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Registered number: 05047778










HLMAD LIMITED T/A HLM ARCHITECTS










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2025

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
COMPANY INFORMATION


Directors
M Staniland 
S D T Bell 
L Robertson 
M A Scherdel 
P A Watson 
M J Earnshaw 
S P Chenery 
C E Wakelin 
C D Liddle (resigned 31 March 2025)
N J Beecroft (resigned 31 March 2025)
R M O'Neil (resigned 31 March 2025)
J G Clarke (resigned 31 March 2025)
D M Cafferty (resigned 31 March 2025)
K S Mosley (resigned 31 March 2025)




Company secretary
K S Mosley (resigned 31 March 2025)



Registered number
05047778



Registered office
Wool + Tailor Building
Fifth Floor

10-12 Alie Street

London

E1 8DE




Independent auditors
Shorts
Chartered Accountants & Statutory Auditor

Cedar House

63 Napier Street

Sheffield

South Yorkshire

S11 8HA





 
HLMAD LIMITED T/A HLM ARCHITECTS
 

CONTENTS



Page
Strategic Report
 
1 - 3
Directors' Report
 
4 - 5
Independent Auditors' Report
 
6 - 9
Statement of Income and Retained Earnings
 
10
Balance Sheet
 
11
Notes to the Financial Statements
 
12 - 23


 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2025

Introduction
 
The directors present the strategic report for the year ended 31 March 2025.

Business review
 
The business continues to be well respected in its chosen marketplaces of Defence, Education, Healthcare, Justice & Emergency Services, and the ‘Combined’ sector of Residential, Workplace, Hospitality, Leisure and Culture. We are delighted that the quality of our work and how we engage with our employees and wider community has again led to the practice being recognised in industry accolades such for design, social value, environmental sustainability and being a good employer – e.g. #24 Best Large Companies to Work For in the UK (#2 for Architecture).
 
We continue to achieve our targets for architectural design quality, business profile and financial performance.  Our strategy of actively managing the business continues in a commercial manner based upon the provision of sustainable, high quality design services to our clients with the Directors leading the design process, encouraging, motivating and leading the team by example. This is reflected by the number of business awards and short listings achieved. The practice rose seven places in Building magazine’s Top 50 Architectural Practices to 11th based on number of permanently employed registered architects and architectural Technologists. 

Alongside this we continued to shape the business to reflect the economic environment and market conditions by focusing on being creative, innovative and as flexible as possible about the way we work together. We have implemented a plan to extend our service offering to include: extended environmental design services, urban data analysis, as well as encouraging our specialist services to flourish and win work in their own capacity rather than as purely support our core architectural offer.

Our strong financial footing has not only allowed us to meet the challenges of the economic environment, but also allowed us to pursue our strategy of continuing to invest in our UK business whilst simultaneously expanding our international presence. 

Our mission is to make the maximum social impact to society through our activities and the places we create.  Through thoughtful design we consciously take account of economic, environmental and social elements to inform the collective decisions we make about where to invest our time and resources.  It also helps us to understand and appreciate the positive difference we can make to the communities in which we operate. We will continue to invest in innovative research and development to keep our operational practices up to date and to de-risk threats from the emerging digital landscape.

In 2020, ownership of the group transitioned to Employee Ownership with 100% of the business now held in Trust on behalf of employees.  With a stake and a say in the direction of our business our employees now benefit from our collective ambition, drive and successes. 

Page 1

 
HLMAD LIMITED T/A HLM ARCHITECTS
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025

Principal risks and uncertainties
 
The principal risks facing the company relate to the ongoing economic uncertainty and inflationary pressures. 

The company continues to closely monitor the constantly changing economic outlook and potential impact in its key sectors. The key risks to our operations include: 

Disruption to our key sectors through uncertainty of future demand; 
Impact on existing client base and pressure on fee levels and cost base; and 
Delay to project decisions.

Other key risks can be summarised under the following categories:
 
Brand reputation, product and service
Competition
Business interruption and infrastructure
Political uncertainty
Continuing to attract and retain the right staff and management team
Working capital management
IT systems, sensitive data and cyber risk
AI

The company manages these risks through a process of policies and controls which are set by the board and implemented and managed by the management team.  All risks are assigned to owners and are reviewed regularly to further assess the extent and effectiveness of the controls.

The group seeks to diversify risks wherever possible, particularly through developing work in new business sectors and geographical areas.

Results and performance

The profit for the year after taxation was £933,939 (2024: £496,397). The shareholders’ funds total £2,058,342 (2024: £1,649,403). 

The company’s performance during the year ended 31 March 2025 as follows:

Turnover amounted to £19,649,780 (2024: £17,110,580)

Operating profit amounted to £972,619 (2024: £492,683)

Headcount amounted to 215 (2024: 205)

Operating profit above is affected by the inclusion of management charges paid to the parent company during the year and staff profit share associated with being employee owned. Overall, the directors are satisfied with the financial performance of the company given the challenges faced by the company during the year.

Business environment

The design market is highly competitive within a number of the sectors in which the company operates. Many other businesses seek to operate in the market which leads to aggressive pricing. The impact of advances in technology has been enormous and it is essential that we continue to keep abreast of advances in this area.

Strategy

Page 2

 
HLMAD LIMITED T/A HLM ARCHITECTS
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2025

The company’s success is dependent on the proper selection of opportunities in the sectors in which it operates. We believe that having diversity in sectors, services and geographical spread will enable us to maintain our position and market share.

The company will continue to concentrate on achieving growth in its existing sectors whilst striving to improve efficiencies and diversification.

Financial key performance indicators
 
We have made significant progress throughout the year in relation to key elements of our strategy. The Board monitors the progress of the company by reference to the following KPIs:


2025
2024
Turnover
£19.65m
£17.11m
Gross Margin
35.9%
37.0%
EBITDA
6.5%
4.4%

The board remain confident that the business is well placed to continue to win major contracts in its chosen sectors and continues to see an improving pipeline of opportunity.

Strategic management

Fostering citizenship and improving society through architecture and design is the foundation of our collective business purpose.  We have built a reputation for design excellence and expertise across our key sectors with a focus on solving our client’s challenges and mindful of the impact that design can have on people, communities and society.

We seek to be agile and adaptable yet maintain a rigour that keeps design excellence as our essence and is achieved through a workplace of like-minded people – a profitable business that offers opportunity and is enjoyable to work in. Brand perception has never been stronger.

Future development

As part of the ongoing strategy to develop a business that is design-led, entrepreneurial and robust in the face of risks associated with the cyclical nature of the UK construction market, the company continues to invest in new service offerings, new sectors and new geographical markets.


This report was approved by the board on 11 December 2025 and signed on its behalf.



P A Watson
Director

Page 3

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
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.

Directors

The directors who served during the year were:

M Staniland 
S D T Bell 
L Robertson 
M A Scherdel 
P A Watson 
M J Earnshaw 
S P Chenery 
C E Wakelin 
C D Liddle (resigned 31 March 2025)
N J Beecroft (resigned 31 March 2025)
R M O'Neil (resigned 31 March 2025)
J G Clarke (resigned 31 March 2025)
D M Cafferty (resigned 31 March 2025)
K S Mosley (resigned 31 March 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 2006They 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 £933,939 (2024 - £496,397).

Page 4

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 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.

Auditors

The auditorsShortswill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 11 December 2025 and signed on its behalf.
 





P A Watson
Director

Page 5

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HLMAD LIMITED T/A HLM ARCHITECTS
 

Opinion


We have audited the financial statements of HLMAD Limited T/A HLM Architects (the 'Company') for the year ended 31 March 2025, which comprise the Statement of Income and Retained Earnings, the Balance Sheet and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Company's affairs as at 31 March 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 6

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HLMAD LIMITED T/A HLM ARCHITECTS (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 ReportOur 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 4, 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 7

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HLMAD LIMITED T/A HLM ARCHITECTS (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 and recognise non-compliance with applicable laws and regulations; and
through discussions with the directors and other management and from our commercial knowledge, we identified the laws and regulations applicable to the Company.
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 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;
reviewed the general ledger entries during the year 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;
considering relationships with HMRC and other relevant regulators; and
reviewing legal and professional costs to identify any indicators of litigation.

There are inherent limitations in our audit procedures described above. The more removed that laws and
Page 8

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF HLMAD LIMITED T/A HLM ARCHITECTS (CONTINUED)


regulations are from financial transactions, the less likely it is that we would become aware 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 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 2006Our 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 BSc FCA (Senior Statutory Auditor)
  
for and on behalf of
Shorts
 
Chartered Accountants
Statutory Auditor
  
Cedar House
63 Napier Street
Sheffield
South Yorkshire
S11 8HA

11 December 2025
Page 9

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 MARCH 2025

2025
2024
Note
£
£

  

Turnover
 4 
19,649,780
17,110,580

Cost of sales
  
(12,592,574)
(10,780,278)

Gross profit
  
7,057,206
6,330,302

Administrative expenses
  
(6,284,587)
(5,837,619)

Other operating income
  
200,000
-

Operating profit
 6 
972,619
492,683

Interest receivable and similar income
 9 
47,371
72,997

Profit before tax
  
1,019,990
565,680

Tax on profit
 10 
(86,051)
(69,283)

Profit after tax
  
933,939
496,397

  

  

Retained earnings at the beginning of the year
  
1,449,403
1,163,006

  
1,449,403
1,163,006

Profit for the year
  
933,939
496,397

Dividends declared and paid
  
(525,000)
(210,000)

Retained earnings at the end of the year
  
1,858,342
1,449,403
The notes on pages 12 to 23 form part of these financial statements.

Page 10

 
HLMAD LIMITED T/A HLM ARCHITECTS
REGISTERED NUMBER: 05047778

BALANCE SHEET
AS AT 31 MARCH 2025

2025
2024
Note
£
£

Fixed assets
  

Tangible assets
 12 
591,031
502,877

Current assets
  

Debtors: amounts falling due within one year
 13 
6,428,769
5,793,813

Cash at bank and in hand
  
895,272
662,293

  
7,324,041
6,456,106

Creditors: amounts falling due within one year
 14 
(5,720,437)
(5,236,517)

Net current assets
  
 
 
1,603,604
 
 
1,219,589

Total assets less current liabilities
  
2,194,635
1,722,466

Creditors: amounts falling due after more than one year
  
(47,813)
-

Provisions for liabilities
  

Deferred tax
 17 
(88,480)
(73,063)

  
 
 
(88,480)
 
 
(73,063)

Net assets
  
2,058,342
1,649,403


Capital and reserves
  

Called up share capital 
 18 
140,000
140,000

Capital redemption reserve
 19 
60,000
60,000

Profit and loss account
 19 
1,858,342
1,449,403

  
2,058,342
1,649,403


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 11 December 2025.




P A Watson
M Staniland
Director
Director

The notes on pages 12 to 23 form part of these financial statements.

Page 11

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025

1.


General information

HLMAD Limited is a company limited by shares incorporated in England and Wales (registered no: 05047778). The registered office is Wool + Tailor Building, Fifth Floor, 10-12 Alie Street, London, E1 8DE. The principal activity of the company continued to be that of the provision of architectural, landscape and urban design, interior design and environmental design services.

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

Financial Reporting Standard 102 - reduced disclosure exemptions

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 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
the requirements of Section 26 Share-based Payment paragraphs 26.18(b), 26.19 to 26.21 and 26.23;
the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of Covalent Group Limited as at 31 March 2025 and these financial statements may be obtained from Wool +Tailor Building Fifth Floor, 10-12 Alie Street, London, England, E1 8DE..

  
2.3

Turnover

Turnover represents the invoices, net of VAT, raised in the year which are adjusted for movements in the level of amounts recoverable on contracts.

Contracts are assessed on a contract by contract basis and reflected in the profit and loss account by recording turnover and related costs as contract activity progresses. Turnover is ascertained in a manner appropriate to the stage of completion of the contract and credit is taken for profit earned to date when the outcome of the contract can be assessed with reasonable certainty. 

Turnover is only recognised in the financial statements when there is a contractual right to consideration.

Page 12

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025

2.Accounting policies (continued)

 
2.4

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, using the straight-line method.

Depreciation is provided on the following basis:

Leasehold improvements
-
5 years straight line
Fixtures and fittings
-
5 years straight line
Computer equipment
-
3 years 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.

  
2.5

Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss.

 
2.6

Financial instruments

The Company only enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities such as bank and cash balances, trade and other accounts receivable and payable, loans from banks and other third parties and loans to and from related parties.

Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at the transaction price 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, the financial asset or liability is measured, initially, at the present value of the future cash flow discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost.

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 13

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025

2.Accounting policies (continued)

  
2.7

Taxation

Tax is recognised in the Statement of Income and Retained Earnings.

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.

 
2.8

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.

  
2.9

Government grant

Grants are accounted under the accruals model as permitted by FRS 102.
Research and Development Expenditure Credit (RDEC) is a government grant that provides support for qualifying R&D activities. RDEC is recognised as other operating income in the statement of comprehensive income, matched to the period in which the qualifying R&D expenditure is incurred. The credit is taxable and is presented above the line, separate from corporation tax.

 
2.10

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.

 
2.11

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.

Page 14

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025

2.Accounting policies (continued)

 
2.12

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.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.


3.


Judgements in applying accounting policies and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting 
estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

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

Stage of completion on contracts
The company undertakes contracts which take place over a period of time and revenue and profits are recognised as the company performs under these contracts. The extent to which revenue and profits have been earned involves an assessment of both the total expected contract costs and the final expected contract margin. While management make every effort to accurately estimate costs at the beginning of a project, this can be subject to revision as the work progresses and the picture becomes clearer.

Page 15

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025

4.


Turnover

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


2025
2024
£
£

Provision of design services
19,649,780
17,110,580


Analysis of turnover by country of destination:

2025
2024
£
£

United Kingdom
17,043,471
16,194,383

Rest of the world
2,606,309
916,197

19,649,780
17,110,580



5.


Other operating income

2025
2024
£
£

Research and development
200,000
-



6.


Operating profit

The operating profit is stated after charging:

2025
2024
£
£

Depreciation of owned tangible fixed assets
294,177
252,572

Exchange differences apart from those arising on financial instruments 
measured at fair value through profit or loss
(55,974)
2,188

Fees payable to the company's auditor for the audit of the company's financial statements
18,000
21,000

Operating lease charges
639,012
618,383

(Profit)/loss on disposal of fixed assets
21,776
-

Page 16

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025

7.


Employees

Staff costs, including directors' remuneration, were as follows:


2025
2024
£
£

Wages and salaries
8,817,499
8,282,914

Social security costs
911,873
850,319

Pension costs
287,892
206,900

10,017,264
9,340,133


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


        2025
        2024
            No.
            No.







Architectural and design staff
181
173



Administration staff
34
32

215
205


8.


Directors' remuneration

2025
2024
£
£

Directors' emoluments
737,755
552,111

Company contributions to defined contribution pension schemes
142,814
77,416

880,569
629,527


The highest paid director received remuneration of £114,136 (2024 - £109,085).

The value of the Company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £38,731 (2024 - £38,731).


9.


Interest receivable

2025
2024
£
£


Interest on bank deposits
47,371
72,997

Page 17

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025

10.


Taxation


2025
2024
£
£

Corporation tax


Current tax on profits for the year
200,000
49,193

Adjustments in respect of previous periods
(129,366)
-


70,634
49,193


Deferred tax


Origination and reversal of timing differences
15,417
1,557

Adjustment in respect of prior periods
-
18,533

Total deferred tax
15,417
20,090


Tax on profit
86,051
69,283

Factors affecting tax charge for the year

The tax assessed for the year is lower than (2024 - lower than) the standard rate of corporation tax in the UK of 25% (2024 - 25%). The differences are explained below:

2025
2024
£
£


Profit on ordinary activities before tax
1,019,990
565,680


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2024 - 25%)
254,998
141,420

Effects of:


Expenses not deductible for tax purposes
22,176
18,270

Depreciation on assets not qualifying for tax allowances
592
7,376

Research and development tax credit
(80,173)
(116,315)

Adjustments to tax charge in respect of prior periods
(49,193)
-

Group relief
(13,377)
-

Movement in deferred tax not recognised.
(48,972)
18,532

Total tax charge for the year
86,051
69,283

Page 18

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025

11.


Dividends

2025
2024
£
£


Interim paid
525,000
210,000


12.


Tangible fixed assets





Leasehold improvements
Equipment
Fixtures and fittings
Computer equipment
Total

£
£
£
£
£



Cost or valuation


At 1 April 2024
545,179
12,302
167,355
1,140,552
1,865,388


Additions
13,055
-
39,337
351,714
404,106


Disposals
(290,273)
(9,906)
-
(174,980)
(475,159)



At 31 March 2025

267,961
2,396
206,692
1,317,286
1,794,335



Depreciation


At 1 April 2024
399,918
9,883
114,150
838,560
1,362,511


Charge for the year on owned assets
45,258
1,061
21,350
226,508
294,177


Disposals
(268,498)
(9,906)
-
(174,980)
(453,384)



At 31 March 2025

176,678
1,038
135,500
890,088
1,203,304



Net book value



At 31 March 2025
91,283
1,358
71,192
427,198
591,031



At 31 March 2024
145,261
2,419
53,205
301,992
502,877

Page 19

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025

13.


Debtors

2025
2024
£
£


Trade debtors
4,164,972
3,834,276

Amounts owed by group undertakings
204,868
71,462

Other debtors
207,626
73,716

Prepayments and accrued income
536,375
630,274

Amounts recoverable on long-term contracts
1,314,928
1,184,085

6,428,769
5,793,813



14.


Creditors: Amounts falling due within one year

2025
2024
£
£

Payments received on account
823,902
602,522

Trade creditors
1,299,823
1,088,906

Amounts owed to group undertakings
149,000
1,355,300

Corporation tax
-
49,193

Other taxation and social security
1,291,687
1,006,888

Obligations under finance lease and hire purchase contracts
26,399
-

Other creditors
57,211
45,426

Accruals and deferred income
2,072,415
1,088,282

5,720,437
5,236,517


The bank facilities are secured by a debenture including fixed charge over all present freehold and leasehold property and a fixed and floating charge over all assets.


15.


Creditors: Amounts falling due after more than one year

2025
2024
£
£

Net obligations under finance leases and hire purchase contracts
47,813
-


Page 20

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025

16.


Hire purchase and finance leases


Minimum lease payments under hire purchase fall due as follows:

2025
2024
£
£


Within one year
26,399
-

Between 1-5 years
47,813
-

74,212
-


17.


Deferred taxation




2025


£






At beginning of year
73,063


Charged to profit or loss
15,417



At end of year
88,480

The provision for deferred taxation is made up as follows:

2025
2024
£
£


Accelerated capital allowances
111,413
84,420

Other short term differences
(22,933)
(11,357)

88,480
73,063


18.


Share capital

2025
2024
£
£
Allotted, called up and fully paid



140,000 (2024 - 140,000) Ordinary shares shares of £1.00 each
140,000
140,000

There is one class of ordinary share which carries full voting rights but no right to fixed income or repayment of capital. Distributions are at the discretion of the company.


Page 21

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025

19.


Reserves

Capital redemption reserve

The capital redemption reserve is the cumulative value of share capital previously issued which has been 
redeemed by the company.

Profit and loss account

Profit & loss reserves are the cumulative profits and losses incurred by the company since incorporation and not distributed to the shareholders.


20.


Financial commitments, guarantees and contingent liabilities

The company is party to a cross-company guarantee given to the group's bankers for the debts of its fellow group undertakings. The aggregate amount owed by HLMAD Limited's fellow group undertakings at 31 March 2025 is £nil (2024 - £nil).

The company has a continued guarantee of AED50,000 in favour of the Ministry of Economy in place.


21.


Commitments under operating leases

At 31 March 2025 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2025
2024
£
£


Not later than 1 year
207,624
542,332

Later than 1 year and not later than 5 years
602,725
1,227,517

810,349
1,769,849


22.


Related party transactions

The company has taken advantage of the exemption available in respect of Section 33.1a of FRS 102, which exempts the company from disclosing transactions with other group companies which are wholly owned subsidiaries.

There is a cross company guarantee provided to the group's bankers in respect of the company and its fellow group undertakings.
Page 22

 
HLMAD LIMITED T/A HLM ARCHITECTS
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025

23.


Ultimate controlling party

The immediate parent company is Covalent Group Limited, which has a registered office at Wool + Tailor Building Fifth Floor, 10-12 Alie Street, London, E1 8DE.

The ultimate controlling party is HLM+LD Employee Trust, which has its registered office at Wool + Tailor Building Fifth Floor, 10-12 Alie Street, London, E1 8DE.

The largest and smallest group into which the company is consolidated is Covalent Group Limited. Copies of the consolidated accounts are available from Companies House.

 
Page 23