Company registration number 13535395 (England and Wales)
SURFACE PREPARATION UK HOLDINGS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
SURFACE PREPARATION UK HOLDINGS LIMITED
COMPANY INFORMATION
Directors
K Yang
S M Wieland
(Appointed 2 February 2024)
C Twibell
C A Pierce
(Appointed 2 February 2024)
J Dodge
M Currie
Secretary
Oakwood Corporate Secretary Limited
Company number
13535395
Registered office
36 Orgreave Drive
Sheffield
United Kingdom
S13 9NR
Auditor
Sumer Auditco Limited
Albert Works
Sidney Street
Sheffield
S1 4RG
SURFACE PREPARATION UK HOLDINGS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 8
Group statement of comprehensive income
9
Group balance sheet
10
Company balance sheet
11
Group statement of changes in equity
12
Company statement of changes in equity
13
Group statement of cash flows
14
Notes to the financial statements
15 - 35
SURFACE PREPARATION UK HOLDINGS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 1 -

The directors present the strategic report for the year ended 31 December 2024.

Review of the business

Surface Preparation UK Holdings Limited is the UK parent company within the global SurfacePrep Group, a leading provider of surface enhancement technologies.

During the year, the group acquired PDJ Vibro Limited, specialists in vibratory deburring solutions, reinforcing its position as a comprehensive provider of surface preparation technologies.

In addition to UK developments, the group expanded its European footprint through the strategic acquisition of SurfacePrep Netherlands BV Group (Leering), based in Hengelo, Netherlands. Leering is a well-established name in the surface preparation industry, supplying abrasive blasting and cleaning solutions to the manufacturing sector. The company also engineers and assembles Normfinish® abrasive blasting systems, including solutions for conventional blasting and post-processing of 3D-printed products. This acquisition strengthens the group’s capabilities in advanced manufacturing and positions SurfacePrep as a leading player across Europe.

The group benefits from continued financial support from SurfacePrep Holdings Inc., with funding agreements in place across UK trading subsidiaries, supplemented by resources from the wider global group.

Strategic Outlook

Our priorities for 2025 and beyond include:

- Operational Integration: Completing the hive-up of remaining UK entities into SurfacePrep UK Limited and aligning European operations under a unified structure.

- Market Positioning: Leveraging the SurfacePrep brand to drive growth in surface preparation solutions across the UK and Europe.

- Financial Discipline: Maintaining robust liquidity and cost control while benefiting from fixed-rate funding arrangements.

- Innovation: Expanding capabilities in advanced manufacturing, including post-processing solutions for additive manufacturing.

Principal risks and uncertainties

The key risks faced by the group include:

- Changes in legislation and tariffs arising from political instability.

- Inflationary pressures impacting growth outlook.

- Product innovation and marketing challenges.

- Reduced sales due to increased competition.

Liquidity Risk: The group seeks to manage financial risk by ensuring liquidity is available to meet foreseeable needs and to invest cash assets safely and profitably.

Interest Rate Risk: The group finances its operations through a combination of retained profits, wider group funding, finance leases and hire purchase contracts. Exposure to interest rate fluctuations is managed by the use of both fixed and floating facilities.

Foreign Currency Risk: Principal foreign currency exposures arise from trading with overseas companies. Group policy permits but does not demand that these exposures may be hedged in order to fix the cost in sterling.

Credit Risk: The principal credit risk arises from trade debtors. All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

SURFACE PREPARATION UK HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 2 -
Key performance indicators

The group monitors performance against financial and non-financial KPIs. Key measures include sales growth, gross margin, and EBITDA, which are reviewed monthly by management and reported to the board.

| 2024 | 2023
Turnover | £28.4m | £27m
Gross Profit % | 38.4% | 39.27%
EBITDA | £2.1m | £2.4m

The group anticipates continued growth supported by strategic investments, operational efficiencies, and strong financial backing from the wider SurfacePrep Group. Management remains focused on cost control, innovation, and customer service to deliver sustainable profitability.

On behalf of the board

C Twibell
Director
17 January 2026
SURFACE PREPARATION UK HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024
- 3 -

The directors present their annual report and financial statements for the year ended 31 December 2024.

Principal activities

The principal activity of the company continued to be that of a non-trading parent holding company. The principal activity of the wider group is that of manufacturing, sales and hire of abrasive blast cleaning equipment and the supply of abrasive blasting machines and accessories, blast rooms and cabinets.

Results and dividends

The results for the year are set out on page 9.

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

K Yang
S M Wieland
(Appointed 2 February 2024)
C Twibell
C A Pierce
(Appointed 2 February 2024)
J Dodge
M Currie
Future developments

The directors continue to consider future trading opportunities, seeking growth through both existing customers and securing new opportunities as they arise.

Consideration is given to industry sectors, product ranges and service offerings, applying the group’s extensive experience to maintain its position as a leading provider within the blasting sector, including aerospace, automotive, marine, medical and rail.

The management board are satisfied that the group benefits from the financial strength of its ultimate US parent, providing support for ongoing operations and enabling further expansion in line with the longer term growth strategy.

Auditor

The auditor, Sumer Auditco Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

SURFACE PREPARATION UK HOLDINGS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 4 -
Statement of directors' responsibilities

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with 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 group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

- select suitable accounting policies and then apply them consistently;

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

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

- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
C Twibell
Director
17 January 2026
SURFACE PREPARATION UK HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SURFACE PREPARATION UK HOLDINGS LIMITED
- 5 -

Qualified opinion

We have audited the financial statements of Surface Preparation UK Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2024 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the 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).

In our opinion, except for the possible effects of the matter described in the Basis for Qualified Opinion paragraph, the financial statements:

- give a true and fair view of the state of the company's affairs as at 31 December 2024 and of its 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 qualified opinion

As disclosed in note 23 to the consolidated financial statements, PDJ Vibro Limited was acquired by the group on 16 October 2024, and the financial year end was extended to 31 December 2024. At the previous financial year end the financial statements were not subject to audit, and as such, no physical stock count was observed. We were unable to obtain sufficient appropriate audit evidence regarding the stock quantities held on 31 October 2023, which are recorded in the balance sheet at £655,539. Our attempts to verify these quantities through alternative audit procedures were unsuccessful. Consequently, we were unable to determine whether any adjustments to this balance were necessary.

In addition, although we observed the physical stock count at 31 December 2024, we have not been provided with sufficient appropriate audit evidence to support the valuation of stock recorded in the balance sheet at £628,336. As stock is a key component in determining the results of operations, we were unable to determine whether any adjustments were required to the profit reported in the consolidated profit and loss account.

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

SURFACE PREPARATION UK HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SURFACE PREPARATION UK HOLDINGS LIMITED
- 6 -

Other information

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

As described in the Basis for qualified opinion section of our report, we were unable to satisfy ourselves concerning the stock quantities of £655,539 held at 31 October 2023 and £628,336 held at 31 December 2024. We have concluded that where the other information refers to the stock balances or related balances such as costs of sales or gross margin , it may be materially misstated for the same reason.

Opinions on other matters prescribed by the Companies Act 2006

Except for the matter described in the Basis for qualified opinion section of this report, in our opinion, based on the work undertaken in the course of our audit:

- the information given in the strategic report and the directors' r eport for the financial year for which the financial statements are prepared is consistent with the financial statements; and

- the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In respect solely of the limitation on our work relating to stock, described above:

- we have not obtained all the information and explanations that we considered necessary for the purpose of our audit; and

- we were unable to determine whether adequate accounting records had been maintained.

Except for the matter described in the Basis for qualified opinion section of our report, i n the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identifie d material misstatements in the strategic report or the directors' r eport.

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 and returns; or

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

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

Responsibilities of directors

As explained more fully in the directors' r esponsibilities s tatement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the 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 parent company or to cease operations, or have no realistic alternative but to do so.

SURFACE PREPARATION UK HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SURFACE PREPARATION UK HOLDINGS LIMITED
- 7 -
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.

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 Group through discussions with directors and other management, and from our commercial knowledge and experience of the trade;

- 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 Group;

- we assessed the extent of compliance with the laws and regulations considered 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 risks of fraud through management bias and override 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;

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

- discussions with senior management regarding relevant regulations and reviewing the company’s legal and professional fees.

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’s and other management and the inspection of regulatory and legal correspondence.

As part of our audit, we addressed the risk of management override of internal controls, including testing of journals and review of the nominal ledger. We evaluated whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.

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.

SURFACE PREPARATION UK HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SURFACE PREPARATION UK HOLDINGS LIMITED
- 8 -

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.

Daniel Varley (Senior Statutory Auditor)
For and on behalf of Sumer Auditco Limited, Statutory Auditor
Chartered Accountants
Albert Works
Sidney Street
Sheffield
S1 4RG
19 January 2026
SURFACE PREPARATION UK HOLDINGS LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024
- 9 -
2024
2023
as restated
Notes
£
£
Turnover
3
28,401,433
26,961,316
Cost of sales
(17,485,014)
(16,374,633)
Gross profit
10,916,419
10,586,683
Distribution costs
18,064
42,179
Administrative expenses
(10,630,996)
(9,887,276)
Other operating income
77,410
10,199
Operating profit
4
380,897
751,785
Interest receivable and similar income
18,581
6,434
Interest payable and similar expenses
7
(481,385)
(496,204)
(Loss)/profit before taxation
(81,907)
262,015
Tax on (loss)/profit
8
(402,492)
(397,568)
Loss for the financial year
(484,399)
(135,553)
Other comprehensive income
Currency translation gain taken to retained earnings
1,070
-
0
Total comprehensive income for the year
(483,329)
(135,553)
Loss for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.
SURFACE PREPARATION UK HOLDINGS LIMITED
GROUP BALANCE SHEET
AS AT 31 DECEMBER 2024
31 December 2024
- 10 -
2024
2023
as restated
Notes
£
£
£
£
Fixed assets
Goodwill
10
16,997,740
9,025,168
Tangible assets
11
1,726,189
1,117,600
18,723,929
10,142,768
Current assets
Stocks
14
9,332,480
3,780,396
Debtors
15
9,566,631
5,032,727
Cash at bank and in hand
3,405,673
3,742,059
22,304,784
12,555,182
Creditors: amounts falling due within one year
16
(42,080,770)
(24,180,515)
Net current liabilities
(19,775,986)
(11,625,333)
Total assets less current liabilities
(1,052,057)
(1,482,565)
Creditors: amounts falling due after more than one year
17
(1,132,140)
(114,801)
Provisions for liabilities
Deferred tax liability
20
23,804
127,306
(23,804)
(127,306)
Net liabilities
(2,208,001)
(1,724,672)
Capital and reserves
Called up share capital
22
1
1
Profit and loss reserves
(2,208,002)
(1,724,673)
Total equity
(2,208,001)
(1,724,672)

These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.

The financial statements were approved by the board of directors and authorised for issue on 17 January 2026 and are signed on its behalf by:
17 January 2026
C Twibell
Director
Company registration number 13535395 (England and Wales)
SURFACE PREPARATION UK HOLDINGS LIMITED
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2024
31 December 2024
- 11 -
2024
2023
Notes
£
£
£
£
Fixed assets
Investments
12
1
1
Current assets
Debtors
15
416,295
230,831
Cash at bank and in hand
391,025
143,846
807,320
374,677
Creditors: amounts falling due within one year
16
(35,969)
(17,842)
Net current assets
771,351
356,835
Net assets
771,352
356,836
Capital and reserves
Called up share capital
22
1
1
Profit and loss reserves
771,351
356,835
Total equity
771,352
356,836

As permitted by s408 Companies Act 2006, the c ompany has not presented its own profit and loss account and related notes. The c ompany’s profit for the year was £414,516 (2023 - £356,835 profit).

The financial statements were approved by the board of directors and authorised for issue on 17 January 2026 and are signed on its behalf by:
17 January 2026
C Twibell
Director
Company registration number 13535395 (England and Wales)
SURFACE PREPARATION UK HOLDINGS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
- 12 -
Share capital
Profit and loss reserves
Total
£
£
£
As restated for the period ended 31 December 2023:
Balance at 1 January 2023
1
(3,996,281)
(3,996,280)
Prior year adjustment
-
2,407,161
2,407,161
As restated
1
(1,589,120)
(1,589,119)
Year ended 31 December 2023:
Loss and total comprehensive income
-
(135,553)
(135,553)
Balance at 31 December 2023
1
(1,724,673)
(1,724,672)
Year ended 31 December 2024:
Loss for the year
-
(484,399)
(484,399)
Other comprehensive income:
Currency translation differences
-
1,070
1,070
Total comprehensive income
-
(483,329)
(483,329)
Balance at 31 December 2024
1
(2,208,002)
(2,208,001)
SURFACE PREPARATION UK HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024
- 13 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2023
1
-
0
1
Year ended 31 December 2023:
Profit and total comprehensive income for the year
-
356,835
356,835
Balance at 31 December 2023
1
356,835
356,836
Year ended 31 December 2024:
Profit and total comprehensive income
-
414,516
414,516
Balance at 31 December 2024
1
771,351
771,352
SURFACE PREPARATION UK HOLDINGS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 14 -
2024
2023
as restated
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
28
316,409
1,785,087
Interest paid
(4,872)
(20,556)
Income taxes refunded/(paid)
39,972
(19,848)
Net cash inflow from operating activities
351,509
1,744,683
Investing activities
Purchase of business
(12,801,237)
-
Purchase of tangible fixed assets
(412,576)
(439,322)
Proceeds from disposal of tangible fixed assets
143,085
109,350
Interest received
18,581
6,434
Net cash used in investing activities
(13,052,147)
(323,538)
Financing activities
Proceeds from borrowings
12,470,689
-
Payment of finance leases obligations
(106,437)
(87,403)
Net cash generated from/(used in) financing activities
12,364,252
(87,403)
Net (decrease)/increase in cash and cash equivalents
(336,386)
1,333,742
Cash and cash equivalents at beginning of year
3,742,059
2,408,317
Cash and cash equivalents at end of year
3,405,673
3,742,059
SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024
- 15 -
1
Accounting policies
Company information

Surface Preparation UK Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 36 Orgreave Drive, Sheffield, United Kingdom, S13 9NR.

The group consists of Surface Preparation UK Holdings Limited and all of its subsidiaries.

1.1
Accounting convention

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 a mounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

- Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

- Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

- Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

1.2
Business combinations

In the parent company financial statements, t he cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. I nvestments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 16 -
1.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Surface Preparation UK Holdings Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

All financial statements are made up to 31 December 2024. 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 g roup.

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.

1.4
Going concern

A t the time of approving the financial statements, t he directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future.The Group has received a formal letter of support from SurfacePrep Holdings Inc confirming it will not demand repayment of the £31,696,189 intercompany balance for at least 12 months from the date these financial statements are approved and will provide financial support as required. Thus t he directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.5
Turnover

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.

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.

1.6
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

1.7
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 17 -

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Leasehold land and buildings
Over the term of the lease
Plant and equipment
15-25% p.a. straight line basis and 10-20% p.a. reducing balance basis
Fixtures and fittings
25-33% p.a. straight line basis and 15-33% p.a. reducing balance basis
Motor vehicles
25% p.a. straight line basis and 25% p.a. reducing balance basis

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.

1.8
Fixed asset investments

Equity in vest ments 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.

I n the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities 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.

1.9
Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible 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.

SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 18 -
1.10
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.11
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.12
Financial instruments

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

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 m ethod 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.

Impairment of financial assets

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.

Derecognition of financial assets

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.

SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 19 -
Classification of financial liabilities

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

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 paymen ts 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.

Derecognition of financial liabilities

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

1.13
Equity instruments

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.

1.14
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current 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

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.

SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
1
Accounting policies
(Continued)
- 20 -
1.15
Employee benefits

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.

1.16
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.17
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

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 lease d asset are consumed.

1.18
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 21 -
2
Judgements and key sources of estimation uncertainty

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.

Estimation uncertainty

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Tangible fixed assets

The useful economic life of tangible fixed assets has to be estimated by the directors of the company to ensure an appropriate depreciation charge is recognised in the year. The value of the assets ultimately depends on the condition of the assets and whether economic income can be derived from the asset. The directors undertake a periodic review of the assets to ensure the value of the assets is fairly stated within the financial statements.

During the year, depreciation of £451,591 (2023: £530,662) has been charged.

Refer to note 11 for the carrying value of tangible fixed assets impacted by this key accounting estimate.

Stock provisions

The group considers it necessary to evaluate the recoverability of the cost stock. The stock levels are constantly reviewed and should there be an indication of obsolescence, the stock is written down to its assessed net realisable value. The movement in provision is recognised in cost of sales.

The stock provision as at the balance sheet date was £54,379 (2023: £275,429)

Refer to note 14 for the carrying value of stock impacted by this key accounting estimate.

Intangible fixed assets

The useful economic life of acquired goodwill has been estimated at 10 years by the directors of the group to ensure an appropriate amortisation charge is recognised each year.

During the year, amortisation of £1,297,855 (2023: £1,164,538) has been charged.

Refer to note 10 for the carrying value of intangible fixed assets impacted by this key accounting estimate.

Impairment of investments in subsidiaries

Determining whether the company investments in subsidiaries have been impaired requires estimations of the investments' value in use. The value in use calculations require the entity to estimate the future cash flows expected to arise from the investments and suitable discount rates in order to calculate present values. The carrying amount of investments in subsidiaries at the balance sheet date was considered appropriate.

Refer to note 12 and 13 for investment and subsidiary detail.

SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 22 -
3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by class of business
Engineering products
10,198,441
9,037,358
Abrasive grit
17,649,224
17,923,958
Hire of equipment
288,598
-
Vibratory deburring & polishing
265,170
-
28,401,433
26,961,316
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
23,430,818
24,812,293
Middle East
212,802
342,345
Far East
142,750
288,241
North America
355,725
39,748
European Union and Eastern Europe
4,029,782
1,424,625
Rest of the world
229,556
54,064
28,401,433
26,961,316
2024
2023
£
£
Other revenue
Interest income
18,581
6,434
4
Operating profit
2024
2023
£
£
Operating profit for the year is stated after charging/(crediting):
Exchange losses
38,497
76,381
Research and development costs
133
2,084
Fees payable to the group's auditor for the audit of the group's financial statements
10,750
6,500
Depreciation of owned tangible fixed assets
435,595
518,665
Depreciation of tangible fixed assets held under finance leases
15,996
11,997
Profit on disposal of tangible fixed assets
(64,751)
(29,630)
Amortisation of intangible assets
1,297,855
1,164,538
Stocks impairment losses recognised
127,913
-
0
Operating lease charges
479,496
512,580
SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 23 -
5
Employees

The average monthly number of persons (including directors) employed by the group and company during the year was:

Group
Company
2024
2023
2024
2023
Number
Number
Number
Number
Administration
13
15
-
-
Production
108
64
-
-
Sales
37
40
-
-
Total
158
119
0
0

Their aggregate remuneration comprised:

Group
Company
2024
2023
2024
2023
£
£
£
£
Wages and salaries
4,797,962
4,788,656
-
0
-
0
Social security costs
523,639
450,495
-
-
Pension costs
269,833
266,336
-
0
-
0
5,591,434
5,505,487
-
0
-
0
Redundancy payments made or committed
49,204
6,000
-
-
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
437,261
252,292
Company pension contributions to defined contribution schemes
53,666
76,063
490,927
328,355
Remuneration disclosed above includes the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
338,528
221,667
Company pension contributions to defined contribution schemes
44,596
73,000
SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 24 -
7
Interest payable and similar expenses
2024
2023
£
£
Interest on bank overdrafts and loans
86
6,811
Interest payable to group undertakings
476,513
475,648
Interest on finance leases and hire purchase contracts
4,786
13,745
Total finance costs
481,385
496,204
8
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
525,234
256,000
Adjustments in respect of prior periods
(29,830)
-
0
Total UK current tax
495,404
256,000
Foreign current tax on profits for the current period
10,590
-
0
Total current tax
505,994
256,000
Deferred tax
Origination and reversal of timing differences
(63,000)
150,101
Adjustment in respect of prior periods
(40,502)
(8,533)
Total deferred tax
(103,502)
141,568
Total tax charge
402,492
397,568
SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
8
Taxation
(Continued)
- 25 -

The actual charge for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:

2024
2023
£
£
(Loss)/profit before taxation
(81,907)
262,015
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 25.00%)
(20,477)
65,504
Tax effect of expenses that are not deductible in determining taxable profit
330,746
342,899
Adjustments in respect of prior years
(29,830)
-
0
Permanent capital allowances in excess of depreciation
8,593
(227)
Other permanent differences
32,788
(2,075)
Effect of overseas tax rates
121,174
-
0
Deferred tax adjustments in respect of prior years
(40,502)
(8,533)
Taxation charge
402,492
397,568
9
Impairments

Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:

2024
2023
Notes
£
£
In respect of:
Stocks
14
127,913
-
Recognised in:
Cost of sales
127,913
-
SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 26 -
10
Intangible fixed assets
Group
Goodwill
£
Cost
At 1 January 2024
11,645,378
Additions - business combinations
9,270,427
Disposals
(169,171)
At 31 December 2024
20,746,634
Amortisation and impairment
At 1 January 2024
2,620,210
Amortisation charged for the year
1,297,855
Disposals
(169,171)
At 31 December 2024
3,748,894
Carrying amount
At 31 December 2024
16,997,740
At 31 December 2023
9,025,168
The company had no intangible fixed assets at 31 December 2024 or 31 December 2023.
SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 27 -
11
Tangible fixed assets
Group
Leasehold land and buildings
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2024
58,215
902,872
119,131
548,172
1,628,390
Additions
-
0
208,329
66,473
137,774
412,576
Business combinations
284,963
-
0
372,276
68,699
725,938
Disposals
(8,767)
(128,273)
-
0
(112,944)
(249,984)
At 31 December 2024
334,411
982,928
557,880
641,701
2,516,920
Depreciation and impairment
At 1 January 2024
27,065
304,379
17,014
162,332
510,790
Depreciation charged in the year
23,524
231,347
42,657
154,063
451,591
Eliminated in respect of disposals
(5,287)
(110,239)
-
0
(56,124)
(171,650)
At 31 December 2024
45,302
425,487
59,671
260,271
790,731
Carrying amount
At 31 December 2024
289,109
557,441
498,209
381,430
1,726,189
At 31 December 2023
31,150
598,493
102,117
385,840
1,117,600
The company had no tangible fixed assets at 31 December 2024 or 31 December 2023.

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

Group
Company
2024
2023
2024
2023
£
£
£
£
Plant and equipment
35,990
128,882
-
0
-
0
Motor vehicles
51,319
239,474
-
0
-
0
87,309
368,356
-
-
12
Fixed asset investments
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Investments in subsidiaries
13
-
0
-
0
1
1
SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
12
Fixed asset investments
(Continued)
- 28 -
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 January 2024 and 31 December 2024
1
Carrying amount
At 31 December 2024
1
At 31 December 2023
1
13
Subsidiaries

Details of the company's subsidiaries at 31 December 2024 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Indirect
Surfaceprep UK LImited
36 Orgreave Drive, Sheffield, S13 9NR
Ordinary
100.00
-
Hodge Clemco Holdings Limited
36 Orgreave Drive, Sheffield, S13 9NR
Ordinary
0
100.00
Surface Finishing Equipment Group Limited
36 Orgreave Drive, Sheffield, S13 9NR
Ordinary
0
100.00
Hodge Clemco Limited
36 Orgreave Drive, Sheffield, S13 9NR
Ordinary
0
100.00
Abraclean Limited
36 Orgreave Drive, Sheffield, S13 9NR
Ordinary
0
100.00
Hogg Blasting & Finishing Equipment Limited
36 Orgreave Drive, Sheffield, S13 9NR
Ordinary
0
100.00
PDJ Vibro Limited
36 Orgreave Drive, Sheffield, S13 9NR
Ordinary
0
100.00
SurfacePrep Netherlands B.V
Barnsteenstraat 1, 7554 TC Hengelo Nederland
Ordinary
0
100.00
Gaalman International B.V
Barnsteenstraat 1, 7554 TC Hengelo Nederland
Ordinary
0
100.00
Jean Brel S.A
2-24 Avenue de Stalingrad, 93240 STAINS France
Ordinary
0
100.00
Holdu B.V
Barnsteenstraat 1, 7554 TC Hengelo Nederland
Ordinary
0
100.00
Leering Hengelo B.V
Barnsteenstraat 1, 7554 TC Hengelo Nederland
Ordinary
0
100.00
Leering Deuschland GmbH
Centroallee 273-277 46047 Oberhausen Duitsland
Ordinary
0
100.00
Leering Engineering B.V
Barnsteenstraat 1, 7554 TC Hengelo Nederland
Ordinary
0
100.00
14
Stocks
Group
Company
2024
2023
2024
2023
£
£
£
£
Raw materials and consumables
1,248,603
371,897
-
-
Work in progress
2,433,073
302,592
-
-
Finished goods and goods for resale
5,650,804
3,105,907
-
0
-
0
9,332,480
3,780,396
-
-
SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 29 -
15
Debtors
Group
Company
2024
2023
2024
2023
Amounts falling due within one year:
£
£
£
£
Trade debtors
6,100,280
3,852,375
-
0
-
0
Corporation tax recoverable
-
0
19,733
-
0
-
0
Amounts owed by group undertakings
1,886,062
45,149
416,295
230,831
Other debtors
1,172,682
14,534
-
0
-
0
Prepayments and accrued income
407,607
1,100,936
-
0
-
0
9,566,631
5,032,727
416,295
230,831
16
Creditors: amounts falling due within one year
Group
Company
As restated
2024
2023
2024
2023
Notes
£
£
£
£
Obligations under finance leases
19
69,095
88,802
-
0
-
0
Loans from group undertakings
18
31,696,189
18,748,987
-
0
-
0
Trade creditors
3,677,293
2,829,688
-
0
-
0
Amounts owed to group undertakings
-
0
336,410
-
0
-
0
Corporation tax payable
817,152
256,000
-
0
-
0
Other taxation and social security
1,000,035
307,313
35,969
17,842
Other creditors
3,507,051
437,324
-
0
-
0
Accruals and deferred income
1,313,955
1,175,991
-
0
-
0
42,080,770
24,180,515
35,969
17,842

Net obligations under finance leases are secured by fixed charges on the assets concerned.

17
Creditors: amounts falling due after more than one year
Group
Company
2024
2023
2024
2023
Notes
£
£
£
£
Obligations under finance leases
19
28,071
114,801
-
0
-
0
Other taxation and social security
270,458
-
0
-
0
-
0
Other creditors
833,611
-
0
-
0
-
0
1,132,140
114,801
-
-

Net obligations under finance leases are secured by fixed charges on the assets concerned.

SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 30 -
18
Loans and overdrafts
Group
Company
2024
2023
2024
2023
£
£
£
£
Loans from group undertakings
31,696,189
18,748,987
-
0
-
0
Payable within one year
31,696,189
18,748,987
-
0
-
0
19
Finance lease obligations
Group
Company
2024
2023
2024
2023
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
69,095
88,802
-
0
-
0
In two to five years
28,071
114,801
-
0
-
0
97,166
203,603
-
-

Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 4 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

20
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

Liabilities
Liabilities
2024
2023
Group
£
£
Accelerated capital allowances
109,937
132,475
Short term timing differences
(86,133)
(5,169)
23,804
127,306
The company has no deferred tax assets or liabilities.
SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
20
Deferred taxation
(Continued)
- 31 -
Group
Company
2024
2024
Movements in the year:
£
£
Liability at 1 January 2024
127,306
-
Credit to profit or loss
(103,502)
-
Liability at 31 December 2024
23,804
-

The deferred tax liability set out above predominantly relates to accelerated capital allowances which are expected to release over the useful economic life of the associated tangible fixed assets. Other short term timing differences such as pension obligations attract corporation tax relief when paid.

21
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
269,833
266,336

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.

22
Share capital
Group and company
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of 1p each
100
100
1
1
SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 32 -
23
Acquisition of a business

On 16 October 2024 the group acquired 100 percent of the issued capital of PDJ Vibro Limited.

Book Value
Adjustments
Fair Value
Net assets acquired
£
£
£
Property, plant and equipment
246
(246)
-
Inventories
579,060
(58,000)
521,060
Trade and other receivables
858,400
-
858,400
Cash and cash equivalents
145,335
-
145,335
Trade and other payables
(303,716)
-
(303,716)
Tax liabilities
(34,919)
-
(34,919)
Total identifiable net assets
1,244,406
(58,246)
1,186,160
Goodwill
4,833,800
Total consideration
6,019,960
The consideration was satisfied by:
£
Cash
6,019,960
Contribution by the acquired business for the reporting period included in the group statement of comprehensive income since acquisition:
£
Turnover
265,170
Profit after tax
354,144

On 15 November 2024 the group acquired 100 percent of the issued capital of SurfacePrep Netherlands B.V Group.

Book Value
Adjustments
Fair Value
Net assets acquired
£
£
£
Property, plant and equipment
725,938
-
725,938
Inventories
2,645,783
(108,000)
2,537,783
Trade and other receivables
1,479,909
-
1,479,909
Cash and cash equivalents
677,616
-
677,616
Trade and other payables
(2,253,645)
-
(2,253,645)
Total identifiable net assets
3,275,601
(108,000)
3,167,601
Goodwill
4,436,627
Total consideration
7,604,228
SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
23
Acquisition of a business
(Continued)
- 33 -
The consideration was satisfied by:
£
Cash
7,604,228
Contribution by the acquired business for the reporting period included in the group statement of comprehensive income since acquisition:
£
Turnover
1,602,423
Loss after tax
(452,927)
24
Financial commitments, guarantees and contingent liabilities

Contingent liabilities in respect of bonds and documentary credits entered into by the group were £120,000 (2023: £120,000).

The group has given a guarantee in favour of HMRC amounting to £50,000 (2023: £50,000).

25
Operating lease commitments
Lessee

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:

Group
Company
2024
2023
2024
2023
£
£
£
£
Within one year
471,009
461,546
-
-
Between two and five years
1,387,884
1,307,333
-
-
In over five years
525,000
825,000
-
-
2,383,893
2,593,879
-
-
26
Related party transactions

The group has taken advantage of the exemption available in accordance with FRS 102 section 33.14 not to disclose transactions entered into between two or more members of a group, as the group is a wholly owned subsidiary undertakings of the wider group to which it is party to the transactions.

27
Controlling party

The immediate parent company is SurfacePrep Holdings, Inc., a company registered in Delaware, United States.

The ultimate parent company is Nautic SurfacePrep Holdings, LLC, a company registered in Delaware, United States.

SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 34 -
28
Cash generated from group operations
2024
2023
£
£
Loss after taxation
(484,399)
(135,553)
Adjustments for:
Taxation charged
402,492
397,568
Finance costs
481,385
496,204
Investment income
(18,581)
(6,434)
Gain on disposal of tangible fixed assets
(64,751)
(29,630)
Amortisation and impairment of intangible assets
1,297,855
1,164,538
Depreciation and impairment of tangible fixed assets
451,591
530,662
Foreign exchange gains on cash equivalents
1,070
-
Movements in working capital:
(Increase)/decrease in stocks
(2,493,241)
611,858
(Increase)/decrease in debtors
(2,215,328)
21,604
Increase/(decrease) in creditors
2,958,316
(1,265,730)
Cash generated from operations
316,409
1,785,087
29
Analysis of changes in net debt - group
1 January 2024
Cash flows
Market value movements
31 December 2024
£
£
£
£
Cash at bank and in hand
3,742,059
(336,386)
-
3,405,673
Borrowings excluding overdrafts
(18,748,987)
(13,423,715)
476,513
(31,696,189)
Obligations under finance leases
(203,603)
106,437
-
(97,166)
(15,210,531)
(13,653,664)
476,513
(28,387,682)
SURFACE PREPARATION UK HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024
- 35 -
30
Prior period adjustment
Reconciliation of changes in equity - group
1 January
31 December
2023
2023
£
£
Adjustments to prior year
Removal of retranslation of group loan
2,407,161
1,121,796
Recognition of group tax impact of the above
-
(256,000)
Total adjustments
2,407,161
865,796
Equity as previously reported
(3,996,280)
(2,590,468)
Equity as adjusted
(1,589,119)
(1,724,672)
Analysis of the effect upon equity
Profit and loss reserves
2,407,161
865,796
Reconciliation of changes in profit/ (loss) for the previous financial period
2023
£
Adjustments to prior year
Removal of retranslation of group loan
(1,285,365)
Recognition of group tax impact of the above
(256,000)
Total adjustments
(1,541,365)
Profit as previously reported
1,405,812
Loss as adjusted
(135,553)
Notes to reconciliation
Retranslation - group loans

Intercompany loan s from the parent company in the United States were retranslated at the year-end foreign exchange rate. The loan is denominated and repayable in sterling, not in US dollars, and therefore should not have been subject to foreign exchange retranslation. The prior year adjustment is to correct this position and the associated tax impact.

Prior year adjustment - company
There is no prior year adjustment in the parent company accounts

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