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Registered number:
FOR THE YEAR ENDED 31 MARCH 2025
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COMPANY INFORMATION
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CONTENTS
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STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2025
The directors present their strategic report on the Company for the year ended 31 March 2025.
The strategic report is consistent with the size and nature of the business and is written in the context of the risks and uncertainties the Company faces. The principal activity of the Company continues to be that of manufacturing, supplying and distributing life safety control systems. The Company develops and manufactures high quality and reliable life safety-related control systems for commercial and industrial applications, which are sold through professional system integrators and specialist distribution channels. The Company has developed manufacturing and support systems which allow greatly reduced lead times to customers compared with the industry norm, while maintaining the business' ability to provide bespoke and OEM products to major users. To remain competitive, the directors plan to expand the business through wireless solutions and a broader systems-based sales approach.
The business had another challenging year following rising inflation, persisting supply shortages and political instability during April 2024 to March 2025. Despite this, the Company exceeded its sales targets, achieving record-breaking turnover of £35.12m – 111% compared to budget and 116.2% compared to previous year.
External sales saw strong growth, supported by a healthy order book for extinguishant products. Group sales were slightly behind expectations, but the Latitude platform continues to grow, supported as a systems sales opportunity throughout most major territories. Gross profit margin for external sales improved slightly due to a higher proportion of UK sales, which typically yield better margins. While the UK saw a change in government in Summer 2024, forecasts for the economy remain mixed. Inflation has eased, but pressures persist due to national debt concerns and public sector wage increases. Interest rates were reduced slightly by the Bank of England, with further cuts possible if inflation stabilises. However, business investment may slow due to continued cost pressures and labour market adjustments, with unemployment expected to peak around 4.6% in 2025. Kentec has anticipated potential changes to the Labour Market reforms and National Insurance Contributions and expects to invest further into automation of the factory, despite increasing the directly employed labour to nearly 265. The UK unemployment rate has already risen to 4.6% — its highest level since mid-2021 — reflecting a cooling labour market and slower business hiring. This trend may offer some short-term relief on wage inflation, but it also signals broader economic caution. The election of a Labour government introduces potential changes to the business landscape, including possible increases to Employer National Insurance Contributions (NICs), especially for higher earners. This could raise employment costs for businesses like Kentec. Labour’s pledges to strengthen workers’ rights and enhance workplace protections may also introduce new obligations around employment policies. While these may increase administrative overhead, Kentec is well-positioned due to its strong HR practices and high staff retention rates. Positively, Labour’s focus on renewable energy, infrastructure investment and public-private innovation could benefit Kentec’s international growth ambitions, particularly in the fire safety applications for energy storage and grid resilience projects. Gross Profit Margins improved to 34.25% in the year ending March 2025, compared to 33.49% in the previous financial year. Operating profit margin also increased, rising from 12.27% to 12.30%, reflecting a disciplined approach to cost control and commercial execution. Cash position improved, with March ending in a £4,765k increase as result of effective credit controlling
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STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
procedures and increased sales.
In line with the company’s strategic commercial plans, strong global demand for extinguishing products drove robust performance and placed increased pressure across all departments. The Company has responded by making strategic operational adjustments to prepare for future growth. Importantly, the Company continues to shift its commercial focus toward external business growth outside the Hochiki group of companies, investing in new partnerships, routes to market, and product strategies to expand its customer base globally. Looking ahead, significant emphasis is being placed on expansion in overseas markets, particularly in China, Southeast Asia, and the Americas, where Kentec sees high-growth potential for its world-class life safety and extinguishing systems. In addition, the Company is actively aligning its offering to support global infrastructure developments, particularly the expansion of renewable energy markets and the stabilisation of global energy grids. With increasing reliance on energy storage and decentralised energy systems, Kentec’s innovative fire safety solutions are ideally positioned to support these critical sectors.
Principal risks and uncertainties
The directors, who are responsible for internal control systems which identify and manage various risks that pose a threat to achieving the Company's objectives, have identified the principal risks as follows:
∙The uncertainty regarding the administration changes in America and impact of potential tariffs, import and retaliatory, may result in higher export prices from the US, which may benefit Kentec as all products are manufactured in the UK
∙Global economic conditions remain uncertain, with elevated inflation, ongoing geopolitical tensions (including the Russia–Ukraine war and Middle East conflicts), and the 2024 US presidential election all affecting supply chain stability. The Company has mitigated some of this risk by increasing raw material stocks of key components.
∙Brexit-related challenges persist, particularly around export regulations and workforce availability. New trade agreements or legislative changes may impact export operations and costs. The Company continues to monitor these factors closely.
∙Regulatory shifts in the UK, Europe, and the US may impact certification and compliance requirements. However, Kentec is well-positioned to adapt, thanks to ongoing investment in a strengthened Research & Development (R&D) function.
∙Attracting and retaining highly skilled staff remains a challenge. Kentec continues to prioritise staff development and review HR strategies. Notably, staff retention is currently at an all-time high.
∙Foreign exchange risk (particularly with USD and GBP) continues to be actively managed through natural hedging, with minimal USD surplus held.
∙Health, Safety, and Environmental compliance remains critical to Kentec’s operations. The compliance function was strengthened in the prior year to ensure best practice is maintained across the business.
∙The Company’s increasing reliance on IT and ERP systems introduces cyber and operational risk. These systems are continuously monitored and updated to minimise disruption.
∙Competitive pressures remain a threat, especially in terms of pricing and innovation. To mitigate this, Kentec continues to invest in R&D and maintain close communication with its market through technical support and customer engagement initiatives.
The directors periodically review the effectiveness of internal control systems to ensure all identified risks are being appropriately managed.
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STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
The directors use several performance measures to assess the Company’s success in meeting its objectives. The key performance indicators are:
∙Comparison of actual sales against budget
∙Gross profit margins
∙Variances between actual and budgeted standard costing
∙Operating profit percentage
∙Aged debtors
∙Working capital cycle
The directors consider the key performance indicators for the year to be satisfactory.
This report was approved by the board and signed on its behalf.
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DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2025
The directors present their report and the financial statements for the year ended 31 March 2025.
Principal activity
The principal activity of· the Company in the year under review was that of manufacturing, supplying and distributing life safety control systems.
The profit for the year, after taxation, amounted to £3,174,475 (2024 - £2,639,902).
The results for the year and financial position of the Company are as shown in the annexed financial statements. The Company had a successful year by moving forward with system sales offerings and enjoyed growth both in turnover and profit. Although the global supply chain disruption had continued to adversely impact on cost structure and financial health of the company, the company took immediate actions to sustain business operations.
In 2025, Taktis/Latitude will continue to be confidently positioned as a core product to our system sales business as a part of the Group business strategy. Our new branding management for system sales and channel management increase sales opportunities for the entire Group and drive improved profits. The sales made by the Company vary from small customers in the UK to large organisations both within the UK and in regions outside the UK. In line with this, the sales in the accounts have been split geographically between the UK, Europe and Rest of the World.
The Company's business activities, together with the factors likely to affect its future development, its financial position, financial risks management objectives and its exposure to global political environment, foreign currency, price, credit and liquidity risk are described in the Strategic Report on page 1.
The Company benefits from the support of membership of a strong global group under its ultimate parent undertaking, Hochiki Corporation and has long term relationships with a number of customers and suppliers across different geographic areas and industries. Consequently, the directors believe that the Company is well placed to manage its business risks successfully. After making enquiries, the directors have a reasonable expectation that they have adequate resources to continue in operational. existence for the foreseeable future. The management of Hochiki Group in Japan Is expecting growth from expansion in international business. Therefore, the Japanese management has set a higher target for 2024. Accordingly, it is felt appropriate to adopt the going concern basis in preparing the financial statements.
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025
The directors who served during the year were:
Subsequent to the year end, Takashi Iseri was appointed as director on 5 June 2025.
The company’s auditor, Greenback Alan LLP, ceased to operate as a registered auditor on 31 March 2025 and its business was transferred to Blick Rothenberg. Accordingly the company appointed Blick Rothenberg Audit LLP as its auditor in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
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DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2025
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 judgments 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.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KENTEC ELECTRONICS LIMITED
We have audited the financial statements of Kentec Electronics Limited (the 'Company') for the year ended 31 March 2025, which comprise the Statement of income and retained earnings, the Statement of financial position 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).
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.
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.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KENTEC ELECTRONICS LIMITED (CONTINUED)
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.
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.
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.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF KENTEC ELECTRONICS LIMITED (CONTINUED)
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:
∙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 company through discussions with directors and
other management, and from our commercial knowledge and experience of the fire safety equipment manufacturing and supply sector;
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.
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.
for and on behalf of
Chartered Accountants
Statutory Auditor
16 Great Queen Street
Covent Garden
WC2B 5AH
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STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 MARCH 2025
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STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2025
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
The notes on pages 12 to 26 form part of these financial statements.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
Kentec Electronics Limited is a private company limited by shares which was incorporated in the United Kingdom.
2.Accounting policies
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 judgment in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
−the requirements of Section 7 Statement of Cash Flows;
−the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
−the requirements of Section 33 Related Party Disclosures paragraph 33.7.
This information is included in the consolidated financial statements of Hochiki Corporation as at 31 March 2024 and these financial statements may be obtained from 2-10-43 Kamiosaki, Shinagawa-ku, Tokyo 141-8660 Japan.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
2.Accounting policies (continued)
Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
2.Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
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.
After making enquiries, the directors have a reasonable expectation that the company has adequate
resources to continue in operational existence and meet its liabilities as they fall due for the foreseeable future, being a period of at least twelve months from the date these financial statements were approved. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
2.Accounting policies (continued)
Functional and presentation currency
Transactions and balances
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
2.Accounting policies (continued)
obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation. Provisions are charged as an expense to profit or loss in the year that the company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. When payments are eventually made, they are charged to the provision carried in the balance sheet. If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
2.Accounting policies (continued)
In respect of estimates and assumptions, and judgements made as a result, made by management in preparing these financial statements, the following are considered to have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities presented: Provisions – see Note 20 In respect of other significant management judgements in applying the accounting policies of the Company, the following have the most significant effect on the financial statements: Carrying value of stock – (see Note 2.5) management consider that there is no impairment to stock Recoverability of debtors – (see Note 2.6) management consider that there is no impairment to debtors
Analysis of turnover by country of destination:
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
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