REGISTERED NUMBER: 00933463 (England and Wales)

MERCIAN SURGICAL SUPPLY CO. LIMITED

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 JULY 2025

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

4

Income Statement

8

Other Comprehensive Income

9

Balance Sheet

10

Statement of Changes in Equity

11

Cash Flow Statement

12

Notes to the Cash Flow Statement

13

Notes to the Financial Statements

14

DIRECTORS:

J F Duffy

K J Turner

P C Duffy

SECRETARY:

K J Turner

REGISTERED OFFICE:

10 Topaz Business Park

Topaz Way

Bromsgrove

Worcestershire

B61 0GD

REGISTERED NUMBER:

00933463 (England and Wales)

AUDITORS:

Charles Lovell & Co Limited

Chartered Certified Accountants

and Statutory Auditors

8 Church Green East

Redditch

Worcestershire

B98 8BP

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

PRINCIPAL ACTIVITIES

The company's principal activity is that of specialist suppliers of surgical instruments and equipment to the healthcare sector.

REVIEW OF THE BUSINESS

The year under review discloses a consolidation of the growth of the company's business achieved in the previous year. The directors expect, that despite the financial pressures present in the healthcare marketplace, a similar trading performance in the forthcoming year.

PRINCIPAL RISKS AND UNCERTAINTIES

The directors are aware of the increased competitiveness of the sector and together with NHS cost saving initiatives and the move towards e-procurement and its associated costs will pose further challenges in the future. The directors' strategy will be to maintain the core strength of the company and to ensure, as far as possible, that those future uncertainties are given due consideration in planning the future growth and development of the company.

RESULTS AND PERFORMANCE

Turnover for the year has shown a satisfactory increase over the previous year and overall gross profit margins were maintained. Operating costs were well controlled and were in line with budgeted costs. In the view of the directors the company performed satisfactorily and in line with their expectations.

ON BEHALF OF THE BOARD:

K J Turner - Secretary

27 April 2026

The directors present their report with the financial statements of the company for the year ended 31 July 2025.

DIVIDENDS

An interim dividend of 7500 per share was paid on 24 December 2024. The directors recommend that no final dividend be paid.

The total distribution of dividends for the year ended 31 July 2025 will be £ 2,175,000 .

DIRECTORS

The directors shown below have held office during the whole of the period from 1 August 2024 to the date of this report.

J F Duffy

K J Turner

P C Duffy

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

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

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS

The auditors, Charles Lovell & Co Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

K J Turner - Secretary

27 April 2026

Opinion

We have audited the financial statements of Mercian Surgical Supply Co. Limited (the 'company') for the year ended 31 July 2025 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, 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 Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 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 Auditors' 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 directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

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.

In connection with our audit of the financial statements, 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 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 Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

-	adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

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

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

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page three, 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 necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditors' 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 a Report of the Auditors 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:

The objectives of our audit are to identify and assess the risks of material misstatement of the financial statements due to fraud or error; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud and error; and to respond appropriately to those risks. Owing to the inherent limitations of an audit, there is an unavoidable risk that material misstatement in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK).

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:

- We obtained an understanding of the legal and regulatory frameworks applicable to the Company and the nature of the industry and the sector in which they operate. We determined that the following laws and regulations were most significant; the Companies Act 2006, the UK Corporate Governance Code and UK corporate taxation laws.

- We obtained an understanding of how the Company are complying with those legal and regulatory frameworks by making inquiries with the management of the Company and the Company's audit department.

- We assessed the susceptibility of the Company's financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the Audit engagement team included:

- identifying and assessing the design effectiveness of controls that management has in place to

prevent and detect fraud.

- Understanding how those charged with governance considered and addressed the potential for

override of controls or other inappropriate influence over the financial reporting process.

- challenging assumptions and judgements made by management in its significant accounting

estimates.

- identifying and testing journal enteries and performing analytical procedures to identify any unusual

or unexpected relationships that may indicate risks of material misstatement due to fraud.

- assessing the extent of compliance with the relevant laws and regulations.

- We also communicated relevant identified laws and regulations and potential fraud risk to all engagement team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.

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 Report of the Auditors.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors 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.

Richard James Beresford (Senior Statutory Auditor)

for and on behalf of Charles Lovell & Co Limited

Chartered Certified Accountants

and Statutory Auditors

8 Church Green East

Redditch

Worcestershire

B98 8BP

27 April 2026

TURNOVER

3

12,977,186

12,173,157

Cost of sales

5,914,902

5,608,971

GROSS PROFIT

7,062,284

6,564,186

Administrative expenses

3,600,573

3,140,357

3,461,711

3,423,829

Other operating income

49,922

50,134

OPERATING PROFIT

5

3,511,633

3,473,963

Interest receivable and similar income

304,670

249,957

3,816,303

3,723,920

Interest payable and similar expenses

6

11,550

3,648

PROFIT BEFORE TAXATION

3,804,753

3,720,272

Tax on profit

7

956,954

880,598

PROFIT FOR THE FINANCIAL YEAR

2,847,799

2,839,674

PROFIT FOR THE YEAR

2,847,799

2,839,674

OTHER COMPREHENSIVE INCOME

Profit and loss account reserve

-

(142,764

)

Fair value reserve

-

107,073

Income tax relating to components of other comprehensive income

-

-

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

-

(35,691

)

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

2,847,799

2,803,983

FIXED ASSETS

Tangible assets

9

1,555,836

1,617,051

Investment property

10

600,000

600,000

2,155,836

2,217,051

CURRENT ASSETS

Stocks

11

3,251,154

2,807,414

Debtors

12

1,609,693

1,377,492

Cash at bank and in hand

9,557,662

9,407,867

14,418,509

13,592,773

CREDITORS

Amounts falling due within one year

13

2,787,302

2,694,194

NET CURRENT ASSETS

11,631,207

10,898,579

TOTAL ASSETS LESS CURRENT LIABILITIES

13,787,043

13,115,630

PROVISIONS FOR LIABILITIES

16

29,899

31,285

NET ASSETS

13,757,144

13,084,345

CAPITAL AND RESERVES

Called up share capital

17

290

290

Capital redemption reserve

18

710

710

Fair value reserve

18

107,073

107,073

Retained earnings

18

13,649,071

12,976,272

SHAREHOLDERS' FUNDS

13,757,144

13,084,345

The financial statements were approved by the Board of Directors and authorised for issue on 27 April 2026 and were signed on its behalf by:

J F Duffy - Director

Called up

Capital

Fair

share

Retained

redemption

value

Total

capital

earnings

reserve

reserve

equity

£

£

£

£

£

Balance at 1 August 2023

290

12,091,862

710

-

12,092,862

Changes in equity

Dividends

-

(1,812,500

)

-

-

(1,812,500

)

Total comprehensive income

-

2,696,910

-

107,073

2,803,983

Balance at 31 July 2024

290

12,976,272

710

107,073

13,084,345

Changes in equity

Dividends

-

(2,175,000

)

-

-

(2,175,000

)

Total comprehensive income

-

2,847,799

-

-

2,847,799

Balance at 31 July 2025

290

13,649,071

710

107,073

13,757,144

Cash flows from operating activities

Cash generated from operations

1

3,049,643

3,331,001

Interest paid

(11,550

)

(3,648

)

Tax paid

(965,004

)

(614,967

)

Net cash from operating activities

2,073,089

2,712,386

Cash flows from investing activities

Purchase of tangible fixed assets

(52,964

)

(232,547

)

Sale of tangible fixed assets

-

63,171

Interest received

304,670

249,957

Net cash from investing activities

251,706

80,581

Cash flows from financing activities

Capital repayments in year

-

(19,081

)

Equity dividends paid

(2,175,000

)

(1,812,500

)

Net cash from financing activities

(2,175,000

)

(1,831,581

)

Increase in cash and cash equivalents

149,795

961,386

Cash and cash equivalents at beginning of year

2

9,407,867

8,446,481

Cash and cash equivalents at end of year

2

9,557,662

9,407,867

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

31.7.25

31.7.24

£

£

Profit before taxation

3,804,753

3,720,272

Depreciation charges

114,179

114,300

Loss on disposal of fixed assets

-

4,151

Gain on revaluation of fixed assets

-

(142,764

)

Finance costs

11,550

3,648

Finance income

(304,670

)

(249,957

)

3,625,812

3,449,650

Increase in stocks

(443,740

)

(209,960

)

Increase in trade and other debtors

(232,201

)

(114,528

)

Increase in trade and other creditors

99,772

205,839

Cash generated from operations

3,049,643

3,331,001

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 July 2025

31.7.25

1.8.24

£

£

Cash and cash equivalents

9,557,662

9,407,867

Year ended 31 July 2024

31.7.24

1.8.23

£

£

Cash and cash equivalents

9,407,867

8,446,481

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1.8.24

Cash flow

At 31.7.25

£

£

£

Net cash

Cash at bank and in hand

9,407,867

149,795

9,557,662

9,407,867

149,795

9,557,662

Total

9,407,867

149,795

9,557,662

1.	STATUTORY INFORMATION

Mercian Surgical Supply Co. Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.

Significant judgements and estimates

The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below.

(i) Useful economic lives of tangible assets

The annual depreciation charge for tangible assets is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary to reflect current estimates, based on technological advancement, future investments, economic utilisation and the physical condition of the assets.

(ii) Valuation of investment property

The valuation of the investment property made by the directors involves significant judgement. As the investment property is not quoted in an active market, its carrying value is determined using valuation techniques that require assumptions regarding future performance and market conditions. Actual results may differ from these estimates, and changes in the assumptions used could have a material impact on the valuation of the investment.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Revenue from the sales and hire of surgical equipment is recognised in accordance with FRS 102 Section 23 at the fair value of consideration receivable, net of VAT and discounts. Revenue is recognised when the goods are despatched on Sage and sent to the customer. This is when the risks and rewards of ownership have transferred to the delivery service provider.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Land & Buildings - 2% on cost of buildings, straight line over 125 years and Nil on land

Fixtures & equipment - 20% on reducing balance

Motor vehicles - 30% on reducing balance

Investment property

Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Financial instruments

Financial instruments are recognised only when the company becomes a party to the contractual provisions of the instrument.

Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs 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.

Other financial instruments, including derivatives, are initially recognised at fair value, unless payment for an asset is deferred beyond normal business terms or financed at a rate of interest that is not a market rate, in which case the asset is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

Other financial instruments are subsequently measured at fair value, with any changes recognised in profit or loss, with the exception of hedging instruments in a designated hedging relationship.

Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately.

For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets are either assessed individually or grouped on the basis of similar credit risk characteristics.

Any reversals of impairment are recognised in profit or loss immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

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.

Research and development

Research expenditure is recognised as an expense as incurred. Costs incurred on development projects (relating to the design and testing of new or improved products) are recognised as intangible assets when it is probable that the project will be a success, considering its commercial and technological feasibility, but only if the cost can be measured reliably.

Other development expenditure is recognised as an expense as incurred.

Development costs previously recognised as an expense are not recognised as an asset in a subsequent period.

Development costs which have been capitalised are amortised from the date the product is available for use on a straight line basis over the period of its expected benefit.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

3.

TURNOVER

The percentage of turnover that in the opinion of the directors is attributable to markets outside the UK is 10% (2024: 8%).

4.	EMPLOYEES AND DIRECTORS

31.7.25

31.7.24

£

£

Wages and salaries

2,686,740

2,527,339

Other pension costs

69,637

65,748

2,756,377

2,593,087

The average number of employees during the year was as follows:

31.7.25

31.7.24

Directors

3

3

Administrative and sales

12

12

Production

12

11

27

26

31.7.25

31.7.24

£

£

Directors' remuneration

1,125,000

1,125,000

Directors' pension contributions to money purchase schemes

32,000

32,000

Information regarding the highest paid director is as follows:

31.7.25

31.7.24

£

£

Emoluments etc

425,000

425,000

Pension contributions to money purchase schemes

10,000

10,000

5.	OPERATING PROFIT

The operating profit is stated after charging:

31.7.25

31.7.24

£

£

Depreciation - owned assets

114,179

105,624

Depreciation - assets on hire purchase contracts or finance leases

-

8,676

Loss on disposal of fixed assets

-

4,151

Auditors' remuneration

8,800

8,500

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

31.7.25

31.7.24

£

£

Interest payable

11,550

3,648

7.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

31.7.25

31.7.24

£

£

Current tax:

UK corporation tax

958,340

885,004

Deferred tax

(1,386

)

(4,406

)

Tax on profit

956,954

880,598

Tax effects relating to effects of other comprehensive income

There were no tax effects for the year ended 31 July 2025.

31.7.24

Gross

Tax

Net

£

£

£

Profit and loss account reserve

(142,764

)

-

(142,764

)

Fair value reserve

107,073

-

107,073

(35,691

)

-

(35,691

)