REGISTERED NUMBER: 14685129 (England and Wales)

Morco Products Holdings Limited

Group Strategic Report, Report of the Directors and

Audited 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

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 Cash Flow Statement

15

Notes to the Consolidated Financial Statements

16

DIRECTORS:

C R E Gillett

W Hildyard

SECRETARY:

C R E Gillett

REGISTERED OFFICE:

Morco House

Riverview Road

Beverley

East Yorkshire

HU17 0LD

REGISTERED NUMBER:

14685129 (England and Wales)

AUDITORS:

Smailes Goldie

Chartered Accountants

Statutory Auditor

Regent's Court

Princess Street

Hull

East Yorkshire

HU2 8BA

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

REVIEW OF BUSINESS

Morco Products is a specialist supplier of own branded LPG heating and hot water systems and have been supplying the UK and Continental European Caravan Holiday Home and Residential Park Home industries with hot water and central heating solutions for decades, evolving with the times in order to maintain a high standard of both products and service.

The Directors consider the results for the year to be satisfactory which includes ongoing costs for a safety upgrade and product recall.

PRINCIPAL RISKS AND UNCERTAINTIES

The main risks for the business are associated with the world economic climate and the effect of any increase in interest rates, which may affect the consumer's drive to enter the caravan market. The trend of world commodity prices also affects the ability of the business to remain competitive, but every effort is made to mitigate adverse factors.

FUTURE DEVELOPMENTS AND PERFORMANCE

Today Morco Products is working with the LPG industry to discuss and understand the future use of renewable gas including other alternative energy sources to diversify the business. Research and Development is taking place to measure the suitability of different options in order to provide customers with a range of heating and hot water systems.

KEY PERFORMANCE INDICATORS

The shareholders are closely involved in the group's activities. The group directors therefore believe that the analysis of group performance for the year using Key Performance Indicators is not necessary as the shareholders already understand the development, performance and position of the group. Performance is measured by the key Performance indicators of turnover, Cost control and profitability.

ON BEHALF OF THE BOARD:

C R E Gillett - Director

3rd December 2025

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

DIVIDENDS

During the year the company paid dividends of £880,000 (2024 £nil).

DIRECTORS

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

C R E Gillett

W Hildyard

POLITICAL DONATIONS AND EXPENDITURE

During the year the group made political donations totalling £3,000.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

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 ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

AUDITORS

The auditors, Smailes Goldie, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

C R E Gillett - Director

3rd December 2025

Opinion

We have audited the financial statements of Morco Products Holdings 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 Consolidated Cash Flow Statement, 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 loss 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 Statement of Directors' Responsibilities 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:

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 focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, tax legislation, data protection, anti-bribery, employment, environmental and health and safety legislation. An understanding of these laws and regulations and the extent of compliance was obtained through discussion with management and inspecting legal and regulatory 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 and considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

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

-

performed analytical procedures to identify any unusual or unexpected relationships;

-

tested journal entries to identify unusual transactions;

-

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

-

investigated the rationale behind significant or unusual transactions.

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

-

agreeing financial statement disclosures to underlying supporting documentation;

-

reading the minutes of meetings of those charged with governance;

-

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

-

reviewing correspondence with relevant regulators and the company's legal advisors.

Due to the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. 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.

The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission, or misrepresentation.

A further description of our responsibilities 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.

Peter Dearing FCCA (Senior Statutory Auditor)

for and on behalf of Smailes Goldie

Chartered Accountants

Statutory Auditor

Regent's Court

Princess Street

Hull

East Yorkshire

HU2 8BA

3rd December 2025

TURNOVER

3

16,644,741

19,684,290

Cost of sales

11,067,643

13,505,341

GROSS PROFIT

5,577,098

6,178,949

Distribution costs

199,689

188,176

Administrative expenses

6,059,783

2,702,884

6,259,472

2,891,060

(682,374

)

3,287,889

Other operating income

110,174

5,557

OPERATING (LOSS)/PROFIT

5

(572,200

)

3,293,446

Interest receivable and similar income

522,221

402,209

(LOSS)/PROFIT BEFORE TAXATION

(49,979

)

3,695,655

Tax on (loss)/profit

7

(14,479

)

1,081,715

(LOSS)/PROFIT FOR THE FINANCIAL YEAR

(35,500

)

2,613,940

(Loss)/profit attributable to:

Owners of the parent

(35,500

)

2,613,940

(LOSS)/PROFIT FOR THE YEAR

(35,500

)

2,613,940

OTHER COMPREHENSIVE INCOME

Purchase of own shares

-

(3,983,600

)

Cancellation of share capital

Income tax relating to other comprehensive income

-

-

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

-

(3,983,600

)

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

(35,500

)

(1,369,660

)

Total comprehensive income attributable to:

Owners of the parent

(35,500

)

(1,369,660

)

FIXED ASSETS

Tangible assets

10

1,845,081

1,882,337

Investments

11

-

-

1,845,081

1,882,337

CURRENT ASSETS

Stocks

12

3,102,568

3,363,242

Debtors

13

4,881,316

3,759,009

Cash at bank and in hand

12,221,523

11,342,274

20,205,407

18,464,525

CREDITORS

Amounts falling due within one year

14

2,054,697

2,226,220

NET CURRENT ASSETS

18,150,710

16,238,305

TOTAL ASSETS LESS CURRENT LIABILITIES

19,995,791

18,120,642

PROVISIONS FOR LIABILITIES

15

2,807,114

16,465

NET ASSETS

17,188,677

18,104,177

CAPITAL AND RESERVES

Called up share capital

16

103,600

103,600

Capital redemption reserve

17

236,400

236,400

Retained earnings

17

16,848,677

17,764,177

SHAREHOLDERS' FUNDS

17,188,677

18,104,177

The financial statements were approved by the Board of Directors and authorised for issue on 3rd December 2025 and were signed on its behalf by:

C R E Gillett - Director

FIXED ASSETS

Tangible assets

10

1,778,986

1,778,986

Investments

11

103,600

103,600

1,882,586

1,882,586

CURRENT ASSETS

Cash at bank

108,332

14,647

CREDITORS

Amounts falling due within one year

14

1,807,207

1,783,751

NET CURRENT LIABILITIES

(1,698,875

)

(1,769,104

)

TOTAL ASSETS LESS CURRENT LIABILITIES

183,711

113,482

CAPITAL AND RESERVES

Called up share capital

16

103,600

103,600

Retained earnings

17

80,111

9,882

SHAREHOLDERS' FUNDS

183,711

113,482

Company's profit for the financial year

950,229

9,882

The financial statements were approved by the Board of Directors and authorised for issue on 3rd December 2025 and were signed on its behalf by:

C R E Gillett - Director

Called up

Capital

share

Retained

redemption

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1st April 2023

140,000

19,170,237

200,000

19,510,237

Changes in equity

Movement in share capital - 3

(36,400

)

-

36,400

-

Total comprehensive income

-

(1,406,060

)

-

(1,406,060

)

Balance at 31st March 2024

103,600

17,764,177

236,400

18,104,177

Changes in equity

Dividends

-

(880,000

)

-

(880,000

)

Total comprehensive income

-

(35,500

)

-

(35,500

)

Balance at 31st March 2025

103,600

16,848,677

236,400

17,188,677

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Changes in equity

Issue of share capital

103,600

-

103,600

Total comprehensive income

-

9,882

9,882

Balance at 31st March 2024

103,600

9,882

113,482

Changes in equity

Dividends

-

(880,000

)

(880,000

)

Total comprehensive income

-

950,229

950,229

Balance at 31st March 2025

103,600

80,111

183,711

Cash flows from operating activities

Cash generated from operations

1

2,169,122

4,993,460

Tax paid

(903,390

)

(1,330,306

)

Net cash from operating activities

1,265,732

3,663,154

Cash flows from investing activities

Purchase of tangible fixed assets

(31,772

)

(1,846,122

)

Sale of tangible fixed assets

100

-

Payment to acquire minority interest

-

(4,020,000

)

Interest received

522,221

402,209

Net cash from investing activities

490,549

(5,463,913

)

Cash flows from financing activities

Amount introduced by directors

4,335

-

Amount withdrawn by directors

(1,367

)

(4,335

)

Equity dividends paid

(880,000

)

-

Net cash from financing activities

(877,032

)

(4,335

)

Increase/(decrease) in cash and cash equivalents

879,249

(1,805,094

)

Cash and cash equivalents at beginning of year

2

11,342,274

13,147,368

Cash and cash equivalents at end of year

2

12,221,523

11,342,274

1.	RECONCILIATION OF (LOSS)/PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2025

2024

£

£

(Loss)/profit before taxation

(49,979

)

3,695,655

Depreciation charges

69,028

181,531

Profit on disposal of fixed assets

(100

)

-

Fair value adjustment to fixed assets

-

529,377

Provision for product recall costs

2,801,433

-

Finance income

(522,221

)

(402,209

)

2,298,161

4,004,354

Decrease in stocks

260,674

189,929

(Increase)/decrease in trade and other debtors

(668,784

)

2,709,055

Increase/(decrease) in trade and other creditors

279,071

(1,909,878

)

Cash generated from operations

2,169,122

4,993,460

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31st March 2025

31.3.25

1.4.24

£

£

Cash and cash equivalents

12,221,523

11,342,274

Year ended 31st March 2024

31.3.24

1.4.23

£

£

Cash and cash equivalents

11,342,274

13,147,368

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1.4.24

Cash flow

At 31.3.25

£

£

£

Net cash

Cash at bank and in hand

11,342,274

879,249

12,221,523

11,342,274

879,249

12,221,523

Total

11,342,274

879,249

12,221,523

1.	STATUTORY INFORMATION

Morco Products Holdings 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.

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.

Basis of consolidation

The group financial statements consolidate the financial statements of 'morco Products Limited and its subsidiary undertaking drawn up to 31 March each year using the merger method of accounting, with the business combination representing a group reconstruction. No company Statement of Comprehensive Income is presented for Morco Group Holdings Limited as permitted by section 408 of the Companies Act 2006.

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.

Turnover is measured at the fair value of the consideration received or receivable net of VAT and trade discounts. The policies adopted for the recognition of turnover are as follows:

Sale of goods

Turnover from the sale of goods is recognised when significant risks and rewards of ownership of the goods have transferred to the buyer, the amount of turnover can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the company and the costs incurred or to be incurred in respect of the transaction can be measured reliably. This is usually on dispatch of the goods.

Interest and other income

Interest income is recognised using the effective interest method.

Tangible fixed assets

Tangible fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes costs directly attributable to making the asset capable of operating as intended.

Depreciation is provided on all tangible fixed assets, at rates calculated to write off the cost, less estimated residual value, of each asset on a systematic basis over its expected useful life as follows:

Freehold property

2% on cost

Long leasehold

Over the period remaining on the lease

Improvements to property

Straight line over 10 to 20 years

Plant and Machinery

33.33% on cost

Motor Vehicles

33.33% on cost

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing stock to its present location and condition. Cost is calculated using the average cost method. Provision is made for damaged, obsolete and slow-moving stock where appropriate.

Taxation

Current tax represents the amount of tax payable or receivable in respect of the taxable profit (or loss) for the current or past reporting periods. It is measured at the amount expected to be paid or recovered using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax represents the future tax consequences of transactions and events recognised in the financial statements of current and previous periods. It is recognised in respect of all timing differences, with certain exceptions. Timing differences are differences between taxable profits and total comprehensive income as stated in the financial statements, that arise from the inclusion of income and expense in tax assessments in periods different from those in which they are recognised in the financial statements. 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.

Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date that are expected to apply to the reversal of timing differences. Deferred tax on revalued non-depreciable tangible fixed assets and investment properties is measured using the rates and allowances that apply to the sale of the asset.

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

Foreign currency transactions are initially recognised applying to the foreign currency amount the spot exchange rate between the functional currency and the foreign currency at the date of the transaction.

Monetary assets and liabilities denominated in a foreign currency at the balance sheet date are translated using the closing rate.

Leasing commitments

Rentals payable and receivable under operating leases are charged to the profit and loss account on a straight line basis over the period of the lease.

Pension costs and other post-retirement benefits

When employees have rendered service to the company, short term employee benefits to which the employees are entitled are recognised at the undiscounted amount expected to be paid in exchange for that service.

The company operates a defined contribution plan for the benefit of its employees. Contributions are expensed as they become payable.

Debtors and creditors receivable/payable within one year

Debtors and creditors with no stated interest rate, and are receivable or payable within one year, are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account in other administrative expenses.

Impairment

Assets not measured at fair value are reviewed for any indication that the asset may be impaired at each balance sheet date. If such indication exists, the recoverable amount of the asset, or the asset's cash generating unit, is estimated and compared to the carrying amount. Where the carrying amount exceeds its recoverable amount, an impairment loss is recognised in profit or loss unless the asset is carried at a revalued amount where the impairment loss is a revaluation decrease.

Investments

Investments are recognised initially at fair value which is normally the transaction price excluding transaction costs. Subsequently, they are measured at fair value through profit or loss if the shares are publicly traded or their value can otherwise be measured reliably. Other investments are measured at cost less impairment.

Business combinations

As permitted by FRS102, business combination meeting the definition of a group reconstruction are consolidated using merger accounting.

Under merger accounting, that carrying values of the assets and liabilities of Morco Products Limited and its subsidiary company are merged with those of Morco Products Holdings Limited. The results and cash flow of the consolidated entity are brought into the consolidated financial statements from the beginning of the financial year in which the combination occurs. The comparative information is also updated to reflect the combination.

Combinations not meeting the definition of a group reconstruction are accounted for using the purchase method.

Under the purchase method the assets and liabilities of acquired entities are adjusted to fair value at the date of acquisition. The difference between the consideration paid to acquire the entity and the fair value of the entity's assets is treated as goodwill and amortised to the income statement over its useful economic life. The results and cash flows of the acquired entity are brought in from the date of acquisition.

3.

TURNOVER

The turnover and loss (2024 - profit) before taxation are attributable to the one principal activity of the group.

An analysis of turnover by geographical market is given below:

2025

2024

£

£

United Kingdom

16,446,988

19,421,694

Rest of the world

197,753

262,596

16,644,741

19,684,290

4.	EMPLOYEES AND DIRECTORS

2025

2024

£

£

Wages and salaries

988,321

1,070,358

Social security costs

114,075

123,857

Other pension costs

209,684

161,991

1,312,080

1,356,206

The average number of employees during the year was as follows:

2025

2024

Office and administration

11

11

Sales and marketing

8

8

19

19

2025

2024

£

£

Directors' remuneration

473,143

519,811

Directors' pension contributions to money purchase schemes

173,390

140,005

Information regarding the highest paid director is as follows:

2025

2024

£

£

Emoluments etc

212,366

222,900

Pension contributions to money purchase schemes

39,566

7,966

5.	OPERATING (LOSS)/PROFIT

The operating loss (2024 - operating profit) is stated after charging/(crediting):

2025

2024

£

£

Other operating leases

-

85,312

Depreciation - owned assets

69,028

181,531

Profit on disposal of fixed assets

(100

)

-

Auditors' remuneration

14,015

9,215

Exceptional items

4,114,531

-

6.	EXCEPTIONAL ITEMS

Group

2025

2024

£

£

Product recall costs

4,114,531

-

4,114,531

-

The company identified a potential safety issue should the installation procedures not be followed correctly with one of its range of water heaters. Voluntarily they launched an upgrade campaign in order to rectify this issue. As the uptake of this upgrade program wasn't deemed sufficient by the company, in December 2024 it issued a full product recall. This campaign commenced in January 2025, replacing or refunding the affected products.