| Parsons Bakery Limited |
| Strategic Report |
|
| The directors present the Strategic Report of Parsons Bakery Limited (the “company”) for the year ended 31st December 2025. |
|
| Business Review and future developments |
In 2025, Parsons Bakery demonstrated resilient, stable performance, effectively navigating ongoing challenges reminiscent of those in 2024. The business continued to face increased costs across key categories and essential commodities, a situation shared by many in the retail bakery and hospitality industries.
Despite these pressures, the Board notes that the Company sustained robust operational results and achieved improved conversion rates.
The most significant ongoing cost challenge remains the increase in the National Living Wage, which places pressure on the Company's ability to consistently deliver exceptional value to its loyal customers. In response, Parsons Bakery continues to collaborate closely with leading technical teams, ensuring it remains competitive and identifies opportunities to deliver savings for its customers.
April 2025 marked a pivotal moment in the Company’s ownership structure, as Parsons Bakery transitioned to Employee Ownership under an Employee Ownership Trust (EOT). This strategic development strengthens the Company’s enduring family heritage and is particularly fitting as Parsons Bakery approaches its centenary year.
The Board remains confident and highly optimistic about Parsons Bakery’s future. The Company demonstrates measured agility, with a Senior Leadership Team committed to ongoing business development. This is evidenced by regular new product launches, ongoing software and technology upgrades, and a steadfast commitment to environmental responsibility.
Additionally, with the establishment of the new Trust in April, the Company is integrating a diverse range of senior-level skills to promote efficiency and streamlined performance. |
|
| Key Performance Indicators |
| The directors consider the main performance indicators are as follows: |
|
|
2025 |
2024 |
| Turnover |
£14.30m |
£14.68m |
| Gross Profit (before labour) |
77.28% |
75.60% |
| EBITDA |
5.36% |
3.70% |
|
| Principal Risks and uncertainties |
The directors remain confident about the company’s future prospects, notwithstanding the issues it faces as a result of the continued financial impact of rising supplier and energy prices. The business has built a leading brand which the directors believe will endure and this is reflected in customer loyalty as shown above.
The company has an excellent working relationship with its bankers and continues to be cash generative with healthy cash reserves as a result. Similarly, the company has strong relationships with key businesses in its supply chain with long term contracts in place in respect of core ingredients mitigating risk in this area. |
|
| This report was approved by the board on 23 April 2026 and signed on its behalf. |
|
|
| B A Paxton |
| Director |
|
|
| 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 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 |
| Parsons Bakery Limited |
| Statement of Cash Flows |
| for the year ended 31 December 2025 |
|
| Notes |
|
2025 |
|
2024 |
| £ |
£ |
| Operating activities |
| Profit for the financial year |
525,404 |
|
197,745 |
|
| Adjustments for: |
| Loss on sale of fixed assets |
93,559 |
|
17,668 |
| Interest receivable |
(31,757) |
|
(95,840) |
| Tax on profit on ordinary activities |
179,052 |
|
74,919 |
| Depreciation |
341,058 |
|
353,795 |
| Decrease/(increase) in stocks |
41,476 |
|
(33,583) |
| Decrease/(increase) in debtors |
167,523 |
|
(80,867) |
| Decrease in creditors |
(169,048) |
|
(120,990) |
|
|
|
1,147,267 |
|
312,847 |
|
| Interest received |
31,757 |
|
95,840 |
| Corporation tax paid |
(120,037) |
|
(111,749) |
|
| Cash generated by operating activities |
1,058,987 |
|
296,938 |
|
|
|
|
|
|
| Investing activities |
| Payments to acquire tangible fixed assets |
(272,314) |
|
(158,118) |
| Proceeds from sale of tangible fixed assets |
16,000 |
|
- |
|
| Cash used in investing activities |
(256,314) |
|
(158,118) |
|
|
|
|
|
|
| Financing activities |
| Contributions to Employee Ownership Trust |
(3,232,822) |
|
- |
|
| Cash used in financing activities |
(3,232,822) |
|
- |
|
|
|
|
|
|
| Net cash (used)/generated |
| Cash generated by operating activities |
1,058,987 |
|
296,938 |
| Cash used in investing activities |
(256,314) |
|
(158,118) |
| Cash used in financing activities |
(3,232,822) |
|
- |
|
| Net cash (used)/generated |
(2,430,149) |
|
138,820 |
|
| Cash and cash equivalents at 1 January |
3,017,560 |
|
2,878,740 |
| Cash and cash equivalents at 31 December |
587,411 |
|
3,017,560 |
|
|
|
|
|
|
| Cash and cash equivalents comprise: |
| Cash at bank |
587,411 |
|
3,017,560 |
|
|
|
|
|
|
|
|
|
Stocks |
|
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first in first out method. The carrying amount of stock sold is recognised as an expense in the period in which the related revenue is recognised. |
|
|
Debtors |
|
Short term debtors are measured at transaction price (which is usually the invoice price), less any impairment losses for bad and doubtful debts. Loans and other financial assets are initially recognised at transaction price including any transaction costs and subsequently measured at amortised cost determined using the effective interest method, less any impairment losses for bad and doubtful debts. |
|
|
Creditors |
|
Short term creditors are measured at transaction price (which is usually the invoice price). Loans and other financial liabilities are initially recognised at transaction price net of any transaction costs and subsequently measured at amortised cost determined using the effective interest method. |
|
|
Taxation |
|
A current tax liability is recognised for the tax payable on the taxable profit of the current and past periods. A current tax asset is recognised in respect of a tax loss that can be carried back to recover tax paid in a previous period. Deferred tax is recognised in respect of all timing differences between the recognition of income and expenses in the financial statements and their inclusion in tax assessments. Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference, except for revalued land and investment property where the tax rate that applies to the sale of the asset is used. Current and deferred tax assets and liabilities are not discounted. |
|
|
Provisions |
|
Provisions (ie liabilities of uncertain timing or amount) are recognised when there is an obligation at the reporting date as a result of a past event, it is probable that economic benefit will be transferred to settle the obligation and the amount of the obligation can be estimated reliably. |
|
|
Leased assets |
|
A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership. All other leases are classified as operating leases. The rights of use and obligations under finance leases are initially recognised as assets and liabilities at amounts equal to the fair value of the leased assets or, if lower, the present value of the minimum lease payments. Minimum lease payments are apportioned between the finance charge and the reduction in the outstanding liability using the effective interest rate method. The finance charge is allocated to each period during the lease so as to produce a constant periodic rate of interest on the remaining balance of the liability. Leased assets are depreciated in accordance with the company's policy for tangible fixed assets. If there is no reasonable certainty that ownership will be obtained at the end of the lease term, the asset is depreciated over the lower of the lease term and its useful life. Operating lease payments are recognised as an expense on a straight line basis over the lease term. |
|
|
Pensions |
|
Contributions to defined contribution plans are expensed in the period to which they relate. |
|
|
Going concern |
|
Management has produced forecasts that have also been sensitised to reflect plausible downside scenarios impacting from the global economy, which have been reviewed by the directors. These demonstrate the company is forecast to generate profits and cash in the year ending 31 December 2026 and beyond and that the company has sufficient cash reserves to enable it to meet its obligations as they fall due for a period of at least 12 months from the date of signing of these financial statements. As such, the directors are satisfied that the Company has adequate resources to continue to operate for the foreseeable future. For this reason they continue to adopt the going concern basis for preparing these financial statements. |
|
|
| 2 |
Analysis of turnover |
2025 |
|
2024 |
| £ |
£ |
|
|
Sale of goods |
14,296,481 |
|
14,681,435 |
|
|
|
|
|
|
|
|
|
|
By geographical market: |
|
|
UK |
14,296,481 |
|
14,681,435 |
|
|
|
|
|
|
|
|
|
|
| 3 |
Operating profit |
2025 |
|
2024 |
| £ |
£ |
|
This is stated after charging: |
|
|
Depreciation of owned fixed assets |
341,058 |
|
353,795 |
|
Operating lease rentals - land and buildings |
779,146 |
|
784,722 |
|
Auditors' remuneration for audit services |
10,200 |
|
10,200 |
|
Key management personnel compensation (including directors' emoluments) |
|
460,678 |
|
682,362 |
|
Carrying amount of stock sold |
3,248,177 |
|
3,580,184 |
|
|
|
|
|
|
|
|
|
|
| 4 |
Directors' emoluments |
2025 |
|
2024 |
| £ |
£ |
|
|
Emoluments |
444,507 |
|
648,941 |
|
Company contributions to defined contribution pension plans |
16,171 |
|
33,421 |
|
|
|
|
|
|
460,678 |
|
682,362 |
|
|
|
|
|
|
|
|
|
|
|
Highest paid director: |
|
Emoluments |
138,000 |
|
210,000 |
|
Company contributions to defined contribution pension plans |
1,321 |
|
- |
|
|
|
|
|
|
139,321 |
|
210,000 |
|
|
|
|
|
|
|
|
|
|
|
Number of directors to whom retirement benefits accrued: |
2025 |
|
2024 |
| Number |
Number |
|
|
Defined contribution plans |
3 |
|
3 |
|
|
|
|
|
|
|
|
|
|
| 5 |
Staff costs |
2025 |
|
2024 |
| £ |
£ |
|
|
Wages and salaries |
733,023 |
|
895,500 |
|
Social security costs |
494,892 |
|
383,577 |
|
Other pension costs |
88,684 |
|
103,859 |
|
|
|
|
|
|
1,316,599 |
|
1,382,936 |
|
|
|
|
|
|
|
|
|
|
|
Average number of employees during the year |
Number |
Number |
|
|
Administration |
13 |
|
13 |
|
Manufacturing |
67 |
|
74 |
|
Sales |
340 |
|
383 |
|
|
|
|
|
|
420 |
|
470 |
|
|
|
|
|
|
|
|
|
|
| 6 |
Taxation |
2025 |
|
2024 |
| £ |
£ |
|
Analysis of charge in period |
|
Current tax: |
|
UK corporation tax on profits of the period |
224,648 |
|
120,037 |
|
|
|
|
|
|
|
|
|
|
Deferred tax: |
|
Origination and reversal of timing differences |
(45,596) |
|
(45,118) |
|
|
|
|
|
|
|
|
|
|
|
Tax on profit on ordinary activities |
179,052 |
|
74,919 |
|
|
|
|
|
|
|
|
|
|
|
Factors affecting tax charge for period |
|
The differences between the tax assessed for the period and the standard rate of corporation tax are explained as follows: |
|
|
|
|
|
|
|
2025 |
|
2024 |
| £ |
£ |
|
Profit on ordinary activities before tax |
704,456 |
|
272,664 |
|
|
|
|
|
|
|
|
|
|
Standard rate of corporation tax in the UK |
25% |
|
25% |
|
| £ |
£ |
|
Profit on ordinary activities multiplied by the standard rate of corporation tax |
|
176,114 |
|
68,166 |
|
|
Effects of: |
|
Expenses not deductible for tax purposes |
2,938 |
|
3,949 |
|
Capital allowances for period in excess of depreciation |
45,539 |
|
47,970 |
|
Other timing differences |
57 |
|
(48) |
|
|
Current tax charge for period |
224,648 |
|
120,037 |
|
|
|
|
|
|
|
|
|
|
| 7 |
Tangible fixed assets |
|
|
Land and buildings |
|
Plant and machinery |
|
Motor vehicles |
|
Total |
|
|
At cost |
|
At cost |
|
At cost |
| £ |
£ |
£ |
£ |
|
Cost or valuation |
|
At 1 January 2025 |
423,343 |
|
4,673,678 |
|
38,438 |
|
5,135,459 |
|
Additions |
- |
|
272,314 |
|
- |
|
272,314 |
|
Disposals |
- |
|
(846,673) |
|
(38,438) |
|
(885,111) |
|
At 31 December 2025 |
423,343 |
|
4,099,319 |
|
- |
|
4,522,662 |
|
|
|
|
|
|
|
|
|
|
Depreciation |
|
At 1 January 2025 |
250,479 |
|
2,946,824 |
|
22,438 |
|
3,219,741 |
|
Charge for the year |
21,167 |
|
319,891 |
|
- |
|
341,058 |
|
On disposals |
- |
|
(753,114) |
|
(22,438) |
|
(775,552) |
|
At 31 December 2025 |
271,646 |
|
2,513,601 |
|
- |
|
2,785,247 |
|
|
|
|
|
|
|
|
|
|
Carrying amount |
|
At 31 December 2025 |
151,697 |
|
1,585,718 |
|
- |
|
1,737,415 |
|
At 31 December 2024 |
172,864 |
|
1,726,854 |
|
16,000 |
|
1,915,718 |
|
|
|
|
|
|
|
|
|
|
|
| 8 |
Stocks |
2025 |
|
2024 |
| £ |
£ |
|
|
Finished goods and goods for resale |
213,501 |
|
254,977 |
|
|
|
|
|
|
|
|
|
|
| 9 |
Debtors |
2025 |
|
2024 |
| £ |
£ |
|
|
Trade debtors |
42,774 |
|
25,985 |
|
Other debtors |
50,761 |
|
171,650 |
|
Prepayments and accrued income |
146,333 |
|
209,756 |
|
|
|
|
|
|
239,868 |
|
407,391 |
|
|
|
|
|
|
|
|
|
|
|
Amounts due after more than one year included in: |
|
Trade debtors |
- |
|
14,506 |
|
|
|
|
|
|
|
|
|
|
| 10 |
Creditors: amounts falling due within one year |
2025 |
|
2024 |
| £ |
£ |
|
|
Trade creditors |
731,626 |
|
802,578 |
|
Corporation tax |
224,648 |
|
120,037 |
|
Other taxes and social security costs |
93,995 |
|
88,848 |
|
Other creditors |
44,158 |
|
96,802 |
|
Accruals and deferred income |
115,890 |
|
166,489 |
|
|
|
|
|
|
1,210,317 |
|
1,274,754 |
|
|
|
|
|
|
|
|
|
|
| 11 |
Deferred taxation |
2025 |
|
2024 |
| £ |
£ |
|
|
Accelerated capital allowances |
238,789 |
|
284,328 |
|
Tax losses carried forward |
(6,330) |
|
(6,330) |
|
Other timing differences |
(1,530) |
|
(1,473) |
|
|
|
|
|
|
230,929 |
|
276,525 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2025 |
|
2024 |
| £ |
£ |
|
|
At 1 January |
276,525 |
|
321,643 |
|
Credited to the profit and loss account |
(45,596) |
|
(45,118) |
|
|
At 31 December |
230,929 |
|
276,525 |
|
|
|
|
|
|
|
|
|
|
|
| 12 |
Share capital |
Nominal |
|
2025 |
|
2025 |
|
2024 |
| value |
Number |
£ |
£ |
|
Allotted, called up and fully paid: |
|
Ordinary shares |
£0.01 each |
|
9,350 |
|
94 |
|
84 |
|
A Ordinary shares |
£0.01 each |
|
- |
|
- |
|
10 |
|
|
|
|
|
|
94 |
|
94 |
|
|
|
|
|
|
|
|
|
|
On 1st April 2025, the A Ordinary shares were redesignated as Ordinary shares of £0.01 each. |
|
|
| 13 |
Other reserves |
2025 |
|
2024 |
|
Capital redemption reserve |
£ |
£ |
|
|
At 1 January |
97 |
|
97 |
|
|
At 31 December |
97 |
|
97 |
|
|
|
|
|
|
|
|
|
|
| 14 |
Profit and loss account |
2025 |
|
2024 |
| £ |
£ |
|
|
At 1 January |
4,044,176 |
|
3,846,431 |
|
Profit for the financial year |
525,404 |
|
197,745 |
|
Contributions to Employee Ownership Trust |
(3,232,822) |
|
- |
|
|
At 31 December |
1,336,758 |
|
4,044,176 |
|
|
|
|
|
|
|
|
|
|
| 15 |
Other financial commitments |
|
|
Total future minimum lease payments under non-cancellable operating leases: |
|
|
|
Land and buildings |
|
Land and buildings |
Other |
Other |
|
|
2025 |
|
2024 |
|
2025 |
|
2024 |
| £ |
£ |
£ |
£ |
|
Falling due: |
|
within one year |
558,470 |
|
559,264 |
|
6,904 |
|
10,648 |
|
within two to five years |
1,660,967 |
|
1,341,025 |
|
12,082 |
|
24,921 |
|
in over five years |
916,203 |
|
853,946 |
|
- |
|
- |
|
|
3,135,640 |
|
2,754,235 |
|
18,986 |
|
35,569 |
|
|
|
|
|
|
|
|
|
|
| 16 |
Loans to directors |
|
Description and conditions |
B/fwd |
Paid |
Repaid |
C/fwd |
| £ |
£ |
£ |
£ |
|
N J Elliott |
|
Interest free loan |
42,981 |
|
- |
|
(42,981) |
|
- |
|
|
|
42,981 |
|
- |
|
(42,981) |
|
- |
|
|
|
|
|
|
|
|
|
|
| 17 |
Related party transactions |
|
|
During the year, the company paid rent of £83,901 (2024: £72,603) to N D Parsons, Elliott Parsons SSAS and the Parsons Family SIPP. At the balance sheet date, the company owed £6,817 (2024: £Nil) in relation to this rent. |
|
During the 2023, the company made a loan of £112,825 to Elliott Parsons Property Co Limited in respect of which N D Parsons and N J Elliott are directors. The loan was repayable by 180 equal monthly instalments with interest charged at 3%. At the balance sheet date, £Nil remained outstanding (2024: £101,121). |
|
During the year, the company made contributions of £3,232,822 (2024: £Nil) to the Parsons Bakery Employee Ownership Trust. These contributions were used by the Trustees to repay the outstanding consideration owed to the vendor shareholders. These contributions have been recorded within the statement of changes in equity as a reduction in distributable reserves. |
|
|
| 18 |
Debenture |
|
|
On 1st April 2025, the company entered into a debenture deed providing security to the exiting shareholders in relation to their shares being acquired by the Parsons Bakery Employee Ownership Trust. The security comprises a fixed and floating charge over all the land, assets, goodwill and undertakings of the company present or future. |
|
|
| 19 |
Controlling party |
|
|
On 1st April 2025, the entire share capital of the company was acquired by the Parsons Bakery Employee Ownership Trust. Parsons Bakery Trustees Limited as corporate trustee for the Parsons Bakery Employee Ownership Trust is the ultimate controlling party. |
|
|
| 20 |
Presentation currency |
|
|
The financial statements are presented in Sterling. |
|
|
| 21 |
Legal form of entity and country of incorporation |
|
|
Parsons Bakery Limited is a private company limited by shares and incorporated in England. |
|
|
| 22 |
Principal place of business |
|
|
The address of the company's principal place of business and registered office is: |
|
|
Unit 105 |
|
Ashton Vale Trading Estate |
|
South Liberty Lane |
|
Bristol |
|
BS3 2SZ |