Hargreaves Engineering Group Limited

Contents
	Page
Strategic Report	1
Director's Report	2—3
Independent Auditor's Report	4—7
Consolidated Profit and Loss Account	8
Consolidated Statement of Comprehensive Income	9
Consolidated Balance Sheet	10
Company Balance Sheet	11
Consolidated Statement of Changes in Equity	12
Company Statement of Changes in Equity	13
Consolidated Statement of Cash Flows	14
Notes to the Consolidated Statement of Cash Flows	15
Notes to the Financial Statements	16—24

The director presents his report and the financial statements for the year ended 31 March 2025.

Principal Activity

The company's principal activity continues to be that of engineering.

Directors

The director who held office during the year were as follows:

Mr Paul Hargreaves

Research and Development

We are committed to spending on Research and Development and strive to be leaders in the industry. Developing new

innovative products is key to maintaining a competetive edge in the Rail industry.

Statement of Director's Responsibilities

The director is responsible for preparing the Strategic Report, the Director's Report and the financial statements in accordance with applicable law and regulations.

Company law requires the director to prepare financial statements for each financial year. Under that law the director has elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', and applicable law). Under company law the director must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and the group and of the profit or loss of the group for that period. In preparing the financial statements the director is required to:

select suitable accounting policies and then apply them consistently;
make judgments and accounting estimates that are reasonable and prudent;
state whether applicable United Kingdom Accounting Standards, comprising FRS102, 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 director is responsible for keeping adequate accounting records that are sufficient to show and explain the company and group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group and enable them to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The director is responsible for the maintenance and integrity of the corporate and financial information included on the company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Statement of Disclosure of Information to Auditors

In the case of each director in office at the date the Director's Report is approved:

so far as the director is aware, there is no relevant audit information of which the company and group's auditors are unaware; and
they have taken all the steps that they ought to have taken as directors in order to make themselves aware of any relevant audit information and to establish that the company and group's auditors are aware of that information.

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Hargreaves Engineering Group Limited

Director's Report (continued)

For The Year Ended 31 March 2025

Independent Auditors

The auditors, JNB Accountancy Limited, have indicated their willingness to continue in office and a resolution concerning their re-appointment will be proposed at the Annual General Meeting.

On behalf of the board

Mr Paul Hargreaves

Director

16/12/2025

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Page 4

Independent Auditor's Report

to the Members of

Hargreaves Engineering Group Limited

Independent Auditor's Report

Opinion

We have audited the financial statements of Hargreaves Engineering Group Limited (the "parent company") and its subsidiaries (the "group") for the year ended 31 March 2025 which comprise the Consolidated Profit and Loss Account, Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes of Equity, Company Statement of Changes of Equity, Consolidated Cash Flow Statement 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 (United Kingdom Generally Accepted Accounting Practice), including FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland".

In our opinion the financial statements:

give a true and fair view of the state of the group's and of the parent company's affairs as at 31 March 2025 and of the group's profit/(loss) for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent 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 director's 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 and parent company's ability to continue as a going concern for a period of at least 12 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 other information comprises the information included in the annual report, other than the financial statements and our auditor's report thereon. The director is 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. 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 Director's Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and Director's Report have been prepared in accordance with applicable legal requirements.

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Independent Auditor's Report (continued)

to the Members of

Hargreaves Engineering Group Limited

Matters on Which We Are Required to Report by Exception

In the light of the knowledge and understanding of the group and parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Director's 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent company financial statements are not in agreement with the accounting records or returns; or
certain disclosures of director's 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 Director's Responsibilities Statement set out on page 2—3, the director is 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 director 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 director is responsible for assessing the group and parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.

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Independent Auditor's Report (continued)

to the Members of

Hargreaves Engineering Group Limited

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.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the computer component manufacturing and supply sector;
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation and data protection, anti-bribery, employment, environmental (including Waste Electrical and Electronic Equipment recycling (WEEE) Regulations 2013) and health and safety legislation;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. To address the risk of fraud through management bias and override of controls, we:

performed analytical procedures to identify any unusual or unexpected relationships;
tested journal entries to identify unusual transactions;
assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and
investigated the rationale behind significant or unusual transactions. In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

agreeing financial statement disclosures to underlying supporting documentation;
reading the minutes of meetings of those charged with governance;
enquiring of management as to actual and potential litigation and claims; and
reviewing correspondence with HMRC, relevant regulators including the Health and Safety Executive, and the company's legal advisors.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website 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 that 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.

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Independent Auditor's Report (continued)

to the Members of

Hargreaves Engineering Group Limited

Joseph Nathan Bannister FCCA (Senior Statutory Auditor)

for and on behalf of JNB Accountancy Limited , Statutory Auditor

16/12/2025

JNB Accountancy Limited

Unit 3b Trident Business Centre

Amy Johnson Way

Blackpool

FY4 2RP

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Hargreaves Engineering Group Limited

Consolidated Profit and Loss Account

For The Year Ended 31 March 2025

Consolidated Profit and Loss Account

		31 March 2025	31 March 2024
	Notes	£	£
TURNOVER		9,010,074	6,716,515
Cost of sales		(3,998,688 )	(3,423,994 )

GROSS PROFIT		5,011,386	3,292,521

Administrative expenses		(4,485,719 )	(2,885,466 )
Other operating income		32,785	43,173

OPERATING PROFIT	3	558,452	450,228
Other interest receivable and similar income	8	26,527	7,617
Interest payable and similar charges	9	(89,558 )	(40,767 )

PROFIT BEFORE TAXATION		495,421	417,078
Tax on Profit	10	(55,059 )	(86,026 )

PROFIT AFTER TAXATION BEING PROFIT FOR THE FINANCIAL YEAR ATTRIBUTABLE TO THE OWNERS OF THE PARENT		440,362	331,052

The notes on pages 15 to 24 form part of these financial statements.

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Hargreaves Engineering Group Limited

Consolidated Statement of Comprehensive Income

For The Year Ended 31 March 2025

Consolidated Statement of Comprehensive Income

	31 March 2025	31 March 2024
	£	£
Profit for the financial year	440,362	331,052

Other comprehensive income for the year	-	-

Total comprehensive income for the year attributable to the owners of the parent	440,362	331,052

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Hargreaves Engineering Group Limited

Consolidated Balance Sheet

As At 31 March 2025

Consolidated Balance Sheet

Registered number: 15010348

		31 March 2025		31 March 2024
	Notes	£	£	£	£
FIXED ASSETS
Intangible Assets	11		594,820		643,632
Tangible Assets	12		2,492,981		2,273,421

			3,087,801		2,917,053
CURRENT ASSETS
Stocks	14	1,838,927		1,608,907
Debtors	15	2,927,215		3,303,075
Cash at bank and in hand		1,548,658		1,880,053

		6,314,800		6,792,035
Creditors: Amounts Falling Due Within One Year	16	(2,443,142 )		(2,376,421 )

NET CURRENT ASSETS (LIABILITIES)			3,871,658		4,415,614

TOTAL ASSETS LESS CURRENT LIABILITIES			6,959,459		7,332,667

Creditors: Amounts Falling Due After More Than One Year	17		(2,603,583 )		(3,403,991 )

PROVISIONS FOR LIABILITIES
Deferred Taxation	20		(6,421 )		(19,583 )

NET ASSETS			4,349,455		3,909,093

CAPITAL AND RESERVES
Called up share capital	21		3,600,000		3,600,000
Profit and Loss Account			749,455		309,093

SHAREHOLDERS' FUNDS			4,349,455		3,909,093

On behalf of the board

Mr Paul Hargreaves

Director

16/12/2025

The notes on pages 15 to 24 form part of these financial statements.

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Hargreaves Engineering Group Limited

Company Balance Sheet

As At 31 March 2025

Company Balance Sheet

Registered number: 15010348

		31 March 2025		31 March 2024
	Notes	£	£	£	£
FIXED ASSETS
Investments	13		8,040,000		8,040,000

			8,040,000		8,040,000
CURRENT ASSETS
Cash at bank and in hand		15,494		24,671

		15,494		24,671
Creditors: Amounts Falling Due Within One Year	16	(2,105,335 )		(1,126,836 )

NET CURRENT ASSETS (LIABILITIES)			(2,089,841 )		(1,102,165 )

TOTAL ASSETS LESS CURRENT LIABILITIES			5,950,159		6,937,835

Creditors: Amounts Falling Due After More Than One Year	17		(2,371,180 )		(3,386,688 )

NET ASSETS			3,578,979		3,551,147

CAPITAL AND RESERVES
Called up share capital	21		3,600,000		3,600,000
Profit and Loss Account			(21,021 )		(48,853 )

SHAREHOLDERS' FUNDS			3,578,979		3,551,147

In accordance with section 408(3) of the Companies Act 2006, the company has not presented its own profit and loss account and the related notes. The company's profit/(loss) for the year was £ 27,832 (2024: £(48,853 ) loss).

On behalf of the board

Mr Paul Hargreaves

Director

16/12/2025

The notes on pages 15 to 24 form part of these financial statements.

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Hargreaves Engineering Group Limited

Consolidated Statement of Changes in Equity

For The Year Ended 31 March 2025

Consolidated Statement of Changes in Equity

	Share Capital	Profit and Loss Account	Total
	£	£	£
As at 18 July 2023	3,600,000	-	3,600,000
Profit for the period and total comprehensive income	-	331,052	331,052

Dividends paid	-	(21,959)	(21,959)

As at 31 March 2024 and 1 April 2024	3,600,000	309,093	3,909,093


Profit for the year and total comprehensive income	-	440,362	440,362

As at 31 March 2025	3,600,000	749,455	4,349,455

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Hargreaves Engineering Group Limited

Company Statement of Changes in Equity

For The Year Ended 31 March 2025

Company Statement of Changes in Equity

	Share Capital	Profit and Loss Account	Total
	£	£	£
As at 18 July 2023	3,600,000	-	3,600,000
Loss for the period and total comprehensive income	-	(48,853 )	(48,853)

As at 31 March 2024 and 1 April 2024	3,600,000	(48,853 )	3,551,147


Profit for the year and total comprehensive income	-	27,832	27,832

As at 31 March 2025	3,600,000	(21,021 )	3,578,979

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Hargreaves Engineering Group Limited

Consolidated Statement of Cash Flows

For The Year Ended 31 March 2025

Consolidated Statement of Cash Flows

		31 March 2025	31 March 2024
	Notes	£	£
Cash flows from operating activities
Net cash generated from/(used in) operations	1	276,484	(2,108,259 )
Interest (paid)/refunded		(89,558 )	1
Tax paid		(125,961 )	-

Net cash generated from/(used in) operating activities		60,965	(2,108,258 )

Cash flows from investing activities
Purchase of tangible assets		(379,212 )	(125,673 )
Purchase of investment in subsidiary undertaking		-	833,066
Grants received		16,125	-
Interest received		26,527	-
Purchase in Subsidiary		-	(47,836)
Other Movements		-	(57,005)

Net cash (used in)/generated from investing activities		(336,560 )	602,552

Cash flows from financing activities
Equity dividends paid		-	(21,959 )
Proceeds from new bank borrowings		-	1,186,688
Repayment of bank borrowings		(67,754 )	-
Repayment of finance leases		11,642	21,030
Amount introduced by directors		312	-

Net cash (used in)/generated from financing activities		(55,800 )	3,385,759



(Decrease)/increase in cash and cash equivalents		(331,395 )	1,880,053
Cash and cash equivalents at beginning of year	2	1,880,053	-

Cash and cash equivalents at end of year	2	1,548,658	1,880,053

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Hargreaves Engineering Group Limited

Notes to the Consolidated Statement of Cash Flows

For The Year Ended 31 March 2025

Notes to the Consolidated Statement of Cash Flows

1. Reconciliation of profit for the financial year to cash generated from/(used in) operations

	31 March 2025	31 March 2024
	£	£
Profit for the financial year	440,362	331,052
Adjustments for:
Tax on profit	55,059	86,026
Interest expense	89,558	40,767
Interest income	(26,527 )	(7,617 )
Amortisation of intangible assets	48,812	48,812
Depreciation of tangible assets	159,652	105,993
Grant income	(16,125)	(25,617)
Foreign exchange losses	-	1,543
Movements in working capital:
Increase in stocks	(230,020 )	(1,608,907 )
Increase in trade and other debtors	(82,140 )	(3,303,075 )
(Decrease)/increase in trade and other creditors	(162,147 )	2,222,764

Net cash generated from/(used in) operations	276,484	(2,108,259 )

2. Cash and cash equivalents

Cash and cash equivalents, as stated in the Statement of Cash Flows, relates to the following items in the Balance Sheet:

	31 March 2025	31 March 2024
	£	£
Cash at bank and in hand	1,548,658	1,880,053

3. Analysis of changes in net (debt)/funds

	As at 1 April 2024	Cash flows	As at 31 March 2025
	£	£	£
Cash at bank and in hand	1,880,053	(331,395)	1,548,658
Finance leases	(38,668)	(11,642)	(50,310)
Debts falling due within one year	-	(67,754)	(67,754 )
Debts falling due after more than one year	(3,386,688)	2,335,508	(1,051,180)

	(1,545,303)	1,924,717	379,414

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Hargreaves Engineering Group Limited

Notes to the Financial Statements

For The Year Ended 31 March 2025

Notes to the Financial Statements

1. Accounting Policies

1.1. Basis of Preparation of Financial Statements

The financial statements have been prepared under the historical cost convention and in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland'' and the Companies Act 2006.

1.2. Basis Of Consolidation

The group consolidated financial statements include the financial statements of the company and all of its subsidiary undertakings together with the group’s share of the results of associates made up to 31 March 2025.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. Where the group owns less than 50% of the voting powers of an entity but controls the entity by virtue of an agreement with other investors which give it control of the financial and operating policies of the entity, it accounts for that entity as a subsidiary.

Where a subsidiary has different accounting policies to the group, adjustments are made to those subsidiary financial statements to apply the group’s accounting policies when preparing the consolidated financial statements.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the group holds a long-term interest and where the group has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate. The results of associates are accounted for using the equity method of accounting.

Any subsidiary undertakings or associates sold or acquired during the year are included up to, or from, the dates of change of control or change of significant influence respectively.

Where control of a subsidiary is lost, the gain or loss is recognised in the consolidated income statement. The cumulative amounts of any exchange differences on translation, recognised in equity, are not included in the gain or loss on disposal and are transferred to retained earnings. The gain or loss also includes amounts included in other comprehensive income that are required to be reclassified to profit or loss but excludes those amounts that are not required to be reclassified.

Where control of a subsidiary is achieved in stages, the initial acquisition that gave the group control is accounted for as a business combination. Thereafter where the group increases its controlling interest in the subsidiary the transaction is treated as a transaction between equity holders. Any difference between the fair value of the consideration paid and the carrying amount of the non-controlling interest acquired is recognised directly in equity. No changes are made to the carrying value of assets, liabilities or provisions for contingent liabilities.

1.3. Business Combinations

Business combinations are accounted for by applying the purchase method.

The cost of a business combination is the fair value of the consideration given, liabilities incurred or assumed and of equity instruments issued plus the costs directly attributable to the business combination. Where control is achieved in stages the cost is the consideration at the date of each transaction.

Contingent consideration is initially recognised at estimated amount where the consideration is probable and can be measured reliably. Where (i) the contingent consideration is not considered probable or cannot be reliably measured but subsequently becomes probable and measurable or (ii) contingent consideration previously measured is adjusted, the amounts are recognised as an adjustment to the cost of the business combination.

On acquisition of a business, fair values are attributed to the identifiable assets, liabilities and contingent liabilities unless the fair value cannot be measured reliably, in which case the value is incorporated in goodwill. Intangible assets are only recognised separately from goodwill where they are separable and arise from contractual or other legal rights. Where the fair value of contingent liabilities cannot be reliably measured they are disclosed on the same basis as other contingent liabilities.

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Hargreaves Engineering Group Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 March 2025

1.4. Turnover

Turnover is measured at the fair value of the consideration received or receivable, net of discounts and value added taxes. Turnover includes revenue earned from the sale of goods and from the rendering of services. Turnover is reduced for estimated customer returns, rebates and other similar allowances.

Sale of goods

Turnover from the sale of goods is recognised when the significant risks and rewards of ownership of the goods has transferred to the buyer. This is usually at the point that the customer has signed for the delivery of the goods.

Rendering of services

Turnover from the rendering of services is recognised by reference to the stage of completion of the contract. The stage of completion of a contract is measured by comparing the costs incurred for work performed to date to the total estimated contract costs. Turnover is only recognised to the extent of recoverable expenses when the outcome of a contract cannot be estimated reliably.

1.5. Intangible Fixed Assets and Amortisation - Goodwill

Goodwill represents the excess of the cost of a business combination over the fair value of the group’s share of the identifiable net assets, liabilities and contingent liabilities acquired.

Goodwill arising on the acquisition of subsidiaries is included in Intangible Assets. Goodwill arising on the acquisition of associates and joint ventures is included in the related equity accounted investment value.

Goodwill is amortised over its expected useful life which is estimated to be 10 years.

Goodwill is assessed for impairment when there are indicators of impairment and any impairment is charged to the profit and loss account. No reversals of impairment are recognised.

1.6. Tangible Fixed Assets and Depreciation

Tangible fixed assets are measured at cost less accumulated depreciation and any accumulated impairment losses. Depreciation is provided at rates calculated to write off the cost of the fixed assets, less their estimated residual value, over their expected useful lives on the following bases:

Freehold	2% Reducing Balance
Plant & Machinery	25% Reducing Balance
Motor Vehicles	25% Reducing Balance

1.7. Investment Properties

All investment properties are carried at fair value determined annually and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided for. Changes in fair value are recognised in the profit and loss account.

1.8. Leasing and Hire Purchase Contracts

Assets obtained under finance leases are capitalised as tangible fixed assets. Assets acquired under finance leases are depreciated over the shorter of the lease term and their useful lives. Assets acquired under hire purchase contracts are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the group. Obligations under such agreements are included in the creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to the profit and loss account so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.

Rentals applicable to operating leases where substantially all of the benefits and risks of ownership remain with the lessor are charged to the profit and loss account as incurred.

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Hargreaves Engineering Group Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 March 2025

1.9. 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 determined using the first-in, first-out method. Cost includes all direct costs and an appropriate proportion of fixed and variable overheads.

Work in progress is reflected in the accounts on a contract by contract basis by recording turnover and related costs as contract activity progresses.

At the end of each reporting period stocks are assessed for impairment. If an item of stock is impaired, the identified stock is reduced to its selling price less costs to complete and sell and an impairment charge is recognised in the profit and loss account. Where a reversal of the impairment is required the impairment charge is reversed, up to the original impairment loss, and is recognised as a credit in the profit and loss account.

1.10. Cash and Cash Equivalents

Cash and cash equivalents are basic financial assets and include cash in hand and deposits held at call with banks, other short-term highly liquid investments that mature in no more than three months from the date of acquisition and are readily convertible to a known amount of cash with insignificant risk of change in value, and bank overdrafts.

1.11. Foreign Currencies

Monetary assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate ruling on the date of the transaction. Exchange differences are taken into account in arriving at the operating profit.

1.12. Taxation

Income 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 profit as reported in the statement of comprehensive income because of items of income or expense that are taxable or deductible in other years and 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 end of the reporting period.

Deferred tax is recognised on timing differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable timing differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible timing differences can be utilised. The carrying amount of deferred tax assets is reviewed at the end of each reporting period 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 assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. Deferred tax liabilities are presented within provisions for liabilities and deferred tax assets within debtors. The measurement of deferred tax liabilities and assets reflect the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

Current and deferred tax are recognised in profit or loss for the year, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case current and deferred tax are recognised in other comprehensive income or directly in equity respectively.

2. Other Operating Income

	31 March 2025	31 March 2024
	£	£
Grant income	16,125	25,617
Rental income	16,640	17,433
Other operating income	20	123

	32,785	43,173

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Hargreaves Engineering Group Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 March 2025

3. Operating Profit

The operating profit is stated after charging:

	31 March 2025	31 March 2024
	£	£
Depreciation of tangible fixed assets	159,652	105,993
Amortisation of intangible fixed assets	48,812	48,812

4. Auditor's Remuneration

Remuneration received by the group's auditors and their associates during the year was as follows:

	31 March 2025	31 March 2024
	£	£
Audit Services
Audit of the group and company's financial statements	5,000	5,000

5. Staff Costs

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

	31 March 2025	31 March 2024
	£	£
Wages and salaries	3,120,672	1,910,533
Social security costs	321,261	187,658
Other pension costs	120,920	33,741

	3,562,853	2,131,932

6. Average Number of Employees

Group

Average number of employees, including directors, during the year was as follows:

	31 March 2025	31 March 2024
Office and administration	26	23
Manufacturing	53	52

	79	75

Company

Average number of employees, including directors, during the year was: 1 (2024: 1)

7. Director's remuneration

	31 March 2025	31 March 2024
	£	£
Emoluments	100,767	49,695
Company contributions to money purchase pension schemes	60,000	-

	160,767	49,695

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Hargreaves Engineering Group Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 March 2025

8. Interest Receivable and Similar Income

	31 March 2025	31 March 2024
	£	£
Interest on short term deposits	26,527	7,617

	26,527	7,617

9. Interest Payable

	31 March 2025	31 March 2024
	£	£
Bank loans and overdrafts	641	1,068
Finance charges payable under finance leases and hire purchase contracts	4,266	1,681
Other finance charges	84,651	38,018

	89,558	40,767

10. Tax on Profit

	Tax Rate		31 March 2025	31 March 2024
	31 March 2025	31 March 2024	£	£
UK Corporation Tax	25.0%	25.0%	69,904	88,768
Prior period adjustment			(1,683 )	-

Total Current Tax Charge			68,221	88,768
Deferred taxation RT			(13,162 )	(2,742 )

Total tax charge for the period			55,059	86,026


			31 March 2025	31 March 2024
			£	£
Profit before tax			495,421	417,078

Breakdown of tax charge is:
Tax on profit at 25% (UK standard rate)			136,058	132,373
Goodwill/depreciation not allowed for tax			39,912	26,497
Expenses not deductible for tax purposes			24,976	1,273
Capital allowances			(36,391 )	(12,715 )
Short term timing differences			(14,846 )	-
Research and Development tax credit			(93,306 )	(50,051 )
Prior period adjustment			(1,683 )	-
Difference in tax rates			339	-
Group relief			-	(8,609 )

Total tax charge for the period			55,059	88,768

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Hargreaves Engineering Group Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 March 2025

11. Intangible Assets

Group

	Goodwill
	£
Cost
As at 1 April 2024	692,444

As at 31 March 2025	692,444

Amortisation
As at 1 April 2024	48,812
Provided during the period	48,812

As at 31 March 2025	97,624

Net Book Value
As at 31 March 2025	594,820

As at 1 April 2024	643,632

Company

The company had no intangible fixed assets as at 31 March 2025 or 31 March 2024.

12. Tangible Assets

Group

	Land & Property
	Freehold	Investment Properties	Plant & Machinery	Motor Vehicles	Total
	£	£	£	£	£
Cost
As at 1 April 2024	1,805,563	194,437	816,520	284,233	3,100,753
Additions	-	-	293,310	85,902	379,212

As at 31 March 2025	1,805,563	194,437	1,109,830	370,135	3,479,965

Depreciation
As at 1 April 2024	71,500	-	565,405	190,427	827,332
Provided during the period	38,570	-	76,155	44,927	159,652

As at 31 March 2025	110,070	-	641,560	235,354	986,984

Net Book Value
As at 31 March 2025	1,695,493	194,437	468,270	134,781	2,492,981

As at 1 April 2024	1,734,063	194,437	251,115	93,806	2,273,421

Company

The company had no tangible fixed assets as at 31 March 2025 or 31 March 2024.

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Hargreaves Engineering Group Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 March 2025

13. Investments

Company

	Subsidiaries
	£
Cost
As at 1 April 2024	8,040,000

As at 31 March 2025	8,040,000

Provision
As at 1 April 2024	-

As at 31 March 2025	-

Net Book Value
As at 31 March 2025	8,040,000

As at 1 April 2024	8,040,000

14. Stocks

	31 March 2025	31 March 2024
	£	£
Stock	1,229,414	1,248,606
Work in progress	609,513	360,301

	1,838,927	1,608,907

15. Debtors

	Group		Company
	31 March 2025	31 March 2024	31 March 2025	31 March 2024
	£	£	£	£
Due within one year
Trade debtors	2,870,595	3,264,916	-	-
Prepayments and accrued income	56,620	38,159	-	-

	2,927,215	3,303,075	-	-

16. Creditors: Amounts Falling Due Within One Year

	Group		Company
	31 March 2025	31 March 2024	31 March 2025	31 March 2024
	£	£	£	£
Net obligations under finance lease and hire purchase contracts	33,727	21,365	-	-
Trade creditors	389,546	809,174	-	-
Bank loans and overdrafts	67,754	-	67,754	-
Corporation tax	68,187	125,927	7,484	-
Other taxes and social security	97,734	91,896	-	-
VAT	412,817	537,778	6,000	739
Other creditors	879,365	766,521	-	-
Accruals and deferred income	47,335	17,395	-	-
Director's loan account	6,677	6,365	-	-

...CONTINUED

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Hargreaves Engineering Group Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 March 2025

Amounts owed to group undertakings	-	-	1,584,097	1,126,097
Amounts owed to other participating interests	440,000	-	440,000	-

	2,443,142	2,376,421	2,105,335	1,126,836

17. Creditors: Amounts Falling Due After More Than One Year

	Group		Company
	31 March 2025	31 March 2024	31 March 2025	31 March 2024
	£	£	£	£
Net obligations under finance lease and hire purchase contracts	16,583	17,303	-	-
Bank loans	1,051,180	1,186,688	1,051,180	1,186,688
Amounts owed to participating interests	1,320,000	2,200,000	1,320,000	2,200,000
Accruals and deferred income	215,820	-	-	-

	2,603,583	3,403,991	2,371,180	3,386,688

Hargreaves Engineering Group Limited has an outstanding mortgage of £1,186,688 secured against proprties held within the business at an interest rate of 7.6% per year, repayable over 20 years.

There is also deferred consideration as a result of a managment buyout of £2,200,000 owed to the former owners of the subsidiary Allan J Hargreaves Plant Engineers Limited. This is repayable over 5 years. There are no interest charges associated to this deferred consideration.

18. Loans

An analysis of the maturity of loans is given below:

	Group		Company
	31 March 2025	31 March 2024	31 March 2025	31 March 2024
	£	£	£	£
Amounts falling due within one year or on demand:
Bank loans	67,754	-	67,754	-

	67,754	-	67,754	-

	Group		Company
	31 March 2025	31 March 2024	31 March 2025	31 March 2024
	£	£	£	£
Amounts falling due between one and five years:
Bank loans	1,051,180	1,186,688	1,051,180	1,186,688

	1,051,180	1,186,688	1,051,180	1,186,688

Page 23

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Hargreaves Engineering Group Limited

Notes to the Financial Statements (continued)

For The Year Ended 31 March 2025

19. Obligations Under Finance Leases and Hire Purchase

	Group
	31 March 2025	31 March 2024
	£	£
The maturity of these amounts is as follows:
Within one year	33,727	21,365
Between one and five years	16,583	17,303

	50,310	38,668

	50,310	38,668

20. Deferred Taxation

The provision for deferred tax is made up as follows:

	31 March 2025	31 March 2024
	£	£
Deferred Tax	6,421	19,583

21. Share Capital

	31 March 2025	31 March 2024
Allotted, called up but not fully paid	£	£
200 Ordinary Shares of £ 1.00 each	200	200

Preference Shares

	31 March 2025	31 March 2024
Allotted, called up but not fully paid	£	£
3,599,800 Preference Shares of £ 1.00 each	3,599,800	3,599,800

22. Pension Commitments

The group operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the group in an independently administered fund.

During the year the charge to the profit and loss account in respect of defined contribution schemes was £120,920 (2024: £33,741).

At the balance sheet date contributions of £0 (2024: £4,754) were due to the fund and are included in creditors.

23. Dividends

	31 March 2025	31 March 2024
	£	£
On equity shares:
Final dividend paid	-	21,959

	-	21,959

24. General Information

Hargreaves Engineering Group Limited is a private company, limited by shares, incorporated in England & Wales, registered number 15010348 . The registered office is Longmeadow Lane, Redmarsh Industrial Estate, Thornton Cleveleys, Lancashire, FY5 4JT.

Page 24