REGISTERED NUMBER: 01894014 (England and Wales)

Strategic Report, Report of the Director and

Financial Statements

for the Year Ended 31st December 2025

for

MECHANICAL SERVICES LIMITED

Page

Company Information

1

Strategic Report

2

Report of the Director

4

Statement of Director's Responsibilities

5

Report of the Independent Auditors

6

Statement of Comprehensive Income

9

Statement of Financial Position

10

Statement of Changes in Equity

11

Statement of Cash Flows

12

Notes to the Financial Statements

13

DIRECTOR:

G A Ivory

SECRETARY:

M M Ivory

REGISTERED OFFICE:

Merlin House

606 Purley Way

Croydon

Surrey

CR0 4RF

REGISTERED NUMBER:

01894014 (England and Wales)

AUDITORS:

TC Group

Statutory Auditor

3rd Floor, Suffolk House

George Street

Croydon

CR0 0YN

The director presents his strategic report for the year ended 31st December 2025.

REVIEW OF BUSINESS

The company reports revenue for the period of £33.32m (2024 - £41.96m (18 month prior period)), costs of sales of £25.27m (2024 - £30.21m) and a gross profit of £8.06m (2024 - £11.74m). This returns a gross margin of 24.2% (2024 - 28%). The total profit for the financial year was £1.72m (2024 - £2.58m).

Total comprehensive income for the period was £0.88m (2024 - £1.47m), which includes amounts contributed to the Employee Ownership Trust of £0.85m (2024 - £1.06m).

At the period end, the company reports a net asset position of £6.88m (2024 - £6m).

PRINCIPAL RISKS AND UNCERTAINTIES

The principal risks and uncertainties facing the company include the following:

Customers and supply chain

The risk of insolvency within the supply chain is significant and prevalent in the construction industry due to the economic conditions. The company mitigates this threat by not placing reliance on one customer. They hold insurance policies to cover any potential losses and continue to monitor the industry.

Liquidity risk

The company ensures that sufficient liquidity is available to meet foreseeable needs. The company holds a strong cash position making sure that bank balances do not pass a certain point.

Competition risk

The market in which the company operates is highly competitive and there is a risk that the company may not win tenders due to other suppliers with lower margins. This risk is mitigated by the company having a good reputation in relation to the service that it provides and creating strong relationships with customers and suppliers.

Economic climate

Global economic conditions can play a huge part in the revenue and profitability of the company. Economic conditions will determine customer spend and overall costs. The company could see the financial failure of a customer which would result with increased financial exposure. The company continues to monitor the market trends. The business continues to make sure that it is not reliant on any one customer.

Health and safety

The company engage in a variety of projects which involve the need for continuous monitoring and management of health and safety risks due to their potential hazardous nature. The company has comprehensive health and safety policies in place and implements the training of these policies across all staff levels. They also minimise this risk by monthly onsite inspections and obtain advice and support from third party advisors.

KEY PERFORMANCE INDICATORS

The following key performance indicators have been selected as most relevant to enable comparison of the company's performance year on year and with other companies operating in the sector:

2025

2024

Key Performance Indicator

%

%

Gross profit margin

24.2

28.0

Operating profit margin

5.0

7.0

Return before tax on average capital employed

25.0

47.0

Each of these indicators are monitored by management against budget and prior periods.

ON BEHALF OF THE BOARD:

G A Ivory - Director

6th May 2026

The director presents his report with the financial statements of the company for the year ended 31st December 2025.

DIVIDENDS

No dividends will be distributed for the year ended 31st December 2025.

FUTURE DEVELOPMENTS

The main focus of the company will be to continue to build on business performance. The directors believe that the company is in a good financial position and that the risks identified are being well managed.

DIRECTOR

G A Ivory held office during the whole of the period from 1st January 2025 to the date of this report.

DISCLOSURE IN THE STRATEGIC REPORT

The principal risks and uncertainties facing the company and key financial performance indicators have been considered in the Strategic Report.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the director is 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 he 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, TC Group, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

G A Ivory - Director

6th May 2026

The director is responsible for preparing the Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations.

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is 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 director is 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 him to ensure that the financial statements comply with the Companies Act 2006. He is 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.

Opinion

We have audited the financial statements of Mechanical Services Limited (the 'company') for the year ended 31st December 2025 which comprise the Statement of Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity, Statement of Cash Flows 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 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 31st December 2025 and of its profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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 director's 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 director 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 Report of the Director 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 Director 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 Director.

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 director's remuneration specified by law are not made; or

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

Responsibilities of director

As explained more fully in the Statement of Director's Responsibilities set out on page five, the director is 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 director determines 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 director is 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 director either intends to liquidate the company or to cease operations, or has 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.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

Extent to which the audit was considered capable of detecting irregularities, including fraud

The objectives of our audit, in respect to fraud, are: to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and its management.

Our approach was as follows:

-

We obtained an understanding of the legal and regulatory framework applicable to the entity and the sector in which it operates, through discussions with management and those charged with governance. We identified the financial reporting framework including but not limited to United Kingdom Generally Accepted Accounting Practice and the Companies Act 2006, Data Protection Act 2018, Bribery Act 2010, tax legislation, Health and Safety regulations as being of significance in the context of the company and its ongoing activities.

-

We made enquiries with management and those charged with governance to confirm our understanding that the company continued to comply with the applicable legal and regulatory frameworks, and also to confirm our understanding of the specific policies and procedures enlisted by the company to ensure ongoing compliance.

-

We assessed the susceptibility of the company's financial statements to material misstatement, including how fraud may occur, and gained an understanding of the company's policies and procedures on fraud risks through discussion with the company's management.

-

We considered the risk of material misstatement due to fraud as a result of possible management override of controls and improper revenue recognition. In addressing this risk of fraud we have tested the appropriateness of journal entries and other adjustments including a sample of manual journals along with testing revenue recognition and confirming that cut-off is appropriate.

Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Where the risk was considered to be higher, we performed audit procedures to address each identified fraud risk. These procedures included: testing manual journals; reviewing the financial statement disclosures and testing to supporting documentation; performing analytical procedures; and enquiring of management, and were designed to provide reasonable assurance that the financial statements were free from fraud or error.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

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.

John Millidge (Senior Statutory Auditor)

For and on behalf of TC Group

Statutory Auditor

3rd Floor, Suffolk House

George Street

Croydon

CR0 0YN

6th May 2026

TURNOVER

4

33,322,462

41,958,071

Cost of sales

(25,265,359

)

(30,213,016

)

GROSS PROFIT

8,057,103

11,745,055

Administrative expenses

(6,328,379

)

(8,941,510

)

OPERATING PROFIT

6

1,728,724

2,803,545

Interest receivable and similar income

223,875

366,444

PROFIT BEFORE TAXATION

1,952,599

3,169,989

Tax on profit

7

(227,680

)

(592,449

)

PROFIT FOR THE FINANCIAL YEAR

1,724,919

2,577,540

OTHER COMPREHENSIVE INCOME

Contribution to Employee Ownership Trust

(850,000

)

(1,062,500

)

Purchase of own shares

-

(43,177

)

Income tax relating to components of other comprehensive income

-

-

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

(850,000

)

(1,105,677

)

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

874,919

1,471,863

FIXED ASSETS

Tangible assets

8

127,336

125,509

CURRENT ASSETS

Stocks

9

50,022

219,802

Debtors

10

3,201,540

1,271,425

Cash at bank

12,435,114

10,178,951

15,686,676

11,670,178

CREDITORS

Amounts falling due within one year

11

8,917,297

5,772,114

NET CURRENT ASSETS

6,769,379

5,898,064

TOTAL ASSETS LESS CURRENT LIABILITIES

6,896,715

6,023,573

PROVISIONS FOR LIABILITIES

13

20,231

22,008

NET ASSETS

6,876,484

6,001,565

CAPITAL AND RESERVES

Called up share capital

14

50,059

50,059

Share premium

15

110,905

110,905

Capital redemption reserve

15

29

29

Retained earnings

15

6,715,491

5,840,572

SHAREHOLDERS' FUNDS

6,876,484

6,001,565

The financial statements were approved by the director and authorised for issue on 6th May 2026 and were signed by:

G A Ivory - Director

Called up

Capital

share

Retained

Share

redemption

Total

capital

earnings

premium

reserve

equity

£

£

£

£

£

Balance at 1st July 2023

50,088

4,368,738

110,905

-

4,529,731

Changes in equity

Reduction in share capital

(29

)

-

-

-

(29

)

Total comprehensive income

-

1,471,834

-

29

1,471,863

Balance at 31st December 2024

50,059

5,840,572

110,905

29

6,001,565

Changes in equity

Total comprehensive income

-

874,919

-

-

874,919

Balance at 31st December 2025

50,059

6,715,491

110,905

29

6,876,484

Cash flows from operating activities

Cash generated from operations

18

3,466,174

5,515,844

Tax paid

(539,525

)

52,595

Net cash from operating activities

2,926,649

5,568,439

Cash flows from investing activities

Purchase of tangible fixed assets

(44,361

)

(46,923

)

Sale of tangible fixed assets

-

6,851

Purchase of own shares

-

(43,178

)

Interest received

223,875

366,444

Net cash from investing activities

179,514

283,194

Cash flows from financing activities

Share issue

-

(29

)

Contribution to Employee Ownership Trust

(850,000

)

(1,062,500

)

Net cash from financing activities

(850,000

)

(1,062,529

)

Increase in cash and cash equivalents

2,256,163

4,789,104

Cash and cash equivalents at beginning of year

19

10,178,951

5,389,847

Cash and cash equivalents at end of year

19

12,435,114

10,178,951

1.	STATUTORY INFORMATION

Mechanical Services 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.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. it also requires management to exercise judgement in applying the company's accounting policies (see note 3).

The company's functional and presentational currency is pound sterling. The financial statements are rounded to the nearest £.

Revenue recognition

Revenue is measured at the fair value of the consideration received or receivable, net of discounts and value added taxes from the rendering of construction activities.

Contract revenue represents the value of work carried out during the period, including amounts not invoiced. Revenue is recognised as follows:

-

When the outcome of individual contracts can be estimated reliably, contract revenue is recognised by reference to the measure of progress at the reporting date using the input method. Costs are recognised as incurred and revenue is recognised on the basis of the proportion of total costs at the reporting date to the estimated total costs of the contract.

-

No margin is recognised until the outcome of the contract can be assessed with reasonable certainty.

-

Provision are made for all known or expected losses on individual contracts once such losses are foreseen.

-

Revenue in respect of variations is recognised when it is probable that they will be agreed by the customer. Revenue in respect of claims is recognised when negotiations have reached an advanced stage such that it is probable the customer will accept the claim and the probable amount can be measured reliably.

-

Profit/(loss) for the period includes the benefit of claims settled in the period on contracts completed in the previous period.

-

Payments received on account are deducted from work in progress and if in excess of individual contract values are included in creditors.

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 included 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.

At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on the following basis:

Leasehold and buildings

- 10% straight line

Motor vehicles

- 25% reducing balance

Plant and machinery

- 25% reducing balance

Gains and losses on disposals are determined by comparing the proceeds with the carrying amounts and are

recognised in the Statement of Comprehensive Income.

Financial instruments

The company enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities such as trade and other debtors and creditors, loans from financial institutions and loans to and from related parties.

Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transactions, like the payment of a trade debt deferred beyond normal business terms or financed at a rate of interest that is not a market rate or in case of an out-right short-term loan not at market value, the financial asset or liability is measured, initially, at the present value of the future cash flow discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost.

Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of Comprehensive Income.

For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the company would receive for the asset if it were to be sold at the balance sheet date.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, 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 statement of financial position date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position 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.

Hire purchase and leasing commitments

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

Pension costs and other post-retirement benefits

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 the Statement of Comprehensive Income when they fall due. Amounts not paid are shown in other creditors as a liability in the balance sheet. The assets of the plan are held separately from the company in independently administered funds.

Work in progress

Work in progress is valued at the lower of cost and net realisable value. It represents costs incurred on contracts prior to the point where an income entitlement arises.

Debtors

Construction contract debtors are measured at transaction price for completed work together with contract profits less losses to date reflecting the stage of completion at the year end, less any impairment losses for bad and doubtful debts.

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.

Creditors

Construction contract creditors are measured at transaction price. Short term trade 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.

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice.

Provisions for liabilities

Provisions are recognised when the company has a present obligation (legal or constructive) as a result of a past event, it is probable that the company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation.

Holiday pay accrual

A liability is recognised to the extent of any unused holiday pay entitlement which has accrued at the balance sheet date and carried forward to future periods. This is measured at the undiscounted salary cost of the future holiday entitlement.

3.	CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In applying the company's accounting policies, the directors are required to make judgements, estimates and assumptions in determining the carrying value of assets and liabilities. The director's judgement, estimates and assumptions are based on the best and most reliable evidence available at the time when the decisions are made and are based on historical experiences and other factors that are considered to be applicable. Due to the inherent sensitivity involved in making judgements, estimates and assumptions, the actual results and outcomes may differ.

The estimates and underlying assumptions are reviewed on an ongoing basis. Any revision to accounting estimates are recognised prospectively.

Revenue and margin recognition

In applying the revenue recognition policy for long-term construction contracts (see note 2), management is required to estimate the outcome of each contract and the stage of completion at the reporting date. This involves judgement in forecasting total contract revenues and costs to complete, including the assessment of variations and claims where applicable. These estimates directly affect the valuation of contract balances (including work in progress) and the profit recognised for the period. Estimates are reviewed regularly as contracts progress and are updated to reflect the latest information, with adjustments recognised where necessary.

Determining residual values and useful economic lived of property, plant and equipment

The company depreciates tangible assets over their estimated useful lives. The estimation of the useful lives of assets is based on historic performance as well as expectations about future use and therefore requires estimates and assumptions to be applied by management. The actual lives of these assets can vary depending on a variety of factors, including technical innovation, product life cycles and maintenance programmes.

4.

TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the company.

All turnover revenue arose within the United Kingdom.

5.	EMPLOYEES AND DIRECTORS

Period

1.7.23

Year Ended

to

31.12.25

31.12.24

£

£

Wages and salaries

7,014,745

9,878,270

Social security costs

564,195

1,144,733

Other pension costs

103,683

190,852

7,682,623

11,213,855

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

Period

1.7.23

Year Ended

to

31.12.25

31.12.24

Administration

52

52

Construction

39

48

91

100

Period

1.7.23

Year Ended

to

31.12.25

31.12.24

£

£

Director's remuneration

61,200

108,027

Director's pension contributions to money purchase schemes

1,321

1,981

6.	OPERATING PROFIT

The operating profit is stated after charging/(crediting):

Period

1.7.23

Year Ended

to

31.12.25

31.12.24

£

£

Other operating leases

92,074

127,987

Depreciation - owned assets

42,534

69,954

Profit on disposal of fixed assets

-

(4,100

)

Auditors remuneration

21,300

21,676

Auditor remuneration for non audit work

10,950

15,000

7.

TAXATION

Analysis of the tax charge

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

Period

1.7.23

Year Ended

to

31.12.25

31.12.24

£

£

Current tax:

UK corporation tax

229,458

596,906

Deferred tax

(1,778

)

(4,457

)

Tax on profit

227,680

592,449

Reconciliation of total tax charge included in profit and loss

The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below:

Period

1.7.23

Year Ended

to

31.12.25

31.12.24

£

£

Profit before tax

1,952,599

3,169,989

Profit multiplied by the standard rate of corporation tax in the UK of 25% (2024 - 25%)

488,150

792,497

Effects of:

Expenses not deductible for tax purposes

16,945

20,675

Depreciation in excess of capital allowances

1,778

3,769

Adjustments to tax charge in respect of previous periods

(277,415

)

(220,035

)

Deferred tax: origination and reversal of timing difference

(1,778

)

(4,457

)

Total tax charge

227,680

592,449

Tax effects relating to effects of other comprehensive income

31.12.25

Gross

Tax

Net

£

£

£

Contribution to Employee Ownership Trust

(850,000

)

-

(850,000

)

Purchase of own shares

(850,000

)

-

(850,000

)

1.7.23 to 31.12.24

Gross

Tax

Net

£

£

£

Contribution to Employee Ownership Trust

(1,062,500

)

-

(1,062,500

)

Purchase of own shares

(43,177

)

-

(43,177

)

(1,105,677

)

-

(1,105,677

)