ACCOUNTS - Final Accounts preparation

An analysis of turnover by class of business is as follows:

Registered number: 01380206

PENNY ENGINEERING LIMITED

ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

PENNY ENGINEERING LIMITED

COMPANY INFORMATION

Directors	R G Penny
	T J Penny
	A J Holmes
	D J Ball


Company secretary	A J Holmes


Registered number	01380206


Registered office	Station Road Industrial Estate
	Station Road
	Clowne
	Derbyshire
	S43 4AB


Independent auditors	Shorts
	Chartered Accountants & Statutory Auditor
	2 Ashgate Road
	Chesterfield
	Derbyshire
	S40 4AA


Bankers	Barclays Bank plc

PENNY ENGINEERING LIMITED

CONTENTS

	Page
Strategic Report	1 - 2
Directors' Report	3 - 4
Independent Auditors' Report	5 - 8
Statement of Income and Retained Earnings	9
Balance Sheet	10
Notes to the Financial Statements	11 - 26

PENNY ENGINEERING LIMITED

STRATEGIC REPORT

FOR THE YEAR ENDED 30 JUNE 2025

Introduction

The Directors present their report and financial statements for the year ended 30th June 2025.

Business review

It was with great pleasure that, in March 2025, we received notification that our continued work at the Royal Palaces had been seen to be of sufficient quality for the company to be granted the Royal Warrant of Appointment to The King as lifting equipment manufacturers and engineers. This comes with a responsibility to not only continue with our superb work but to develop as a more sustainable business. We are already committed to this, but we have to demonstrate year on year improvement to maintain the Warrant.
The Board, as always, remains cautious and maintains a strong financial position with investment focussed on efficiency, quality and sustainability.
This was the first year with Sidetracker Engineering forming an internal division within Penny Engineering Ltd. which has led to further cost savings and profitability within the group. There has been a significant investment with Hallam University through a Knowledge Transfer Partnership to develop a class-leading multi-directional forklift truck. Progress is on target for the new truck to be put to market before June 2026.
The company name change to Penny Engineering and subsequent marketing campaigns have brought an increase in sales of non-core product ranges such as our lighting winch systems, nuclear decommissioning solutions and solid tyre pressing equipment. As all sectors remain turbulent due to the worldwide political situation the growth in what are currently non-core ranges are a focus for growth.
The £1M programme of investment in environmental and sustainability related improvements continued with new offices and welfare facilities at the Sidetracker factory with 100% LED lighting, improved insulation and low energy appliances. Trials of an EV van for our service engineers in London is still underway as we continue to pursue our sustainability goals. More solar panels plus battery storage are planned for 2026.
Turnover during the past financial year was at an excellent level considering the economic uncertainty. Total sales for the year amounted to £10,069,188 with export sales at record levels. Building new links with overseas customers and strengthening old links is a key priority along with the promotion of non-core ranges.

Going concern

The Board’s cautious approach and high levels of re-investment in the past has kept the company at the forefront of technology with respected products, efficient systems and low overheads. The Company has no borrowing requirement. Most components are UK or EU sourced with little reliance on the Far East. The diverse customer base allows marketing resource to be redirected should any one sector suffer a down-turn.

Key performance indicators

The directors use a number KPls in measuring the performance of the business, as follows:
• Trends in turnover year on year
• Profit before tax as a percentage of turnover
• Return on capital employed
• Trends in cashflow
• Debtor Days and Creditor Days
• Trends in output by product
• Health and safety statistics
• Net promoter score and Trust pilot reviews.
• Monitoring of energy consumption.

Page 1

PENNY ENGINEERING LIMITED

STRATEGIC REPORT (CONTINUED)

FOR THE YEAR ENDED 30 JUNE 2025

Other key performance indicators

The Company is committed to conducting its business in an ethically responsible manner and this commitment has been recognised in that the operating and management systems have been certified as meeting the standards required by ISO 45001 (Occupational Health and Safety Management), ISO 14001 (Environmental Management), EN 1090 (Factory Production Control), ISO 9001 (Quality Management) as well as Cyber Essentials and Fit 4 Nuclear. The topic of corporate, social and environmental governance continues to be greatly important to the business and during the last financial year the board and senior leadership team’s focus is to ensure sustainability, support for our local community and protection of the environment.

Financial risk management objectives

The Company's operations expose it to a variety of financial risks that include the effects of credit risk and exchange rate risk. The company monitors and acts in each of these areas as follows:
Credit Risk
The Company has implemented policies that require appropriate credit checks on potential customers before sales are made, in addition, credit checks are made on those customers who are deemed to be a significant credit risk to the company. The company also monitors all court judgements made against its customers and makes appropriate adjustments in the light of this information.
Exchange Rate Risk
The Company monitors its exposures in the foreign currencies in which it regularly transacts in order to protect against excessive fluctuations.

This report was approved by the board on 19 November 2025 and signed on its behalf.

T J Penny

Director

Page 2

PENNY ENGINEERING LIMITED

DIRECTORS' REPORT

FOR THE YEAR ENDED 30 JUNE 2025

The directors present their report and the financial statements for the year ended 30 June 2025.

Directors' responsibilities statement

The directors are responsible for preparing the Strategic Report, the Directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 for the Company's financial statements and then apply them consistently;

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

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to 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.

Results and dividends

The profit for the year, after taxation, amounted to £492,044 (2024 - £234,999).

Directors

The directors who served during the year were:

R G Penny

T J Penny

A J Holmes

D J Ball

Qualifying third party indemnity provisions

The directors have been granted a qualifying third party indemnity provision under Section 234 of the Companies Act 2006. This indemnity does not provide cover in the event of a director acting fraudulently or dishonestly.

Page 3

PENNY ENGINEERING LIMITED

DIRECTORS' REPORT (CONTINUED)

FOR THE YEAR ENDED 30 JUNE 2025

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:

∙so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and

∙the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

Post balance sheet events

There have been no significant events affecting the Company since the year end.

Auditors

The auditors, Shorts, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 19 November 2025 and signed on its behalf.

T J Penny

Director

Page 4

PENNY ENGINEERING LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF PENNY ENGINEERING LIMITED

Opinion

We have audited the financial statements of Penny Engineering Limited (the 'Company') for the year ended 30 June 2025, which comprise the Statement of Income and Retained Earnings, the Balance Sheet and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

∙give a true and fair view of the state of the Company's affairs as at 30 June 2025 and of its profit for the year then ended;

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

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

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.

Page 5

PENNY ENGINEERING LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF PENNY ENGINEERING LIMITED (CONTINUED)

Other information

The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' 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.

Opinion on other matters prescribed by the Companies Act 2006

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

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

∙the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

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

Responsibilities of directors

As explained more fully in the Directors' Responsibilities Statement set out on page 3, 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.

Page 6

PENNY ENGINEERING LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF PENNY ENGINEERING LIMITED (CONTINUED)

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 an Auditors' 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.

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:

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

∙through discussions with the directors and other management and from our commercial knowledge and experience of the clients business, we identified the laws and regulations applicable to the Company; and

∙focusing on the specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the Company, we assessed the extent of compliance with those laws and regulations identified above through making enquiries of management and inspecting relevant correspondence.

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 regulation.

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

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

∙reviewed 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;

∙reading the minutes of meetings of those charged with governance;

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

∙reviewing and correspondence with HMRC, relevant regulators and the Company’s legal advisors.

There are inherent limitations in our audit procedures described above. The more removed that laws andregulations are from financial transactions, the less likely it is that we would become aware of non-

Page 7

PENNY ENGINEERING LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF PENNY ENGINEERING LIMITED (CONTINUED)

compliance

Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

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 Auditors' 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 Auditors' 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.

Howard Freeman (Senior Statutory Auditor)

for and on behalf of

Shorts

Chartered Accountants

Statutory Auditor

2 Ashgate Road

Chesterfield

Derbyshire

S40 4AA

19 November 2025

Page 8

PENNY ENGINEERING LIMITED

STATEMENT OF INCOME AND RETAINED EARNINGS

FOR THE YEAR ENDED 30 JUNE 2025

	2025	2024
Note	£	£


Turnover	4	10,069,188	9,772,749
Cost of sales		(5,275,602)	(5,334,261)
Gross profit		4,793,586	4,438,488
Administrative expenses		(4,319,602)	(3,972,096)
Other operating income	5	131,497	134,939
Operating profit	6	605,481	601,331
Income from shares in group undertakings		-	1,225,375
Amounts written off investments		-	(1,455,449)
Interest receivable and similar income		76,545	61,060
Profit before tax		682,026	432,317
Tax on profit	10	(189,982)	(197,318)
Profit after tax		492,044	234,999



Retained earnings at the beginning of the year	7,355,696	7,515,238
Profit for the year	492,044	234,999
Dividends declared and paid	(374,260)	(394,541)
Retained earnings at the end of the year	7,473,480	7,355,696

The notes on pages 11 to 26 form part of these financial statements.

Page 9

PENNY ENGINEERING LIMITED

REGISTERED NUMBER: 01380206

BALANCE SHEET

AS AT 30 JUNE 2025

		2025		2024
Note		£		£

Fixed assets
Tangible assets	11		3,522,586		3,420,238
Investments	12		108		108
			3,522,694		3,420,346
Current assets
Stocks	13	2,188,780		2,303,629
Debtors: amounts falling due within one year	14	1,418,878		1,271,966
Cash at bank and in hand		2,803,415		2,619,784
		6,411,073		6,195,379
Creditors: amounts falling due within one year	15	(2,191,217)		(1,948,506)
Net current assets			4,219,856		4,246,873
Total assets less current liabilities			7,742,550		7,667,219
Provisions for liabilities
Deferred tax	16		(257,070)		(299,523)
Net assets			7,485,480		7,367,696

Capital and reserves
Called up share capital	17	1,494	1,494
Share premium account	18	9,994	9,994
Capital redemption reserve	18	512	512
Profit and loss account	18	7,473,480	7,355,696
		7,485,480	7,367,696

The financial statements were approved and authorised for issue by the board and were signed on its behalf on 19 November 2025.

T J Penny	A J Holmes
Director	Director

The notes on pages 11 to 26 form part of these financial statements.

Page 10

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

1.	General information

Penny Engineering Limited is a private company limited by shares, incorporated in England and Wales (registered number: 01380206). Its registered office is Station Road, Clowne, Chesterfield, Derbyshire, S43 4AB. The principal activity of the Company continued to be that of design, manufacture, installation and service of bespoke lifting equipment. Products include vehicle mounted cranes, goods lifts, winch systems for chandeliers, multi-directional fork-lift trucks and equipment for the nuclear decommissioning industry.

2.Accounting policies

2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).

The following principal accounting policies have been applied:

2.2

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Page 11

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

2.Accounting policies (continued)

2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:

∙the Company has transferred the significant risks and rewards of ownership to the buyer;

∙the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;

∙the amount of revenue can be measured reliably;

∙it is probable that the Company will receive the consideration due under the transaction; and

∙the costs incurred or to be incurred in respect of the transaction can be measured reliably.

2.4

Operating leases: the Company as lessee

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

2.5

Grant income

Grants are accounted for under the performance model as permitted by FRS 102. Grants that do not impose specified future performance related conditions on the recipient are recognised in income when the grant proceeds are received. Grants that impose specified future performance related conditions on the recipient are recognised in income only when the performance related conditions are met.

2.6

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Company in independently administered funds.

Page 12

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

2.Accounting policies (continued)

2.7

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:

∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and

∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

2.8

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, as follows:

The depreciation rates used are

Freehold property	-	4%	straight line
Plant and machinery	-	15%	straight line
Motor vehicles	-	25%	straight line
Office equipment	-	25%	straight line
Computer equipment	-	25%	straight line

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

Page 13

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

2.Accounting policies (continued)

2.9

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

Investments in listed company shares are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in profit or loss for the period.

2.10

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

2.11

Financial instruments

The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
Financial assets and liabilities are offset and the net amount reported in the Balance Sheet when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Page 14

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

3.	Judgements in applying accounting policies and key sources of estimation uncertainty

No significant judgements have had to be made by management in preparing these financial statements.
The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have the greatest level of uncertainty are addressed below:
(i) Stock provisioning
When calculating the stock provision, management considers the nature and condition of the inventory, as well as applying assumptions around anticipated saleability of stock. The carrying value of stock after making such a provision was £2,188,780 (2024: £2,303,629).
(ii) Impairment of debtors

The company makes an estimate of the recoverable value of trade and other debtors. When assessing impairment of trade and other debtors, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience. The amount of trade debtors after making such provision was £1,265,798 (2024: £1,006,584).
(iii) Warranty provision
Based upon previous experience and the particular profile of the sales at the time the company has made an estimate in respect of a warranty provision of £100,867 (2024: £92,682).

	Sales	10,069,188	9,772,749

Analysis of turnover by country of destination:

					2025	2024
					£	£

United Kingdom	8,979,803	8,755,750
Rest of Europe	930,141	903,374
Rest of the world	159,244	113,625
	10,069,188	9,772,749

Page 15

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

5.	Other operating income
		2025	2024
		£	£

Other operating income	32,651	86,383
Net rents receivable	56,441	48,556
Amortisation of government grant	3,000	-
Research & Development Expenditure Credit	39,405	-
	131,497	134,939

Depreciation of tangible fixed assets	333,058	270,303
Defined contribution pension costs	247,810	218,493
Operating lease rentals	37,489	31,105
Loss / (profit) on disposal of fixed assets	10,435	(16,379)

Fees payable to the Company's auditors for the audit of the Company's financial statements

19,650

18,700

Page 16

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

Wages and salaries	3,186,385	2,947,827
Social security costs	333,625	291,900
Cost of defined contribution scheme	247,810	218,494
	3,767,820	3,458,221

The average monthly number of employees, including the directors, during the year was as follows:

	2025	2024
	No.	No.

Production	57	50
Management & administration	30	35
Selling & distribution	4	5

	91	90

9.	Directors' remuneration
		2025	2024
		£	£

Directors' emoluments	234,391	219,698
Company contributions to defined contribution pension schemes	36,849	45,650
	271,240	265,348

	During the year retirement benefits were accruing to 1 director (2024 - 1) in respect of defined contribution pension schemes.
	The highest paid director received remuneration of £82,559 (2024 - £82,551).
	The value of the Company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £36,849 (2024 - £45,650).

Page 17

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

Corporation tax
Current tax on profits for the year	232,435	84,478

Total current tax	232,435	84,478

Deferred tax
Origination and reversal of timing differences	(42,453)	112,840
Total deferred tax	(42,453)	112,840


	Tax on profit	189,982	197,318

Page 18

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

10.Taxation (continued)

Profit on ordinary activities before tax

682,025

432,316

Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2024 - 25%)	170,506	108,079
Effects of:
Expenses not deductible for tax purposes, other than goodwill amortisation and impairment	19,476	384,796
Adjustments to tax charge in respect of prior periods	-	22,846
Group income	-	(306,344)
Adjustment in research and development tax credit leading to an increase (decrease) in the tax charge	-	(26,736)
Other differences leading to an increase (decrease) in the tax charge	-	33,435
Group relief	-	(37,298)
Transfers - Deferred tax	-	18,540
Total tax charge for the year	189,982	197,318

Factors that may affect future tax charges

There were no factors that may affect future tax charges.

Page 19

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

11.	Tangible fixed assets

	Freehold property	Plant and machinery	Motor vehicles	Office equipment	Computer equipment	Total
	£	£	£	£	£	£
Cost or valuation
At 1 July 2024	3,225,087	853,028	664,525	7,393	218,539	4,968,572
Additions	273,237	-	164,629	-	8,933	446,799
Disposals	-	-	(58,977)	(7,393)	-	(66,370)
At 30 June 2025	3,498,324	853,028	770,177	-	227,472	5,349,001
Depreciation
At 1 July 2024	489,271	548,220	321,860	7,389	181,594	1,548,334
Charge for the year on owned assets	105,662	64,228	146,441	4	16,723	333,058
Disposals	-	-	(47,584)	(7,393)	-	(54,977)
At 30 June 2025	594,933	612,448	420,717	-	198,317	1,826,415
Net book value
At 30 June 2025	2,903,391	240,580	349,460	-	29,155	3,522,586
At 30 June 2024	2,735,816	304,808	342,665	4	36,945	3,420,238

Page 20

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

12.	Fixed asset investments

		Investments in subsidiary companies
		£
	Cost or valuation
	At 1 July 2024	2,230,557
	At 30 June 2025	2,230,557
	Impairment
	At 1 July 2024	2,230,449
	At 30 June 2025	2,230,449
	Net book value
	At 30 June 2025	108
	At 30 June 2024	108

Page 21

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

Subsidiary undertakings
The following were subsidiary undertakings of the Company:
Name	Registered office	Class of shares	Holding

R & L Systems Limited	Penny Hydraulics Station Road, Clowne, Chesterfield, Derbyshire, S43 4AB	Ordinary	100%
Penny Lifting Limited	Penny Hydraulics Station Road, Clowne, Chesterfield, Derbyshire, S43 4AB	Ordinary	100%
Penny Nuclear Limited	Penny Hydraulics Ltd Station Road, Clowne, Chesterfield, S43 4AB	Ordinary	100%
Raising & Lowering Systems Limited	Penny Hydraulics Station Road, Clowne, Chesterfield, Derbyshire, S43 4AB	Ordinary	100%
Penny Cranes Limited	Penny Hydraulics Limited Station Road, Clowne, Chesterfield, Derbyshire, S43 4AB	Ordinary	100%
Penny Lifts Limited	Penny Hydraulics Limited Station Road, Clowne, Chesterfield, S43 4AB	Ordinary	100%
Penny Engineering Group Limited	Penny Hydraulics Limited Station Road, Clowne, Chesterfield, Derbyshire, England, S43 4AB	Ordinary	100%
Penny Hydraulics Limited	Station Road Industrial Estate, Station Road, Clowne, Derbyshire, United Kingdom, S43 4AB	Ordinary	100%
Sidetracker Engineering Limited	Station Road Industrial Estate, Clowne, Nr. Chesterfield., S43 4AB	Ordinary	100%

Page 22

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

Subsidiary undertakings (continued)

The aggregate of the share capital and reserves as at 30 June 2025 and the profit or loss for the year ended on that date for the subsidiary undertakings were as follows:
Name	Aggregate of share capital and reserves	Profit/(Loss)
	£	£

R & L Systems Limited	1	-
Penny Lifting Limited	1	-
Penny Nuclear Limited	100	-
Raising & Lowering Systems Limited	1	-
Penny Cranes Limited	1	-
Penny Lifts Limited	1	-
Penny Engineering Group Limited	1	-
Penny Hydraulics Limited	1	-
Sidetracker Engineering Limited	1	-

13.	Stocks
		2025	2024
		£	£

	Finished goods and goods for resale	2,188,780	2,303,629

14.

Debtors

					2025	2024
					£	£


Trade debtors	1,265,798	1,006,584
Amounts owed by group undertakings	-	29,567
Other debtors	153,080	235,815
	1,418,878	1,271,966

Page 23

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

15.	Creditors: Amounts falling due within one year
		2025	2024
		£	£

Trade creditors	746,112	822,339
Corporation tax	193,030	84,478
Other taxation and social security	356,816	261,307
Other creditors	122,292	133,445
Accruals and deferred income	772,967	646,937
	2,191,217	1,948,506

16.	Deferred taxation

		2025
		£

	At beginning of year	299,523
	Released to profit or loss	(42,453)
	At end of year	257,070

The provision for deferred taxation is made up as follows:
	2025	2024
	£	£

Accelerated capital allowances	263,873	301,398
Movements in provisions	(6,803)	(1,875)
	257,070	299,523

Page 24

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

17.	Share capital
		2025	2024
		£	£

Allotted, called up and fully paid

249 (2024 - 249) Ordinary shares of £1.00 each	249	249
6 (2024 - 6) A Ordinary shares of £1.00 each	6	6
249 (2024 - 249) B Ordinary shares of £1.00 each	249	249
496 (2024 - 496) C Ordinary shares of £1.00 each	496	496
492 (2024 - 492) D Ordinary shares of £1.00 each	492	492
1 (2024 - 1) E Ordinary share of £1.00	1	1
1 (2024 - 1) F Ordinary share of £1.00	1	1

	1,494	1,494

18.

Reserves

Share premium account

Share premium reserve represents the amount above the nominal value received for shares sold, less transaction costs.

Capital redemption reserve

The capital redemption reserve represents the amount of money the company must retain within reserves when it buys back company shares and this is a non distributable reserve.

Profit and loss account

Profit and loss account represents all current and prior period retained profits and losses and is all considered to be distributable.

19.	Pension commitments

The company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the company to the fund and amounted to £247,810 (2024: £218,493).

Page 25

PENNY ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

Not later than 1 year	43,918	49,378
Later than 1 year and not later than 5 years	49,227	79,806
Later than 5 years	-	13,340
	93,145	142,524

Page 26