REGISTERED NUMBER: 07713285 (England and Wales)

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2025

FOR

LLOYD BAKER LEATHER LTD

Page

Company Information

1

Strategic Report

2

Report of the Directors

5

Report of the Independent Auditors

6

Income Statement

10

Other Comprehensive Income

11

Balance Sheet

12

Statement of Changes in Equity

13

Cash Flow Statement

14

Notes to the Cash Flow Statement

15

Notes to the Financial Statements

16

DIRECTORS:

Mr T Malhotra

Mr A Malhotra

REGISTERED OFFICE:

Lloyd Baker House Travellers Lane

Welham Green, North Mymms

Hatfield

Hertfordshire

AL9 7HF

REGISTERED NUMBER:

07713285 (England and Wales)

SENIOR STATUTORY AUDITOR:

Thurairatnam Sudarshan FCCA

AUDITORS:

Xeinadin Audit Limited Chartered Accountants

Statutory Auditor

8th Floor, Becket House

36 Old Jewry

London

EC2R 8DD

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

REVIEW OF BUSINESS

The results for the Company for the year show a turnover of £11,359,051 (2024: £11,333,108) and a profit before taxation of £554,669 (2024: £992,856).

Revenue levels remained broadly consistent with the prior year, reflecting stable demand across both wholesale and retail channels. Despite this stability in turnover, profitability was lower than the previous year, primarily as a result of increased operating costs and continued inflationary pressures within the supply chain and labour markets.

The gross profit margin for the year was 34.76%, compared with 34.86% in the prior year. The slight reduction in margin reflects higher input and logistics costs, which were partially mitigated through pricing discipline and an ongoing focus on operational efficiency.

The Directors consider the overall performance of the Company to be satisfactory given the prevailing economic conditions and competitive trading environment. The business has continued to maintain strong relationships with key customers and suppliers, which remain fundamental to its ability to operate effectively and respond to market challenges.

The key financial performance indicators for the company are as follows:-

KPI

2025

2024

Measure

Performance ratios:

Gross Profit Margin

35.00 %

35.00%

Gross Profit/Turnover

Trade debtor days

51

71

Trade Debtors/Turnover

Trade creditors days

68

10

Trade Creditors/Cost of Sales

Stock days

249

189

Stock/Cost of Sales

PRINCIPAL RISKS AND UNCERTAINTIES

The company's operations expose it to a variety of financial risks that include the effects of changes in credit risk, liquidity risk and interest rate risk. The company has in place a risk management programme that seeks to limit the adverse effects on the financial performance of the company by monitoring levels of debt finance and the related finance costs. The company does not use derivative financial instruments to manage interest rate costs and as such, no hedge accounting is applied.

Given the size of the company, the directors have not delegated the responsibility of monitoring financial risk management to a sub-committee of the board. The policies set by the directors are implemented by the company's finance department.

Price risk

The company is exposed to price risk due to normal inflationary increases in the purchase price of goods and services purchased in the UK. The company has no exposure to equity securities price risk as it holds no listed or other equity investment.

Liquidity risk

The company actively maintains short-term debt finance that is designed to ensure that the company has sufficient available funds for operations and planned expansions.

Interest rate risk

The company has both interest bearing assets and interest-bearing liabilities. Interest bearing assets include only cash balances which earn interest at fixed rate. The company has a policy of maintaining debt at a fixed rate to ensure certainty of future interest cash flows. The directors will revisit the appropriateness of this policy if the operations of the company change in size or nature.

EMPLOYEES

The policy of the company is to employ the most suitably qualified persons regardless of age, religion, gender, sexual orientation or ethnic origin or any other grounds not related to a person's ability to work safely and effectively for the business. The company recognises the importance of ensuring that relevant business information is provided to the employees prior to the employee's commencement date. This is achieved through initial induction (Health Questionnaire, Health & Safety, Anti-Bribery Policy, Skills and Qualifications Assessment) and regular training as required for the industry standards.

EXECUTIVE SUMMARY

This Strategic Report presents an overview of the Company's business activities, market environment, and strategic priorities for the year. The Company operates in the leather handbags and accessories wholesale and retail sector, supplying mid-range, high-quality products through a combination of wholesale distribution, physical retail stores, and online sales channels.

During the year, the Company focused on maintaining revenue stability while managing increased cost pressures arising from inflation, logistics, and staffing. Despite these challenges, the business continued to trade resiliently, supported by strong customer relationships, established supplier partnerships, and a diversified sales model. The Board remains committed to protecting profitability and positioning the business for sustainable long-term growth.

MARKET CONDITIONS

The Company operates in a competitive and evolving fashion accessories market. Demand for affordable, good-quality leather products remains resilient; however, consumer purchasing behaviour continues to be influenced by cost-of-living pressures and heightened price sensitivity.

Key market trends affecting the business include:

- Continued growth in websites, marketplaces, and direct-to-consumer retail channels, with increased efforts to sell at marketplaces

- Increased consumer preference for value-led shopping, including designer outlet locations

- Ongoing volatility in shipping, logistics, and raw material costs

While market conditions remain challenging, the Directors believe the Company is well-positioned due to its established retail footprint, flexible wholesale offering, and efficient supply chain arrangements.

FUTURE DEVELOPMENTS

Following the 2023 restructuring and the creation of Lloyd Baker Group Ltd, we plan to acquire a new warehouse to streamline operations.

We will expand into online marketplaces to grow internet sales and open three boutique shops in motorway service stations to strengthen our retail presence.

CONCLUSION

The Company has maintained stable revenue during the year despite challenging economic conditions and rising costs. While profitability was affected, the business remains resilient, supported by strong customer relationships, reliable supplier partnerships, and a diversified sales model.

The Directors are confident that, through continued focus on operational efficiency, cost management, and strategic development across wholesale, retail, and online channels, the Company is well-positioned for sustainable long-term growth.

ON BEHALF OF THE BOARD:

Mr A Malhotra - Director

31 December 2025

The directors present their report with the financial statements of the company for the year ended 31 March 2025.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of agents involved in the sale of textiles.

DIVIDENDS

No dividends will be distributed for the year ended 31 March 2025.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 April 2024 to the date of this report.

Mr T Malhotra

Mr A Malhotra

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;

-	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 ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

ON BEHALF OF THE BOARD:

Mr A Malhotra - Director

31 December 2025

Opinion

We have audited the financial statements of Lloyd Baker Leather Ltd (the 'company') for the year ended 31 March 2025 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, 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 31 March 2025 and of its profit for the year then ended;

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

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

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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 five, 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.

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 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, employment, 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 where necessary.

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 transactions;

- tested the appropriateness of journal entries;

- 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.

To address the risk that revenue could be misstated due to fraud, we:

- obtained an understanding of the company's revenue recognition policies and compared these to the accounting standard;

- performed a walkthrough to confirm our understanding of the processes and controls through which the business

initiates, records, processes and reports revenue transactions;

- tested a sample of revenue transactions to supporting evidence; and

- tested, on a sample basis, revenue related balances in the balance sheet.

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;

- enquiring of management as to actual and potential litigation and claims.

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 director 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 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.

Thurairatnam Sudarshan FCCA (Senior Statutory Auditor)

for and on behalf of Xeinadin Audit Limited Chartered Accountants

Statutory Auditor

8th Floor, Becket House

36 Old Jewry

London

EC2R 8DD

31 December 2025

TURNOVER

3

11,359,051

11,333,108

Cost of sales

(7,410,901

)

(7,382,884

)

GROSS PROFIT

3,948,150

3,950,224

Administrative expenses

(3,305,123

)

(2,877,364

)

643,027

1,072,860

Other operating income

52,939

15,883

OPERATING PROFIT

6

695,966

1,088,743

Interest payable and similar expenses

7

(141,297

)

(95,887

)

PROFIT BEFORE TAXATION

554,669

992,856

Tax on profit

8

(154,190

)

(267,907

)

PROFIT FOR THE FINANCIAL YEAR

400,479

724,949

PROFIT FOR THE YEAR

400,479

724,949

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

400,479

724,949

FIXED ASSETS

Tangible assets

9

415,029

349,473

CURRENT ASSETS

Stocks

10

5,054,650

3,829,519

Debtors

11

3,812,376

3,919,362

Cash at bank

188,694

126,490

9,055,720

7,875,371

CREDITORS

Amounts falling due within one year

12

2,534,348

1,690,407

NET CURRENT ASSETS

6,521,372

6,184,964

TOTAL ASSETS LESS CURRENT LIABILITIES

6,936,401

6,534,437

CREDITORS

Amounts falling due after more than one year

13

(687,718

)

(702,703

)

PROVISIONS FOR LIABILITIES

15

(102,492

)

(86,022

)

NET ASSETS

6,146,191

5,745,712

CAPITAL AND RESERVES

Called up share capital

16

100

100

Retained earnings

17

6,146,091

5,745,612

SHAREHOLDERS' FUNDS

6,146,191

5,745,712

The financial statements were approved by the Board of Directors and authorised for issue on 31 December 2025 and were signed on its behalf by:

Mr A Malhotra - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 April 2023

100

5,020,663

5,020,763

Changes in equity

Total comprehensive income

-

724,949

724,949

Balance at 31 March 2024

100

5,745,612

5,745,712

Changes in equity

Total comprehensive income

-

400,479

400,479

Balance at 31 March 2025

100

6,146,091

6,146,191

Cash flows from operating activities

Cash generated from operations

1

555,385

(319,514

)

Interest paid

(141,297

)

(95,887

)

Tax paid

(262,994

)

-

Net cash from operating activities

151,094

(415,401

)

Cash flows from investing activities

Purchase of tangible fixed assets

(177,575

)

(132,979

)

Sale of tangible fixed assets

6,500

1,977

Net cash from investing activities

(171,075

)

(131,002

)

Cash flows from financing activities

Loan repayments in year

(19,452

)

(18,431

)

Amount withdrawn by directors

(6,360

)

(17,226

)

Loans from group undertakings

107,997

146,407

Net cash from financing activities

82,185

110,750

Increase/(decrease) in cash and cash equivalents

62,204

(435,653

)

Cash and cash equivalents at beginning of year

2

126,490

562,143

Cash and cash equivalents at end of year

2

188,694

126,490

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2025

2024

£

£

Profit before taxation

554,669

992,856

Depreciation charges

109,496

144,144

Profit on disposal of fixed assets

(3,976

)

(1,977

)

Finance costs

141,297

95,887

801,486

1,230,910

Increase in stocks

(1,225,131

)

(853,971

)

Decrease in trade and other debtors

90,319

75,091

Increase/(decrease) in trade and other creditors

888,711

(771,544

)

Cash generated from operations

555,385

(319,514

)

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 March 2025

31.3.25

1.4.24

£

£

Cash and cash equivalents

188,694

126,490

Year ended 31 March 2024

31.3.24

1.4.23

£

£

Cash and cash equivalents

126,490

562,143

3.	ANALYSIS OF CHANGES IN NET DEBT

At 1.4.24

Cash flow

At 31.3.25

£

£

£

Net cash

Cash at bank

126,490

62,204

188,694

126,490

62,204

188,694

Debt

Debts falling due within 1 year

(78,866

)

4,466

(74,400

)

Debts falling due after 1 year

(702,703

)

14,985

(687,718

)

(781,569

)

19,451

(762,118

)

Total

(655,079

)

81,655

(573,424

)

1.	STATUTORY INFORMATION

Lloyd Baker Leather Ltd is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

The presentation currency of the financial statements is the Pound Sterling (£).

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

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

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the accounting policies. The following principal accounting policies have been applied.

Going concern

The director has assessed whether the use of the going concern assumption is appropriate in preparing these accounts. The director has made this assessment in respect to a period of at least twelve months from when the financial statements are authorised for issue.

The director has concluded that there are no material uncertainties related to events or conditions that may cast significant doubt on the ability of the company to continue as going concern. The director is of the opinion that the company will have sufficient resources to meet its liabilities as they fall due with the continued support of the group companies.

Critical accounting judgements and key sources of estimation uncertainty

Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The items in the financial statements where these judgements and estimates have been made include:

- assessing the useful economic lives attributed to tangible fixed assets used to determine the annual

depreciation charge, and

- the provision required for any bad or doubtful debts.

Tangible fixed assets

Fixed assets are depreciated over their useful lives taking into account residual values, where appropriate. The actual lives of the assets are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as technological innovation and product life cycles are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values.

Stock provision

Stock is valued at the lower of cost and net realisable value. Management is required to consider the net realisable value of stock and whether an impairment is appropriate. When calculating the stock impairment provision, management considers the nature, condition, ageing and expiry date of stock, as well as applying assumptions around anticipated saleability of finished goods and future usage of raw materials.

Deferred tax

Management is required to assess whether it is appropriate to recognise a deferred tax asset relating to taxable losses available to the company. The recognition of deferred tax assets is based upon whether it is more likely than not that sufficient and suitable taxable profits will be available in the future against which the reversal of losses and other deductions can be deducted.

To determine the future taxable profits, reference is made to the latest available forecasts. Therefore, this involves judgement regarding the future financial performance of the company in which a deferred tax asset has been recognised.

Bad debt provision

The company makes an estimate of the recoverable value of trade and other debtors. When assessing impairment of trade and other debtors, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

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

Sale of goods

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

- the company has transferred the significant risks and rewards of ownership to the buyer;

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

- the amount of revenue can be measured reliably;

- it is probable that the company will receive the consideration due under the transaction; and

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

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Long leasehold

-

25% on cost

Plant and machinery

-

25% on cost

Fixtures and fittings

-

25% on cost

Motor vehicles

-

25% on cost

Computer equipment

-

25% on cost

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

Taxation

Taxation for the year 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 year 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.

Debtors and creditors

Debtors

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

Creditors

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

Foreign currencies translation

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 of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

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

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.

Hire purchase and leasing commitments

Assets that are held by the company under leases which transfer to the company substantially all the risks and rewards of ownership are classified as being held under finance leases. Leases which do not transfer substantially all the risks and rewards of ownership to the company are classified as operating leases.

Assets held under finance leases are initially recognised as assets of the company at their fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. The corresponding liability to the lessor is included in the statement of financial position as a finance lease obligation. Lease payments are apportioned between finance expenses and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance expenses are recognised immediately in profit or loss, unless they are directly attributable to qualifying assets, in which case they are capitalised in accordance with the company's policy on borrowing costs (see the accounting policy above). Contingent rentals are recognised as expenses in the periods in which they are incurred.

Operating lease payments are recognised as an expense on a straight-line basis over the lease term, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred.

In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit of incentives is recognised as a reduction of rental expense on a straightline basis over the lease term, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. A defined contribution plan is a post-employment benefit plan under which the company pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution pension plans are recognised as an expense in the profit and loss account in the periods during which services are rendered by employees.

Cash and cash equivalents

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

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

Provisions and liabilities

Provisions are made where an event has taken place that gives the company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.

Provisions are charged as an expense to profit or loss in the year that the company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.

When payments are eventually made, they are charged to the provision carried in the balance sheet.

3.

TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the company.

An analysis of turnover by geographical market is given below:

2025

2024

£

£

United Kingdom

11,359,051

11,333,108

11,359,051

11,333,108

4.	EMPLOYEES AND DIRECTORS

2025

2024

£

£

Wages and salaries

1,341,719

1,273,767

Social security costs

91,569

88,310

Other pension costs

107,749

77,073

1,541,037

1,439,150

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

2025

2024

Head office

14

14

Ware house

16

16

Stores

44

30

74

60

5.	DIRECTORS' EMOLUMENTS

The directors’ emoluments were as follows

Salaries : £50,000 (2024 - £51,197)

Highest Paid Director

The highest paid directors emoluments were as follows:

Salaries : £110,000 ( 2024- £109,197)

6.	OPERATING PROFIT

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

2025

2024

£

£

Hire of plant and machinery

29,848

7,714

Depreciation - owned assets

109,495

144,144

Profit on disposal of fixed assets

(3,976

)

(1,977

)

Auditors' remuneration

14,000

9,500

Foreign exchange differences

23,562

(32,752

)

7.

INTEREST PAYABLE AND SIMILAR EXPENSES

2025

2024

£

£

Bank loan interest

58,055

56,674

Other interest

83,242

39,213

141,297

95,887

8.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2025

2024

£

£

Current tax:

UK corporation tax

137,720

250,406

Deferred tax

16,470

17,501

Tax on profit

154,190

267,907