Company registration number 08292937 (England and Wales)
KAIFA TECHNOLOGY U.K. LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
KAIFA TECHNOLOGY U.K. LIMITED
COMPANY INFORMATION
Directors
J F Mo
J Yan
Company number
08292937
Registered office
6th Floor, Manfield House
1 Southampton Street
WC2R 0LR
Auditor
Alliotts LLP
Manfield House
1 Southampton Street
London
WC2R 0LR
KAIFA TECHNOLOGY U.K. LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 5
Independent auditor's report
6 - 9
Statement of comprehensive income
10
Balance sheet
11
Statement of changes in equity
12
Statement of cash flows
13
Notes to the financial statements
14 - 24
KAIFA TECHNOLOGY U.K. LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2025
- 1 -

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

Principal activities

The principal activity of the company continued to be that of smart meter distribution.

Review of the business

The results for the year and the financial position of the Company are shown in the financial statements.

The company achieved a substantial increase in turnover, rising to £3 6.7 million from £31.1 million in 202 5. This growth was driven by the company’s strategic focus on expanding its market presence, supported by the UK government’s energy policy promoting smart meter installations, which significantly boosted demand for Kaifa’s smart metering solutions. The company further strengthened its market position through a commission agreement with a third party, enhancing customer reach and driving sales.

Despite the higher turnover, the gross profit margin declined from 5.19% to 3.82%, reflecting the company’s deliberate strategy to prioritise revenue growth and market share, even at the expense of reduced margins. This approach is expected to position Kaifa Technology UK Limited for sustained growth, leveraging its established relationships and the continuing demand for energy efficient solutions in the UK.

Principal risks and uncertainties

The directors consider the principal risks and uncertainties for the Company as below:

Competitive risks

The smart meter sector is a highly competitive industry with a continually evolving environment. The Company place s great emphasis on new and innovative solution s to meet ever-changing customer requirements. However, competitors may develop advantages in capital, technology, or other resources. and accordingly the group is seeking to preserve its competitive advantage.

Political risks

After years of negotiation, the UK and European Union reached an agreement after Brexit, which defined their future relationship. The Company has taken all reasonable steps to continue its operation with minimal impact to its business. There are reputational risks regarding the ownership of the company and the company actively looks to defend its reputation.

Credit risk

The Company's credit risk primarily arises from its trade debtors. Credit risk is managed by assessing the creditworthiness of new customers and where necessary adjusting credit exposure to existing customers based on monitoring payments against contractual terms. The company also manages overdue accounts receivable by monthly verification, and will collect overdue accounts in a timely manner.

Liquidity risk

The company manages liquidity risk by regular reviews of the cash flow position of the business and ensuring facilities are readily available for future use.

Taking into account these risks and uncertainties, we realise that any plans for the future development of the business may be affected by unforeseen future events beyond our control.

KAIFA TECHNOLOGY U.K. LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
- 2 -
Development and performance

Future developments

The directors anticipate the business environment with regard to smart meters will remain competitive. They believe that the company is in a good financial position and that the risks that have been identified are being well managed. The directors are confident in the company's ability to maintain and build on this position, albeit with cautious growth expectations. The roll out of smart meters in the UK continues and while there have been issues reported regarding meters, these are mainly relating the issues transferring between suppliers and do not relate to the meters themselves.

Financial instruments

The company has a normal level of exposure to price, credit, liquidity and cash flow risks arising from trading activities which are largely conducted in sterling, with the only foreign currency transactions being covered by suitable currency contracts to minimise exposure to exchange rate volatility. The company does not enter into any formally designated hedging arrangements.

With regard to the use of financial instruments, an indication of:

– the financial risk management objectives and policies of the company, including the policy for hedging each major type of forecasted transaction for which hedge accounting is used; and

– the exposure of the company to price risk, credit risk, liquidity risk and cash flow risk, unless such information is not material for the assessment of the assets, liabilities, financial position and profit or loss of the company;

Key performance indicators

The director considers that the Company's key financial performance indicators are those that communicate its financial performance and strength as a whole and these are:

| 2025 |  | 2024
Turnover | £36,716,676 |  | £31,051,539
Gross Profit | £1,40 2,174 |  | £1,612,665
Gross Profit Margin | 3.82% |  | 5.19%
Profit Before Taxation | £8 33,122 |  | £1,063,161
(excluding exceptional costs) |  |  |

Position at the year end

Kaifa UK retained reserves totalled £3,241,2 87 as of the year-end, compared to £2,625,925 in 202 4, reflecting the net profits generated during the year and cash holdings amounting to £3,310,844 (202 4: £2,873,172). This indicates a satisfactory position at year-end, especially considering the increased revenue achieved this year, demonstrating the company's healthy financial status.

KAIFA TECHNOLOGY U.K. LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
- 3 -

On behalf of the board

J F Mo
Director
3 April 2026
KAIFA TECHNOLOGY U.K. LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2025
- 4 -

The directors present their annual report and financial statements for the year ended 31 December 2025.

Results and dividends

The results for the year are set out on page 10.

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

Directors

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

J F Mo
J Yan
Auditor

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

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 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; and

- 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.

Strategic report

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report.

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 company’s auditor 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 company’s auditor 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.

KAIFA TECHNOLOGY U.K. LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
- 5 -
On behalf of the board
J F Mo
Director
3 April 2026
KAIFA TECHNOLOGY U.K. LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF KAIFA TECHNOLOGY U.K. LIMITED
- 6 -
Opinion

We have audited the financial statements of Kaifa Technology U.K. Limited (the 'company') for the year ended 31 December 2025 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, the 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 the financial statements:

- give a true and fair view of the state of the company's affairs as at 31 December 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 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 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 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.

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 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.

KAIFA TECHNOLOGY U.K. LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF KAIFA TECHNOLOGY U.K. LIMITED (CONTINUED)
- 7 -
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 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, 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 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 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.

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.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

KAIFA TECHNOLOGY U.K. LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF KAIFA TECHNOLOGY U.K. LIMITED (CONTINUED)
- 8 -
Extent to which the audit was considered capable of detecting irregularities, including fraud

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including

fraud and non-compliance with laws and regulations, was as follows:

- the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;

- we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the electronic equipment/product manufacturing and supply sector;

- we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation and data protection, anti-bribery, employment, environmental and health and safety legislation;

- we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and

- identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

- making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and

- considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.

To address the risk of fraud through management bias and override of controls, we:

- performed analytical procedures to identify any unusual or unexpected relationships;

- tested journal entries to identify unusual transactions;

- assessed whether judgements and assumptions made in determining the accounting estimates were indicative of potential bias; and

- investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

- agreeing financial statement disclosures to underlying supporting documentation;

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

- reviewing correspondence with HMRC.

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

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

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

This report is made solely to the company's member 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 member those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.

KAIFA TECHNOLOGY U.K. LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF KAIFA TECHNOLOGY U.K. LIMITED (CONTINUED)
- 9 -
Nicholas Nicolaou FCCA (Senior Statutory Auditor)
For and on behalf of Alliotts LLP, Statutory Auditor
Chartered Accountants
Manfield House
1 Southampton Street
London
WC2R 0LR
7 April 2026
KAIFA TECHNOLOGY U.K. LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2025
- 10 -
2025
2024
Notes
£
£
Turnover
3
36,716,676
31,051,539
Cost of sales
(35,314,502)
(29,438,874)
Gross profit
1,402,174
1,612,665
Administrative expenses
(574,247)
(550,343)
Operating profit
4
827,927
1,062,322
Interest receivable and similar income
6
5,195
839
Profit before taxation
833,122
1,063,161
Tax on profit
7
(217,760)
(268,814)
Profit for the financial year
615,362
794,347

The profit and loss account has been prepared on the basis that all operations are continuing operations.

KAIFA TECHNOLOGY U.K. LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2025
31 December 2025
- 11 -
2025
2024
Notes
£
£
£
£
Fixed assets
Tangible assets
8
1,081
840
Current assets
Stocks
9
1,206,344
1,021,965
Debtors
10
4,066,009
3,456,665
Cash at bank and in hand
3,310,844
2,873,172
8,583,197
7,351,802
Creditors: amounts falling due within one year
11
(4,802,991)
(4,186,717)
Net current assets
3,780,206
3,165,085
Net assets
3,781,287
3,165,925
Capital and reserves
Called up share capital
13
540,000
540,000
Profit and loss reserves
3,241,287
2,625,925
Total equity
3,781,287
3,165,925

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

The financial statements were approved by the board of directors and authorised for issue on 3 April 2026 and are signed on its behalf by:
J F Mo
Director
Company registration number 08292937 (England and Wales)
KAIFA TECHNOLOGY U.K. LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2025
- 12 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2024
540,000
1,831,578
2,371,578
Year ended 31 December 2024:
Profit and total comprehensive income
-
794,347
794,347
Balance at 31 December 2024
540,000
2,625,925
3,165,925
Year ended 31 December 2025:
Profit and total comprehensive income
-
615,362
615,362
Balance at 31 December 2025
540,000
3,241,287
3,781,287
KAIFA TECHNOLOGY U.K. LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2025
- 13 -
2025
2024
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
18
708,555
1,736,109
Income taxes paid
(275,195)
(364,739)
Net cash inflow from operating activities
433,360
1,371,370
Investing activities
Purchase of tangible fixed assets
(883)
(93)
Interest received
5,195
839
Net cash generated from investing activities
4,312
746
Net increase in cash and cash equivalents
437,672
1,372,116
Cash and cash equivalents at beginning of year
2,873,172
1,501,056
Cash and cash equivalents at end of year
3,310,844
2,873,172
KAIFA TECHNOLOGY U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2025
- 14 -
1
Accounting policies
Company information

Kaifa Technology U.K. Limited is a private company limited by shares incorporated in England and Wales. The registered office is 6th Floor, Manfield House, 1 Southampton Street, WC2R 0LR. The business address is Milton Keynes, Spaces, Avebury Boulevard, MK9 1FH.

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.

1.2
Going concern

The financial statements have been prepared on a going concern basis, as the ultimate parent company has confirmed its ongoing support, including the continued supply of goods to the Company. The Company meets its day-to-day working capital requirements through trading facilities provided by its ultimate parent.

The Director believes that the Company is able to manage its business risks effectively and, having made appropriate enquiries, has a reasonable expectation that the Company will have access to adequate resources to continue in operational existence for the foreseeable future. Accordingly, the Director considers it appropriate to adopt the going concern basis in preparing the annual report and financial statements. No adjustments have been made to reflect the potential impact should the parent company withdraw its support.

1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods provided in the normal course of selling and distributing electronic goods 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 sales of goods is recognised when the Company has dispatched the products to customers and when the customers has accepted the goods together with risks and rewards of ownership.

1.4
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.

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:

Fixtures, fittings & equipment
25% on cost

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 credited or charged to profit or loss.

KAIFA TECHNOLOGY U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
1
Accounting policies
(Continued)
- 15 -
1.5
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

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.

1.6
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.

No stock is physically held on site. All items included in the closing stock figure represent goods in transit between the suppliers and the customers.

1.7
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.

1.8
Financial instruments

The company 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 company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with 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.

KAIFA TECHNOLOGY U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
1
Accounting policies
(Continued)
- 16 -
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 method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

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 company 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.

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 company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors and loans from fellow group companies, 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. A m ounts 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.

KAIFA TECHNOLOGY U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
1
Accounting policies
(Continued)
- 17 -
Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are s ubsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value th r ough profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.9
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs.

1.10
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 company’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 when the company has 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.

KAIFA TECHNOLOGY U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
1
Accounting policies
(Continued)
- 18 -
1.11
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.

1.12
Retirement benefits

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

1.13
Leases

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 s asset are consumed.

1.14
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.

2
Judgements and key sources of estimation uncertainty

In the application of the company’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.

Critical judgements

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

Receivables recovery

Judgement is required to determine whether there are indicators of impairment of the company’s receivable balances. Factors taken into consideration in reaching such a decision include the economic viability, indicators of financial stress and non compliance with payment terms.

Inventory provisioning

Inventories are valued at the lower of cost and net realisable value. Net realisable value includes, where necessary, provisions for slow moving and obsolete stocks. Calculation of these provisions requires judgements to be made, which include forecast consumer demand, the promotional, competitive and economic environment and inventory loss trends.

KAIFA TECHNOLOGY U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
2
Judgements and key sources of estimation uncertainty
(Continued)
- 19 -
Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Inventory provisioning

When considering the inventory provision, management considers the nature and condition of the inventory, as well as applying assumptions around anticipated saleability of inventory held and recent sales performance of inventory lines.

3
Turnover and other revenue

An analysis of the company's turnover is as follows:

2025
2024
£
£
Turnover analysed by geographical market
United Kingdom
36,716,676
31,051,539
2025
2024
£
£
Other revenue
Interest income
5,195
839

The company's total turnover for the year was generated from the sale of electricity smart meters and the provision of bank guarantee services to customers in the United Kingdom.

4
Operating profit
2025
2024
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(3,315)
1,977
Fees payable to the company's auditor for the audit of the company's financial statements
24,000
23,000
Depreciation of tangible fixed assets
642
778
Operating lease charges
9,098
7,416
KAIFA TECHNOLOGY U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
- 20 -
5
Employees

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

2025
2024
Number
Number
Directors
2
2
Management
1
1
Technical Support
2
2
Operations
1
1
Administration
1
1
Sales
1
-
Total
8
7

Their aggregate remuneration comprised:

2025
2024
£
£
Wages and salaries
352,036
329,254
Social security costs
39,541
36,018
Pension costs
9,346
8,543
400,923
373,815
6
Interest receivable and similar income
2025
2024
£
£
Interest income
Other interest income
5,195
839
7
Taxation
2025
2024
£
£
Current tax
UK corporation tax on profits for the current period
217,760
268,814
KAIFA TECHNOLOGY U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
7
Taxation
(Continued)
- 21 -

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

2025
2024
£
£
Profit before taxation
833,122
1,063,161
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2024: 25.00%)
208,281
265,790
Tax effect of expenses that are not deductible in determining taxable profit
9,540
2,853
Timing differences not recognised
(61)
171
Taxation charge for the year
217,760
268,814
8
Tangible fixed assets
Fixtures, fittings & equipment
£
Cost
At 1 January 2025
6,180
Additions
883
At 31 December 2025
7,063
Depreciation and impairment
At 1 January 2025
5,340
Depreciation charged in the year
642
At 31 December 2025
5,982
Carrying amount
At 31 December 2025
1,081
At 31 December 2024
840
9
Stocks
2025
2024
£
£
Finished goods and goods for resale
1,206,344
1,021,965
KAIFA TECHNOLOGY U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
- 22 -
10
Debtors
2025
2024
Amounts falling due within one year:
£
£
Trade debtors
3,884,963
3,329,926
Corporation tax recoverable
148,621
91,186
Other debtors
3,320
3,248
Prepayments and accrued income
29,105
32,305
4,066,009
3,456,665
11
Creditors: amounts falling due within one year
2025
2024
£
£
Trade creditors
58,749
63,478
Amounts owed to group undertakings
3,645,726
3,157,242
Taxation and social security
1,000,808
904,333
Accruals and deferred income
97,708
61,664
4,802,991
4,186,717
12
Retirement benefit schemes
2025
2024
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
9,346
8,543

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

13
Share capital
2025
2024
2025
2024
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
540,000
540,000
540,000
540,000

The company has one class of Ordinary shares which carry full and equal rights to participate in voting in all circumstances and in dividends and capital distributions

14
Bank guarantee

The company has put in place bank guarantees of £35,842,125 (202 4: £31,434,575) in favour of its customers which are wholly covered by the company’s ultimate parent Shenzhen Kaifa Technology Co. Ltd.

KAIFA TECHNOLOGY U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
- 23 -
15
Operating lease commitments
As lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2025
2024
£
£
Within 1 year
1,950
1,950
16
Related party transactions

The following amounts were outstanding at the reporting end date:

2025
2024
Amounts due to related parties
£
£
Entities with control, joint control or significant influence over the company
3,645,726
3,157,242
17
Ultimate controlling party

At the year end, Kaifa Metering Technology (H.K.) Limited, was the immediate parent company. Shenzhen Kaifa Technology Co. Ltd. is the ultimate parent company.

Both companies have their registered offices at 2201, Hong Kong Worsted Mills Industrial Building, 31-39 Wo Tong Tsui Street, Kwai Chung, New Territories, Hong Kong.

The financial statements of the company are consolidated in the financial statements of Shenzhen Kaifa Technology Co. Ltd. These consolidated statements are available from its registered office, 2201, Hong Kong Worsted Mills Industrial Building, 31-39 Wo Tong Tsui Street, Kwai Chung, New Territories, Hong Kong.

KAIFA TECHNOLOGY U.K. LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2025
- 24 -
18
Cash generated from operations
2025
2024
£
£
Profit for the year after tax
615,362
794,347
Adjustments for:
Taxation charged
217,760
268,814
Investment income
(5,195)
(839)
Depreciation and impairment of tangible fixed assets
642
778
Movements in working capital:
Increase in stocks
(184,379)
(254,620)
(Increase)/decrease in debtors
(551,909)
483,359
Increase in creditors
616,274
444,270
Cash generated from operations
708,555
1,736,109
19
Analysis of changes in net funds
1 January 2025
Cash flows
31 December 2025
£
£
£
Cash at bank and in hand
2,873,172
437,672
3,310,844
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