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Morning Foods, Limited Registered number: 00375854 Annual report and financial statements For the year ended 31 July 2025
MORNING FOODS, LIMITED COMPANY INFORMATION
Directors | J J Lea
| J E Lea
| M T Cookson
| D W Baxter
| J M Borrowdale
| D C Croucher
| E P Lea
| A Meikle
Company secretary | M T Cookson
Registered number | 00375854
Registered office | North Western Mills
| Gresty Road
| Crewe
| Cheshire
| CW2 6HP
Independent auditor | Forvis Mazars LLP
| Chartered Accountants & Statutory Auditor
| One St. Peter's Square
| Manchester
| M2 3DE
MORNING FOODS, LIMITED CONTENTS
| Page
Strategic Report | 1 - 2
Directors' Report | 3 - 5
Independent Auditor's Report | 6 - 9
Statement of Comprehensive Income | 10
Statement of Financial Position | 11 - 12
Statement of Changes in Equity | 13
Notes to the Financial Statements | 14 - 33
MORNING FOODS, LIMITED STRATEGIC REPORT FOR THE YEAR ENDED 31 JULY 2025
Introduction
The Directors present their Strategic Report for the year ended 31 July 2025.
Business review
The Company continuously monitors the performance of its operations and other activities through regular reviews using Key Performance Indicators (KPI) tools for measurement. The volatility of commodity markets remains an ongoing and critical issue. As in previous years, the current period was impacted by severe market forces and genuine shortages of certain commodities. Several advanced manufacturing initiatives have contributed to efficiency gains across various production and administrative processes. This has been key to mitigating the continued cost pressures experienced in key commodities and services.
Principal risks and uncertainties
Managing commodity risks remains a key skill and the Company remains committed to long-term partnerships, especially with oat growers. The Company continues to invest in the generation of energy from renewable sources to operate on a more efficient and lower carbon footing.
Financial key performance indicators
The key performance indicators that the Company uses are relevant to the type of business it operates in. The financial key performance indicators are specifically related to volumes, growth, turnover and balance sheet strength all of which are monitored on a continuous basis and the Directors remain satisfied with that performance.
| 2025 | 2024 | Variance
| £ | £ |
Turnover | 284,052,867 | 285,246,027 | (0.4)%
Profit before tax % | 3.6% | 2.1% | 1.6%
Net assets | 71,744,909 | 65,702,979 | 9.7%
Other key performance indicators
The other key performance indicators that the Company uses are operational (staff retention and motivational) and customer service (customer feedback, customer retention, and the attraction of new customers). These KPI indicators are within the targets set for the year. Page 1
MORNING FOODS, LIMITED STRATEGIC REPORT (CONTINUED) FOR THE YEAR ENDED 31 JULY 2025
Directors' statement of compliance with duty to promote the success of the Company
Section 172(1) of the Companies Act 2006 requires Directors to act in the way they consider, in good faith, would be most likely to promote the success of the Company for the benefit of its members, and in doing so have regard (amongst other matters) to: a. the likely consequences of any decisions in the long term, b.the interests of the Company's employees, c.the need to foster the company's business relationships with suppliers, customers, and others, d.the impact of the Company's operations on the community and the environment, e.the desirability of the Company maintaining a reputation for high standards of business conduct, and f.the need to act fairly as between members of the Company. The Directors consider that they act in ways most likely to promote the success of the Company and that strategic decisions fully consider the factors associated with s172. The strategy of the board is to enhance the Company's position by recognising the changing requirements of our stakeholders on whom the long-term success of our business is dependent. Our employee, customer, and supplier stakeholders were fundamental to the significant decisions made in the year, with the aim of strengthening the opportunity for long term business success. Communication with stakeholders is facilitated formally and informally on a regular basis to ensure effective understanding. The Company is focused on managing and reducing its carbon footprint and use of energy through a variety of measures on an ongoing basis. In the community, the business continually employs local skills and has supported a variety of local causes. This report was approved by the board on 18 December 2025 and signed on its behalf.
J E Lea Director
Page 2
MORNING FOODS, LIMITED DIRECTORS' REPORT FOR THE YEAR ENDED 31 JULY 2025 The Directors present their report and the financial statements for the year ended 31 July 2025.
Directors' responsibilities statement
The Directors are responsible for preparing the Strategic Report, the Directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 for the Company's financial statements and then apply them consistently; ∙make judgments 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 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 to 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.
Principal activity
The principal activity of the Company continues to be that of oat milling and cereal manufacture.
Results and dividends
The profit for the year, after taxation, amounted to £7,519,640 (2024 - £4,385,365). During the year the Company paid a dividend of £1,477,710 (2024 - £Nil).
Directors
The Directors who served during the year were:
J J Lea
J E Lea
M T Cookson
D W Baxter
J M Borrowdale
D C Croucher
E P Lea
A Meikle
Page 3
MORNING FOODS, LIMITED DIRECTORS' REPORT (CONTINUED) FOR THE YEAR ENDED 31 JULY 2025
Going concern
The Directors have produced an extended forecast, 'the forecast' for the period to 31 December 2026. These forecasts are monitored monthly by the Board against actual trading performance. The Directors continue to monitor the impact of world events on various commodity prices however the long-term outlook remains uncertain. The Directors have also considered the impact of supply chain issues and inflationary pressures. The Directors are confident in the forecasts for the business in terms of ongoing demand, source of supply and productive ability and in the short and long term liquidity. The Directors are satisfied that a scenario that could result in the business not being a going concern are considered extremely remote. After making enquiries and considering the matters described above for a period of more than 12 months post approval of the accounts, the Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. For these reasons, they continue to adopt the going concern basis in preparing the Annual Report and financial statements.
Financial risk management
The Company manages its risk to foreign currency fluctuations using bank accounts in foreign currencies to match purchase and sales transactions. The Company's exposure to risk on the supply and price of oats is, in the opinion of the Directors, managed using contracts with suppliers which are negotiated at the start of each growing season. Any grain requirements over contracted amounts, or in the event of an unexpected poor growing season, are purchased on the open market at market prices. The Company make sales on normal credit terms and manages the related risks through its normal credit control procedures. In the opinion of the Directors the exposure to such risks has been assessed and at present its deemed to be low and at an acceptable level for the Company to continue operating. The Company do not hedge interest payments on any of its borrowings or foreign currency transactions.
Engagement with employees
It is the policy of the Company to encourage and develop every employee to realise their maximum potential. Wherever possible, vacancies are filled from within the Company adequate opportunities for internal promotion are created. The Company has continued its practice of keeping employees informed of matters affecting them as employees and the financial and economic factors affecting the performance of the Company.
Engagement with suppliers, customers and others
The Company strives to have strong mutually beneficial relationships with suppliers, customers, and government bodies. The Directors continually assess these stakeholders to ensure the strategy of the Company is delivered in the best way over the long term. The Company assesses the impact its operations on the community and is pleased to be able to support many local initiatives.
Qualifying third party indemnity provisions
Throughout the year and up to the date of this report the Company maintained qualifying third-party indemnity insurance for the Directors. Page 4
MORNING FOODS, LIMITED DIRECTORS' REPORT (CONTINUED) FOR THE YEAR ENDED 31 JULY 2025
Greenhouse gas emissions, energy consumption and energy efficiency action
The Company's energy consumption for the year was 96,874,107kWh (2024 - 94,949,390kWh), resulting in total gross tCO2e emissions of 18,537 (2024 - 18,165):
| 2025 | 2024
Emissions from purchased electricity, including for the purposes of transport (tCO2e) | 6,710 | 6,560
Emissions from the combustion of gas (tCO2e) | 11,584 | 11,377
Emissions from the consumption of fuel for the purposes of transport (tCO2e) | 242 | 228
Intensity ratio: tCO2e per EBITDA | 0.00102 | 0.00138
These figures have been compiled in accordance with the 2019 UK Government environmental reporting guidelines and the UK Government 2024 GHG Conversion Factors. The scope includes all Company sites in the UK. We have exported electricity from on-site wind turbines to the grid. We have multiplied the amount of electricity by the grid average emissions factor and deducted the emissions figure from our gross emissions figure.
Matters covered in the Strategic Report
The Company has chosen, in accordance with section 414C(11) of the Companies Act 2006 (Strategic Report and Director's Report) Regulations 2013 to set out in the Strategic Report certain information required by schedule 7 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008: future developments.
Disclosure of information to auditor
Each of the persons who are Directors at the time when this Directors' Report is approved has confirmed that: ∙so far as the Director is aware, there is no relevant audit information of which the Company's auditor is unaware, and ∙the Director has taken all the steps that ought to have been taken as a Director in order to be aware of any relevant audit information and to establish that the Company's auditor is aware of that information.
Post balance sheet events
There have been no significant events affecting the Company since the year end.
Auditor
The auditor, Forvis Mazars LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006. This report was approved by the board on 18 December 2025 and signed on its behalf.
J E Lea Director
Page 5
MORNING FOODS, LIMITED INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MORNING FOODS, LIMITED Opinion We have audited the financial statements of Morning Foods, Limited (the ‘Company’) for the year ended 31 July 2025 which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 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 July 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. Page 6
MORNING FOODS, LIMITED INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MORNING FOODS, LIMITED 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 the audit: ∙the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and ∙the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements. Matters on which we are required to report by exception In light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion: ∙adequate accounting records have not been kept, 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. ∙ Page 7
MORNING FOODS, LIMITED INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MORNING FOODS, LIMITED Responsibilities of Directors As explained more fully in the Directors' Responsibilities Statement set out on page 3, 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 intend either 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. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below. 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. Based on our understanding of the Company and their industry, we considered that non-compliance with the following laws and regulations might have a material effect on the financial statements: employment regulation, health and safety regulation and anti-money laundering regulation. To help us identify instances of non-compliance with these laws and regulations, and in identifying and assessing the risks of material misstatement in respect to non-compliance, our procedures included, but were not limited to: ∙Inquiring of management and, where appropriate, those charged with governance, as to whether the Company is in compliance with laws and regulations, and discussing their policies and procedures regarding compliance with laws and regulations; ∙Inspecting correspondence, if any, with relevant licensing or regulatory authorities; ∙Communicating identified laws and regulations to the engagement team and remaining alert to any indications of non-compliance throughout our audit; and ∙Considering the risk of acts by Company which were contrary to applicable laws and regulations, including fraud. We also considered those laws and regulations that have a direct effect on the preparation of the financial statements, such as tax legislation, pension legislation and the Companies Act 2006. Page 8
MORNING FOODS, LIMITED INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MORNING FOODS, LIMITED In addition, we evaluated the Directors' and management’s incentives and opportunities for fraudulent manipulation of the financial statements, including the risk of override of controls, and determined that the principal risks were related to posting manual journal entries to manipulate financial performance, management bias through judgements and assumptions in significant accounting estimates, revenue recognition (which we pinpointed to the cut-off assertion), and significant one-off or unusual transactions. Our audit procedures in relation to fraud included but were not limited to: ∙Making enquiries of the directors and management on whether they had knowledge of any actual, suspected or alleged fraud; ∙Gaining an understanding of the internal controls established to mitigate risks related to fraud; ∙Discussing amongst the engagement team the risks of fraud; and ∙Addressing the risks of fraud through management override of controls by performing journal entry testing. There are inherent limitations in the audit procedures described above and the primary responsibility for the prevention and detection of irregularities including fraud rests with management. As with any audit, there remained a risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal controls. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report. Use of the audit 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. Neil Barton (Senior Statutory Auditor) for and on behalf of Forvis Mazars LLP Chartered Accountants and Statutory Auditor One St. Peter's Square Manchester M2 3DE 18 December 2025 Page 9
MORNING FOODS, LIMITED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 JULY 2025
| 2025 | 2024
Note | £ | £
Turnover | 4 | 284,052,867 | 285,246,027
Cost of sales |  | (239,276,881) | (243,379,909)
Gross profit |  | 44,775,986 | 41,866,118
Distribution costs |  | (13,859,669) | (14,448,889)
Administrative expenses |  | (24,851,508) | (22,770,439)
Other operating income | 5 | 3,959,659 | 1,308,573
Operating profit | 6 | 10,024,468 | 5,955,363
Interest receivable and similar income | 10 | 401,517 | 144,673
Interest payable and similar expenses | 11 | (229,553) | (127,028)
Profit before tax |  | 10,196,432 | 5,973,008
Tax on profit | 12 | (2,676,792) | (1,587,643)
Profit for the financial year |  | 7,519,640 | 4,385,365
There were no recognised gains and losses for 2025 or 2024 other than those included in the statement of comprehensive income.
There was no other comprehensive income for 2025 (2024:£NIL).
The notes on pages 14 to 33 form part of these financial statements.
Page 10
MORNING FOODS, LIMITED REGISTERED NUMBER: 00375854 STATEMENT OF FINANCIAL POSITION AS AT 31 JULY 2025
|  | 2025 |  | 2024
Note |  | £ |  | £
Fixed assets |  |  |  |  |
Intangible assets | 14 |  | 8,760 |  | 18,883
Tangible assets | 15 |  | 19,401,042 |  | 19,071,800
Investments | 16 |  | 67 |  | 7,299
|  |  | 19,409,869 |  | 19,097,982
Current assets |  |  |  |  |
Stocks | 17 | 18,792,592 |  | 17,808,684 |
Debtors: amounts falling due after more than one year | 18 | 10,492,953 |  | 13,243,327 |
Debtors: amounts falling due within one year | 18 | 45,395,868 |  | 37,701,502 |
Cash at bank and in hand | 19 | 180,542 |  | 4,865,099 |
|  | 74,861,955 |  | 73,618,612 |
Creditors: amounts falling due within one year | 20 | (14,379,482) |  | (15,534,265) |
Net current assets |  |  | 60,482,473 |  | 58,084,347
Total assets less current liabilities |  |  | 79,892,342 |  | 77,182,329
Creditors: amounts falling due after more than one year | 21 |  | (8,088,484) |  | (9,880,806)
Provisions for liabilities |  |  |  |  |
Other provisions | 23 | (58,949) |  | (1,598,544) |
|  |  | (58,949) |  | (1,598,544)
Net assets |  |  | 71,744,909 |  | 65,702,979
Capital and reserves |  |  |  |  |
Called up share capital | 24 |  | 24,623 |  | 24,623
Capital redemption reserve | 25 |  | 25,377 |  | 25,377
Profit and loss account | 25 |  | 71,694,909 |  | 65,652,979
|  |  | 71,744,909 |  | 65,702,979
Page 11
MORNING FOODS, LIMITED REGISTERED NUMBER: 00375854 STATEMENT OF FINANCIAL POSITION (CONTINUED) AS AT 31 JULY 2025 The financial statements were approved and authorised for issue by the board and were signed on its behalf on 18 December 2025.
J E Lea
Director
The notes on pages 14 to 33 form part of these financial statements. Page 12
MORNING FOODS, LIMITED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 JULY 2025
| Called up share capital | Capital redemption reserve | Profit and loss account | Total equity
| £ | £ | £ | £
At 1 August 2023 | 24,623 | 25,377 | 61,267,614 | 61,317,614
Comprehensive income for the year |  |  |  |
Profit for the year | - | - | 4,385,365 | 4,385,365
Total comprehensive income for the year | - | - | 4,385,365 | 4,385,365
At 1 August 2024 | 24,623 | 25,377 | 65,652,979 | 65,702,979
Comprehensive income for the year |  |  |  |
Profit for the year | - | - | 7,519,640 | 7,519,640
Total comprehensive income for the year | - | - | 7,519,640 | 7,519,640
Contributions by and distributions to owners |  |  |  |
Dividends: Equity capital | - | - | (1,477,710) | (1,477,710)
At 31 July 2025 | 24,623 | 25,377 | 71,694,909 | 71,744,909
| The notes on pages 14 to 33 form part of these financial statements.
Page 13
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
1. | General information
Morning Foods, Limited ("the Company") is a private company limited by shares incorporated in England and Wales with registration number 00375854. The address of the registered office is North Western Mills, Gresty Road, Crewe, Cheshire, CW2 6HP. The principal activity of the Company is grain milling and the manufacture of breakfast cereals and cereals-based food. 2.Accounting policies
| 2.1 | Basis of preparation of financial statements
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006. The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3). The presentation currency for the financial statements is Pounds Sterling (£) as this is the currency of the primary economic environment in which the Company operates and is rounded to the nearest thousand. A summary of the Company's accounting policies, which have been consistently applied, are set out below:
| 2.2 | Financial Reporting Standard 102 - reduced disclosure exemptions
The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland": ∙the requirements of Section 7 Statement of Cash Flows; ∙the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d); ∙the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c); ∙the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A; ∙the requirements of Section 33 Related Party Disclosures paragraph 33.7. This information is included in the consolidated financial statements of Agri Food Holdings Limited as at 31 July 2025 and these financial statements may be obtained from Companies House, Crown Way, Cardiff, CF14 3UZ.
| 2.3 | Exemption from preparing consolidated financial statements
The Company is a parent company that is also a subsidiary included in the consolidated financial statements of a larger group by a parent undertaking established under the law of any part of the United Kingdom and is therefore exempt from the requirement to prepare consolidated financial statements under section 400 of the Companies Act 2006. Page 14
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025 2.Accounting policies (continued)
| 2.4 | Going concern
The Directors have produced an extended forecast, 'the forecast' for the period to 31 December 2026. These forecasts are monitored monthly by the Board against actual trading performance. The Directors continue to monitor the impact of world events on various commodity prices however the long-term outlook remains uncertain. The Directors have also considered the impact of supply chain issues and inflationary pressures. The Directors are confident in the forecasts for the business in terms of ongoing demand, source of supply and productive ability and in the short and long term liquidity. The Directors are satisfied that a scenario that could result in the business not being a going concern are considered extremely remote. After making enquiries and considering the matters described above for a period of more than 12 months post approval of the accounts, the Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. For these reasons, they continue to adopt the going concern basis in preparing the Annual Report and financial statements.
| 2.5 | Foreign currency translation
Functional and presentation currency The Company's functional and presentational currency is GBP rounded to the nearest £1. Transactions and balances Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions. At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined. Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges. Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'. Page 15
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025 2.Accounting policies (continued)
| 2.6 | Revenue
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised: Sale of goods Revenue from the sale of goods is recognised when all of the following conditions are satisfied: ∙the Company has transferred the significant risks and rewards of ownership to the buyer; ∙the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold; ∙the amount of revenue can be measured reliably; ∙it is probable that the Company will receive the consideration due under the transaction; and ∙the costs incurred or to be incurred in respect of the transaction can be measured reliably. Rendering of services Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied: ∙the amount of revenue can be measured reliably; ∙it is probable that the Company will receive the consideration due under the contract; ∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and ∙the costs incurred and the costs to complete the contract can be measured reliably.
| 2.7 | Interest income
Interest income is recognised in profit or loss using the effective interest method.
| 2.8 | Finance costs
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument. Page 16
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025 2.Accounting policies (continued)
| 2.9 | Pensions
Defined contribution pension plan The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations. The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.
| 2.10 | Current and deferred taxation
The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively. The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income. Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that: ∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and ∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met. Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
| 2.11 | Intangible assets
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years. Amortisation is provided on the following bases:
|  |  |  | Computer software | - | 33% | Straight line
Page 17
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025 2.Accounting policies (continued)
| 2.12 | Tangible fixed assets
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on the following basis. Depreciation is provided on the following basis:
|  |  |  | Freehold property | - | over 30 years straight line
|  |  |  | Plant and machinery | - | over 4 to 6 years straight line
|  |  |  | Motor vehicles | - | over 4 years reducing balance
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date. Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss. Assets under construction are not depreciated until they are brought into use.
| 2.13 | Valuation of investments
Investments in subsidiaries are measured at cost less accumulated impairment. Investments in unlisted Company shares, whose market value can be reliably determined, are remeasured to market value at each reporting date. Gains and losses on remeasurement are recognised in the Statement of Comprehensive Income for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment. Investments in listed company shares are remeasured to market value at each reporting date. Gains and losses on remeasurement are recognised in profit or loss for the period.
| 2.14 | Stocks
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads. At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.
| 2.15 | Debtors
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment. Page 18
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025 2.Accounting policies (continued)
| 2.16 | Cash and cash equivalents
Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
| 2.17 | Creditors
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
| 2.18 | Provisions for liabilities
Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made. Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties. Increases in provisions are generally charged as an expense to profit or loss.
| 2.19 | Financial instruments
The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments. The Company has elected to apply the recognition and measurement provisions of IFRS 9 Financial Instruments (as adopted by the UK Endorsement Board) with the disclosure requirements of Sections 11 and 12 and the other presentation requirements of FRS 102. Financial instruments are recognised in the Company's Statement of Financial Position 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. Basic financial assets Basic financial assets, which include trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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. Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments. Page 19
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025 2.Accounting policies (continued)
| 2.19 | Financial instruments (continued)
Other financial assets Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment. Impairment of financial assets At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. 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. Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate. If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss. Basic 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 the deduction of all its liabilities. Basic financial liabilities, which include trade and other creditors, bank loans and other loans are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial. Debt instruments are subsequently carried at their amortised cost using the effective interest rate method. Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade creditors are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial. Page 20
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025 2.Accounting policies (continued)
| 2.19 | Financial instruments (continued)
Derecognition of financial instruments Derecognition of financial assets Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained. Derecognition of financial liabilities Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.
| 2.20 | Dividends
Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.
3. | Judgments in applying accounting policies and key sources of estimation uncertainty
In the process of applying the Company's accounting policies, the Company is required to make certain judgements, estimates and assumptions that it believes are reasonable based on the information available. The significant judgements relate to the following: Onerous contract provision The calculation of the onerous contract provision is performed using published commodity information, and is based on the contracted tonnage of product to be sold at agreed prices. Whilst the calculation of the provision is largely supported by externally published prices, the cost of grain at the period end and the costs of production are the main judgement involved is the potential fluctuation in the prices of oats post the year end. The carrying amount of the onerous contract provision is included in note 23. Useful lives of property, plant and equipment Depreciation is provided so as to write down the assets to their residual values over their estimated useful lives as set out in the Company's accounting policy. The selection of these estimated lives requires the exercise of management judgement. Useful lives are regularly reviewed and should management's assessment of useful lives shorten then depreciation charges in the financial statements would increase and carrying amounts of property, plant and equipment would reduce accordingly. The carrying amount of property, plant and equipment by each class is included in note 15. Page 21
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
4. | Turnover
The whole of the turnover is attributable to the Company's principal activity. Analysis of turnover by country of destination:
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| United Kingdom | 259,959,521 | 261,085,178
| Rest of Europe | 15,027,237 | 15,966,737
| Rest of the world | 9,066,109 | 8,194,112
|  | 284,052,867 | 285,246,027
5. | Other operating income
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Rent, Electricity Generation and Misc trading sales | 642,484 | 658,573
| Management Fee Income | 3,317,175 | 650,000
|  | 3,959,659 | 1,308,573
6. | Operating profit
| The operating profit is stated after charging/(crediting):
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Depreciation of tangible fixed assets | 1,858,670 | 2,769,316
| Amortisation of intangible assets | 23,263 | 56,048
| Foreign exchange loss/(gain) | (9,726) | 26,730
| (Profit)/loss on sale of fixed assets | 13,556 | (3,681)
Page 22
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
7. | Auditor's remuneration
| During the year, the Company obtained the following services from the Company's auditor:
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Fees payable to the Company's auditor for the audit of the Company's financial statements | 36,700 | 37,500
| The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent Company.
8. | Employees
| Staff costs, including Director's remuneration, were as follows:
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Wages and salaries | 17,050,891 | 16,184,371
| Social security costs | 2,188,338 | 1,861,183
| Cost of defined contribution scheme | 1,185,046 | 1,157,507
|  | 20,424,275 | 19,203,061
| The average monthly number of employees, including the Directors, during the year was as follows:
|  |  | 2025 | 2024
|  |  | No. | No.
|  | Administration and sales | 84 | 76
|  | Production | 218 | 205
|  |  | 302 | 281
Page 23
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
9. | Directors' remuneration
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Directors' emoluments | 2,201,947 | 1,786,391
| Company contributions to defined contribution pension schemes | 127,409 | 102,850
|  | 2,329,356 | 1,889,241
| During the year retirement benefits were accruing to 7 Directors (2024 - 7) in respect of defined contribution pension schemes.
| The highest paid Director received remuneration of £305,979 (2024 - £289,681).
| The value of the Company's contributions paid to a defined contribution pension scheme in respect of the highest paid Director amounted to £12,000 (2024 - £4,000).
| The Directors of the Company are considered to be the key management personnel. Their total remuneration inclusive of employer's national insurance is £3,380,460 (2024 - £2,700,181).
10. | Interest receivable and similar income
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Interest receivable | 401,517 | 144,673
11. | Interest payable and similar expenses
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Bank interest payable | 229,553 | 127,028
Page 24
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
12. | Taxation
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Corporation tax |  |
| Current tax on profits for the year | 2,493,495 | 1,451,527
| Adjustments in respect of previous periods | (54,960) | (174,926)
| Total current tax | 2,438,535 | 1,276,601
| Deferred tax |  |
| Origination and reversal of timing differences | 211,619 | 164,998
| Adjustments in respect of prior periods | 26,638 | 146,044
| Total deferred tax | 238,257 | 311,042
|  | 2,676,792 | 1,587,643
Page 25
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025 12.Taxation (continued)
| Factors affecting tax charge for the year
| The tax assessed for the year is higher than (2024 - higher than) the standard rate of corporation tax in the UK of 25% (2024 - 25%). The differences are explained below:
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Profit on ordinary activities before tax | 10,196,432 | 5,973,008
| Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2024 - 25%) | 2,549,108 | 1,493,252
| Effects of: |  |
| Fixed asset differences | 67,409 | 119,425
| Expenses not deductible for tax purposes | 4,998 | 7,398
| Capital allowances for year in excess of depreciation | - | (3,550)
| Adjustments to tax charge in respect of prior periods | (54,960) | (174,926)
| Adjustments to tax charge in respect of previous periods - deferred tax | 26,638 | 146,044
| Other timing differences leading to an increase/(decrease) in taxation | 95,706 | -
| Group relief | (12,107) | -
| Total tax charge for the year | 2,676,792 | 1,587,643
| Factors that may affect future tax charges
There were no factors that may affect future tax charges.
13. | Dividends
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Dividends paid | 1,477,710 | -
Page 26
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
14. | Intangible assets
|  | Computer software
|  | £
| Cost |
| At 1 August 2024 | 188,094
| Additions | 13,140
| At 31 July 2025 | 201,234
| Amortisation |
| At 1 August 2024 | 169,211
| Charge for the year | 23,263
| At 31 July 2025 | 192,474
| Net book value |
| At 31 July 2025 | 8,760
| At 31 July 2024 | 18,883
Page 27
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
15. | Tangible fixed assets
|  | Freehold property | Plant and machinery | Motor vehicles | Assets under construction | Total
|  | £ | £ | £ | £ | £
| Cost |  |  |  |  |
| At 1 August 2024 | 25,236,862 | 57,288,538 | 373,296 | - | 82,898,696
| Additions | 1,326,823 | 905,497 | 29,276 | 31,713 | 2,293,309
| Disposals | - | (30,785,964) | (24,100) | - | (30,810,064)
| At 31 July 2025 | 26,563,685 | 27,408,071 | 378,472 | 31,713 | 54,381,941
| Depreciation |  |  |  |  |
| At 1 August 2024 | 8,534,257 | 55,014,821 | 277,818 | - | 63,826,896
| Charge for the year | 249,280 | 1,581,871 | 27,519 | - | 1,858,670
| Disposals | - | (30,694,123) | (10,544) | - | (30,704,667)
| At 31 July 2025 | 8,783,537 | 25,902,569 | 294,793 | - | 34,980,899
| Net book value |  |  |  |  |
| At 31 July 2025 | 17,780,148 | 1,505,502 | 83,679 | 31,713 | 19,401,042
| At 31 July 2024 | 16,702,605 | 2,273,717 | 95,478 | - | 19,071,800
| Included in freehold property is land at cost of £12,325,523 (2024 - £12,325,523), which is not depreciated. During the year the Company removed assets with a cost and accumulated depreciation of £30,655,681 that are no longer deemed in use.
Page 28
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
16. | Fixed asset investments
|  | Investments in subsidiary companies | Other fixed asset investments | Total
|  | £ | £ | £
| Cost or valuation |  |  |
| At 1 August 2024 | 67 | 7,232 | 7,299
| Disposals | - | (7,232) | (7,232)
| At 31 July 2025 | 67 | - | 67
| Subsidiary undertakings
| The following were subsidiary undertakings of the Company:
| Name | Registered office | Class of shares | Holding
| Mornflake Oats Limited | North Western Mills, Gresty Road, Crewe, Cheshire, CW2 6HP | Ordinary | 100%
| Organic Oat Company Limited | North Western Mills, Gresty Road, Crewe, Cheshire, CW2 6HP | Ordinary | 100%
| MFL Cereals Limited | Floor 3, Block 3, Miesian Plaza, Dublin, D02 Y754 | Ordinary | 100%
| Mornflake Inc | North Western Mills, Gresty Road, Crewe, Cheshire, CW2 6HP | Ordinary | 100%
17. | Stocks
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Raw materials and consumables | 11,080,991 | 9,121,530
| Finished goods and goods for resale | 7,711,601 | 8,687,154
|  | 18,792,592 | 17,808,684
| There is no material difference between the replacement cost of stocks and the amounts stated above.
Page 29
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
18. | Debtors
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Due after more than one year |  |
| Amounts owed by group undertakings | 10,492,953 | 13,243,327
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Due within one year |  |
| Trade debtors | 29,070,736 | 28,432,120
| Amounts owed by group undertakings | 273,592 | -
| Amounts owed by joint ventures and associated undertakings | 6,845,000 | 3,650,000
| Other debtors | 4,723,973 | 1,921,542
| Prepayments and accrued income | 1,611,759 | 482,273
| Tax recoverable | 1,588,629 | 1,695,131
| Deferred taxation | 1,282,179 | 1,520,436
|  | 45,395,868 | 37,701,502
| Trade debtors for the Company are stated after a bad debt provision of £492,865 (2024 - £974,546). Amounts owed by group undertakings are unsecured, interest free and not repayable for a period of at least twelve months from the date of signing these financial statements.
19. | Cash and cash equivalents
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Cash at bank and in hand | 180,542 | 4,865,099
| The overdraft facility with Barclays Bank PLC is secured by means of charges comprising of first fixed charge on all book debts and other debts, and charges over freehold property and land.
Page 30
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
20. | Creditors: Amounts falling due within one year
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Trade creditors | 10,022,067 | 10,033,748
| Other taxation and social security | 155,332 | 522,476
| Other creditors | 3,199 | 323,538
| Accruals and deferred income | 4,198,884 | 4,654,503
|  | 14,379,482 | 15,534,265
21. | Creditors: Amounts falling due after more than one year
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Amounts owed to group undertakings | 8,088,484 | 9,880,806
| Amounts owed to group undertakings are unsecured, interest free and not repayable for a period of at least twelve months from the date of signing these financial statements.
22. | Deferred taxation
|  | 2025 | 2024
|  | £ | £
| At beginning of year | 1,520,436 | 1,831,478
| Charged to profit or loss | (238,257) | (311,042)
| At end of year | 1,282,179 | 1,520,436
| The deferred tax asset is made up as follows:
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Fixed asset timing differences | 922,953 | 996,936
| Short term timing differences | 359,226 | 523,500
|  | 1,282,179 | 1,520,436
Page 31
MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
23. | Provisions
|  | Onerous contract provision
|  | £
| At 1 August 2024 | 1,598,544
| Utilised in year | (1,539,595)
| At 31 July 2025 | 58,949
| The onerous contract provision represents the present obligation on contracts that the Company has with suppliers for the supply of goods as at the balance sheet date that are deemed to be onerous.
24. | Share capital
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
|  | Allotted, called up and fully paid |  |
|  | 24,623 (2024 - 24,623) Ordinary shares of £1.00 each | 24,623 | 24,623
25. | Reserves
Capital redemption reserve The capital redemption reserve represents the nominal value of shares which have been repurchased by the Company. Profit and loss account This reserve represents cumulative profits and losses less any dividends declared.
26. | Capital commitments
| At 31 July 2025 the Company had capital commitments as follows:
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Contracted for but not provided in these financial statements | 1,094,486 | 380,000
| Authorised but not contracted | 14,181,816 | 15,283,463
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MORNING FOODS, LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
27. | Pension commitments
The Company operates a defined contribution pension scheme, the assets of which are held separately from those of the Company in an independently administered fund. The pension cost charge for the year is £1,185,046 (2024 - £1,157,507). Contributions totalling £Nil (2024 - £175,036) were payable to the fund at the balance sheet date and are included in other creditors.
28. | Related party transactions
| The Company has taken advantage of the exemption offered by Financial Reporting Standard 102 (Section 33) from the requirement to disclose transactions with other Group companies that are 100% owned. At the year end, the Company was owed £6,845,000 (2024 - £3,650,000) by related companies by virtue of common control and the maximum amount outstanding during the year was £11,920,000 (2024 - £10,630,128). The loans represent a cash sweep treasury function to the related parties.
29. | Controlling party
The immediate and ultimate Parent Company is Agri Food Holdings Limited, a company incorporated in England and Wales,with a registered address of North Western Mills, Crewe, Cheshire, CW2 6HP. The parent undertaking of the largest and smallest Group for which consolidated financial statements are prepared is Agri Food Holdings Limited. The Directors do not consider there to be an ultimate controlling party.
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