The directors present the strategic report for the year ended 31 March 2025.
Principal activities
The Company, Legado Holdings Limited, is a UK based company, established in March 2022.
The Company's principal activity is the distribution of post-tax investment funds to drive further sales growth in new sectors. There have not been any significant changes in the Company's principal activities in the year under review.
The Company has sole ownership of Ignite Solutions Limited, a UK based company, established in July 2008, which is its primary revenue source. Ignite Solutions Limited is a leading, major tech retailer accredited agency, and award winning marketing service provider in the telecommunications sector (services in UK & EMEA). The other subsidiaries, details of which can be found in notes 16 and 17, joined the group during the year.
Fair review of the business
The establishment of the holding company is primarily for future survival and will allow for the diversification of trading companies and development of new products and services which will open further opportunities. This strategy will enable specialist investment into new sectors including systems and reporting solutions to complement the current sales and marketing trading company with the group. Investment will be key in establishing these new trading entities and becoming relevant and competitive.
The Group did not perform well in the year ended 31 March 2025, reporting a decrease in turnover of £1,892k (24.3%) and profit before tax of £934k (15.9%) (after adding back the exceptional reversal of the negative goodwill in these financial statements). Gross margin decreased from 33.7% in 2024 to 32.6% in 2025.
Market outlook
The concerns highlighted in last year’s strategic report, specifying a challenging trading period to come with our services business, are now coming to fruition. The increased cost of living to customers has drastically impacted the volumes of products and services purchased with our existing clients, resulting in a change of behaviors on budget spend with third party agencies.
Agreed long-term contractual obligations are being challenged and, in some instances, ignored, pushing the increased liabilities on resource costs specifically (NI increases as an example) fully onto the responsibility of the agencies which will continue to damage the service providers sector and put them at financial risk due to the cannibalization of GP even further.
It is a disturbing and unique trading tactic as high-profile clients are so focused on short term strategic objectives to inflate financial performance (to stimulate their stocks market appeal) while damaging long term stability and customer / service retention. There is a lack of mitigation planning being conducted due to the continued lack of team productivity following the “work from home directive” with continued planning forums cancelled or conducted via remote technology solutions. The early adoption of AI as an alternative solution to drive sales engagement is being explored and adopted, however this seems to have backfired badly with some clients losing customers as a result of poor internal alignment and sales risk assessment within the fibre sector specifically. AI, early adoption capabilities are massively misunderstood currently, and short-term traditional customer engagement solutions will still have a place for brands needing to grow market share with effective high touch conversion solutions. This is vital when considering a customer service contract is a minimum 24-month term of recurring revenues. Quality is being sacrificed for low-cost solutions, with middle management directed to implement the changes with limited commercial understanding, personal interest and limited consideration for longer term impact.
SME’s are in the toughest trading period we have seen for decades, with continued increased tax liabilities, higher staff costs and client spending being reduced, the need to reduce risk, maintain stability and diversify needs to be the directive moving forward.
The final risk for consideration is the offshore service (specifically SAAS & telemarketing) which pose a big threat given the cheaper workforce, low business rates and tax advantages resulting in an ability to provide efficient customer acquisition. However, quality is still a key factor and a USP we will continue to build on.
Our planned 2 year strategy, with the implementation of new entities with diversified service offerings (including the setup of an investment company and SAAS business) will require real market analysis before investing further and this unfortunately is also driven by the drastic reduction in R&D rebates which make the ambition to grow and expand further, high risk to the group.
Key Performance Indicators (KPI’s)
The key metrics of success will be the evolution of our business model to reflect the UK landscape following turbulent changes to historic trading hurdles undertaken and factoring higher tax liabilities since the budget announcement.
Trading continuity, with a lean efficient operation, is our primary objective for the trading companies. Our ambition is to continue due diligence and to identify potential AI companies to acquire or partners to conduct a joint venture.
Continued investment into proven lower risk markets, with long term growth remains our continued focus.
Controlled costs and effective investments into further revenue generating services will be key to our survival and protection of all vital employees.
Diversification of services and digital solutions will remain our focus, however a change in direction away from the UK market is now the only viable option. We will continue with a planned reporting subscription tool for new digital solutions flexible enough to be utilized in other counties requiring remote worker performance and reporting tools.
Talent specialism attraction will be another core area of focus ensuring the innovative service solutions can meet expectations and provide a point of difference vs competitors. This is a key focus and investment strategy for future succession planning.
The financial KPI’s used by management are turnover and profit before tax and gross margins.
Principal Risks
The primary risks still remain the reduction in demand for services from core clients. Increased cost for trading, challenges from customers on reduced margins on services provided.
SME survival in the next 24 months and staff redundancies as a result remain a continued threat.
Removal of tax incentives (especially on R&D where we have already committed to a substantial investment plan) is now forcing a change of direction and consideration.
Support for SME’s from principal institutes will be key in ensuring the survival and growth of businesses adapting to the new normal and higher liabilities and risks to trading.
Protection of business v’s overseas service providers with efficient costing models will force a shift of trade away from the UK.
The removal of tax incentives for the fibre providers and ISP’s currently benefiting from the BDUK voucher remuneration following a change of government.
The drastic and unsustainable increases to insurance charges (fleet, central, liabilities cover, data protection etc) driving the central costs service model to uncompetitive levels.
Identifying and sourcing strong leadership and management stakeholders have continued to prove challenging. Underestimating the importance of a high-tech, high touch approach to client management has impacted on the growth expectations and required continued intervention, diverting attention away from developing other service solutions. This is unlikely to change given the current climate and therefore a focus on higher quality, ambitious and capable performers, with incentives to match will become the focus.
In high service demand industries and environments in which we operate, this can have a detrimental impact to the services offered and client satisfaction / NPS and positive staff retention levels. The risk is client churn or margin erosion which would impact investment planning and continued trading performance. We have mitigated this with the recruitment of higher calibre operators and proven senior board directors who are assisting in the implementation of performance and operational standards of excellence, in addition to the contribution in the development and implementation of the new service offering.
Within our rental business, there are three core risks to highlight. 1) Increased service charges which we are unable to pass onto the tenants lease agreements. 2) Removal of any airb&b bookings due to new regulations 3) renters uncertainty on future cost of living impact forcing them to trigger their early release from tenancy agreements. Although we have sourced strong third party managing agents, the new regulations are now forcing us to review the viability of this business model in the current format. The three risks above will require further consideration to ensure investments in the UK property renters’ market is still a viable option.
Outlook of the business
Ongoing development of core sales and marketing business.
Focus on investment opportunity in stocks & shares with leading financial institutes planned.
Potential joint ventures for our SAAS business to drive innovative license agreement reporting, remote field operation performance solutions and ability to roll out into new EMEA territories
Liquidity risk
There is no liquid risk given the continued focus on building healthy performing trading entities which will enable a higher level of success with the new service propositions.
Credit risk
There are no credit risks to report.
On behalf of the board
The directors present their annual report and financial statements for the year ended 31 March 2025.
The results for the year are set out on page 9.
Ordinary dividends were paid amounting to £251,153 (2024: £177,000). The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
In accordance with the company’s articles, a resolution proposing that BK Plus Audit Limited be reappointed as auditor of the company will be put at a General Meeting.
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
We have audited the financial statements of Legado Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2025 which comprise the group profit and loss account, the group statement of comprehensive income, group balance sheet, company balance sheet, group statement of changes in equity, company statement of changes in equity, group statement of cash flows and notes to the financial statements, including 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).
Basis for opinion
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our 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.
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.
From the preliminary stage of the audit, we ensure our understanding of the entity is up to date. This includes, but is not limited to, current knowledge of their activities, the business and control environments, and their compliance with the applicable legal and regulatory frameworks. This information supports our risk identification and the subsequent design of audit procedures to mitigate those risks; ensuring that the audit evidence obtained is sufficient and appropriate to support our opinion.
In response to the risks identified, specific to this entity, we designed procedures which included, but were not limited to:
Enquiry of management and those charged with governance around actual and potential litigation and claims;
Reviewing minutes of meetings of those charged with governance, if available;
Reviewing financial statements disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, and evaluating the business rationale for significant transactions outside the normal course of business.
There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations are from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusions. There is always the unavoidable risks that material misstatements in the financial statements may not be detected despite the audit being properly performed in accordance with UK Auditing standards.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's 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 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.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £348,598 (2024 - £1,526,597 profit).
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
Legado Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Tech House, 26 Temple End, High Wycombe, Buckinghamshire, HP13 5DR.
The group consists of Legado Holdings Limited and all of its subsidiaries.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
The consolidated group financial statements consist of the financial statements of the parent company Legado Holdings Limited together with all entities controlled by the parent company (its subsidiaries).
All financial statements are made up to 31 March 2025. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.
At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
At each reporting period end date, the group reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally 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.
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
In the application of the group’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.
Depreciation
Tangible fixed assets are depreciated over their estimated useful economic lives, taking into account estimated residual values. These estimates are based on management’s experience with similar assets, consideration of anticipated technological changes, expected usage, and other relevant factors.
Bad debt provisions
The company establishes provisions for receivables that are considered unlikely to be collected. These provisions are based on management’s assessment of the probability of recovery, considering factors such as the customer’s financial position, past payment history, current economic conditions, and specific knowledge of individual debtors.
Valuation of investment property
Investment properties are carried at fair value. Valuations are based on market evidence of transaction prices for similar properties, adjusted for differences in location, condition, and other relevant factors. Where observable market data is not available, valuations rely on discounted cash flow models or other techniques, which involve assumptions about future rental income, occupancy rates, yields, and discount rates.
Impairment of investments
In evaluating the impairment of the company’s portfolio of investments, management exercises significant judgement in reviewing the performance of the portfolio alongside their independent investment advisor.
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
The above net exceptional loss relates to the goodwill arising on the acquisition of the full share capital of the subsidiaries which joined the group during the year, the details of which can be found in notes 16 and 17.
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
Investment property comprises of caravan holiday lodge units and rental properties. The fair value of the investment property has been arrived at following an assessment of available market data by the directors.
Details of the company's subsidiaries at 31 March 2025 are as follows:
On 31 March 2024 the company acquired 100 percent of the issued capital of VRS Solutions Limited, by way of a share for share exchange.
On 10 March 2024 the group acquired 100 percent of the issued capital of Sparc Intelligence Limited, by way of a share for share exchange.
The following are the major deferred tax liabilities recognised by the group and company, and movements thereon:
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
The following amounts were outstanding at the reporting end date:
In the prior year, the above companies were treated as related parties by way of common directorship. In 2025, they joined the group and any amounts owed were eliminated upon consolidation. This is detailed in note 17 to the financial statements.