extent that it is probable that they will result in revenue and that they are capable of being reliably measured.

Where the total income of a contract cannot be estimated reliably, contract revenue is recognised to the extent that it is probable contract costs will be recovered.

Profit on contracts is calculated in accordance with the accounting standards and industry practice. Profit recognition is based on an assessment of the overall profitability forecast on individual contracts and is recognised when the outcome of the contract can be assessed with reasonable certainty. The profit recognised reflects that part of the total profit currently estimated to arise over the duration of the contract that fairly represents the profit attributable to work performed at the balance sheet date. The assessment of the final outcome of each contract is determined by regular review of the revenues and costs to complete that contract.

Provisions are made for losses incurred or foreseen in bringing the contract to completion as soon as they become apparent.

Basis of consolidation

The financial statements have been consolidated based on provision included with FRS102.

Related party exemption

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

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

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Goodwill

Goodwill, being the amount paid in connection with the acquisition of the group in the year to 31st March 2020, is being amortised over estimated useful life of 20 years and reviewed for impairment annually, however, the directors consider that there is no reduction in the value in the year of acquisition.

Intangible assets

Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off the cost less estimated residual value of each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Freehold property

-

in accordance with the property

Plant and machinery

-

25% on cost

Fixtures and fittings

-

25% on cost

Motor vehicles

-

25% on cost and at varying rates on cost

Computer equipment

-

25% on cost

Stocks

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

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

Taxation

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

Current or deferred taxation assets and liabilities are not discounted.

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

Deferred tax

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

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

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

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Hire purchase and leasing commitments

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

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

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

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

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

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

Pension costs and other post-retirement benefits

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