ACCOUNTS - Final Accounts

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

Registered number: 05469396

ADVANCED FIBREOPTIC ENGINEERING LIMITED

ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

ADVANCED FIBREOPTIC ENGINEERING LIMITED

COMPANY INFORMATION

Directors	N Martin
	M Johnson
	A Brown
	N Leavy
	M Zanola


Registered number	05469396


Registered office	Unit 2 & 3 Glebe Court
	West Oxfordshire Business Park
	Carterton
	Oxfordshire
	OX18 3FX


Independent auditor	James Cowper Kreston Audit
	Chartered Accountants and Statutory Auditor
	201 Cumnor Hill
	Cumnor
	Oxford
	Oxfordshire
	OX2 9PJ

ADVANCED FIBREOPTIC ENGINEERING LIMITED

CONTENTS

	Page
Strategic Report	1
Directors' Report	2 - 3
Independent Auditor's Report	4 - 7
Statement of Comprehensive Income	8
Balance Sheet	9
Statement of Changes in Equity	10
Statement of Cash Flows	11
Analysis of Net Debt	12
Notes to the Financial Statements	13 - 26

ADVANCED FIBREOPTIC ENGINEERING LIMITED

STRATEGIC REPORT

FOR THE YEAR ENDED 30 JUNE 2025

Business review

FY25 started with the same global economic problems that had affected the company's performance in FY24. There was a marked upturn in sales during the second half of the year, leading to an overall modest increase in revenue of around 2.3% year on year.

Whilst cost of sales gave a like for like performance compared to the previous year, overhead costs rose significantly leading to a marked drop in operating profit. This was due to a combination of: increases in indirect labour costs, exchange rate variance due to a weakening USD during the year, and some effects due to the treatment of our aerospace development programmes.

However, during the last few months of the FY a number of longer term customer projects have come to fruition, which has made a big impact on the start of FY26, giving a significant upturn in business. These projects cover a mix of markets and technologies, but two larger areas are high voltage grids, and test & measurement for data centres. In addition a further aerospace development contract was signed at the start of FY26.

To date we have not had any issues with sales due to tariffs in to the US, although we have noticed some issues with increased timescales to clear customs. Sales to the US remain at around the 75% level.

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

N Martin

Director

Date: 16 December 2025

Page 1

ADVANCED FIBREOPTIC ENGINEERING LIMITED

DIRECTORS' REPORT

FOR THE YEAR ENDED 30 JUNE 2025

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

Directors

The directors who served during the year were:

N Martin

M Johnson

A Brown

N Leavy

M Zanola

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 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.

Principal activity

The principal activity of the Company in the year under review was that of the design, development and manufacture of specialist fibreoptic components and assemblies.

Results and dividends

The profit for the year, after taxation, amounted to £425,159 (2024 - £855,351).

During the year there were two dividends declared and paid, totalling £386,000, to Adfen Investments Limited, the Company's parent company (2024 - £430,000).

Page 2

ADVANCED FIBREOPTIC ENGINEERING LIMITED

DIRECTORS' REPORT (CONTINUED)

FOR THE YEAR ENDED 30 JUNE 2025

Disclosure of information to auditor

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 auditor is 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 auditor is aware of that information.

Auditor

The auditor, James Cowper Kreston Audit, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

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

N Martin

Director

Date: 16 December 2025

Page 3

ADVANCED FIBREOPTIC ENGINEERING LIMITED

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ADVANCED FIBREOPTIC ENGINEERING LIMITED

Opinion

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

In our opinion the financial statements:

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

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

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

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's 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 4

ADVANCED FIBREOPTIC ENGINEERING LIMITED

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ADVANCED FIBREOPTIC ENGINEERING LIMITED (CONTINUED)

Other information

The other information comprises the information included in the Annual Report other than the financial statements and our Auditor's Report thereon. The directors are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinion on other matters prescribed by the Companies Act 2006

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

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

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

Matters on which we are required to report by exception

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

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

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

∙the financial statements are not in agreement with the accounting records and returns; or

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

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

Responsibilities of directors

As explained more fully in the Directors' Responsibilities Statement set out on page 2, 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 5

ADVANCED FIBREOPTIC ENGINEERING LIMITED

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ADVANCED FIBREOPTIC ENGINEERING LIMITED (CONTINUED)

Auditor's 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 Auditor's 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.

Because of 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.

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

The specific procedures for this engagement that we designed and performed to detect material misstatements in respect of irregularities, including fraud, were as follows:

∙Enquiry of management and those charged with governance around actual and potential litigation and claims;

∙Enquiry of management and those charged with governance to identify any material instances of non-compliance with laws and regulations;

∙Reviewing minutes of meetings of those charged with governance;

∙Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;

∙Performing audit work to address the risk of irregularities due to management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for evidence of bias.

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 Auditor's Report.

Page 6

ADVANCED FIBREOPTIC ENGINEERING LIMITED

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ADVANCED FIBREOPTIC ENGINEERING LIMITED (CONTINUED)

Use of our report

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an Auditor's 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.

Sue Staunton MA FCA CF (Senior Statutory Auditor)

for and on behalf of

James Cowper Kreston Audit

Chartered Accountants and Statutory Auditor

201 Cumnor Hill

Cumnor

Oxford

Oxfordshire

OX2 9PJ

17 December 2025

Page 7

ADVANCED FIBREOPTIC ENGINEERING LIMITED

STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 30 JUNE 2025

	2025	2024
Note	£	£


Turnover	4	7,500,604	7,290,457
Cost of sales		(3,675,942)	(3,707,064)
Gross profit		3,824,662	3,583,393
Administrative expenses		(3,553,181)	(2,931,406)
Other operating income	5	383,700	418,324
Operating profit	6	655,181	1,070,311
Interest payable and similar expenses	10	(25,202)	(10,387)
Profit before tax		629,979	1,059,924
Tax on profit	11	(204,820)	(204,573)
Profit for the financial year		425,159	855,351

There was no other comprehensive income for 2025 (2024:£NIL).

The notes on pages 13 to 26 form part of these financial statements.

Page 8

ADVANCED FIBREOPTIC ENGINEERING LIMITED

REGISTERED NUMBER: 05469396

BALANCE SHEET

AS AT 30 JUNE 2025

		2025		2024
Note		£		£

Fixed assets
Intangible assets	13		3,026,397		2,471,819
Tangible assets	14		556,353		472,757
			3,582,750		2,944,576
Current assets
Stocks	15	999,503		801,765
Debtors	16	2,001,819		1,710,728
Cash at bank and in hand	17	25,992		349,457
		3,027,314		2,861,950
Creditors: amounts falling due within one year	18	(1,436,343)		(821,278)
Net current assets			1,590,971		2,040,672
Total assets less current liabilities			5,173,721		4,985,248
Provisions for liabilities
Deferred tax	19	(790,701)		(641,387)
Other provisions	21	(149,490)		(149,490)
			(940,191)		(790,877)
Net assets			4,233,530		4,194,371

Capital and reserves
Called up share capital	22	100,000	100,000
Profit and loss account		4,133,530	4,094,371
		4,233,530	4,194,371

The financial statements were approved and authorised for issue by the board and were signed on its behalf by:

N Martin

Director

Date: 16 December 2025

Page 9

ADVANCED FIBREOPTIC ENGINEERING LIMITED

STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 30 JUNE 2025

	Called up share capital	Profit and loss account	Total equity
	£	£	£
At 1 July 2024	100,000	4,094,371	4,194,371
Comprehensive income for the year
Profit for the year	-	425,159	425,159
Total comprehensive income for the year	-	425,159	425,159
Contributions by and distributions to owners
Dividends: Equity capital	-	(386,000)	(386,000)
Total transactions with owners	-	(386,000)	(386,000)
At 30 June 2025	100,000	4,133,530	4,233,530

STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 30 JUNE 2024

	Called up share capital	Profit and loss account	Total equity
	£	£	£
At 1 July 2023	100,000	3,669,020	3,769,020
Comprehensive income for the year
Profit for the year	-	855,351	855,351
Total comprehensive income for the year	-	855,351	855,351
Contributions by and distributions to owners
Dividends: Equity capital	-	(430,000)	(430,000)
Total transactions with owners	-	(430,000)	(430,000)
At 30 June 2024	100,000	4,094,371	4,194,371

Page 10

ADVANCED FIBREOPTIC ENGINEERING LIMITED

STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 30 JUNE 2025

			2025	2024
			£	£

Cash flows from operating activities
Profit for the financial year	425,159	855,351
Adjustments for:
Amortisation of intangible assets	167,532	122,125
Depreciation of tangible assets	116,206	110,452
Impairments of fixed assets	62,021	-
(Increase)/decrease in stocks	(197,738)	224,334
(Increase) in debtors	(291,091)	(256,961)
Increase in creditors	434,866	202,316
Increase in provisions	149,314	38,273
Net cash generated from operating activities	866,269	1,295,890

Cash flows from investing activities
Purchase of intangible fixed assets	(784,131)	(787,046)
Purchase of tangible fixed assets	(199,802)	(89,179)
Net cash from investing activities	(983,933)	(876,225)
Cash flows from financing activities
Dividends paid	(386,000)	(430,000)
Net cash used in financing activities	(386,000)	(430,000)
Net (decrease) in cash and cash equivalents	(503,664)	(10,335)
Cash and cash equivalents at beginning of year	349,457	359,792
Cash and cash equivalents at the end of year	(154,207)	349,457

Cash and cash equivalents at the end of year comprise:
Cash at bank and in hand	25,992	349,457
Bank overdrafts	(180,199)	-
	(154,207)	349,457

The notes on pages 13 to 26 form part of these financial statements.

Page 11

ADVANCED FIBREOPTIC ENGINEERING LIMITED

ANALYSIS OF NET DEBT

FOR THE YEAR ENDED 30 JUNE 2025


At 1 July 2024	Cash flows	At 30 June 2025
£	£	£

Cash at bank and in hand	349,457	(323,465)	25,992
Bank overdrafts	-	(180,199)	(180,199)
	349,457	(503,664)	(154,207)

The notes on pages 13 to 26 form part of these financial statements.

Page 12

ADVANCED FIBREOPTIC ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

1.	General information

Advanced Fibreoptic Engineering Limited is a company limited by shares and incorporated in England and Wales. The registered office is Unit 2 & 3 Glebe Court, West Oxfordshire Business Park, Carterton, OX18 3FX. The principal activity of the Company in the year under review was that of the design, development and manufacture of specialist fibreoptic components and assemblies.

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 judgment in applying the Company's accounting policies (see note 3).

The following principal accounting policies have been applied:

2.2

Going concern

At the balance sheet date the Company had net assets of £4,233,530 (2024: £4,184,371) which includes net current assets of £1,590,971 (2024: £2,030,672) having made a profit before tax in the year of £629,979 (2024: £1,059,924). The directors believe, with the arranged overdraft facility and the expectation of a trade loan to be obtained in the FY26, it is appropriate to prepare the financial statements on a going concern basis.

2.3

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is pounds sterling rounded to the nearest pound.

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.

Page 13

ADVANCED FIBREOPTIC ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

2.Accounting policies (continued)

2.4

Revenue

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

Sale of goods

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

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

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

∙the amount of revenue can be measured reliably;

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

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

2.5

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.

2.6

Government grants

Grants are accounted for under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.

Grants of a revenue nature are recognised in the Statement of Comprehensive Income in the same period as the related expenditure.

2.7

Pensions

Defined contribution pension plan

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

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

Page 14

ADVANCED FIBREOPTIC ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

2.Accounting policies (continued)

2.8

Current and deferred taxation

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

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

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

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

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

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

2.9

Intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

2.10

Development costs

Development costs are capitalised within intangible assets when they can be identified with a specific product or project anticipated to produce future benefits, and are amortised on a straight-line basis over the anticipated life of the benefits arising from the completed product or project which varies from 3-10 years.

2.11

Stocks and work in progress

Stocks and work in progress are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow-moving stocks. Cost is based on costs of materials.

Page 15

ADVANCED FIBREOPTIC ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

2.Accounting policies (continued)

2.12

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 a combination of the reducing balance and the straight-line method..

Depreciation is provided on the following basis:

Plant & machinery	-	15% reducing balance
Motor vehicles	-	33% straight line
Fixtures & fittings	-	15% reducing balance / 33% straight line
Other Fixed Assets	-	33% 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.

2.13

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

2.14

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.

2.15

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

2.16

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.

Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.

Increases in provisions are generally charged as an expense to profit or loss.

Page 16

ADVANCED FIBREOPTIC ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

2.Accounting policies (continued)

2.17

Financial instruments

The Company enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities such as trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in non-puttable ordinary shares.

The Company also enters into forward foreign exchange contracts which are not basic financial instruments. These are initially recognised at fair value on the date a forward contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value are recognised in profit or loss in finance costs or income as appropriate. The Company does not currently apply hedge accounting for foreign exchange derivatives.

2.18

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.

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

The Company makes estimates and assumptions concering the future judgments in applying the Company's accounting policies. The resulting accounting estimates will, by definition, seldom equal actual results. The following estimates and assumption have significant risk of causing a material adjustment to the carrying value of assets and liabilities within the next financial year.

Intangible fixed assets

Development expenditure is capitalised as an intangible fixed asset if the Company can demonstrate that the Compnay intends to complete the asset to use or sell and it is technically feasible to do so, the Company is able to use the asset, the asset will generate future probably economic benefits, the Company has adequate technical, financial or other resources to complete the development and to use or sell the asset and the Company can reliably measure the expenditure attributable to the intangible asset during its development. The Company uses judgement to make these assessments and actual results may vary.

Intangible fixed assets are amortised over the period the Company expects to use the assets. the actual lives of the assets are assessed annually and may vary depnding on a number of factors. Residual value assessments consider issues such as the remaining life of the asset and any impairments.

Page 17

ADVANCED FIBREOPTIC ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

Test and measurement	5,451,218	5,573,960
Aerospace, military and intelligence	1,486,536	1,273,826
Other revenue	562,850	442,671
	7,500,604	7,290,457

Analysis of turnover by country of destination:

					2025	2024
					£	£

United Kingdom	1,556,423	1,384,895
Rest of Europe	462,414	196,731
Rest of the World	5,481,767	5,708,831
	7,500,604	7,290,457

5.	Other operating income
		2025	2024
		£	£

Research and Development Credit	292,137	169,496
Government grants receivable	91,563	248,828
	383,700	418,324

Research & development charged as an expense	213,230	210,790
Exchange differences	94,747	39,068
Other operating lease rentals	297,412	301,256

Page 18

ADVANCED FIBREOPTIC ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

Audit of the Company's financial statements

13,555

12,875

The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent Company.

8.	Employees
		2025	2024
		£	£

Wages and salaries	2,796,469	2,410,886
Social security costs	135,303	113,040
Cost of defined contribution scheme	236,964	215,324
	3,168,736	2,739,250

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

	2025	2024
	No.	No.

Staff	57	51

9.	Directors' remuneration
		2025	2024
		£	£

Directors' emoluments	785,457	742,312
Company contributions to defined contribution pension schemes	22,989	20,460
	808,446	762,772

	During the year retirement benefits were accruing to 3 directors (2024 - 3) in respect of defined contribution pension schemes.
	The highest paid director received remuneration of £285,665 (2024 - £269,016).
	The value of the Company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £NIL (2024 - £NIL).

Key management personnel received remuneration of £866,911 (2024 - £815,071).

Page 19

ADVANCED FIBREOPTIC ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

10.	Interest payable and similar expenses
		2025	2024
		£	£

	Bank interest payable	25,202	10,387
		25,202	10,387

Corporation tax
Current tax on profits for the year	55,506	58,451
	55,506	58,451

Total current tax	55,506	58,451

Deferred tax
Origination and reversal of timing differences	149,314	146,122
Total deferred tax	149,314	146,122


	Taxation on profit on ordinary activities	204,820	204,573

Page 20

ADVANCED FIBREOPTIC ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

11.Taxation (continued)

Profit on ordinary activities before tax

629,979

1,059,924

Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2024 - 25%)	157,495	264,981
Effects of:
Expenses not deductible for tax purposes	819	1,113
Marginal relief	(405)	-
Adjustments to tax charge in respect of prior periods	-	(27,544)
RDEC	31,406	(33,029)
Group relief claimed	-	(948)
Other differences leading to an increase (decrease) in the tax charge	15,505	-
Total tax charge for the year	204,820	204,573

There are no factors affecting future tax charges.

12.	Dividends
		2025	2024
		£	£

Ordinary dividend

386,000

430,000

Page 21

ADVANCED FIBREOPTIC ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

13.	Intangible assets

		Development
		£
	Cost
	At 1 July 2024	2,969,344
	Additions - internal	784,131
	At 30 June 2025	3,753,475
	Amortisation
	At 1 July 2024	497,525
	Charge for the year on owned assets	167,532
	Impairment charge	62,021
	At 30 June 2025	727,078
	Net book value
	At 30 June 2025	3,026,397
	At 30 June 2024	2,471,819

Page 22

ADVANCED FIBREOPTIC ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

14.	Tangible fixed assets

	Plant & machinery	Motor vehicles	Fixtures & fittings	Other fixed assets	Total
	£	£	£	£	£
Cost or valuation
At 1 July 2024	867,412	29,435	829,423	79,851	1,806,121
Additions	146,943	38,339	14,520	-	199,802
Disposals	(5,310)	(29,435)	-	-	(34,745)
At 30 June 2025	1,009,045	38,339	843,943	79,851	1,971,178
Depreciation
At 1 July 2024	659,399	8,744	585,370	79,851	1,333,364
Charge for the year	41,415	22,821	51,970	-	116,206
Disposals	(5,310)	(29,435)	-	-	(34,745)
At 30 June 2025	695,504	2,130	637,340	79,851	1,414,825
Net book value
At 30 June 2025	313,541	36,209	206,603	-	556,353
At 30 June 2024	208,013	20,691	244,053	-	472,757

Page 23

ADVANCED FIBREOPTIC ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

15.	Stocks
		2025	2024
		£	£

Raw materials and consumables	910,559	727,640
Work in progress (goods to be sold)	88,944	74,125
	999,503	801,765

The carrying value of stocks is stated net of impairment losses totalling £Nil (2024 - £nil). Impairment losses totalling £Nil (2024 - £nil) were recognised in profit and loss.

16.

Debtors

					2025	2024
					£	£



Trade debtors	1,508,123	1,368,708
Amounts owed by group undertakings	300	10,000
Other debtors	264,963	150,140
Prepayments and accrued income	228,433	181,880
	2,001,819	1,710,728

Amounts owed by group undertakings are unsecured, repayable on demand and non-interest bearing.

17.	Cash and cash equivalents
		2025	2024
		£	£

Cash at bank and in hand	25,992	349,457
Less: bank overdrafts	(180,199)	-

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

Bank overdrafts	180,199	-
Trade creditors	984,837	567,185
Other taxation and social security	76,915	73,496
Other creditors	28,062	22,520
Accruals and deferred income	166,330	158,077
	1,436,343	821,278

Page 24

ADVANCED FIBREOPTIC ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

19.	Deferred taxation

		2025
		£

	At beginning of year	(641,387)
	Charged to profit or loss	(149,314)
	At end of year	(790,701)

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

Accelerated capital allowances	(804,020)	(652,731)
Short term timing differences	13,319	11,344
	(790,701)	(641,387)

20.	Financial instruments

As at 30 June 2025, the Company was committed to the sale of foreign currency amounting to £367,097 (2024: £369,800).

21.	Provisions

		Provisions
		£

	At 1 July 2024	149,490
	At 30 June 2025	149,490

The provision relates to an estimate of the costs for restoration, repair and redecoration of the Company's leased premises at the termination of the leases in accordance with the terms of the lease agreements.

22.	Share capital
		2025	2024
		£	£

Allotted, called up and fully paid

100,000 (2024 - 100,000) Ordinary shares of £1.00 each	100,000	100,000

Page 25

ADVANCED FIBREOPTIC ENGINEERING LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2025

23.	Pension commitments

The Company operates a defined contribution scheme at a cost during the year to the Company of £236,964 (2024: £215,324) with an amount outstanding at the year end of £21,445 (2024: £18,710).

Not later than 1 year	290,820	290,820
Later than 1 year and not later than 5 years	508,935	799,755
	799,755	1,090,575

25.	Controlling party

The ultimate parent undertaking is Adfen Investments Limited. The registered office is Units 2 & 3 Glebe Court, West Oxfordshire Business Park, Carterton, OX18 3FX. The Directors consider there is no one ultimate controlling party.

Page 26