Turnover decreased by 6.84% to £29,943,795 compared to £32,143,207 in 2024. Overall net assets increased by £158,794 and are now at £9,160,979 compared to £9,002,185 in 2024.

Great importance is placed on the development and retention of staff. Our competitive edge comes from their relentless efforts and commitment to their customers. As a result, our customers enjoy high levels of customer service and technical support.

The directors would view earnings before interest, tax, depreciation and amortisation (EBITDA) as their Key Performance Indicator.

The directors continue to work hard to improve revenue, pre-tax profit and net assets in a very competitive market.

The company monitors credit risk closely as it is exposed to the usual credit risks and cash flows associated with selling on credit and manages these risks through credit control procedures.

The company`s activities with European customers and suppliers result in low levels of currency transaction risk, variances affecting operational activities in this regard are reflected in the operating costs or in the cost of sales in the profit and loss account in the years in which they arise.

The key risks and uncertainties are maintaining and improving sales levels in a competitive environment and the potential impact of increases in material costs on gross margins.

We endeavour to mitigate these risks by implementing regular strategic and operational reviews.

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;

■ 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.

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

■ Performed analytical procedures to identify any unusual or unexpected relationships;

■ Tested journal entries to identify unusual transactions;

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

■ Investigated the rationale behind significant or unusual transactions.

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

■ Agreeing financial statement disclosures to underlying supporting documentation;

■ Reading the minutes of meetings of those charged with governance;

■ Enquiring of management as to actual and potential litigation and claims;

■ Reviewing correspondence with HMRC, Companies House and the company’s legal advisors.

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

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

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

Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in equity, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation, is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in equity in respect of that asset. Where a revaluation decrease exceeds the accumulated revaluation gains in equity in respect of that asset, the excess is recognised in profit or loss.

Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:

Impairment

A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date.

For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets.

For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the company are assigned to those units.

Fixed asset investments are initially recorded at cost, and subsequently stated at cost less any accumulated impairment losses.

Listed investments are measured at fair value with changes in fair value being recognised in profit or loss.

The Directors have not identified any material uncertainties related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern.

At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Post year end activity levels remain at a similar level and the company has a strong balance sheet. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Provision is made for slow moving stock on a line by line basis based on historical usage, which management believe provides a guide to recoverable value.

Tangible assets held at valuation

The property at Llay Industrial Estate, Wrexham was valued at £1,175,000 in November 2023 and the property at Hillington Industrial Estate, Glasgow was valued at £350,000 being current market value in October 2019, in accordance with the Red Book of the Royal Institute of Chartered Surveyors, by external professional surveyors, Legat Owen Chartered Surveyors & Ryden Chartered Surveyors. This valuation has not been reflected in the accounts for the year ended 31 August 2024 as the properties are held under the cost model.

The company has provided the Danske bank with the following securities:

a) A floating charge over the assets of the company

b) A fixed charge over the book debts

c) An individual letter of guarantee in the amount of £1,000,000 signed by Mr J McConachie

d) A guarantee in the amount of £20,000 to the beneficiary HMRC

The company`s bankers have legal mortgage over the following properties:

a) land at north west side of Davy Way, Llay Industrial Estate, Wrexham

b) 14/16 Carlyle Avenue, Hillington Industrial Estate, Glasgow and;

c) Unit 6 Davy Way Llay Industrial Estate, Wrexham

The company has provided security for total exposure (for the liabilities of a third party) with Danske Bank, being a company guarantee in favour of Elsteel UK Limited and an inter company cross guarantee in favour of Westbank Group Limited.

Amounts owed to group undertakings are unsecured, interest free, have no fixed date of repayment and are repayable on demand.

■ Group undertakings

The Company has taken advantage of the exemption under FRS102 "The Financial Reporting Standard Applicable in the UK and Republic of Ireland" not to disclose transactions with entities that are part of the group.

Following a partial disposal of shares in the prior year, Parkelect Limited held a 20% non-controlling interest in Kaizen PLM Limited throughout the current financial year ended 31 August 2025. No additional transactions affecting the shareholding occurred during the current period.

The investment continues to be accounted for as a non-current investment measured at cost less impairment, as Parkelect does not exercise significant influence over Kaizen PLM Limited.

Dividend income of €29,032.26 was payable to Parkelect during the year, with exemption from Irish dividend withholding tax addressed via Form V2A/V2B procedures.

■ Related undertakings Transactions and balances

During the year Park Rentals charged rent of £161,675 (2024: £143,645). During the year management charges of £nil (2024: £90,000) were charged to Park Rentals and £nil (2024: £50,000) to J McConachie Children Settlement. Park Rentals, J McConachie Children Settlement and Park Pension scheme are owned by Mr J McConachie, Director of Parkelect Limited & the sole shareholder in the ultimate controlling party Westbank Group Limited.

The balances at the year ended were nil (2024: nil)