ACCOUNTS - Final Accounts preparation

Operating profit

The operating profit is stated after charging:

Registered number: 03125348

LECHLER COATINGS LIMITED

ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

LECHLER COATINGS LIMITED

COMPANY INFORMATION

Directors	M Baretti
	A Manoukian


Company secretary	M Baretti


Registered number	03125348


Registered office	Unit 42 Pochin Way
	Middlewich
	Cheshire
	CW10 0GY


Independent auditors	WR Partners
	Chartered Accountants & Statutory Auditors
	3 Royal Court
	Gadbrook Way
	Gadbrook Park
	Northwich
	Cheshire
	CW9 7UT

LECHLER COATINGS LIMITED

CONTENTS

	Page
Strategic Report	1 - 3
Directors' Report	4 - 5
Independent Auditors' Report	6 - 9
Statement of Comprehensive Income	10
Balance Sheet	11
Statement of Changes in Equity	12
Notes to the Financial Statements	13 - 24

LECHLER COATINGS LIMITED

STRATEGIC REPORT

FOR THE YEAR ENDED 31 DECEMBER 2025

Introduction

The directors present their strategic Report for Year Ended 31 December 2025.

Fair review of the business

Lechler Coatings Ltd is a paint distribution company based in Middlewich, Cheshire. The company is the only UK based subsidiary of Lechler Spa.

Lechler Coatings imports all paints and most of the equipment directly from Italy, where Lechler Spa is based.
The company sells paints to the Refinish and Industry markets. Turnover decreased in 2025. The director’s plan is to maintain a stable business in 2026. Unfortunately, both the Refinish and the Industry business didn’t achieve their sales target planned for the year 2025.

Even though no official tracking system for customer satisfaction is in place, we do record complaints and the number of official complaints recorded on the system went from 147 in 2024 to 116 in 2025.

As part of a bigger group, the company also adheres to ISO 9001 – international quality standard. To comply with GDPR and anti-Bribery laws, the company is supported by the legal department based at the headquarters in Italy and a legal firm in the UK.

The year ahead

The group strategy for 2026 is to continue the focus on the development of new markets: from our Brazilian subsidiary into the other South American countries, but also into Canada and some of the Eastern European countries. The group also counts on the support from the European subsidiaries to further expand the brand in Europe.

Lechler group will continue on its sustainability journey. Different projects have been and will be implemented to increase sustainability. From reducing Co2 emission, thanks to the installation of solar panels and the introduction of hybrid and electric cars, to focusing on employees' wellbeing (Lechler academy), while making sure that the companies of the group are economically sustainable.

Works continue at our headquarters in Como, Italy, as part of the project ‘Lechler Village’. The new colour laboratories should open their doors in the spring of 2026.

The group will continue to support the company as needed.

Page 1

LECHLER COATINGS LIMITED

STRATEGIC REPORT (CONTINUED)

FOR THE YEAR ENDED 31 DECEMBER 2025

Principal risks and uncertainties

From a review meeting with our internal legal departments and the manager on site, we have identified key business risks faced by the business.

The business risks include:

∙Health and Safety risk

∙External business risks, including regulatory and compliance obligations (importing goods into the UK market)

∙Legal risks resulting from contracts with suppliers and customers as well as employee contracts

∙Financing risks, increasing costs of running the business

∙Employment risks, predominantly due to shortage of qualified people in the market

∙Information risks such as data protection, bribery, cyber-security and integrity of IT systems.

Our market sectors, competitors and the impact of political decisions may have an effect on our trading activity and therefore primary sources for risk assessments.

Financial key performance indicators

The company performed well in 2025, especially taking into consideration the difficulties in recruiting staff and the decrease in sales.

The plan for 2026 is to protect the current business with the view to implement changes to increase business in the years to come. We have been able to replace 1 sales manager, with an additional one starting in 2026, but we are still looking to recruit 1 technician to return to a full team.


	2025	2024
	£	£

Turnover	10,847,623	10,996,497
Gross profit	1,806,701	1,881,846
Profit before tax	455,625	454,958

Page 2

LECHLER COATINGS LIMITED

STRATEGIC REPORT (CONTINUED)

FOR THE YEAR ENDED 31 DECEMBER 2025

Company Governance

Training
Training is provided to comply with H&S regulations.

Board meetings
There are no specific board meetings held in the UK and/or just to discuss the subsidiary matters. Both directors are based at the headquarters in Italy.

Decision making and principal decisions
The fundamental approach to making effective decisions remains the need to consider the interests of the company employees together with the business relationships of our customers and suppliers.

The company actively engages with key customers on a regular basis via the sales and technical team.

Principal decisions are undertaken by the management team with clear delegated authority. The group directors are the final decision makers for all matters with long term consequences.

Culture
The company people values form the principles of the culture, and are used by the Board, acting as a guiding framework for decision making. Good governance and effective communication are essential to ensuring business decisions and conduct are of a high standard. This assists with the delivery of our purpose, whilst at the same time protecting the company's reputation.

This report was approved by the board on 30 April 2026 and signed on its behalf.

M Baretti

Director

Page 3

LECHLER COATINGS LIMITED

DIRECTORS' REPORT

FOR THE YEAR ENDED 31 DECEMBER 2025

The directors present their report and the financial statements for the year ended 31 December 2025.

Directors' responsibilities statement

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

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.

In preparing these financial statements, the directors are required to:

∙select suitable accounting policies for the Company's financial statements and then apply them consistently;

∙make judgments and accounting estimates that are reasonable and prudent;

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

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

Principal activity

The principal activity of the company continued to be that of a marketer of car refinishing and industrial paints and allied products.

Results and dividends

The profit for the year, after taxation, amounted to £334,728 (2024 - £334,821).

Dividends of £700,000 (2024 - £276,142) were paid during the year.

Directors

The directors who served during the year were:

M Baretti

A Manoukian

Page 4

LECHLER COATINGS LIMITED

DIRECTORS' REPORT (CONTINUED)

FOR THE YEAR ENDED 31 DECEMBER 2025

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:

∙so far as the directors is aware, there is no relevant audit information of which the Company's auditors are unaware, and

∙the directors has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

Post reporting date events

The difficulties in recruiting staff and the higher costs of running the business, have had an impact on this challenging year. Some of our distributors have lost main accounts which resulted in decrease in our sales.

Raw materials are now more steadily available, and costs have decreased. An average price increase of 2.3% will be implemented from 1 March 2026 on all Refinish products. The market, especially the Refinish one, has slowed down, especially in the last quarter of 2025, impacting our sales.

Auditors

The auditors, WR Partners, is deemed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 30 April 2026 and signed on its behalf.

M Baretti

Director

Page 5

LECHLER COATINGS LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LECHLER COATINGS LIMITED

Opinion

We have audited the financial statements of Lechler Coatings Limited (the 'Company') for the year ended 31 December 2025, which comprise the Statement of Comprehensive Income, the Balance Sheet, the Statement of Changes in Equity and the related notes, 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 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 United Kingdom, including the Financial Reporting Council'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.

Page 6

LECHLER COATINGS LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LECHLER COATINGS LIMITED (CONTINUED)

Other information

The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' 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.

Opinion on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

∙the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

∙the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In 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 Directors' Report.

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

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

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

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

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

Responsibilities of directors

As explained more fully in the Directors' Responsibilities Statement set out on page 4, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

Page 7

LECHLER COATINGS LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LECHLER COATINGS LIMITED (CONTINUED)

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 an Auditors' Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

The audit team obtained an understanding of the legal and regulatory frameworks that are applicable to the Company and determined that the most significant are those that relate to the reporting framework (FRS 102 and the Companies Act 2006), the relevant tax compliance regulations, employment law, health and safety regulations and UK General Data Protection Regulation. We understood how the Company is complying with these frameworks by making enquiries of management and those responsible for legal and compliance procedures. We assessed the susceptibility of the Company's financial statements to material misstatement, including how fraud might occur by meeting with key management to gain their understanding. Based on our understanding, our procedures involved enquiries of management, manual journal testing, cash book reviews for large and unusual transactions and challenging management on key accounting estimates and judgements.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

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 Auditors' Report.

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 an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.

Page 8

LECHLER COATINGS LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LECHLER COATINGS LIMITED (CONTINUED)

Fran Johnson BSc BFP FCA (Senior Statutory Auditor)

for and on behalf of

WR Partners

Chartered Accountants

Statutory Auditors

3 Royal Court

Gadbrook Way

Gadbrook Park

Northwich

Cheshire

CW9 7UT

5 May 2026

Page 9

LECHLER COATINGS LIMITED

STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2025

	2025	2024
Note	£	£


Turnover	4	10,847,623	10,996,497
Cost of sales		(9,040,922)	(9,114,651)
Gross profit		1,806,701	1,881,846
Administrative expenses		(1,351,076)	(1,428,193)
Operating profit	5	455,625	453,653
Interest receivable and similar income	8	0	1,305
Profit before tax		455,625	454,958
Tax on profit	9	(120,897)	(120,137)
Profit for the financial year		334,728	334,821

There was no other comprehensive income for 2025 (2024:£NIL).

The notes on pages 13 to 24 form part of these financial statements.

Page 10

LECHLER COATINGS LIMITED

REGISTERED NUMBER: 03125348

BALANCE SHEET

AS AT 31 DECEMBER 2025

		2025		2024
Note		£		£

Fixed assets
Intangible assets	11		3,225		3,225
Tangible assets	12		750,255		868,447
Investments	13		1,888		1,888
			755,368		873,560
Current assets
Stocks	14	1,602,118		1,647,292
Debtors: amounts falling due within one year	15	2,402,869		2,393,286
Cash at bank and in hand	16	594,801		488,450
		4,599,788		4,529,028
Creditors: amounts falling due within one year	17	(1,623,264)		(1,277,835)
Net current assets			2,976,524		3,251,193
Total assets less current liabilities			3,731,892		4,124,753
Provisions for liabilities
Deferred tax	18	(174,462)		(202,051)
			(174,462)		(202,051)
Net assets			3,557,430		3,922,702

Capital and reserves
Called up share capital	19	1,000,000	1,000,000
Profit and loss account	20	2,557,430	2,922,702
		3,557,430	3,922,702

The financial statements were approved and authorised for issue by the board and were signed on its behalf on 30 April 2026.

M Baretti

Director

The notes on pages 13 to 24 form part of these financial statements.

Page 11

LECHLER COATINGS LIMITED

STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2025

	Called up share capital	Profit and loss account	Total equity
	£	£	£
At 1 January 2024	1,000,000	2,864,023	3,864,023

Profit for the year	0	334,821	334,821
Dividends: Equity capital	0	(276,142)	(276,142)

At 1 January 2025	1,000,000	2,922,702	3,922,702

Profit for the year	0	334,728	334,728
Dividends: Equity capital	0	(700,000)	(700,000)
At 31 December 2025	1,000,000	2,557,430	3,557,430

Page 12

LECHLER COATINGS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

1.	General information

Lechler Coatings Limited is a private company, limited by shares and incorporated in England and Wales. The address of the registered office and the principal place of business are the same and detailed on the company information page.

2.Accounting policies

2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

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

The following principal accounting policies have been applied:

2.2

Financial Reporting Standard 102 - reduced disclosure exemptions

The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

∙the requirements of Section 7 Statement of Cash Flows;

∙the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);

∙the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);

∙the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;

∙the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of Odescalchi SRL as at 31 December 2025 and these financial statements may be obtained from its registered office Via Santa Sofia 21, 20122, Milan, Italy.

2.3

Going concern

The directors have considered the expected future cash flows for the business, taking into account potential risks. They expect to continue to have access to sufficient funding from the parent company if required and have obtained written assurances for this. As a result the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for at least 12 months from the date of approval of the financial statements.

Page 13

LECHLER COATINGS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

2.Accounting policies (continued)

2.4

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss.

2.5

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:

∙the Company has transferred the significant risks and rewards of ownership to the buyer;

∙the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;

∙the amount of revenue can be measured reliably;

∙it is probable that the Company will receive the consideration due under the transaction; and

∙the costs incurred or to be incurred in respect of the transaction can be measured reliably.

2.6

Operating leases: the Company as lessee

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

2.7

Interest income

Interest income is recognised in profit or loss using the effective interest method.

Page 14

LECHLER COATINGS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

2.Accounting policies (continued)

2.8

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Company in independently administered funds.

2.9

Intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

The estimated useful lives range as follows:

Software

no amortisation as not yet brought into use

2.10

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

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, using the straight-line method.

Depreciation is provided on the following basis:

Plant and machinery	-	13%	on cost
Fixtures and fittings	-	13%	on cost
Computer equipment	-	20%	on cost
Other fixed assets	-	20%	on cost

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

Page 15

LECHLER COATINGS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

2.Accounting policies (continued)

2.11

Valuation of investments

Investments in associates are measured at cost less accumulated impairment.

2.12

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

2.13

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

2.14

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

2.15

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

2.16

Provisions for liabilities

Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.

Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the bets estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.

When payments are eventually made, they are charged to the provision carried in the Balance Sheet.

Deferred tax liabilities are also presented within provisions but are measured in accordance with the accounting policy on taxation.

Page 16

LECHLER COATINGS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

2.Accounting policies (continued)

2.17

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.

3.	Judgments in applying accounting policies and key sources of estimation uncertainty

Stock provisions are identified on a line by line basis and use management's experience in identifying slow moving and obsolete stock. The stock provision at 31 December 2025 was £40,764 (2024 - £9,311).

Bad debt provisions are identified using managements knowledge of the business. The bad debt provision at 31 December 2025 was £64,750 (2024 - £64,750).

Turnover

The whole of the turnover is attributable to the principal activity of the company.

All turnover arose within the United Kingdom.

Stock provision	20,000	2,250
Exchange differences	1,868	2,422
Other operating lease rentals	285,473	305,339
Depreciation on owned tangible fixed assets	323,088	348,537
Profit on disposal of tangible fixed assets	300	-

Fees payable to the Company's auditors for the audit of the Company's financial statements

12,426

11,400

The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent Company.

Page 17

LECHLER COATINGS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

Wages and salaries	1,107,489	1,207,260
Social security costs	136,285	145,684
Cost of defined contribution scheme	67,556	42,749
	1,311,330	1,395,693

The average monthly number of employees, including the directors, during the year was as follows:

	2025	2024
	No.	No.

Administration and finance	3	3
Laboratory	3	3
Sales	12	15
Warehouse	4	4

	22	25

8.	Interest receivable
		2025	2024
		£	£

	Other interest receivable	0	1,305
		0	1,305

Page 18

LECHLER COATINGS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

Corporation tax
Current tax on profits for the year	148,486	165,846
	148,486	165,846

Total current tax	148,486	165,846

Deferred tax
Origination and reversal of timing differences	(27,589)	(45,709)
Total deferred tax	(27,589)	(45,709)


	Taxation on profit on ordinary activities	120,897	120,137

Profit on ordinary activities before tax

455,625

454,958

Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2024 - 25%)	113,906	113,740
Effects of:
Expenses not deductible for tax purposes, other than goodwill amortisation and impairment	6,991	7,330
Capital allowances for year in excess of depreciation	0	(933)
Total tax charge for the year	120,897	120,137

Factors that may affect future tax charges

There were no factors that may affect future tax charges.

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LECHLER COATINGS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

	Dividend paid to parent	700,000	276,142
		700,000	276,142

11.	Intangible assets

		Computer software
		£
	Cost
	At 1 January 2025	3,225
	At 31 December 2025	3,225

	Net book value
	At 31 December 2025	3,225
	At 31 December 2024	3,225

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LECHLER COATINGS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

12.	Tangible fixed assets

	Plant and machinery	Fixtures and fittings	Leasehold improvements	Total
	£	£	£	£
Cost or valuation
At 1 January 2025	2,886,320	30,518	298,198	3,215,036
Additions	205,709	0	0	205,709
Disposals	(8,215)	0	0	(8,215)
At 31 December 2025	3,083,814	30,518	298,198	3,412,530
Depreciation
At 1 January 2025	2,020,269	28,122	298,198	2,346,589
Charge for the year on owned assets	323,309	592	0	323,901
Disposals	(8,215)	0	0	(8,215)
At 31 December 2025	2,335,363	28,714	298,198	2,662,275
Net book value
At 31 December 2025	748,451	1,804	0	750,255
At 31 December 2024	866,051	2,396	0	868,447

13.	Fixed asset investments

		Investments in associates
		£
	Cost or valuation
	At 1 January 2025	1,888
	At 31 December 2025	1,888

The company holds 1.67% of the share capital of Lechler Coatings Iberica, a fellow group undertaking of Odescalchi S.r.l.

Page 21

LECHLER COATINGS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

14.	Stocks
		2025	2024
		£	£

Raw materials and consumables	117,108	129,443
Finished goods and goods for resale	1,485,010	1,517,849
	1,602,118	1,647,292

Stock recognised in cost of sales during the year as an expense was £7,319,288 (2024 - £7,304,218).

15.

Debtors

					2025	2024
					£	£


Trade debtors	2,226,512	2,268,969
Other debtors	38,431	28,176
Prepayments and accrued income	137,926	96,141
	2,402,869	2,393,286

16.	Cash and cash equivalents
		2025	2024
		£	£

Cash at bank and in hand	594,801	488,450
	594,801	488,450

Page 22

LECHLER COATINGS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

17.	Creditors: Amounts falling due within one year
		2025	2024
		£	£

Trade creditors	70,018	68,986
Amounts owed to group undertakings	520,000	200,000
Corporation tax	0	91,555
Other taxation and social security	503,352	496,050
Other creditors	12,005	9,764
Accruals and deferred income	517,889	411,480
	1,623,264	1,277,835

18.	Deferred taxation

		2025
		£

	At beginning of year	(202,051)
	Charged to profit or loss	27,589
	At end of year	(174,462)

The provision for deferred taxation is made up as follows:
	2025	2024
	£	£

Accelerated capital allowances	(175,943)	(202,865)
Pension contributions	1,481	814
	(174,462)	(202,051)

19.	Share capital
		2025	2024
		£	£

Allotted, called up and fully paid

1,000,000 (2024 - 1,000,000 Ordinary shares of £1.00 each)	1,000,000	1,000,000

Page 23

LECHLER COATINGS LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2025

20.

Reserves

Profit and loss account

The profit and loss account represents the accumulated profits and losses of the company less dividends paid.

21.	Pension commitments

The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £75,383 (2024 - £42,749). Contributions totalling £11,123 (2024 - £8,966) were payable to the fund at the balance sheet date and are included in creditors.

Not later than 1 year	256,547	244,323
Later than 1 year and not later than 5 years	407,197	584,598
	663,744	828,921

23.	Controlling party

Lechler S.p.A is the immediate parent company. The ultimate parent company is Odescalchi S.r.L, a company registered in Italy.

Odescalchi S.r.L is the smallest and largest group in which Lechler Coatings Limited is a member and for which consolidated financial statements are prepared. A copy of the group financial statements can be obtained from the registered office at Odescalchi Srl, Via Santa Sofia 21, 20122 Milano, Italy.

Page 24