REGISTERED NUMBER: 00455692

Strategic Report, Report of the Directors and

Financial Statements

for the Period 31 March 2024 to 29 March 2025

for

Fine Lady Bakeries Limited

Page

Company Information

1

Strategic Report

2

to

4

Report of the Directors

5

to

7

Report of the Independent Auditors

8

to

11

Income Statement

12

Other Comprehensive Income

13

Balance Sheet

14

Statement of Changes in Equity

15

Notes to the Financial Statements

16

to

32

DIRECTORS:

A R Heygate

P M Heygate

C D Roberts

Mrs S E Kreckler

A R Heygate

K J Adisa

T P Heygate

P J Skelding

SECRETARY:

S K Y Chia

REGISTERED OFFICE:

Bugbrooke Mills

Bugbrooke

Northampton

Northamptonshire

NN7 3QH

REGISTERED NUMBER:

00455692

AUDITORS:

Clifford Roberts

Chartered Accountants &

Statutory Auditors

Pacioli House

9 Brookfield

Duncan Close

Northampton

Northamptonshire

NN3 6WL

BANKERS:

HSBC UK Bank plc

Large Corporates

6th Floor

120 Edmund Street

Birmingham

B3 2QZ

The directors present their strategic report for the period 31 March 2024 to 29 March 2025.

PRINCIPAL ACTIVITY

The principal activity of the company continues to be the manufacture and sale of bakery and morning goods.

REVIEW OF BUSINESS

The company maintains the overriding objective of continuing growth and maintaining profitability. The key factors which contribute to this are:

- Continuing to develop and deliver high quality products;

- Providing high quality and cost effective technical services to our customers;

- Continuing to implement cost reduction initiatives and improving operational efficiency; and

- Maintaining a highly skilled and loyal workforce.

The UK baking industry remains a highly competitive market and the company has sought to address this through a targeted growth strategy. The company has two production facilities which give a wide geographical spread and address the risk of operating from a single site and it continues to invest to meet capacity as the market demands.

During the period, due to a combination of economic factors putting pressure on consumer finances and a shift in consumer habits, volumes of traditional wrapped and sliced loaves has declined resulting in reduced sales, cost of sales and ultimately gross profit. Whilst being able to maintain gross margin percentage this has put pressure on fixed overhead coverage and resulted in a lower net profit position for the year.

PRINCIPAL RISKS AND UNCERTAINTIES

The company does not have significant exposure to foreign currency or cash flow risks due to the nature of its trade. Exposure to credit, liquidity, interest rate and other price risks arise in the normal course of Fine Lady Bakeries Limited's business. These risks are limited by the company's financial management policies described below.

Credit risk

Credit risk is the risk that one party to a financial instrument will cause a financial loss for Fine Lady Bakeries Limited by failing to discharge an obligation. Predominantly any risks will arise from trade debtors going bad. Fine Lady Bakeries Limited reduces the risk through sensible sales ledger management policies. The risk is also mitigated by the size of the company's customers, which are predominantly supermarkets, as these are very unlikely to fail.

Liquidity risk

The directors have ultimate responsibility for liquidity risk management in maintaining adequate reserves, banking and borrowing facilities. These are managed on a group wide basis in order to benefit from economies of scale. The risk is further reduced through the use of invoice discounting facilities by the company. This is particularly relevant for the larger customers on generous credit terms.

Interest rate risk

The company is exposed to interest rate risk through the impact of rate changes on interest bearing borrowings. The bank loan, overdraft and the invoice discounting facility, together with the hire purchase and finance lease contracts are liabilities impacted by this risk. By managing the first two facilities on a group wide basis, better interest rates are obtained helping to mitigate the risk. The latter contracts are negotiated on the best fixed rate terms achievable at the time and therefore crystallise the risk and remove the sensitivity to a change in rates.

Other price risk

The company operates in a very competitive market. In order to retain its existing customers and generate new ones, the company continues to strive to achieve its overriding aim of building and maintaining good customer relationships and consistently producing high quality, innovative products together with a high level of service at competitive prices. The resulting strong relationships help the company to be able to work with its customers following significant changes in raw material costs and mitigate the risk of having to absorb wheat, and the resulting flour price fluctuations, alone. In the period under review, market conditions around the world have eased resulting in a decrease in both global and UK grain prices. The overall mix resulted in a decrease in the average price of grain and hence flour prices.

SECTION 172(1) STATEMENT

The company operates in a complex and interconnected commercial and regulatory environment which impacts and touches many different stakeholders. By understanding and engaging with stakeholders the company can consider their interests and priorities when making key decisions and ensure that the business works constructively with them to promote the success of the company. Details of how the company engages with its key stakeholders are included in the Directors' Report.

ANALYSIS OF DEVELOPMENT AND PERFORMANCE

The directors are pleased with the performance of the company for the period despite continuing competitive and economic pressures.

The key performance indicators (KPI's) used in monitoring the company's performance are:

1. Organic sales growth - year on year percentage change in sales revenue.

2. Gross return on sales - gross profit as a percentage of sales revenue.

3. Net return on sales - profit/(loss) on ordinary activities before taxation and before non-recurring items and income from other fixed asset investments, as a percentage of sales revenue.

4. Return on net assets - profit/(loss) on ordinary activities before taxation and before non-recurring items and income from other fixed asset investments, as a percentage of net assets.

5. Free cash flow - comprises the net cash flows from operating activities, less cash outflows due to capital

expenditure.

KEY PERFORMANCE INDICATORS (KPI'S)

2025

2024

Organic sales growth

(11.55%)

1.61%

Gross return on sales

14.50%

13.60%

Net return on sales

0.50%

0.86%

Return on net assets

5.40%

11.26%

Free cash flow

£485k

(£7,230k)

In addition, the company uses a number of non-financial performance indicators, including measures to monitor quality and wastage at each site.

ON BEHALF OF THE BOARD:

P M Heygate - Director

16 December 2025

The directors present their report with the financial statements of the company for the period 31 March 2024 to 29 March 2025.

DIVIDENDS

There was a profit on ordinary activities after taxation for the period amounting to £116,555 (2024: £1,110,792). No dividends were recommended or paid during the period (2024: £Nil).

FUTURE DEVELOPMENTS

The company continues to modernise and refurbish its bakeries, investing in the latest efficient plant and machinery to maintain the excellent quality of its market leading products.

DIRECTORS

The directors shown below have held office during the whole of the period from 31 March 2024 to the date of this report.

A R Heygate

P M Heygate

C D Roberts

Mrs S E Kreckler

A R Heygate

Other changes in directors holding office are as follows:

K J Adisa - appointed 11 June 2024

T P Heygate and P J Skelding were appointed as directors after 29 March 2025 but prior to the date of this report.

S Cook and D A R Howlett ceased to be directors after 29 March 2025 but prior to the date of this report.

ENGAGEMENT WITH EMPLOYEES

The company places considerable value on the involvement of its employees. It has regular communication, with its unions, management and with its employees directly, keeping them informed of matters affecting them as individuals, on the various factors affecting the company in general and in respect of its pension schemes.

DISABLED EMPLOYEES

The company recognises their responsibility towards disabled persons. Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes and abilities of the applicant concerned.

In the event of members of staff becoming disabled, every effort is made to ensure that their employment with the company continues and that appropriate training is arranged.

It is the policy of the company that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of the other employees.

ENGAGEMENT WITH SUPPLIERS, CUSTOMERS AND OTHERS

The company believes that engagement with its stakeholders has an important role to play in achieving its strategy, helping it to be a responsible business, delivering long-term sustainable growth.

How the company engages with its key stakeholders is set out below.

Customers

As described within Other Price Risk, the company continues to strive to achieve its overriding aim of building and maintaining good customer relationships, a key ingredient of which is regular dialogue. These relationships culminate in long term contracts, ensuring continuity and helping the business plan, and deliver, in the long term.

Workforce

The company has an experienced and dedicated workforce and has a responsibility to ensure that all employees work in a safe environment and have opportunities to learn and develop their careers. Careers can start with apprenticeships and can continue through internal promotion schemes up to management and subsequent development programmes.

The company is an equal opportunities employer and has a formal whistleblowing policy in place to allow employees to raise any concerns or issues they have confidentially.

Suppliers

The procurement team engage closely with key suppliers to ensure that we can continue to source high quality ingredients at the right price, whilst ensuring that suppliers meet the company's policies on ethical trading, health and safety, anti-bribery, competition law compliance and anti-slavery. The company is a member of Sedex and undergoes SMETA social audits to understand working conditions in their supply chain.

Community and environment

As well as considering the impact on its supply chain, the company considers the impact it has in the areas it operates, including local businesses, residents and charities. A significant number of its employees come from the local community and the company makes charitable contributions to charities serving those communities.

The company takes environmental matters very seriously. It is committed to continuing efforts to reduce its carbon footprint by participating in an ongoing programme to become even more efficient in its energy usage.

Government and society

The company believes in the importance of acting responsibly and operating with high standards of business conduct, including governance in relation to UK taxation. The company also takes an active role in seeking to shape and influence debates around key issues in society relating to food safety, nutrition, health and wellbeing issues through membership of organisations such as the National Association of British and Irish Flour Millers, Campden BRI, the Food and Drink Federation and the Federation of Bakers.

Banks and pension schemes

The company's bankers provide essential financing which supports the long-term future of the company and the group.

The company has long-established defined benefit and contribution pension schemes and fully engages regularly with their trustees, members, actuaries and professional advisors. As part of this engagement, the company will ensure that the deficit recovery plan is adhered to when the scheme is in deficit.

STREAMLINED ENERGY AND CARBON REPORTING

The company has not included its energy and carbon report on the basis that its results are included in the consolidated financial statements of its parent company. Details of the parent company in which full disclosure can be found are contained in the 'Ultimate Controlling Party' note.

DISCLOSURE IN THE STRATEGIC REPORT

Principal activities, financial risk management objectives and policies and the exposure to credit, liquidity, interest rate and other price risks are set out in the strategic report (as defined by section 414 C (11) of the Companies Act 2006).

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the 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 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 and then apply them consistently;

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

-	state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;

-	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 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.

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 company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS

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

ON BEHALF OF THE BOARD:

P M Heygate - Director

16 December 2025

Opinion

We have audited the financial statements of Fine Lady Bakeries Limited (the 'company') for the period ended 29 March 2025 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity and 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 company's affairs as at 29 March 2025 and of its profit for the period 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 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 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 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 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 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 company and its environment obtained in the course of the audit, we have not identified material misstatements in the 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, 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 Statement of Directors' Responsibilities set out on page seven, 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 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.

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.

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:

-

We obtained an understanding of the legal and regulatory framework applicable to the company and the sector in which they operate. We determined that the following laws and regulations were most significant: the Companies Act 2006, UK Generally Accepted Accounting Practice, UK corporate taxation laws and the BRC Global Standard for Food Safety.

-

We obtained an understanding of how the company is complying with those legal and regulatory frameworks by making inquiries to the management and by observing the oversight of management, the culture of honesty and ethical behaviour and whether strong emphasis is placed on fraud prevention, which may reduce the opportunities for fraud to take place, and fraud deterrence, which could persuade individuals not to commit fraud in the first instance. We corroborated our inquiries through our review of all relevant available audit information.

-

We assessed and understood the susceptibility of the company's financial statements to material misstatement, including how fraud might occur. Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. The audit procedures performed by the engagement team included:

>

identifying and assessing the design and effectiveness of controls management has in place to prevent and detect fraud;

>

understanding of how senior management considered and addressed the potential for override of controls or other inappropriate influence over the financial reporting process;

>

challenging assumptions and judgements made by management in its significant accounting estimates;

>

performing audit work over the risk of 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 bias; and,

>

assessing the extent of compliance with relevant laws and regulations.

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.

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.

Robert Dearing BEng FCA (Senior Statutory Auditor)

for and on behalf of Clifford Roberts

Chartered Accountants &

Statutory Auditors

Pacioli House

9 Brookfield

Duncan Close

Northampton

Northamptonshire

NN3 6WL

16 December 2025

TURNOVER

163,877,195

185,267,710

Cost of sales

140,112,322

160,075,842

GROSS PROFIT

23,764,873

25,191,868

Distribution costs

12,922,300

14,943,006

Administrative expenses

8,210,903

7,266,007

21,133,203

22,209,013

OPERATING PROFIT

4

2,631,670

2,982,855

Interest receivable and similar income

20,630

29,634

Other finance income

21

-

189,500

20,630

219,134

2,652,300

3,201,989

Interest payable and similar expenses

5

1,701,471

1,614,675

Other finance costs

21

128,500

-

1,829,971

1,614,675

PROFIT BEFORE TAXATION

822,329

1,587,314

Tax on profit

6

705,774

476,522

PROFIT FOR THE FINANCIAL PERIOD

116,555

1,110,792

PROFIT FOR THE PERIOD

116,555

1,110,792

OTHER COMPREHENSIVE INCOME

FRS 102 actuarial gains/(losses)

1,027,500

(2,225,000

)

Income tax relating to other comprehensive income

(9,625

)

556,250

OTHER COMPREHENSIVE INCOME FOR THE PERIOD, NET OF INCOME TAX

1,017,875

(1,668,750

)

TOTAL COMPREHENSIVE INCOME FOR THE PERIOD

1,134,430

(557,958

)

FIXED ASSETS

Intangible assets

7

-

-

Tangible assets

8

43,864,828

34,707,206

Investments

9

200

200

43,865,028

34,707,406

CURRENT ASSETS

Stocks

10

2,328,438

2,039,803

Debtors

11

27,740,848

32,190,309

Cash in hand

242

546

30,069,528

34,230,658

CREDITORS

Amounts falling due within one year

12

46,199,656

42,141,275

NET CURRENT LIABILITIES

(16,130,128

)

(7,910,617

)

TOTAL ASSETS LESS CURRENT LIABILITIES

27,734,900

26,796,789

CREDITORS

Amounts falling due after more than one year

13

(4,587,426

)

(6,419,392

)

PROVISIONS FOR LIABILITIES

18

(5,725,772

)

(3,191,125

)

PENSION LIABILITY

21

(2,186,500

)

(3,085,500

)

NET ASSETS

15,235,202

14,100,772

CAPITAL AND RESERVES

Called up share capital

19

3,500,000

3,500,000

Retained earnings

20

11,735,202

10,600,772

SHAREHOLDERS' FUNDS

15,235,202

14,100,772

The financial statements were approved by the Board of Directors and authorised for issue on 16 December 2025 and were signed on its behalf by:

P M Heygate - Director

A R Heygate - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 2 April 2023

3,500,000

11,158,730

14,658,730

Changes in equity

Total comprehensive income

-

(557,958

)

(557,958

)

Balance at 30 March 2024

3,500,000

10,600,772

14,100,772

Changes in equity

Total comprehensive income

-

1,134,430

1,134,430

Balance at 29 March 2025

3,500,000

11,735,202

15,235,202

1.	PRINCIPAL PLACE OF BUSINESS

Fine Lady Bakeries Limited is a private company, limited by shares, incorporated and domiciled in England and has two principal places of business being at Southam Road, Banbury, Oxfordshire, OX16 2RE and Grimshaw Lane, Newton Heath, Manchester, M40 2BA. The company's registered number and registered office address can be found on the Company Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with applicable United Kingdom accounting standards, including Financial Reporting Standard 102 - "The Financial Reporting Standard applicable in the UK and Republic of Ireland" ("FRS 102") and with the Companies Act 2006. The financial statements have been prepared on the historical cost basis.

The financial statements are presented in Sterling (£) and cover the period to the Saturday that falls closest to the 31st March each year. This results in the comparatives being not entirely comparable.

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 FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

•

the requirements of Section 7 Statement of Cash Flows;

•

the requirements of paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);

•

the requirements of paragraphs 12.26, 12.27, 12.29(a), 12.29(b) and 12.29A.

Details of the parent company in which full disclosure can be found are contained in the 'Ultimate Controlling Party' note.

Preparation of consolidated financial statements

The financial statements contain information about Fine Lady Bakeries Limited as an individual company and do not contain consolidated financial information as the parent of a group. The company is exempt under Section 400 of the Companies Act 2006 from the requirements to prepare consolidated financial statements as it and its subsidiary undertaking are included by full consolidation in the consolidated financial statements of its parent, Heygate and Sons Limited, Bugbrooke Mills, Bugbrooke, Northamptonshire, NN7 3QH.

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.

Significant judgements and estimates

In the application of the company's accounting policies, management is required to make judgements, estimates and assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions are based on historical experience and other factors that are considered relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis.

The key sources of estimation uncertainty that have a significant effect on the amounts recognised in the financial statements are described below.

(a) Valuation of pension obligations

The fair value of the Company's defined benefit scheme is determined each year following advice from a qualified, independent actuary and can fluctuate based on a number of external factors, which are subject to major assumptions. These assumptions are described fully in the 'Employee Benefit Obligations' note.

In the current year, the £2,186,500 (2024: £3,085,500) deficit has been recognised in the accounts giving rise to a deferred tax charge of £9,625 (2024 credit: £556,250) through other comprehensive income and a deferred tax charge of £215,125 (2024 credit: £215,125) through the income statement.

(b) Determining net realisable values of stocks

In determining the net realisable value of stocks, management takes into account the most reliable evidence available at the dates the estimates are made.

(c) Trade debtors

The directors carefully consider the recoverability of trade debtors based on their experience of customers' payment history and the likelihood of recovery.

(d) Determining net book value of tangible fixed assets

In determining net book value of tangible fixed assets, management estimate both the residual value and the useful economic lives of the assets. Both judgements rely on the experience of management.

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 represents the invoiced amount of goods sold, stated net of value added tax. The turnover and pre-tax result is wholly attributable to the manufacture and sale of bakery and morning goods within the United Kingdom, and is recognised upon evidence of delivery.

Investment income

Income from investments is included in the income statement of the accounting period in which it is received.

Intangible assets - licences

Licences for the use of bread baskets and wheels are included at cost and amortised in equal annual instalments over a period of three years, which is their useful economic life. Provisions are made for any impairments.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off the cost less estimated residual value of each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Short leasehold

-

20% on cost, 10% on cost, 4% on cost or lease term if shorter, 3% on cost and Over the life of the lease

Commercial vehicles

-

20% on cost and 10% on cost

Plant and machinery

-

50% on cost, 33% on cost, 20% on cost, 10% on cost, 5% on cost and Straight line over 15 years

Office equipment

-

33% on cost, 25% on cost, 20% on cost and 10% on cost

Motor vehicles

-

25% on cost

Assets in the course of construction and payments on account are recorded at cost. No depreciation will be provided on these assets until all of the activities necessary to bring the assets fully in to use are complete.

Items costing £5,000, or less, and not forming part of a wider project costing more than £5,000, are written off to the income statement as repairs and renewals.

Investments in subsidiaries and associates

Fixed asset investments comprise of unquoted shares in subsidiaries and associates which are stated at cost less impairment. Impairment losses are recognised immediately in the statement of income. The details of the investments are shown in the 'Fixed Asset Investments' note.

Stocks

Stocks are stated at the lower of cost price and net realisable value. Raw materials are valued at cost price, calculated on a first in first out basis. Finished goods are valued at the cost of direct materials plus a percentage to cover overheads and labour costs. Net realisable value is based on estimated selling prices less further costs expected to be incurred to completion and disposal.

Financial instruments

Fine Lady Bakeries Limited enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other accounts receivable and payable, loans, hire purchase contracts, balances to and from related parties and invoice discounting facilities.

Debt instruments (other than those wholly repayable or receivable in one year), including loans and other accounts receivable and payable, are initially measured at the present value of future cash flows and subsequently at amortised cost using the effective interest rate 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.

Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective impairment is found, an impairment loss is recognised in the income statement.

Taxation

Taxation for the period comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

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 period 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.

Hire purchase and leasing commitments

Assets held under finance leases, hire purchase contracts and other similar arrangements, which confer rights and obligations similar to those attached to owned assets, are capitalised as tangible fixed assets at the fair value of the leased asset (or, if lower, the present value of the minimum lease payments as determined at the inception of the lease) and are depreciated over the shorter of the lease terms and their useful lives. The capital elements of future lease obligations are recorded as liabilities, while the interest elements are charged to profit and loss over the period of the leases to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals under operating leases are charged on a straight line basis over the lease term, even if the payments are not made on such a basis. Benefits received and receivable as an incentive to sign an operating lease are similarly spread on a straight line basis over the lease term.

Pension and post employment benefits

In accordance with FRS 102 Section 28 - "Employee benefits", the operating and financing costs of pension and post-retirement schemes are recognised separately in the profit and loss account. Service costs are systematically spread over the service lives of the employees and financing costs are recognised in the period in which they arise. The costs of past service benefit enhancements, settlements and curtailments are also recognised in the period in which they arise.

The difference between actual and expected returns on assets during the year, including changes in actuarial assumptions, are recognised in the statement of other comprehensive income.

The disclosure required by FRS 102 Section 28 - "Employee benefits" are given in the 'Employee Benefit Obligations' note.

3.	EMPLOYEES AND DIRECTORS

2025

2024

£

£

Wages and salaries

29,663,485

28,968,562

Social security costs

2,952,520

2,967,948

Other pension costs

2,364,333

1,367,732

34,980,338

33,304,242

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

2025

2024

No.

No.

Office and management

28

32

Manufacturing and production

600

611

Selling and distribution

111

120

739

763

Period

Period

31.3.24

2.4.23

to

to

29.3.25

30.3.24

£

£

Directors' remuneration

1,076,134

845,017

Directors' pension contributions to money purchase schemes

15,899

26,600

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes

6

5

Defined benefit schemes

4

4

Information regarding the highest paid director is as follows:

Period

Period

31.3.24

2.4.23

to

to

29.3.25

30.3.24

£

£

Emoluments etc

208,272

198,883

Pension contributions to money purchase schemes

2,576

7,820

4.	OPERATING PROFIT

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

Period

Period

31.3.24

2.4.23

to

to

29.3.25

30.3.24

£

£

Hire of plant and machinery

160,854

503,233

Depreciation - owned assets

2,505,643

3,413,573

Depreciation - assets on hire purchase contracts

2,423,802

2,647,987

Loss/(profit) on disposal of fixed assets

229,620

(58,350

)

Auditors' remuneration

67,600

66,000

Foreign exchange differences

(25,421

)

-

Rent of land and buildings

1,700,000

1,700,000

Impairment losses

266,456

-

5.

INTEREST PAYABLE AND SIMILAR EXPENSES

Period

Period

31.3.24

2.4.23

to

to

29.3.25

30.3.24

£

£

Bank interest

1,105,535

902,358

Bank loan interest

43,805

57,628

Hire purchase

552,131

654,689

1,701,471

1,614,675